Document and Entity Information
Document and Entity Information - shares | 12 Months Ended | |
Dec. 31, 2015 | Feb. 09, 2016 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | SHOPIFY INC. | |
Entity Central Index Key | 1,594,805 | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | FY | |
Document Type | 20-F | |
Document Period End Date | Dec. 31, 2015 | |
Amendment Flag | false | |
Class A Subordinate Voting | ||
Class of Stock [Line Items] | ||
Entity Common Stock, Shares Outstanding | 57,338,837 | |
Class B Multiple Voting | ||
Class of Stock [Line Items] | ||
Entity Common Stock, Shares Outstanding | 23,002,175 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets | ||
Cash and cash equivalents | $ 110,070 | $ 41,953 |
Marketable securities | 80,103 | 17,709 |
Trade and other receivables | 6,089 | 7,227 |
Other current assets | 6,203 | 1,495 |
Total current assets | 202,465 | 68,384 |
Long term assets | ||
Property and equipment | 33,048 | 21,728 |
Intangible assets | 5,826 | 2,708 |
Goodwill | 2,373 | 2,373 |
Total long term assets | 41,247 | 26,809 |
Total assets | 243,712 | 95,193 |
Current liabilities | ||
Accounts payable and accrued liabilities | 23,689 | 12,514 |
Current portion of deferred revenue | 12,726 | 6,775 |
Current portion of lease incentives | 822 | 485 |
Total current liabilities | 37,237 | 19,774 |
Long term liabilities | ||
Deferred revenue | 661 | 394 |
Lease incentives | 10,497 | 7,293 |
Total long term liabilities | $ 11,158 | $ 7,687 |
Commitments and contingencies | ||
Shareholders’ equity | ||
Convertible preferred shares; nil and 27,159,277 shares authorized, issued and outstanding (aggregate liquidation preference of nil and $87,500) | $ 0 | $ 87,056 |
Common stock, unlimited Class A subordinate voting shares authorized, 56,877,089 and nil issued and outstanding; unlimited Class B multiple voting shares authorized, 23,212,769 and nil issued and outstanding; unlimited Common shares authorized, nil and 39,310,446 issued and outstanding | 231,452 | 4,055 |
Additional paid-in capital | 11,719 | 5,685 |
Accumulated deficit | (47,854) | (29,064) |
Total shareholders’ equity | 195,317 | 67,732 |
Total liabilities and shareholders’ equity | $ 243,712 | $ 95,193 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Preferred shares authorized (in shares) | 0 | 27,159,277 |
Preferred shares issued (in shares) | 0 | 27,159,277 |
Preferred shares outstanding (in shares) | 0 | 27,159,277 |
Preferred shares aggregate liquidation preference amount | $ 0 | $ 87,500 |
Common shares issued (in shares) | 0 | 39,310,446 |
Common shares outstanding (in shares) | 0 | 39,310,446 |
Class A Subordinate Voting | ||
Common shares issued (in shares) | 56,877,089 | 0 |
Common shares outstanding (in shares) | 56,877,089 | 0 |
Class B Multiple Voting | ||
Common shares issued (in shares) | 23,212,769 | 0 |
Common shares outstanding (in shares) | 23,212,769 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues | |||
Subscription solutions | $ 111,979 | $ 66,668 | $ 38,339 |
Merchant solutions | 93,254 | 38,350 | 11,913 |
Total revenues | 205,233 | 105,018 | 50,252 |
Cost of revenues | |||
Subscription solutions | 24,531 | 16,790 | 8,504 |
Merchant solutions | 69,631 | 26,433 | 5,009 |
Total cost of revenues | 94,162 | 43,223 | 13,513 |
Gross profit | 111,071 | 61,795 | 36,739 |
Operating expenses | |||
Sales and marketing | 70,374 | 45,929 | 23,351 |
Research and development, net of refundable tax credits of $1,058 (2014 – $1,295; 2013 – $891) | 39,722 | 25,915 | 13,682 |
General and administrative | 18,731 | 11,566 | 3,975 |
Total operating expenses | 128,827 | 83,410 | 41,008 |
Loss from operations | (17,756) | (21,615) | (4,269) |
Other income (expense) | |||
Interest income, net | 200 | 57 | 42 |
Loss on asset disposal | 0 | (100) | (73) |
Foreign exchange loss | (1,234) | (653) | (537) |
Total other income (expense) | (1,034) | (696) | (568) |
Net loss and comprehensive loss | $ (18,790) | $ (22,311) | $ (4,837) |
Basic and diluted net loss per share attributable to common shareholders (in dollars per share) | $ (0.30) | $ (0.57) | $ (0.13) |
Weighted average shares used to compute basic and diluted net loss per share attributable to shareholders (in shares) | 61,716,065 | 38,940,252 | 37,248,710 |
Consolidated Statements of Ope5
Consolidated Statements of Operations and Comprehensive Loss (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Statement [Abstract] | |||
Refundable research tax credits | $ 1,058 | $ 1,295 | $ 891 |
Comprehensive loss | $ (18,790) | $ (22,311) | $ (4,837) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders’ Equity - USD ($) $ in Thousands | Total | Preferred StockSeries A Convertible Preferred Shares | Preferred StockSeries B Convertible Preferred Shares | Preferred StockSeries C Convertible Preferred Shares | Common Stock | Additional Paid-in Capital | Accumulated Deficit |
Shareholders' equity, beginning balance (in shares) at Dec. 31, 2012 | 13,025,765 | 7,247,070 | 0 | 36,453,715 | |||
Shareholders' equity, beginning balance at Dec. 31, 2012 | $ 17,969 | $ 5,346 | $ 11,952 | $ 0 | $ 1,840 | $ 747 | $ (1,916) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options (in shares) | 1,658,197 | ||||||
Exercise of stock options | 295 | $ 445 | (150) | ||||
Stock-based compensation | 1,472 | 1,472 | |||||
Issuance of common stock - business combination (in shares) | 96,479 | ||||||
Issuance of common stock - business combination | 404 | $ 404 | |||||
Vesting of restricted shares (in shares) | 354,730 | ||||||
Vesting of restricted shares | 320 | $ 320 | |||||
Issuance of stock (in shares) | 6,886,442 | ||||||
Issuance of stock | 69,758 | $ 69,758 | |||||
Net loss and comprehensive loss for the year | (4,837) | (4,837) | |||||
Shareholders' equity, ending balance (in shares) at Dec. 31, 2013 | 13,025,765 | 7,247,070 | 6,886,442 | 38,563,121 | |||
Shareholders' equity, ending balance at Dec. 31, 2013 | $ 85,381 | $ 5,346 | $ 11,952 | $ 69,758 | $ 3,009 | 2,069 | (6,753) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options (in shares) | 305,649 | 305,649 | |||||
Exercise of stock options | $ 140 | $ 395 | (255) | ||||
Stock-based compensation | 3,871 | 3,871 | |||||
Vesting of restricted shares (in shares) | 441,676 | ||||||
Vesting of restricted shares | 651 | $ 651 | |||||
Net loss and comprehensive loss for the year | (22,311) | (22,311) | |||||
Shareholders' equity, ending balance (in shares) at Dec. 31, 2014 | 13,025,765 | 7,247,070 | 6,886,442 | 39,310,446 | |||
Shareholders' equity, ending balance at Dec. 31, 2014 | $ 67,732 | $ 5,346 | $ 11,952 | $ 69,758 | $ 4,055 | 5,685 | (29,064) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options (in shares) | 4,665,059 | 4,665,059 | |||||
Exercise of stock options | $ 1,604 | $ 3,737 | (2,133) | ||||
Stock-based compensation | 8,167 | 8,167 | |||||
Vesting of restricted shares (in shares) | 100,076 | ||||||
Vesting of restricted shares | 353 | $ 353 | |||||
Issuance of stock (in shares) | 8,855,000 | ||||||
Issuance of stock | 136,251 | $ 136,251 | |||||
Conversion of shares (in shares) | (13,025,765) | (7,247,070) | (6,886,442) | 27,159,277 | |||
Conversion of shares | 0 | $ (5,346) | $ (11,952) | $ (69,758) | $ 87,056 | ||
Net loss and comprehensive loss for the year | (18,790) | (18,790) | |||||
Shareholders' equity, ending balance (in shares) at Dec. 31, 2015 | 0 | 0 | 0 | 80,089,858 | |||
Shareholders' equity, ending balance at Dec. 31, 2015 | $ 195,317 | $ 0 | $ 0 | $ 0 | $ 231,452 | $ 11,719 | $ (47,854) |
Consolidated Statements of Cha7
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Common Stock | |
Stock issuance cost | $ 14,259 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities | |||
Net loss for the year | $ (18,790) | $ (22,311) | $ (4,837) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Amortization and depreciation | 7,236 | 4,672 | 1,758 |
Stock-based compensation | 7,805 | 3,792 | 1,446 |
Vesting of restricted shares | 353 | 651 | 320 |
Loss on asset disposal | 0 | 100 | 73 |
Unrealized foreign exchange loss | 1,828 | 524 | 62 |
Changes in lease incentives | 3,541 | 7,292 | 236 |
Change in deferred revenue | 6,218 | 2,813 | 1,945 |
Changes in non-cash working capital items | 7,565 | 1,666 | 393 |
Net cash provided by (used in) operating activities | 15,756 | (801) | 1,396 |
Cash flows from investing activities | |||
Purchase of marketable securities | (111,154) | (20,131) | 0 |
Maturity of marketable securities | 48,350 | 2,375 | 0 |
Acquisitions of property and equipment | (16,525) | (20,573) | (3,462) |
Proceeds from disposal of property and equipment | 0 | 90 | 0 |
Acquisitions of intangible assets | (4,511) | (2,127) | (1,042) |
Acquisition of business, net of cash acquired | 0 | 0 | (828) |
Net cash used in investing activities | (83,840) | (40,366) | (5,332) |
Cash flows from financing activities | |||
Proceeds from initial public offering, net of issuance costs | 136,251 | 0 | 0 |
Issuance of Series C convertible preferred shares, net of issuance costs | 0 | 0 | 69,758 |
Proceeds from the exercise of stock options | 1,604 | 140 | 295 |
Net cash provided by financing activities | 137,855 | 140 | 70,053 |
Effect of foreign exchange on cash and cash equivalents | (1,654) | (549) | (243) |
Net increase (decrease) in cash and cash equivalents | 68,117 | (41,576) | 65,874 |
Cash and cash equivalents – Beginning of Year | 41,953 | 83,529 | 17,655 |
Cash and cash equivalents – End of Year | $ 110,070 | $ 41,953 | $ 83,529 |
Nature of Business
Nature of Business | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business | Nature of Business Shopify Inc. (“Shopify” or “the Company”) was incorporated as a Canadian corporation on September 28, 2004. The Company’s mission is to make commerce better for everyone. The Company provides the leading cloud-based, multi-channel commerce platform designed for small and medium-sized businesses. Using a single interface, the Company’s merchants can design, set up and manage their business across multiple sales channels, including web and mobile storefronts, social media storefronts and physical retail locations. The Company’s platform provides merchants with a single view of their business and customers across all of their sales channels and enables them to manage products and inventory, process orders and payments, ship orders, build customer relationships and leverage analytics and reporting. The Company’s platform is engineered to enterprise-level standards and functionality while designed for simplicity and ease-of-use. The Company’s headquarters and principal place of business are in Ottawa, Canada. Initial Public Offering In May 2015, the Company completed its initial public offering, or IPO, in which it issued and sold 8,855,000 Class A subordinate voting shares at a public offering price of $17.00 per share (including the 1,155,000 Class A subordinate voting shares purchased by the underwriters pursuant to the exercise of the over-allotment option). The Company received net proceeds of $136,251 after deducting underwriting discounts and commissions of $10,537 and other offering expenses of $3,747 . Immediately prior to consummation of the IPO, all of the then-outstanding common shares were redesignated as an aggregate of 39,780,952 Class B multiple voting shares, and upon consummation of the IPO, all of the then-outstanding convertible preferred stock automatically converted into an aggregate of 27,159,277 Class B multiple voting shares. |
Basis of Presentation and Conso
Basis of Presentation and Consolidation | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation These consolidated financial statements include the accounts of the Company and its directly and indirectly wholly owned subsidiaries: Shopify Payments (Canada) Inc., incorporated in Canada; Shopify (Ireland) Limited., incorporated in Ireland; Shopify (Australia) Pty Ltd., incorporated in Australia; and the following United States subsidiaries each incorporated in Delaware: Shopify Payments (USA) Inc., Shopify Data Processing (USA) Inc., Shopify LLC and Shopify Holdings (USA) Inc. On February 19, 2015 the Company dissolved and wound up two inactive shell subsidiaries, Jet Cooper Ltd., incorporated in Canada; and Atatomic Inc., incorporated in Canada. The wind-up had no accounting impact on the consolidated financial statements. All intercompany accounts and transactions have been eliminated upon consolidation. These consolidated financial statements of the Company have been presented in United States dollars (USD) and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), including the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding financial reporting. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Use of Estimates The preparation of consolidated financial statements, in accordance with U.S. GAAP, requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items that are subject to estimation and assumptions include: estimates related to contingencies and refundable tax credits; chargebacks on Shopify Payments transactions that are unrecoverable from merchants; recoverability of deferred tax assets; fair values of assets and liabilities acquired in business combinations; capitalization of software development costs; estimated useful lives of property and equipment and intangible assets; estimates relating to the recoverability of lease inducements; and assumptions used when employing the Black-Scholes valuation model to estimate the fair value of common shares and stock-based awards. Actual results may differ from the estimates made by management. Segment Information The Company’s “chief operating decision maker” is the Chief Executive Officer. The Chief Executive Officer reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluation of financial performance. Accordingly, the Company has determined that it operates as a single operating and reportable segment. Revenue Recognition The Company’s sources of revenue consist of subscription solutions and merchant solutions. Arrangements with merchants do not provide the merchants with the right to take possession of the software supporting the Company’s hosting platform at any time and are therefore accounted for as service contracts. The Company’s subscription service contracts do not provide for refunds or any other rights of return to merchants in the event of cancellations. The Company recognizes revenue when all of the following criteria are met: • There is persuasive evidence of an arrangement; • The services have been or are being provided to the merchant; • The amount of fees to be paid by the merchant is fixed or determinable; and • The collection is reasonably assured. The Company follows the guidance provided in ASC 605-45, Principal Agent Considerations for determining whether the Company should recognize revenue based on the gross amount billed to a merchant or the net amount retained. This determination is a matter of judgment that depends on the facts and circumstances of each arrangement. The Company recognizes revenue from Shopify Shipping and the sales of Apps on a net basis as it has been determined that the Company is the agent in the arrangement with merchants. All other revenue is reported on a gross basis, as the Company has determined it is the principal in the arrangement, in that it is the primary obligor for providing services and assumes the risk of any loss or changes in costs. Sales taxes collected from merchants and remitted to government authorities are excluded from revenue. Our arrangements can include multiple elements, which may consist of some or all of our subscription solutions. When multiple-element arrangements exist, we evaluate whether these individual deliverables should be accounted for as separate units of accounting or one single unit of accounting. In order to treat deliverables in a multiple-element arrangement as separate units of accounting, the delivered item or items must have standalone value upon delivery. A delivered item has standalone value to the customer when either (1) any vendor sells that item separately or (2) the customer could resell that item on a standalone basis. Each of our subscription solutions have standalone value, as the solutions are sold separately. Accordingly, we consider the separate units of accounting in our multiple deliverable arrangements to be the subscription fees, themes, apps and domain names. When multiple deliverables included in an arrangement are separable into different units of accounting, the arrangement consideration is allocated to the identified separate units of accounting based on their relative selling price. Multiple-element arrangement accounting guidance provides a hierarchy to use when determining the relative selling price for each unit of accounting. Vendor-specific objective evidence (VSOE) of selling price, based on the price at which the item is regularly sold by the vendor on a standalone basis, should be used if it exists. If VSOE of selling price is not available, third-party evidence (TPE) of selling price is used to establish the selling price if it exists. We have not established VSOE for our subscription solutions due to lack of pricing consistency, the introduction of new services and other factors. We have also concluded that third-party evidence of selling price is not a practical alternative due to differences in our service offerings compared to other parties and the availability of relevant third-party pricing information. Accordingly, we use our best estimate of selling price (BESP) to determine the relative selling price for our subscription solutions. We determined BESP by considering our overall pricing objectives and market conditions. Significant pricing practices taken into consideration for our subscription solutions include discounting practices, the size and volume of our transactions, the customer demographic, the geographic area where services are sold, price lists, our go-to-market strategy, historical standalone sales and contract prices. The determination of BESP is made through consultation with and approval by our management, taking into consideration our go-to-market strategy. As our go-to-market strategies evolve, we may modify our pricing practices in the future, which could result in changes in relative selling prices. Subscription Solutions Subscription revenue is recognized on a rateable basis over the contractual term. The terms range from monthly, annual or multi-year subscription terms. Revenue recognition begins on the date that the Company’s service is made available to the merchant. Payments received in advance of services being rendered are recorded as deferred revenue and recognized on a rateable basis over the requisite service period. The Company earns revenue based on the services it delivers either directly to its merchants or indirectly through resellers. The Company also sells separately priced Themes and Apps to merchants for which revenue is recognized at the time of the sale. The right to use domain names is also sold separately and is recognized on a rateable basis over the contractual term, which is generally an annual term. Revenue from Themes, as well as Apps and Domains have been classified within Subscription solutions on the basis that they are typically sold at the time the merchant enters into the subscription services arrangement or because they are charged on a recurring basis. Merchant Solutions The Company generates the majority of its merchant solutions revenue from fees that it charges merchants on their customer orders processed through Shopify Payments. The Company also derives merchants solutions revenue relating to Shopify Shipping, other transaction services and referral fees, as well as from the sale of Point-of-Sale (POS) hardware. For the sale of POS hardware, revenue is recognized when title passes to the merchant, in accordance with the shipping terms. Revenues earned from Shopify Payments, Shopify Shipping, other transaction services, and referral fees are recognized at the time of the transaction. Cost of Revenues The Company’s cost of revenues consists of payments for Themes and Domain registration, credit card fees, hosting infrastructure costs, an allocation of costs incurred by both the operations and support functions, and amortization of capitalized software development costs. In addition, included in the cost of merchant solutions are costs associated with credit card processing and chargebacks related to Shopify Payments and the cost of POS hardware. Software Development Costs Research and development costs are generally expensed as incurred. These costs primarily consist of personnel and related expenses, contractor and consultant fees, stock-based compensation, and corporate overhead allocations, including depreciation. The Company capitalizes certain development costs incurred in connection with its internal use software. These capitalized costs are related to the development of its software platform that is hosted by the Company and accessed by its merchants on a subscription basis as well as material internal infrastructure software. Costs incurred in the preliminary stages of development are expensed as incurred. The Company capitalizes all direct and incremental costs incurred during the application phase, until such time when the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional features and functionality. Capitalized costs are recorded as part of Intangible assets in the consolidated balance sheets and are amortized on a straight-line basis over their estimated useful lives of three years. Maintenance costs are expensed as incurred. Advertising Costs Advertising costs are expensed as incurred. Advertising costs included in sales and marketing expenses during the years ended December 31, 2015 , 2014 , and 2013 were $ 45,445 , $ 31,093 , and $14,447 respectively. Operating Leases The total payments and costs associated with operating leases, including leases that contain lease inducements and uneven payments, are aggregated and amortized on a straight-line basis over the initial lease term of each respective agreement. Foreign Currency Transactions The functional and reporting currency of the Company and its subsidiaries is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are re-measured to United States dollars using the exchange rates at the consolidated balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are measured in United States dollars using historical exchange rates. Revenues and expenses are measured using the actual exchange rates prevailing on the dates of the transactions. Gains and losses resulting from re-measurement are recorded in the Company’s Consolidated Statements of Operations and Comprehensive Loss as Foreign exchange gain (loss). Cash and Cash Equivalents The Company considers all short term highly liquid investments purchased with original maturities at their acquisition date of three months or less to be cash equivalents. Marketable Securities The Company’s marketable securities consist of U.S federal agency bonds, corporate bonds and commercial paper, and mature within 12 months from the date of purchase. Marketable securities are classified as held-to-maturity at the time of purchase and this classification is re-evaluated as of each consolidated balance sheet date. Held-to-maturity securities represent those securities that the Company has both the intent and ability to hold to maturity and are carried at amortized cost, which approximates their fair market value. Interest on these securities, as well as amortization/accretion of premiums/discounts, are included in interest income. All investments are assessed as to whether any unrealized loss positions are other than temporarily impaired. Impairments are considered other than temporary if they are related to deterioration in credit risk or if it is likely the Company will sell the securities before the recovery of their cost basis. Realized gains and losses and declines in value determined to be other than temporary are determined based on the specific identification method and are reported in Other income (expenses) in the Consolidated Statements of Operations and Comprehensive Loss. Derivatives The Company may hold foreign exchange forward contracts to mitigate the risk of future foreign exchange rate volatility related to future Canadian dollar denominated costs and current and future obligations. The Company recognizes these derivative financial instruments as either assets or liabilities and measures them at fair value. The Company has elected not to apply hedge accounting, therefore changes in the fair value of these derivative instruments will affect their consolidated balance sheet amounts and the resulting gain or loss will be reflected as Foreign exchange gains (losses) in the Consolidated Statements of Operations and Comprehensive Loss. Concentration of Credit Risk The Company’s cash and cash equivalents, marketable securities, trade and other receivables, and foreign exchange forward contracts subject the Company to concentrations of credit risk. Management mitigates this risk associated with cash and cash equivalents by making deposits and entering into foreign exchange forward contracts only with large Canadian, Irish, Australian and United States banks and financial institutions that are considered to be highly credit worthy. Management mitigates the risks associated with marketable securities by adhering to its investment policy, which stipulates minimum rating requirements, maximum investment exposures and maximum maturities. Due to the Company’s diversified merchant base, there is no particular concentration of credit risk related to the Company’s trade receivables. Trade and other receivables are monitored on an ongoing basis to ensure timely collection of amounts. There are no receivables from individual merchants accounting for 10% or more of revenues or receivables. Interest Rate Risk Certain of the Company’s cash equivalents and marketable securities earn interest. The Company’s trade and other receivables, accounts payable and accrued liabilities and lease liabilities do not bear interest. The Company is not exposed to material interest rate risk. Foreign Exchange Risk The Company’s exposure to foreign exchange risk is primarily related to fluctuations between the Canadian dollar and the United States dollar. The Company is exposed to foreign exchange fluctuations on the revaluation of foreign currency assets and liabilities. The Company may use foreign exchange derivative products to manage the impact of foreign exchange fluctuations. By their nature, derivative financial instruments involve risk, including the credit risk of non-performance by counter parties. Fair Value Measurements The carrying amounts for cash and cash equivalents, marketable securities, trade receivables, other receivables, trade accounts payable and accruals, and employee related accruals approximate fair value due to the short-term maturities of these instruments. The Company measures the fair value of its financial assets and liabilities using a fair value hierarchy. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value. Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Property and Equipment Property and equipment is stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets. Computer equipment is depreciated over three years while office furniture and equipment are depreciated over four years. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or the term of their associated leases, which range from three to thirteen years. The carrying values of property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amounts of such assets may not be recoverable. The determination of whether any impairment exists includes a comparison of estimated undiscounted future cash flows anticipated to be generated over the remaining life of the asset to the net carrying value of the asset. If the estimated undiscounted future cash flows associated with the asset are less than the carrying value, an impairment loss will be recorded based on the estimated fair value. Intangible Assets Intangible assets are stated at cost, less accumulated amortization. Amortization is calculated using the straight-line method over the estimated useful lives of the related assets. Purchased software, other intangible assets, and capitalized software development costs are amortized into cost of revenues over a three year period. The carrying values of intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amounts of such assets may not be recoverable. The determination of whether any impairment exists includes a comparison of estimated undiscounted future cash flows anticipated to be generated over the remaining life of the asset to the net carrying value of the asset. If the estimated undiscounted future cash flows associated with the asset are less than the carrying value, an impairment loss will be recorded based on the estimated fair value. Goodwill Goodwill represents the excess of the purchase price over the estimated fair value of net assets of a business acquired in a business combination. Goodwill is not amortized, but instead tested for impairment at least annually in the fourth quarter of each year. Should certain events or indicators of impairment occur between annual impairment tests, the Company will perform the impairment test as those events or indicators occur. Examples of such events or circumstances include the following: a significant decline in the Company’s expected future cash flows; a sustained, significant decline in the Company’s fair value; a significant adverse change in the business climate; and slower growth rates. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. The qualitative assessment considers the following factors: macroeconomic conditions, industry and market considerations, cost factors, overall company financial performance, events affecting the reporting units, and changes in the Company’s fair value. If the reporting unit does not pass the qualitative assessment, the Company carries out a two-step test for impairment of goodwill. The first step of the test compares the fair value of the reporting unit with the carrying value of its net assets. If the fair value of the reporting unit is greater than its carrying value, no impairment results. If the fair value of the reporting unit is less than its carrying value, the Company performs the second step of the test for impairment of goodwill. During the second step of the test, the Company compares the implied fair value of the reporting unit’s goodwill with the carrying value of that goodwill. If the implied fair value of goodwill is less than the carrying value, an impairment charge would be recorded in the Consolidated Statements of Operations and Comprehensive Loss. The Company has one reporting unit and evaluates goodwill for impairment at the entity level. Income Taxes Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amounts and the tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are more likely than not to be realized. The Company evaluates tax positions taken or expected to be taken in the course of preparing tax returns to determine whether the tax positions have met a “more-likely-than-not” threshold of being sustained by the applicable tax authority. Tax benefits related to tax positions not deemed to meet the “more-likely-than-not” threshold are not permitted to be recognized in the consolidated financial statements. The Company classifies accrued interest and penalties related to liabilities for income taxes in income tax expense. Refundable Tax Credits Tax credits related to Scientific Research and Experimental Development (SR&ED) expenditures are accounted for using the flow-through method. Refundable tax credits are accounted for, in the period in which the related expenditures are incurred, as a direct reduction of research and development or capitalized costs. Non-refundable tax credits, which may only be used to reduce future taxes otherwise payable, are recorded as an income tax recovery in the period in which their realization is considered more likely than not. Stock-Based Compensation The accounting for stock-based awards is based on the fair value of the award measured at the grant date. Accordingly, stock-based compensation cost is recognized in the Consolidated Statements of Operations and Comprehensive Loss as an operating expense over the requisite service period. The fair value of stock options is determined using the Black-Scholes option-pricing model, single option approach. An estimate of forfeitures is applied when determining compensation expense. The Company determines the fair value of stock option awards on the date of grant using assumptions regarding expected term, share price volatility over the expected term of the awards, risk-free interest rate, and dividend rate. All shares issued under the Legacy Option Plan and Stock Option Plan are from treasury. The fair value of restricted share units ("RSU's") is measured using the fair value of the Company's shares as if the RSU's were vested and issued on the grant date. An estimate of forfeitures is applied when determining compensation expense. All shares issued under the Long Term Incentive Plan are from treasury. In connection with prior period business acquisitions, the Company has also issued restricted shares. The restricted shares vest evenly, on a month-by-month basis and are contingent on future services being provided. As a result, the restricted shares are considered post business combination services and are accounted for as compensation expense and not as part of purchase accounting. The fair value of the restricted shares is derived from the fair value of the Company’s common shares, which was determined by an independent valuation firm, based on input, feedback and review by the Company’s management, at or around the same time as the related transactions and in combination with other available market data. Earnings Per Share Basic earnings per share are calculated by dividing net earnings attributable to common equity holders of the Company by the weighted average number of common stock outstanding during the year. Diluted earnings per share are calculated by dividing net earnings attributable to common equity holders of the Company by the weighted average number of common stock outstanding during the year, plus the effect of dilutive potential common stock outstanding during the year. This method requires that diluted earnings per share be calculated (using the treasury stock method) as if all dilutive potential common stock had been exercised at the latest of the beginning of the year or on the date of issuance, as the case may be, and that the funds obtained thereby (plus an amount equivalent to the unamortized portion of related stock-based compensation costs) be used to purchase common stock of the Company at the average fair value of the common stock during the year. Recent Accounting Pronouncements Not Yet Adopted In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2014-9 “Revenue from Contracts with Customers.” The new accounting standards update requires an entity to apply a five step model to recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, as well as a cohesive set of disclosure requirements that would result in an entity providing comprehensive information about the nature, timing, and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. In August 2015 the Financial Accounting Standards Board issued ASU No. 2015-14, which deferred the effective date for all entities by one year. The standard becomes effective for reporting periods beginning after December 15, 2017. Early adoption is permitted starting January 1, 2017. The Company is currently assessing the impact of these standards. In February 2015, the Financial Accounting Standards Board issued ASU No. 2015-02 “Consolidations (Topic 810)—Amendments to the Consolidation Analysis”. The new standard makes amendments to the current consolidation guidance, including introducing a separate consolidation analysis specific to limited partnerships and other similar entities. Under this analysis, limited partnerships and other similar entities will be considered a variable-interest entity (“VIE”) unless the limited partners hold substantive kick-out rights or participating rights. The standard is effective for annual periods beginning after December 15, 2015. The Company is currently assessing the impact of these amendments. In April 2015, the Financial Accounting Standards Board issued ASU No. 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license. The amendment is effective for interim and annual periods beginning after December 15, 2015 with early adoption permitted. The Company is currently assessing the impact of this new standard. In May 2015, the Financial Accounting Standards Board issued ASU 2015-07, “Disclosures for Investments in Certain Entities That Calculate Net Asset Value Per Share (or Its Equivalent)”, which amends ASC 820, Fair Value Measurement. The standard removes the requirement to categorize within the fair value hierarchy investments for which fair value is measured using the net asset value per share practical expedient and removes certain related disclosure requirements. The standard will be effective for the Company’s fiscal year beginning January 1, 2016. The Company is currently assessing the impact of this new standard. In November 2015, the Financial Accounting Standards Board issued ASU 2015-17, "Income Taxes (Topic 740)", which simplifies the presentation of deferred income taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. The standard will be effective for the Company’s fiscal year beginning January 1, 2016. The Company is currently assessing the impact of this new standard. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 12 Months Ended |
Dec. 31, 2015 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | Cash and Cash Equivalents As of December 31, 2015 and 2014 , the Company’s cash and cash equivalents balance of $ 110,070 and $ 41,953 , respectively, included $80,914 and $36,065 , respectively, of money market funds and term deposits that bear interest at rates ranging from 0.01% to 1% . As of December 31, 2015 , the Company had $ 1,000 CAD of restricted cash which was pledged as collateral against the Company's leases ( December 31, 2014 - $1,050 CAD). |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments | Financial Instruments As of December 31, 2015 , the Company’s financial instruments, measured at fair value on a recurring and non-recurring basis, were as follows: Amount at Fair Value Measurements Using Level 1 Level 2 Level 3 Assets: Cash equivalents: Money market funds 59,655 59,655 — — U.S. term deposits 21,259 21,259 — — Marketable securities: U.S. federal bonds 35,970 35,970 — — Corporate bonds 44,028 — 44,028 — All cash equivalents and marketable securities mature within one year of the consolidated balance sheet date. As at December 31, 2015 the Company did not have any outstanding foreign exchange forward contracts. As of December 31, 2014 , the Company’s financial instruments, measured at fair value on a recurring and non-recurring basis, were as follows: Amount at Fair Value Measurements Using Level 1 Level 2 Level 3 Assets: Cash equivalents: Money market funds 31,271 31,271 — — Canadian guaranteed investment certificates 1,294 1,294 — — U.S. term deposits 3,500 3,500 — — Marketable securities: U.S. federal bonds 5,502 5,502 — — Corporate bonds 12,207 — 12,207 — Derivatives: Foreign exchange forward contracts 7 — 7 — As at December 31, 2014 the Company held foreign exchange forward contracts to convert USD into CAD to fund a portion of its operations. The fair value of foreign exchange forward contracts and corporate bonds was based upon Level 2 inputs, which included period-end mid-market quotations for each underlying contract as calculated by the financial institution with which the Company has transacted. The quotations are based on bid/ask quotations and represent the discounted future settlement amounts based on current market rates. There were no transfers between Levels 1, 2 and 3 during the years ended December 31, 2015 and 2014 . |
Trade and Other Receivables
Trade and Other Receivables | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Trade and Other Receivables | Trade and Other Receivables 2015 2014 Trade receivables 1,701 838 Leasehold incentives receivable 1,554 3,158 Unbilled revenues 1,075 704 Refundable tax credits 754 1,959 Sales tax receivable 572 499 Other receivables 433 69 6,089 7,227 Unbilled revenues represent amounts not yet billed to merchants related to transaction fee charges, up to the consolidated balance sheet date. |
Other Current Assets
Other Current Assets | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Current Assets | Other Current Assets 2015 2014 Prepaid expenses 3,264 1,023 POS hardware 1,550 290 Deposits 1,389 175 Foreign exchange forward contracts — 7 6,203 1,495 As of December 31, 2015 , the Company did not hold any foreign exchange forward contracts to convert USD into CAD. As of December 31, 2014 , the Company held foreign exchange forward contracts to convert $6,000 USD into $6,974 CAD at exchange rates ranging from 1.1618 to 1.1630 . These contracts expired between January 12, 2015 and March 11, 2015 and the fair value of these contracts as of December 31, 2014 was an asset of $7 . During the years ended December 31, 2015 , 2014 , and 2013 , the use of foreign exchange forward contracts resulted in net foreign exchange losses of nil , $368 and $489 , respectively. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment 2015 Cost Accumulated Net book Leasehold improvements 23,225 2,057 21,168 Computer equipment 14,508 5,630 8,878 Office furniture and equipment 4,100 1,098 3,002 41,833 8,785 33,048 2014 Cost Accumulated Net book Leasehold improvements 15,014 352 14,662 Computer equipment 7,346 2,415 4,931 Office furniture and equipment 2,506 371 2,135 24,866 3,138 21,728 The following table illustrates the classification of depreciation in the Consolidated Statements of Operations and Comprehensive Loss. 2015 2014 2013 Cost of revenues 3,086 1,599 572 Sales and marketing 1,040 795 344 Research and development 1,191 1,253 466 General and administrative 408 351 98 5,725 3,998 1,480 |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets 2015 Cost Accumulated Net book Software development costs 4,238 1,143 3,095 Purchased software 3,668 1,242 2,426 Domain names 540 235 305 8,446 2,620 5,826 2014 Cost Accumulated Net book Software development costs 1,925 445 1,480 Purchased software 1,806 588 1,218 Domain names 90 80 10 3,821 1,113 2,708 Internal software development costs of $2,313 , $1,269 and $656 were capitalized during the years ended December 31, 2015 , 2014 and 2013 , respectively, and are included in Intangible assets in the accompanying Consolidated Balance Sheets. Amortization expense related to the capitalized internally developed software was $698 , for the year ended December 31, 2015 and is included in Cost of revenues and General and administrative expense. Amortization expense related to the capitalized internally developed software was $330 and $115 for the years ended 2014 and 2013 , respectively, and is included in Cost of revenues in the accompanying Consolidated Statements of Operations and Comprehensive Loss. The following table illustrates the classification of amortization expense related to Intangible assets in the Consolidated Statements of Operations and Comprehensive Loss. 2015 2014 2013 Cost of revenues 750 608 240 Sales and marketing 186 33 32 Research and development 465 20 5 General and administrative 110 13 1 1,511 674 278 Estimated future amortization expense related to intangible assets, as at December 31, 2015 is as follows. Fiscal Year Amount 2016 2,288 2017 2,215 2018 1,192 2019 131 Total 5,826 |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Liabilities | Accounts Payable and Accrued Liabilities 2015 2014 Trade accounts payable and trade accruals 18,453 8,186 Other payables and accrued liabilities 1,697 1,607 Accrued payroll taxes related to exercised stock options 1,584 — Employee related accruals 1,150 539 Accrued sales tax 805 2,182 23,689 12,514 |
Lease Incentives
Lease Incentives | 12 Months Ended |
Dec. 31, 2015 | |
Leases [Abstract] | |
Lease Incentives | Lease Incentives The Company leases space for its offices. The Company’s principal lease is for its head office, which is located at 150 Elgin Street in Ottawa, Canada. This lease covers a period of twelve years, ten months that began on March 1, 2014. The lease includes an option to renew for a further five years . The Company received leasehold incentives in the form of rent-free periods and fit-up allowances. The lease agreement also includes scheduled rent increases that are not dependent on future events and therefore the lease payments are being accounted for on a straight-line basis over the entire term of the lease. The Company also maintains offices in Toronto, Montreal and Kitchener-Waterloo. In all locations, the Company received leasehold incentives in the form of rent-free periods and fit-up allowances. The lease agreements also include scheduled rent increases that are not dependent on future events and therefore the lease payments are being accounted for on a straight-line basis over the entire term of the lease. The following table represents the details of the Company’s lease incentives balance as of December 31, 2015 and 2014. 2015 2014 Lease incentives 11,177 7,536 Other lease liabilities 142 242 11,319 7,778 Less: current portion 822 485 Long-term portion 10,497 7,293 |
Credit Facilities
Credit Facilities | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Credit Facilities | Credit Facilities In 2011, the Company established a revolving line of credit with the Royal Bank of Canada. The credit facility is renewable annually for borrowing of up to $1,500 CAD. The line is collateralized by cash and cash equivalents and its interest rate is tied to the Bank of Canada prime lending rate plus 0.3% ( 3.0% as of December 31, 2015 and 3.3% as of December 31, 2014 ). As of December 31, 2015 the Company had drawn nil under the facility. As of December 31, 2015 , $1,000 CAD under the facility was pledged as collateral for a letter of credit. In March 2015, the Company entered into a credit facility with Silicon Valley Bank, which provides for a $25,000 revolving line of credit bearing interest at the U.S. prime rate, as published by the Wall Street Journal plus or minus 25 basis points per annum. As at December 31, 2015 the effective rate was 3.25% . The credit facility has a maturity date of March 11, 2016, and is collateralized by substantially all of the Company’s assets, including the stock of its subsidiaries named in the agreement as guarantors, but excluding the Company’s intellectual property, which is subject to a negative pledge. As of December 31, 2015 , no amounts have been drawn under this credit facility and the Company is in compliance with all of the covenants contained therein. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Operating Leases The Company leases space for its offices in Ottawa, Toronto and Kitchener-Waterloo, Ontario, Canada and Montreal, Quebec, Canada. In the years ended December 31, 2015 , 2014 , and 2013 rent expense totalled $6,446 , $4,547 and $1,178 , respectively. Amounts of minimum future annual rental payments under non-cancellable operating leases in each of the next five years and thereafter are as follows: Fiscal Year Amount $ 2016 5,804 2017 7,809 2018 7,907 2019 7,958 2020 8,070 Thereafter 42,594 Total future minimum lease payments 80,142 Litigation and Loss Contingencies The Company accrues estimates for loss contingencies when losses are probable and reasonably estimable. From time to time, the Company may become a party to litigation and subject to claims incident to the ordinary course of business, including intellectual property claims, labour and employment claims and threatened claims, breach of contract claims, tax and other matters. The Company currently has no material pending litigation or claims. The Company is not aware of any litigation matters or loss contingencies that would be expected to have a material adverse effect on the business, consolidated financial position, results of operation, or cash flows. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Convertible Preferred Shares Upon the completion of the Company’s IPO, all of the then outstanding convertible preferred shares were converted into 27,159,277 Class B multiple voting shares. Common Stock Authorized Immediately prior to the completion of the Company’s IPO, all of the then outstanding 39,780,952 common shares were redesignated as Class B multiple voting shares. The Company is authorized to issue an unlimited number of Class A subordinate voting shares and an unlimited number of Class B multiple voting shares. The Class A subordinate voting shares have one vote per share and the Class B multiple voting shares have 10 votes per share. The Class A subordinate voting shares are not convertible into any other class of shares, including Class B multiple voting shares. The Class B multiple voting shares are convertible into Class A subordinate voting shares on a one -for-one basis at the option of the holder. In addition, Class B multiple voting shares will automatically convert into Class A subordinate voting shares in certain other circumstances. In connection with historical acquisitions, the Company has also issued restricted shares. The restricted shares vest evenly, on a month-by-month basis, and are contingent on future services being provided. Preferred Shares The Company is authorized to issue an unlimited number of preferred shares issuable in series. Each series of preferred shares shall consist of such number of shares and having such rights, privileges, restrictions and conditions as may be determined by the Company’s Board of Directors prior to the issuance thereof. Holders of preferred shares, except as otherwise provided in the terms specific to a series of preferred shares or as required by law, will not be entitled to vote at meetings of holders of shares. Stock-Based Compensation In 2008, the Board of Directors adopted and the Company’s shareholders approved the Legacy Stock Option Plan (“the Legacy Option Plan”). Under the Legacy Option Plan, the Board of Directors was authorized to grant options to purchase common shares to both employees and non-employees. The Compensation Committee, or in their absence, the Board of Directors, was given the authority to set the exercise prices of all options granted based upon not less than the fair market value of the common shares of the Company on the date of grant. In October 2010, an amendment was made to the Legacy Option Plan to set all future option grants, unless otherwise specified by the Board of Directors at the time of grant, on a vesting schedule over four years with 25% vesting after one year and the remainder vesting 1/48 each month thereafter. In April 2013, an amendment was made to the Legacy Option Plan to provide that the term of the options shall be exercisable until the tenth anniversary of their grant date. In December 2013 the Board of Directors approved a modification to the Legacy Option Plan which allowed for uniform vesting at 1/48 each month starting immediately in the first month after an option grant for any grant issued to employees subsequent to their initial grant. At that time, the Board of Directors also approved a modification that changed the initial vesting commencement date from three months following the employment or engagement start date to the actual employment or engagement start date. Immediately prior to the completion of the Company’s IPO, a total of 14,982,341 options were outstanding under the Legacy Option Plan, and, in connection with the closing of the offering, each such option became exercisable for one Class B multiple voting share. Following the closing of the Company’s IPO, no further awards were made under the Legacy Option Plan. The Company’s Board of Directors and shareholders approved a new stock option plan (“Stock Option Plan”) as well as a long-term incentive plan (“LTIP”), each of which became effective on May 27, 2015. The Stock Option Plan allows for the grant of options to the Company’s officers, directors, employees and consultants. All options granted under the Stock Option Plan will have an exercise price determined and approved by the Company’s Board of Directors at the time of grant, which shall not be less than the market price of the Class A subordinate voting shares at such time. For purposes of the Stock Option Plan, the market price of the Class A subordinate voting shares shall be the volume weighted average trading price of the Class A subordinate voting shares on the NYSE for the five trading days ending on the last trading day before the day on which the option is granted. Options granted under the Stock Option Plan are exercisable for Class A subordinate voting shares. Both the vesting period and term of the options in the Stock Option Plan are determined by the Board of Directors at the time of grant. The LTIP provides for the grant of share units, or LTIP Units, consisting of restricted share units (“RSU”), performance share units (“PSU”), and deferred share units (“DSU”). Each LTIP Unit represents the right to receive one Class A subordinate voting share in accordance with the terms of the LTIP. Unless otherwise approved by the Board of Directors, RSUs will vest as to 1/3 each on the first, second and third anniversary dates of the date of grant. A PSU participant’s grant agreement will describe the performance criteria established by the Company’s Board of Directors that must be achieved for PSUs to vest to the PSU participant, provided the participant is continuously employed by or in the Company’s service or the service or employment of any of the Company’s affiliates from the date of grant until such PSU vesting date. DSUs will be granted solely to directors of the Company, at their option, in lieu of their Board retainer fees. DSUs will vest upon a director ceasing to act as a director. As at the consolidated balance sheet date there have been nil PSUs or DSUs granted. The maximum number of Class A subordinate voting shares reserved for issuance, in the aggregate, under the Company's Stock Option Plan and the LTIP was initially equal to 3,743,692 Class A subordinate voting shares. The number of Class A subordinate voting shares available for issuance, in the aggregate, under the Stock Option Plan and the LTIP will be automatically increased on January 1st of each year, beginning on January 1, 2016 and ending on January 1, 2026, in an amount equal to 5% of the aggregate number of outstanding Class A subordinate voting shares and Class B multiple voting shares on December 31st of the preceding calendar year. As at January 1, 2016 there were 6,786,124 shares reserved for issuance under the Company's Stock Option Plan and LTIP. The following table summarizes the stock option and RSU award activities under the Company's share-based compensation plans for the years ended December 31, 2015 , 2014 , and 2013 : Shares Subject to Options Outstanding Outstanding RSUs Number of Options (1) Weighted Average Exercise Price Remaining Contractual Term (in years) Aggregate Intrinsic Value (2) $ Weighted Average Grant Date Fair Value Outstanding RSUs Weighted Average Grant Date Fair Value Balance as at December 31, 2013 12,737,893 0.38 — — — — — Stock options granted 2,985,495 5.28 — — 5.63 — — Stock options exercised (305,649 ) 0.46 — — — — — Stock options forfeited (386,351 ) 1.40 — — — — — Balance as at December 31, 2014 15,031,388 1.31 7.16 73,642 — — — Stock options granted 1,259,025 22.16 — — 12.16 — — Stock options exercised (4,665,059 ) 0.34 — — — — — Stock options forfeited (421,328 ) 12.04 — — — — — RSUs granted — — — — — 503,701 32.01 RSUs settled — — — — — — — RSUs forfeited — — — — — (75,135 ) 30.95 Balance as at December 31, 2015 11,204,026 3.65 6.99 248,119 — 428,566 32.19 Stock options exercisable as of December 31, 2015 6,902,359 0.82 6.03 172,415 (1) As at December 31, 2015 10,519,901 of the outstanding stock options were granted under the Company's Legacy Option Plan and are exercisable for Class B multiple voting shares, and 684,125 of the outstanding stock options were granted under the Company's Stock Option Plan and are exercisable for Class A subordinate voting shares. (2) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock option awards and the assessed fair value of the common stock as of December 31, 2014 and the closing market price of our common stock as of December 31, 2015 . As of December 31, 2015 , and 2014 , there was $ 34,572 and $16,574 , respectively, of remaining unamortized compensation cost related to unvested stock options and RSUs granted to the Company’s employees. This cost will be recognized over an estimated weighted-average remaining period of 3.22 years. Total unamortized compensation cost will be adjusted for future changes in estimated forfeitures. Share-Based Compensation Expense All share-based awards are measured based on the grant date fair value of the awards and recognized in the Consolidated Statements of Operations and Comprehensive Loss over the period during which the employee is required to perform services in exchange for the award (generally the vesting period of the award). The Company estimates the fair value of stock options granted using the Black-Scholes option valuation model, which requires assumptions, including the fair value of our underlying common stock, expected term, expected volatility, risk-free interest rate and dividend yield of the Company's common stock. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, share-based compensation expense could be materially different in the future. These assumptions are estimated as follows: • Fair Value of Common Stock. Prior to the Company's IPO in May 2015, the Board of Directors, with input from management, exercised significant judgment and considered numerous objective and subjective factors to determine the fair value of the Company's common stock as of the date of each option grant. Valuations of the Company’s stock were determined in accordance with the guidelines outlined in the American Institute of Certified Public Accountant Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. Since the Company's IPO, the Company has used the Volume Weighted Average Price for its common stock as reported on the New York Stock Exchange. • Expected Term. The Company determines the expected term based on the average period the stock options are expected to remain outstanding. The Company bases the expected term assumptions on its historical behavior combined with estimates of post-vesting holding period. • Expected Volatility. The Company determines the price volatility factor based on the historical volatility of publicly traded industry peers. To determine its peer group of companies, the Company considers public companies in the technology industry and selects those that are similar to us in size, stage of life cycle, and financial leverage. The Company intends to continue to consistently apply this methodology using the same or similar public companies until a sufficient amount of historical information regarding the volatility of its own common stock price becomes available, or unless circumstances change such that the identified companies are no longer similar, in which case, more suitable companies whose share prices are publicly available would be utilized in the calculation. • Risk-Free Interest Rate. The Company bases the risk-free interest rate used in the Black-Scholes valuation model on the yield available on U.S. Treasury zero-coupon issues with an equivalent remaining term of the stock options for each stock option group. • Expected Dividend. The Company has not paid and does not anticipate paying any cash dividends in the foreseeable future and, therefore, uses an expected dividend yield of zero in the option pricing model. The assumptions used to estimate the fair value of stock options granted to employees are as follows: 2015 2014 2013 Expected volatility 64.3 % 62.4 % 73.9 % Risk free interest rate 1.62 % 1.82 % 1.67 % Dividend yield Nil Nil Nil Average expected life 5.26 5.73 6.06 In addition to the assumptions used in the Black-Scholes option valuation model, the Company must also estimate a forfeiture rate to calculate the share-based compensation expense for our awards. The Company's forfeiture rate is based on an analysis of its actual forfeitures. The Company will continue to evaluate the appropriateness of the forfeiture rate based on actual forfeiture experience, analysis of employee turnover, and other factors. Changes in the estimated forfeiture rate can have a significant impact on share-based compensation expense as the cumulative effect of adjusting the rate is recognized in the period the forfeiture estimate is changed. If a revised forfeiture rate is higher/lower than the previously estimated forfeiture rate, an adjustment is made that will result in an increase/decrease to the share-based compensation expense recognized in the consolidated financial statements. The following table illustrates the classification of stock-based compensation in the Consolidated Statements of Operations and Comprehensive Loss, which includes both stock-based compensation and restricted share-based compensation expense. Years ended December 31, 2015 December 31, 2014 December 31, 2013 $ $ $ Cost of revenues 282 259 113 Sales and marketing 1,099 696 354 Research and development 4,509 2,776 1,152 General and administrative 2,268 712 147 8,158 4,443 1,766 |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The Company applies the two-class method to calculate its basic and diluted net loss per share as both classes of its voting shares are participating securities with equal participation rights and are entitled to receive dividends on a share for share basis. The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding. Years ended December 31, 2015 December 31, 2014 December 31, 2013 Basic and diluted weighted average number of shares outstanding 61,716,065 38,940,252 37,248,710 The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: Stock options 11,204,026 15,031,388 12,737,893 Restricted share units 428,566 — — Restricted shares 48,238 148,314 589,990 Convertible preferred shares — 27,159,277 27,159,277 11,680,830 42,338,979 40,487,160 In the years ended December 31, 2015 , 2014 , and 2013 the Company was in a loss position and therefore diluted loss per share is equal to basic loss per share. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The reconciliation of the expected provision for income tax recovery/expense to the actual provision for income tax recovery/expense reported in the Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2015 , 2014 , and 2013 is as follows. 2015 2014 2013 Earnings (loss) before income taxes (18,790 ) (22,311 ) (4,837 ) Expected income tax expense (recovery) at Canadian statutory income tax rate of 26.51% (2014-26.51%) (4,980 ) (5,915 ) (1,282 ) Permanent differences 1,333 1,203 435 Share issuance costs (3,734 ) — — Effect of change in tax rates — — (163 ) Utilization of tax credits — — (93 ) Other (8 ) (43 ) — Foreign rate differential (44 ) (3 ) (2 ) Increase (decrease) in valuation allowance 7,433 4,758 1,105 Provision for income tax (recovery) expense — — — During the years ended December 31, 2015 , 2014 , and 2013 , the loss before income taxes includes foreign income (loss) of $234 , $14 , and ( $14 ), respectively. The significant components of the Company’s deferred income tax assets and liabilities as of December 31, 2015 and 2014 are as follows. 2015 2014 Deferred tax assets Temporary differences on capital and intangible assets 415 606 Tax loss carryforwards 3,799 3,415 SR&ED expenditure carryforwards 1,687 974 Share issue costs 3,345 39 Investment tax credits 1,253 497 Lease accruals and other provisions 4,316 1,664 Total deferred tax assets 14,815 7,195 Valuation allowance (14,011 ) (6,578 ) 804 617 Deferred tax liabilities Capitalized software development costs (804 ) (380 ) Investment tax credits used or refunded — (237 ) Total deferred tax liabilities (804 ) (617 ) Net deferred tax asset — — The Company has determined that it is not more likely than not that it will realize any of its deferred tax assets, and therefore a full valuation allowance has been established against the total deferred tax assets. The Company does not have any unrecognized tax benefits. The Company's accounting policy is to recognize interest and penalties related to uncertain tax positions as a component of income tax expense. In the years ended December 31, 2015 , 2014 , and 2013 , there was no interest or penalties related to uncertain tax positions. The Company and its Canadian subsidiaries file federal and provincial income tax returns in Canada. The Company and its U.S. subsidiaries file federal and state income tax returns in the U.S. and its other foreign subsidiaries file income tax returns in their respective foreign jurisdictions. The Company remains subject to audit by the relevant tax authorities for the years ended 2010 through 2015 . The Company estimates SR&ED expenditures and claims investment tax credits for income tax purposes based on management’s interpretation of the applicable legislation in the Income Tax Act (“the Act”) and related provincial legislation. These claims are subject to audit by the tax authorities. In the opinion of management, the treatment of research and development expenditures for income tax purposes is appropriate. Any difference between recorded refundable tax credits and amounts ultimately received is recorded when the amount becomes known. As of December 31, 2015 and 2014 , the Company had unused non-capital tax losses of approximately $14,264 and $13,475 respectively, a SR&ED expenditure pool totaling $6,364 and $3,673 respectively, and investment tax credits of $1,486 and $532 respectively, that are due to expire as follows. SR&ED Investment Non-Capital 2031 — 45 — 2032 — 117 13 2033 — 232 11,235 2034 — 197 825 2035 — 895 2,191 Indefinite 6,364 — — 6,364 1,486 14,264 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information Items | 12 Months Ended |
Dec. 31, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information Items | Supplemental Cash Flow Information Items The following table presents the changes in non-cash working capital items. 2015 2014 2013 Trade and other receivables 1,176 (3,930 ) (1,196 ) Other current assets (4,708) (414) (725) Accounts payable and accrued liabilities 11,097 6,010 2,314 7,565 1,666 393 The following table provides supplemental disclosure of non-cash investing and financing activities. 2015 2014 2013 Acquired property and equipment remaining unpaid 1,295 853 — Acquired intangibles assets remaining unpaid — 250 — Capitalized stock-based compensation 362 79 26 Non-cash acquisitions of businesses — — 404 |
Geographical Information
Geographical Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Geographical Information | Geographical Information The following table presents total external revenues by geographic location, based on the location of the Company’s merchants. 2015 2014 2013 Amount % Amount % Amount % Canada 14,691 7.2 % 7,729 7.4 % 4,101 8.2 % United States 144,748 70.5 % 72,149 68.7 % 31,743 63.2 % United Kingdom 15,436 7.5 % 7,912 7.5 % 4,517 9.0 % Australia 10,531 5.1 % 6,420 6.1 % 3,807 7.6 % Rest of World 19,827 9.7 % 10,808 10.3 % 6,084 12.0 % 205,233 100.0 % 105,018 100.0 % 50,252 100.0 % The following table presents the total net book value the Company’s long-lived assets by geographic location. 2015 2014 Amount % Amount % Canada 25,886 78.3 % 17,758 81.7 % United States 7,162 21.7 % 3,970 18.3 % 33,048 100.0 % 21,728 100.0 % |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions 2013 Acquisition On July 31, 2013 the Company acquired 100% of the shares of two companies which were commonly owned, Jet Cooper Ltd., a design studio focused on user experience and website design, and Atatomic Inc., a firm of mobile application developers, in a combined purchase transaction for total consideration on closing of $1,232 , consisting of cash in the amount of $828 and 96,479 common shares with a fair value of $404 determined at the date of acquisition. The acquisition also established an escrow agreement upon which additional cash payments of C$468 were restricted and 289,435 of additional common shares were transferred to an escrow agent. The restrictions on the cash were lifted on July 31, 2014. The restricted common shares vest evenly, on a month-by-month basis over a period of three years ending on July 31, 2016. Both the cash payment and restricted common shares are contingent on the sellers’ continued employment and were therefore considered post business combination services and are accounted for as compensation expense and not part of purchase accounting. During the years ended December 31, 2015 , 2014 , and 2013 , nil , C $280 and C $188 , respectively, of the restricted cash was released from escrow and 82,697 shares with a fair value of $ 345 , 118,301 shares with a fair value of $493 , and 40,200 restricted shares with a fair value of $168 , respectively, were earned and have been recognized as compensation expense in the Consolidated Statements of Operations. The Company did not complete any acquisitions during the years ended December 31, 2015 and December 31, 2014 . |
Comparative Figures
Comparative Figures | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Comparative Figures | Comparative Figures Certain comparative figures have been reclassified in order to conform to the current year presentation. |
Significant Accounting Polici29
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Accounting | These consolidated financial statements of the Company have been presented in United States dollars (USD) and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), including the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding financial reporting. |
Use of Estimates | The preparation of consolidated financial statements, in accordance with U.S. GAAP, requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items that are subject to estimation and assumptions include: estimates related to contingencies and refundable tax credits; chargebacks on Shopify Payments transactions that are unrecoverable from merchants; recoverability of deferred tax assets; fair values of assets and liabilities acquired in business combinations; capitalization of software development costs; estimated useful lives of property and equipment and intangible assets; estimates relating to the recoverability of lease inducements; and assumptions used when employing the Black-Scholes valuation model to estimate the fair value of common shares and stock-based awards. Actual results may differ from the estimates made by management. |
Segment Information | The Company’s “chief operating decision maker” is the Chief Executive Officer. The Chief Executive Officer reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluation of financial performance. Accordingly, the Company has determined that it operates as a single operating and reportable segment. |
Revenue Recognition, Subscription Solutions, and Merchant Solutions | The Company’s sources of revenue consist of subscription solutions and merchant solutions. Arrangements with merchants do not provide the merchants with the right to take possession of the software supporting the Company’s hosting platform at any time and are therefore accounted for as service contracts. The Company’s subscription service contracts do not provide for refunds or any other rights of return to merchants in the event of cancellations. The Company recognizes revenue when all of the following criteria are met: • There is persuasive evidence of an arrangement; • The services have been or are being provided to the merchant; • The amount of fees to be paid by the merchant is fixed or determinable; and • The collection is reasonably assured. The Company follows the guidance provided in ASC 605-45, Principal Agent Considerations for determining whether the Company should recognize revenue based on the gross amount billed to a merchant or the net amount retained. This determination is a matter of judgment that depends on the facts and circumstances of each arrangement. The Company recognizes revenue from Shopify Shipping and the sales of Apps on a net basis as it has been determined that the Company is the agent in the arrangement with merchants. All other revenue is reported on a gross basis, as the Company has determined it is the principal in the arrangement, in that it is the primary obligor for providing services and assumes the risk of any loss or changes in costs. Sales taxes collected from merchants and remitted to government authorities are excluded from revenue. Our arrangements can include multiple elements, which may consist of some or all of our subscription solutions. When multiple-element arrangements exist, we evaluate whether these individual deliverables should be accounted for as separate units of accounting or one single unit of accounting. In order to treat deliverables in a multiple-element arrangement as separate units of accounting, the delivered item or items must have standalone value upon delivery. A delivered item has standalone value to the customer when either (1) any vendor sells that item separately or (2) the customer could resell that item on a standalone basis. Each of our subscription solutions have standalone value, as the solutions are sold separately. Accordingly, we consider the separate units of accounting in our multiple deliverable arrangements to be the subscription fees, themes, apps and domain names. When multiple deliverables included in an arrangement are separable into different units of accounting, the arrangement consideration is allocated to the identified separate units of accounting based on their relative selling price. Multiple-element arrangement accounting guidance provides a hierarchy to use when determining the relative selling price for each unit of accounting. Vendor-specific objective evidence (VSOE) of selling price, based on the price at which the item is regularly sold by the vendor on a standalone basis, should be used if it exists. If VSOE of selling price is not available, third-party evidence (TPE) of selling price is used to establish the selling price if it exists. We have not established VSOE for our subscription solutions due to lack of pricing consistency, the introduction of new services and other factors. We have also concluded that third-party evidence of selling price is not a practical alternative due to differences in our service offerings compared to other parties and the availability of relevant third-party pricing information. Accordingly, we use our best estimate of selling price (BESP) to determine the relative selling price for our subscription solutions. We determined BESP by considering our overall pricing objectives and market conditions. Significant pricing practices taken into consideration for our subscription solutions include discounting practices, the size and volume of our transactions, the customer demographic, the geographic area where services are sold, price lists, our go-to-market strategy, historical standalone sales and contract prices. The determination of BESP is made through consultation with and approval by our management, taking into consideration our go-to-market strategy. As our go-to-market strategies evolve, we may modify our pricing practices in the future, which could result in changes in relative selling prices. Subscription Solutions Subscription revenue is recognized on a rateable basis over the contractual term. The terms range from monthly, annual or multi-year subscription terms. Revenue recognition begins on the date that the Company’s service is made available to the merchant. Payments received in advance of services being rendered are recorded as deferred revenue and recognized on a rateable basis over the requisite service period. The Company earns revenue based on the services it delivers either directly to its merchants or indirectly through resellers. The Company also sells separately priced Themes and Apps to merchants for which revenue is recognized at the time of the sale. The right to use domain names is also sold separately and is recognized on a rateable basis over the contractual term, which is generally an annual term. Revenue from Themes, as well as Apps and Domains have been classified within Subscription solutions on the basis that they are typically sold at the time the merchant enters into the subscription services arrangement or because they are charged on a recurring basis. Merchant Solutions The Company generates the majority of its merchant solutions revenue from fees that it charges merchants on their customer orders processed through Shopify Payments. The Company also derives merchants solutions revenue relating to Shopify Shipping, other transaction services and referral fees, as well as from the sale of Point-of-Sale (POS) hardware. For the sale of POS hardware, revenue is recognized when title passes to the merchant, in accordance with the shipping terms. Revenues earned from Shopify Payments, Shopify Shipping, other transaction services, and referral fees are recognized at the time of the transaction. |
Cost of Revenues | The Company’s cost of revenues consists of payments for Themes and Domain registration, credit card fees, hosting infrastructure costs, an allocation of costs incurred by both the operations and support functions, and amortization of capitalized software development costs. In addition, included in the cost of merchant solutions are costs associated with credit card processing and chargebacks related to Shopify Payments and the cost of POS hardware. |
Software Development Costs | Research and development costs are generally expensed as incurred. These costs primarily consist of personnel and related expenses, contractor and consultant fees, stock-based compensation, and corporate overhead allocations, including depreciation. The Company capitalizes certain development costs incurred in connection with its internal use software. These capitalized costs are related to the development of its software platform that is hosted by the Company and accessed by its merchants on a subscription basis as well as material internal infrastructure software. Costs incurred in the preliminary stages of development are expensed as incurred. The Company capitalizes all direct and incremental costs incurred during the application phase, until such time when the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional features and functionality. Capitalized costs are recorded as part of Intangible assets in the consolidated balance sheets and are amortized on a straight-line basis over their estimated useful lives of three years. Maintenance costs are expensed as incurred. |
Advertising Costs | Advertising costs are expensed as incurred. |
Operating Leases | The total payments and costs associated with operating leases, including leases that contain lease inducements and uneven payments, are aggregated and amortized on a straight-line basis over the initial lease term of each respective agreement. |
Foreign Currency Transactions | The functional and reporting currency of the Company and its subsidiaries is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are re-measured to United States dollars using the exchange rates at the consolidated balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are measured in United States dollars using historical exchange rates. Revenues and expenses are measured using the actual exchange rates prevailing on the dates of the transactions. Gains and losses resulting from re-measurement are recorded in the Company’s Consolidated Statements of Operations and Comprehensive Loss as Foreign exchange gain (loss). |
Cash and Cash Equivalents | The Company considers all short term highly liquid investments purchased with original maturities at their acquisition date of three months or less to be cash equivalents. |
Marketable Securities | The Company’s marketable securities consist of U.S federal agency bonds, corporate bonds and commercial paper, and mature within 12 months from the date of purchase. Marketable securities are classified as held-to-maturity at the time of purchase and this classification is re-evaluated as of each consolidated balance sheet date. Held-to-maturity securities represent those securities that the Company has both the intent and ability to hold to maturity and are carried at amortized cost, which approximates their fair market value. Interest on these securities, as well as amortization/accretion of premiums/discounts, are included in interest income. All investments are assessed as to whether any unrealized loss positions are other than temporarily impaired. Impairments are considered other than temporary if they are related to deterioration in credit risk or if it is likely the Company will sell the securities before the recovery of their cost basis. Realized gains and losses and declines in value determined to be other than temporary are determined based on the specific identification method and are reported in Other income (expenses) in the Consolidated Statements of Operations and Comprehensive Loss. |
Derivatives | The Company may hold foreign exchange forward contracts to mitigate the risk of future foreign exchange rate volatility related to future Canadian dollar denominated costs and current and future obligations. The Company recognizes these derivative financial instruments as either assets or liabilities and measures them at fair value. The Company has elected not to apply hedge accounting, therefore changes in the fair value of these derivative instruments will affect their consolidated balance sheet amounts and the resulting gain or loss will be reflected as Foreign exchange gains (losses) in the Consolidated Statements of Operations and Comprehensive Loss. |
Concentration of Credit Risk | The Company’s cash and cash equivalents, marketable securities, trade and other receivables, and foreign exchange forward contracts subject the Company to concentrations of credit risk. Management mitigates this risk associated with cash and cash equivalents by making deposits and entering into foreign exchange forward contracts only with large Canadian, Irish, Australian and United States banks and financial institutions that are considered to be highly credit worthy. Management mitigates the risks associated with marketable securities by adhering to its investment policy, which stipulates minimum rating requirements, maximum investment exposures and maximum maturities. Due to the Company’s diversified merchant base, there is no particular concentration of credit risk related to the Company’s trade receivables. Trade and other receivables are monitored on an ongoing basis to ensure timely collection of amounts. There are no receivables from individual merchants accounting for 10% or more of revenues or receivables. |
Interest Rate Risk | Certain of the Company’s cash equivalents and marketable securities earn interest. The Company’s trade and other receivables, accounts payable and accrued liabilities and lease liabilities do not bear interest. The Company is not exposed to material interest rate risk. |
Foreign Exchange Risk | The Company’s exposure to foreign exchange risk is primarily related to fluctuations between the Canadian dollar and the United States dollar. The Company is exposed to foreign exchange fluctuations on the revaluation of foreign currency assets and liabilities. The Company may use foreign exchange derivative products to manage the impact of foreign exchange fluctuations. By their nature, derivative financial instruments involve risk, including the credit risk of non-performance by counter parties. |
Fair Value Measurements | The carrying amounts for cash and cash equivalents, marketable securities, trade receivables, other receivables, trade accounts payable and accruals, and employee related accruals approximate fair value due to the short-term maturities of these instruments. The Company measures the fair value of its financial assets and liabilities using a fair value hierarchy. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value. Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. |
Property and Equipment | Property and equipment is stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets. Computer equipment is depreciated over three years while office furniture and equipment are depreciated over four years. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or the term of their associated leases, which range from three to thirteen years. The carrying values of property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amounts of such assets may not be recoverable. The determination of whether any impairment exists includes a comparison of estimated undiscounted future cash flows anticipated to be generated over the remaining life of the asset to the net carrying value of the asset. If the estimated undiscounted future cash flows associated with the asset are less than the carrying value, an impairment loss will be recorded based on the estimated fair value. |
Intangible Assets | Intangible assets are stated at cost, less accumulated amortization. Amortization is calculated using the straight-line method over the estimated useful lives of the related assets. Purchased software, other intangible assets, and capitalized software development costs are amortized into cost of revenues over a three year period. The carrying values of intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amounts of such assets may not be recoverable. The determination of whether any impairment exists includes a comparison of estimated undiscounted future cash flows anticipated to be generated over the remaining life of the asset to the net carrying value of the asset. If the estimated undiscounted future cash flows associated with the asset are less than the carrying value, an impairment loss will be recorded based on the estimated fair value. |
Goodwill | Goodwill represents the excess of the purchase price over the estimated fair value of net assets of a business acquired in a business combination. Goodwill is not amortized, but instead tested for impairment at least annually in the fourth quarter of each year. Should certain events or indicators of impairment occur between annual impairment tests, the Company will perform the impairment test as those events or indicators occur. Examples of such events or circumstances include the following: a significant decline in the Company’s expected future cash flows; a sustained, significant decline in the Company’s fair value; a significant adverse change in the business climate; and slower growth rates. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. The qualitative assessment considers the following factors: macroeconomic conditions, industry and market considerations, cost factors, overall company financial performance, events affecting the reporting units, and changes in the Company’s fair value. If the reporting unit does not pass the qualitative assessment, the Company carries out a two-step test for impairment of goodwill. The first step of the test compares the fair value of the reporting unit with the carrying value of its net assets. If the fair value of the reporting unit is greater than its carrying value, no impairment results. If the fair value of the reporting unit is less than its carrying value, the Company performs the second step of the test for impairment of goodwill. During the second step of the test, the Company compares the implied fair value of the reporting unit’s goodwill with the carrying value of that goodwill. If the implied fair value of goodwill is less than the carrying value, an impairment charge would be recorded in the Consolidated Statements of Operations and Comprehensive Loss. The Company has one reporting unit and evaluates goodwill for impairment at the entity level. |
Income Taxes | Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amounts and the tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are more likely than not to be realized. The Company evaluates tax positions taken or expected to be taken in the course of preparing tax returns to determine whether the tax positions have met a “more-likely-than-not” threshold of being sustained by the applicable tax authority. Tax benefits related to tax positions not deemed to meet the “more-likely-than-not” threshold are not permitted to be recognized in the consolidated financial statements. The Company classifies accrued interest and penalties related to liabilities for income taxes in income tax expense. |
Refundable Tax Credits | Tax credits related to Scientific Research and Experimental Development (SR&ED) expenditures are accounted for using the flow-through method. Refundable tax credits are accounted for, in the period in which the related expenditures are incurred, as a direct reduction of research and development or capitalized costs. Non-refundable tax credits, which may only be used to reduce future taxes otherwise payable, are recorded as an income tax recovery in the period in which their realization is considered more likely than not. |
Stock-Based Compensation | The accounting for stock-based awards is based on the fair value of the award measured at the grant date. Accordingly, stock-based compensation cost is recognized in the Consolidated Statements of Operations and Comprehensive Loss as an operating expense over the requisite service period. The fair value of stock options is determined using the Black-Scholes option-pricing model, single option approach. An estimate of forfeitures is applied when determining compensation expense. The Company determines the fair value of stock option awards on the date of grant using assumptions regarding expected term, share price volatility over the expected term of the awards, risk-free interest rate, and dividend rate. All shares issued under the Legacy Option Plan and Stock Option Plan are from treasury. The fair value of restricted share units ("RSU's") is measured using the fair value of the Company's shares as if the RSU's were vested and issued on the grant date. An estimate of forfeitures is applied when determining compensation expense. All shares issued under the Long Term Incentive Plan are from treasury. In connection with prior period business acquisitions, the Company has also issued restricted shares. The restricted shares vest evenly, on a month-by-month basis and are contingent on future services being provided. As a result, the restricted shares are considered post business combination services and are accounted for as compensation expense and not as part of purchase accounting. The fair value of the restricted shares is derived from the fair value of the Company’s common shares, which was determined by an independent valuation firm, based on input, feedback and review by the Company’s management, at or around the same time as the related transactions and in combination with other available market data. |
Earnings Per Share | Basic earnings per share are calculated by dividing net earnings attributable to common equity holders of the Company by the weighted average number of common stock outstanding during the year. Diluted earnings per share are calculated by dividing net earnings attributable to common equity holders of the Company by the weighted average number of common stock outstanding during the year, plus the effect of dilutive potential common stock outstanding during the year. This method requires that diluted earnings per share be calculated (using the treasury stock method) as if all dilutive potential common stock had been exercised at the latest of the beginning of the year or on the date of issuance, as the case may be, and that the funds obtained thereby (plus an amount equivalent to the unamortized portion of related stock-based compensation costs) be used to purchase common stock of the Company at the average fair value of the common stock during the year. |
Recent Accounting Pronouncements Not Yet Adopted | In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2014-9 “Revenue from Contracts with Customers.” The new accounting standards update requires an entity to apply a five step model to recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, as well as a cohesive set of disclosure requirements that would result in an entity providing comprehensive information about the nature, timing, and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. In August 2015 the Financial Accounting Standards Board issued ASU No. 2015-14, which deferred the effective date for all entities by one year. The standard becomes effective for reporting periods beginning after December 15, 2017. Early adoption is permitted starting January 1, 2017. The Company is currently assessing the impact of these standards. In February 2015, the Financial Accounting Standards Board issued ASU No. 2015-02 “Consolidations (Topic 810)—Amendments to the Consolidation Analysis”. The new standard makes amendments to the current consolidation guidance, including introducing a separate consolidation analysis specific to limited partnerships and other similar entities. Under this analysis, limited partnerships and other similar entities will be considered a variable-interest entity (“VIE”) unless the limited partners hold substantive kick-out rights or participating rights. The standard is effective for annual periods beginning after December 15, 2015. The Company is currently assessing the impact of these amendments. In April 2015, the Financial Accounting Standards Board issued ASU No. 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” The amendments in this update provide guidance to customers about whether a cloud computing arrangement includes a software license. The amendment is effective for interim and annual periods beginning after December 15, 2015 with early adoption permitted. The Company is currently assessing the impact of this new standard. In May 2015, the Financial Accounting Standards Board issued ASU 2015-07, “Disclosures for Investments in Certain Entities That Calculate Net Asset Value Per Share (or Its Equivalent)”, which amends ASC 820, Fair Value Measurement. The standard removes the requirement to categorize within the fair value hierarchy investments for which fair value is measured using the net asset value per share practical expedient and removes certain related disclosure requirements. The standard will be effective for the Company’s fiscal year beginning January 1, 2016. The Company is currently assessing the impact of this new standard. In November 2015, the Financial Accounting Standards Board issued ASU 2015-17, "Income Taxes (Topic 740)", which simplifies the presentation of deferred income taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. The standard will be effective for the Company’s fiscal year beginning January 1, 2016. The Company is currently assessing the impact of this new standard. |
Comparative Figures | Certain comparative figures have been reclassified in order to conform to the current year presentation. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments, Measured at Fair Value on a Recurring and Non-recurring Basis | As of December 31, 2014 , the Company’s financial instruments, measured at fair value on a recurring and non-recurring basis, were as follows: Amount at Fair Value Measurements Using Level 1 Level 2 Level 3 Assets: Cash equivalents: Money market funds 31,271 31,271 — — Canadian guaranteed investment certificates 1,294 1,294 — — U.S. term deposits 3,500 3,500 — — Marketable securities: U.S. federal bonds 5,502 5,502 — — Corporate bonds 12,207 — 12,207 — Derivatives: Foreign exchange forward contracts 7 — 7 — As of December 31, 2015 , the Company’s financial instruments, measured at fair value on a recurring and non-recurring basis, were as follows: Amount at Fair Value Measurements Using Level 1 Level 2 Level 3 Assets: Cash equivalents: Money market funds 59,655 59,655 — — U.S. term deposits 21,259 21,259 — — Marketable securities: U.S. federal bonds 35,970 35,970 — — Corporate bonds 44,028 — 44,028 — |
Trade and Other Receivables (Ta
Trade and Other Receivables (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Schedule of Trade and Other Receivables | 2015 2014 Trade receivables 1,701 838 Leasehold incentives receivable 1,554 3,158 Unbilled revenues 1,075 704 Refundable tax credits 754 1,959 Sales tax receivable 572 499 Other receivables 433 69 6,089 7,227 |
Other Current Assets (Tables)
Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Current Assets | 2015 2014 Prepaid expenses 3,264 1,023 POS hardware 1,550 290 Deposits 1,389 175 Foreign exchange forward contracts — 7 6,203 1,495 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, and Classification of Depreciation | 2015 Cost Accumulated Net book Leasehold improvements 23,225 2,057 21,168 Computer equipment 14,508 5,630 8,878 Office furniture and equipment 4,100 1,098 3,002 41,833 8,785 33,048 2014 Cost Accumulated Net book Leasehold improvements 15,014 352 14,662 Computer equipment 7,346 2,415 4,931 Office furniture and equipment 2,506 371 2,135 24,866 3,138 21,728 The following table illustrates the classification of depreciation in the Consolidated Statements of Operations and Comprehensive Loss. 2015 2014 2013 Cost of revenues 3,086 1,599 572 Sales and marketing 1,040 795 344 Research and development 1,191 1,253 466 General and administrative 408 351 98 5,725 3,998 1,480 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | 2015 Cost Accumulated Net book Software development costs 4,238 1,143 3,095 Purchased software 3,668 1,242 2,426 Domain names 540 235 305 8,446 2,620 5,826 2014 Cost Accumulated Net book Software development costs 1,925 445 1,480 Purchased software 1,806 588 1,218 Domain names 90 80 10 3,821 1,113 2,708 |
Classification of Amortization Expense Related to Intangible Assets | The following table illustrates the classification of amortization expense related to Intangible assets in the Consolidated Statements of Operations and Comprehensive Loss. 2015 2014 2013 Cost of revenues 750 608 240 Sales and marketing 186 33 32 Research and development 465 20 5 General and administrative 110 13 1 1,511 674 278 |
Estimated Future Amortization Expense Related to Intangible Assets | Estimated future amortization expense related to intangible assets, as at December 31, 2015 is as follows. Fiscal Year Amount 2016 2,288 2017 2,215 2018 1,192 2019 131 Total 5,826 |
Accounts Payable and Accrued 35
Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | 2015 2014 Trade accounts payable and trade accruals 18,453 8,186 Other payables and accrued liabilities 1,697 1,607 Accrued payroll taxes related to exercised stock options 1,584 — Employee related accruals 1,150 539 Accrued sales tax 805 2,182 23,689 12,514 |
Lease Incentives (Tables)
Lease Incentives (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Leases [Abstract] | |
Schedule of Lease Incentives | The following table represents the details of the Company’s lease incentives balance as of December 31, 2015 and 2014. 2015 2014 Lease incentives 11,177 7,536 Other lease liabilities 142 242 11,319 7,778 Less: current portion 822 485 Long-term portion 10,497 7,293 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Minimum Future Annual Rental Payments Under Non-cancellable Operating Leases | Amounts of minimum future annual rental payments under non-cancellable operating leases in each of the next five years and thereafter are as follows: Fiscal Year Amount $ 2016 5,804 2017 7,809 2018 7,907 2019 7,958 2020 8,070 Thereafter 42,594 Total future minimum lease payments 80,142 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Summary of the Stock Option and RSU Award Activities | The following table summarizes the stock option and RSU award activities under the Company's share-based compensation plans for the years ended December 31, 2015 , 2014 , and 2013 : Shares Subject to Options Outstanding Outstanding RSUs Number of Options (1) Weighted Average Exercise Price Remaining Contractual Term (in years) Aggregate Intrinsic Value (2) $ Weighted Average Grant Date Fair Value Outstanding RSUs Weighted Average Grant Date Fair Value Balance as at December 31, 2013 12,737,893 0.38 — — — — — Stock options granted 2,985,495 5.28 — — 5.63 — — Stock options exercised (305,649 ) 0.46 — — — — — Stock options forfeited (386,351 ) 1.40 — — — — — Balance as at December 31, 2014 15,031,388 1.31 7.16 73,642 — — — Stock options granted 1,259,025 22.16 — — 12.16 — — Stock options exercised (4,665,059 ) 0.34 — — — — — Stock options forfeited (421,328 ) 12.04 — — — — — RSUs granted — — — — — 503,701 32.01 RSUs settled — — — — — — — RSUs forfeited — — — — — (75,135 ) 30.95 Balance as at December 31, 2015 11,204,026 3.65 6.99 248,119 — 428,566 32.19 Stock options exercisable as of December 31, 2015 6,902,359 0.82 6.03 172,415 (1) As at December 31, 2015 10,519,901 of the outstanding stock options were granted under the Company's Legacy Option Plan and are exercisable for Class B multiple voting shares, and 684,125 of the outstanding stock options were granted under the Company's Stock Option Plan and are exercisable for Class A subordinate voting shares. (2) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock option awards and the assessed fair value of the common stock as of December 31, 2014 and the closing market price of our common stock as of December 31, 2015 . |
Schedule of Assumptions Used to Estimate the Fair Value of Stock Options | The assumptions used to estimate the fair value of stock options granted to employees are as follows: 2015 2014 2013 Expected volatility 64.3 % 62.4 % 73.9 % Risk free interest rate 1.62 % 1.82 % 1.67 % Dividend yield Nil Nil Nil Average expected life 5.26 5.73 6.06 |
Schedule of Classification of Stock-based Compensation | The following table illustrates the classification of stock-based compensation in the Consolidated Statements of Operations and Comprehensive Loss, which includes both stock-based compensation and restricted share-based compensation expense. Years ended December 31, 2015 December 31, 2014 December 31, 2013 $ $ $ Cost of revenues 282 259 113 Sales and marketing 1,099 696 354 Research and development 4,509 2,776 1,152 General and administrative 2,268 712 147 8,158 4,443 1,766 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Summary of the Reconciliation of the Basic and Diluted Weighted Average Number of Shares Outstanding | The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding. Years ended December 31, 2015 December 31, 2014 December 31, 2013 Basic and diluted weighted average number of shares outstanding 61,716,065 38,940,252 37,248,710 The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: Stock options 11,204,026 15,031,388 12,737,893 Restricted share units 428,566 — — Restricted shares 48,238 148,314 589,990 Convertible preferred shares — 27,159,277 27,159,277 11,680,830 42,338,979 40,487,160 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding. Years ended December 31, 2015 December 31, 2014 December 31, 2013 Basic and diluted weighted average number of shares outstanding 61,716,065 38,940,252 37,248,710 The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: Stock options 11,204,026 15,031,388 12,737,893 Restricted share units 428,566 — — Restricted shares 48,238 148,314 589,990 Convertible preferred shares — 27,159,277 27,159,277 11,680,830 42,338,979 40,487,160 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Reconciliation of the Expected Provision for Income Tax Recovery/Expense to the Actual Provision for Income Tax Recovery/Expense | The reconciliation of the expected provision for income tax recovery/expense to the actual provision for income tax recovery/expense reported in the Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2015 , 2014 , and 2013 is as follows. 2015 2014 2013 Earnings (loss) before income taxes (18,790 ) (22,311 ) (4,837 ) Expected income tax expense (recovery) at Canadian statutory income tax rate of 26.51% (2014-26.51%) (4,980 ) (5,915 ) (1,282 ) Permanent differences 1,333 1,203 435 Share issuance costs (3,734 ) — — Effect of change in tax rates — — (163 ) Utilization of tax credits — — (93 ) Other (8 ) (43 ) — Foreign rate differential (44 ) (3 ) (2 ) Increase (decrease) in valuation allowance 7,433 4,758 1,105 Provision for income tax (recovery) expense — — — |
Significant Components of Future Income Tax Assets and Liabilities | The significant components of the Company’s deferred income tax assets and liabilities as of December 31, 2015 and 2014 are as follows. 2015 2014 Deferred tax assets Temporary differences on capital and intangible assets 415 606 Tax loss carryforwards 3,799 3,415 SR&ED expenditure carryforwards 1,687 974 Share issue costs 3,345 39 Investment tax credits 1,253 497 Lease accruals and other provisions 4,316 1,664 Total deferred tax assets 14,815 7,195 Valuation allowance (14,011 ) (6,578 ) 804 617 Deferred tax liabilities Capitalized software development costs (804 ) (380 ) Investment tax credits used or refunded — (237 ) Total deferred tax liabilities (804 ) (617 ) Net deferred tax asset — — |
Schedule of Expiration Dates of Investment Tax Credits | As of December 31, 2015 and 2014 , the Company had unused non-capital tax losses of approximately $14,264 and $13,475 respectively, a SR&ED expenditure pool totaling $6,364 and $3,673 respectively, and investment tax credits of $1,486 and $532 respectively, that are due to expire as follows. SR&ED Investment Non-Capital 2031 — 45 — 2032 — 117 13 2033 — 232 11,235 2034 — 197 825 2035 — 895 2,191 Indefinite 6,364 — — 6,364 1,486 14,264 |
Summary of Operating Loss Carryforwards | As of December 31, 2015 and 2014 , the Company had unused non-capital tax losses of approximately $14,264 and $13,475 respectively, a SR&ED expenditure pool totaling $6,364 and $3,673 respectively, and investment tax credits of $1,486 and $532 respectively, that are due to expire as follows. SR&ED Investment Non-Capital 2031 — 45 — 2032 — 117 13 2033 — 232 11,235 2034 — 197 825 2035 — 895 2,191 Indefinite 6,364 — — 6,364 1,486 14,264 |
Supplemental Cash Flow Inform41
Supplemental Cash Flow Information Items (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
Changes in Non-cash Working Capital, Investing, and Financing Items | The following table presents the changes in non-cash working capital items. 2015 2014 2013 Trade and other receivables 1,176 (3,930 ) (1,196 ) Other current assets (4,708) (414) (725) Accounts payable and accrued liabilities 11,097 6,010 2,314 7,565 1,666 393 The following table provides supplemental disclosure of non-cash investing and financing activities. 2015 2014 2013 Acquired property and equipment remaining unpaid 1,295 853 — Acquired intangibles assets remaining unpaid — 250 — Capitalized stock-based compensation 362 79 26 Non-cash acquisitions of businesses — — 404 |
Geographical Information (Table
Geographical Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Revenue by Geographic Location | The following table presents total external revenues by geographic location, based on the location of the Company’s merchants. 2015 2014 2013 Amount % Amount % Amount % Canada 14,691 7.2 % 7,729 7.4 % 4,101 8.2 % United States 144,748 70.5 % 72,149 68.7 % 31,743 63.2 % United Kingdom 15,436 7.5 % 7,912 7.5 % 4,517 9.0 % Australia 10,531 5.1 % 6,420 6.1 % 3,807 7.6 % Rest of World 19,827 9.7 % 10,808 10.3 % 6,084 12.0 % 205,233 100.0 % 105,018 100.0 % 50,252 100.0 % |
Long-lived Assets by Geographic Location | The following table presents the total net book value the Company’s long-lived assets by geographic location. 2015 2014 Amount % Amount % Canada 25,886 78.3 % 17,758 81.7 % United States 7,162 21.7 % 3,970 18.3 % 33,048 100.0 % 21,728 100.0 % |
Nature of Business (Details)
Nature of Business (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
May. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Class of Stock [Line Items] | ||||
Proceeds from initial public offering, net of issuance costs | $ 136,251 | $ 0 | $ 0 | |
Class A Subordinate Voting | IPO | ||||
Class of Stock [Line Items] | ||||
Share price (in dollars per share) | $ 17 | |||
Proceeds from initial public offering, net of issuance costs | $ 136,251 | |||
Underwriting discounts and commissions | 10,537 | |||
Other offering expenses | $ 3,747 | |||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Issuance of stock (in shares) | 8,855,000 | |||
Shares issued upon conversion of convertible preferred stock | 27,159,277 | |||
Common Stock | Class A Subordinate Voting | IPO | ||||
Class of Stock [Line Items] | ||||
Issuance of stock (in shares) | 8,855,000 | |||
Common Stock | Class A Subordinate Voting | Over-Allotment Option | ||||
Class of Stock [Line Items] | ||||
Issuance of stock (in shares) | 1,155,000 | |||
Common Stock | Class B Multiple Voting | IPO | ||||
Class of Stock [Line Items] | ||||
Shares issued upon redesignation of common stock | 39,780,952 | |||
Shares issued upon conversion of convertible preferred stock | 27,159,277 |
Basis of Presentation and Con44
Basis of Presentation and Consolidation (Details) | Feb. 19, 2015subsidiary |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of inactive shell subsidiaries dissolved | 2 |
Significant Accounting Polici45
Significant Accounting Policies - Segment Information (Details) | 12 Months Ended |
Dec. 31, 2015segment | |
Accounting Policies [Abstract] | |
Number of operating segments | 1 |
Number of reportable segments | 1 |
Significant Accounting Polici46
Significant Accounting Policies - Software Development Costs (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Software development costs | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life | 3 years |
Significant Accounting Polici47
Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accounting Policies [Abstract] | |||
Advertising costs | $ 45,445 | $ 31,093 | $ 14,447 |
Significant Accounting Polici48
Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Computer equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Office furniture and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 4 years |
Leasehold improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Leasehold improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 13 years |
Significant Accounting Polici49
Significant Accounting Policies - Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Purchased software | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life | 3 years |
Other Intangible Assets | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life | 3 years |
Software development costs | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life | 3 years |
Significant Accounting Polici50
Significant Accounting Policies - Goodwill (Details) | 12 Months Ended |
Dec. 31, 2015reporting_unit | |
Accounting Policies [Abstract] | |
Number of reporting units | 1 |
Cash and Cash Equivalents (Deta
Cash and Cash Equivalents (Details) CAD in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2015CAD | Dec. 31, 2014CAD | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | |
Cash and Cash Equivalents [Line Items] | ||||||
Cash and cash equivalents | $ 110,070 | $ 41,953 | $ 83,529 | $ 17,655 | ||
Restricted cash | CAD | CAD 1,000 | CAD 1,050 | ||||
Money Market Funds and Term Deposits | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash and cash equivalents | $ 80,914 | $ 36,065 | ||||
Money Market Funds and Term Deposits | Minimum | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Interest rates | 0.01% | 0.01% | ||||
Money Market Funds and Term Deposits | Maximum | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Interest rates | 1.00% | 1.00% |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | $ 0 | $ 7 |
Foreign exchange forward contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 7 | |
U.S. federal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 35,970 | 5,502 |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 44,028 | 12,207 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 59,655 | 31,271 |
Canadian guaranteed investment certificates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,294 | |
U.S. term deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 21,259 | 3,500 |
Level 1 $ | Foreign exchange forward contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | |
Level 1 $ | U.S. federal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 35,970 | 5,502 |
Level 1 $ | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Level 1 $ | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 59,655 | 31,271 |
Level 1 $ | Canadian guaranteed investment certificates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,294 | |
Level 1 $ | U.S. term deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 21,259 | 3,500 |
Level 2 $ | Foreign exchange forward contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 7 | |
Level 2 $ | U.S. federal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Level 2 $ | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 44,028 | 12,207 |
Level 2 $ | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level 2 $ | Canadian guaranteed investment certificates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | |
Level 2 $ | U.S. term deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level 3 $ | Foreign exchange forward contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | |
Level 3 $ | U.S. federal bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Level 3 $ | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Level 3 $ | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Level 3 $ | Canadian guaranteed investment certificates | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | |
Level 3 $ | U.S. term deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 0 | $ 0 |
Trade and Other Receivables (De
Trade and Other Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | $ 6,089 | $ 7,227 |
Trade receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | 1,701 | 838 |
Leasehold incentives receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | 1,554 | 3,158 |
Unbilled revenues | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | 1,075 | 704 |
Refundable tax credits | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | 754 | 1,959 |
Sales tax receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | 572 | 499 |
Other receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade and other receivables | $ 433 | $ 69 |
Other Current Assets (Details)
Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 3,264 | $ 1,023 |
POS hardware | 1,550 | 290 |
Deposits | 1,389 | 175 |
Foreign exchange forward contracts | 0 | 7 |
Other current assets | $ 6,203 | $ 1,495 |
Other Current Assets - Narrativ
Other Current Assets - Narrative (Details) CAD in Thousands | 12 Months Ended | ||||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2014CAD | Dec. 31, 2014USD ($) | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Foreign exchange forward contracts | $ 0 | $ 7,000 | |||
Foreign Exchange Forward Contracts | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Foreign exchange forward contracts | 7,000 | ||||
Not Designated as Hedging Instrument | Foreign Exchange Forward Contracts | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Conversion amount | CAD 6,974 | 6,000,000 | |||
Foreign exchange forward contracts | $ 7,000 | ||||
Foreign exchange loss | $ 0 | $ 368,000 | $ 489,000 | ||
Minimum | Not Designated as Hedging Instrument | Foreign Exchange Forward Contracts | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Exchange rate | 1.1618 | 1.1618 | |||
Maximum | Not Designated as Hedging Instrument | Foreign Exchange Forward Contracts | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Exchange rate | 1.1630 | 1.1630 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Cost | $ 41,833 | $ 24,866 | |
Accumulated depreciation | 8,785 | 3,138 | |
Net book value | 33,048 | 21,728 | |
Depreciation | 5,725 | 3,998 | $ 1,480 |
Cost of revenues | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation | 3,086 | 1,599 | 572 |
Sales and marketing | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation | 1,040 | 795 | 344 |
Research and development | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation | 1,191 | 1,253 | 466 |
General and administrative | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation | 408 | 351 | $ 98 |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 23,225 | 15,014 | |
Accumulated depreciation | 2,057 | 352 | |
Net book value | 21,168 | 14,662 | |
Computer equipment | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 14,508 | 7,346 | |
Accumulated depreciation | 5,630 | 2,415 | |
Net book value | 8,878 | 4,931 | |
Office furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 4,100 | 2,506 | |
Accumulated depreciation | 1,098 | 371 | |
Net book value | $ 3,002 | $ 2,135 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets [Line Items] | |||
Cost | $ 8,446 | $ 3,821 | |
Accumulated amortization | 2,620 | 1,113 | |
Net book value | 5,826 | 2,708 | |
Amortization expense | 1,511 | 674 | $ 278 |
Software development costs | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 4,238 | 1,925 | |
Accumulated amortization | 1,143 | 445 | |
Net book value | 3,095 | 1,480 | |
Intangible assets acquired | 2,313 | 1,269 | 656 |
Amortization expense | 698 | 330 | $ 115 |
Purchased software | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 3,668 | 1,806 | |
Accumulated amortization | 1,242 | 588 | |
Net book value | 2,426 | 1,218 | |
Domain names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 540 | 90 | |
Accumulated amortization | 235 | 80 | |
Net book value | $ 305 | $ 10 |
Intangible Assets - Classificat
Intangible Assets - Classification of Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 1,511 | $ 674 | $ 278 |
Cost of revenues | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | 750 | 608 | 240 |
Sales and marketing | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | 186 | 33 | 32 |
Research and development | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | 465 | 20 | 5 |
General and administrative | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 110 | $ 13 | $ 1 |
Intangible Assets - Future Amor
Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,016 | $ 2,288 | |
2,017 | 2,215 | |
2,018 | 1,192 | |
2,019 | 131 | |
Net book value | $ 5,826 | $ 2,708 |
Accounts Payable and Accrued 60
Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Payables and Accruals [Abstract] | ||
Trade accounts payable and trade accruals | $ 18,453 | $ 8,186 |
Other payables and accrued liabilities | 1,697 | 1,607 |
Accrued payroll taxes related to exercised stock options | 1,584 | 0 |
Employee related accruals | 1,150 | 539 |
Accrued sales tax | 805 | 2,182 |
Accounts payable and accrued liabilities | $ 23,689 | $ 12,514 |
Lease Incentives (Details)
Lease Incentives (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Leased Assets [Line Items] | ||
Lease incentives | $ 11,177 | $ 7,536 |
Other lease liabilities | 142 | 242 |
Total lease incentives | 11,319 | 7,778 |
Less: current portion | 822 | 485 |
Long-term portion | $ 10,497 | $ 7,293 |
Ottawa Office | ||
Operating Leased Assets [Line Items] | ||
Lease term | 12 years 10 months | |
Lease renewal term | 5 years |
Credit Facilities (Details)
Credit Facilities (Details) - Line of Credit | 1 Months Ended | 12 Months Ended | |||
Mar. 31, 2015USD ($) | Dec. 31, 2011CAD | Dec. 31, 2015CAD | Dec. 31, 2015USD ($) | Dec. 31, 2014 | |
Revolving Line of Credit | Royal Bank of Canada | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | CAD 1,500,000 | ||||
Effective interest rate (as a percent) | 3.00% | 3.00% | 3.30% | ||
Line of credit facility, amount drawn | CAD 0 | ||||
Revolving Line of Credit | Royal Bank of Canada | Bank of Canada Prime Rate | |||||
Line of Credit Facility [Line Items] | |||||
Interest rate basis spread | 0.30% | ||||
Revolving Line of Credit | Silicon Valley Bank | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ | $ 25,000,000 | ||||
Effective interest rate (as a percent) | 3.25% | 3.25% | |||
Line of credit facility, amount drawn | $ | $ 0 | ||||
Revolving Line of Credit | Silicon Valley Bank | U.S. Prime Rate | |||||
Line of Credit Facility [Line Items] | |||||
Interest rate basis spread | 25.00% | ||||
Letter of Credit | Royal Bank of Canada | |||||
Line of Credit Facility [Line Items] | |||||
Amount pledged as collateral | CAD 1,000,000 |
Commitments and Contingencies63
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $ 6,446 | $ 4,547 | $ 1,178 |
Minimum Future Annual Rental Payments Under Non-cancellable Operating Leases | |||
2,016 | 5,804 | ||
2,017 | 7,809 | ||
2,018 | 7,907 | ||
2,019 | 7,958 | ||
2,020 | 8,070 | ||
Thereafter | 42,594 | ||
Total future minimum lease payments | $ 80,142 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) | 1 Months Ended | 12 Months Ended |
May. 31, 2015shares | Dec. 31, 2015voteshares | |
Class A Subordinate Voting | ||
Class of Stock [Line Items] | ||
Voting rights (in votes per share) | vote | 1 | |
Class B Multiple Voting | ||
Class of Stock [Line Items] | ||
Shares issued upon redesignation of common stock | 39,780,952 | |
Voting rights (in votes per share) | vote | 10 | |
Voting shares convertible (per share) | 1 | |
Common Stock | ||
Class of Stock [Line Items] | ||
Shares issued upon conversion of convertible preferred stock | 27,159,277 | |
Common Stock | IPO | Class B Multiple Voting | ||
Class of Stock [Line Items] | ||
Shares issued upon conversion of convertible preferred stock | 27,159,277 |
Shareholders' Equity - Stock-Ba
Shareholders' Equity - Stock-Based Compensation Narrative (Details) - shares | May. 27, 2015 | Dec. 31, 2013 | Apr. 30, 2013 | Oct. 31, 2010 | Dec. 31, 2015 | Jan. 01, 2016 | Apr. 30, 2015 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Options outstanding (in shares) | 12,737,893 | 11,204,026 | 15,031,388 | |||||
Restricted Share Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Units granted (in shares) | 503,701 | |||||||
Stock Option Plan and LTIP | Class A Subordinate Voting | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares reserved for issuance | 3,743,692 | |||||||
Shares reserved for issuance, percentage of annual increase | 5.00% | |||||||
Stock Option Plan | Stock options | Class A Subordinate Voting | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Trading days used to calculate volume weighted average trading price | 5 days | |||||||
LTIP | Class A Subordinate Voting | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares receivable per LTIP unit | 1 | |||||||
LTIP | PSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Units granted (in shares) | 0 | |||||||
LTIP | DSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Units granted (in shares) | 0 | |||||||
Legacy Option Plan | Employee and Nonemployee Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 4 years | |||||||
Award vesting amount (as a percent) | 2.08% | |||||||
Vesting commencement period, following employment or engagement start date | 3 months | |||||||
Options outstanding (in shares) | 14,982,341 | |||||||
Award expiration period | 10 years | |||||||
Tranche One | LTIP | Restricted Share Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting amount (as a percent) | 33.33% | |||||||
Tranche One | Legacy Option Plan | Employee and Nonemployee Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 1 year | |||||||
Award vesting amount (as a percent) | 25.00% | |||||||
Tranche Two | LTIP | Restricted Share Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting amount (as a percent) | 33.33% | |||||||
Tranche Two | Legacy Option Plan | Employee and Nonemployee Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting amount (as a percent) | 2.08% | |||||||
Tranche Three | LTIP | Restricted Share Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting amount (as a percent) | 33.33% | |||||||
Subsequent Event | Stock Option Plan and LTIP | Class A Subordinate Voting | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares reserved for issuance | 6,786,124 |
Shareholders' Equity - Stock Op
Shareholders' Equity - Stock Option and RSU Award Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Options outstanding (in shares) | 15,031,388 | 12,737,893 | |||
Stock options granted (in shares) | 1,259,025 | 2,985,495 | |||
Stock options exercised (in shares) | (4,665,059) | (305,649) | |||
Stock options forfeited (in shares) | (421,328) | (386,351) | |||
Options outstanding, ending balance (in shares) | 11,204,026 | 15,031,388 | 12,737,893 | ||
Stock options exercisable | 6,902,359 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||||
Options outstanding, beginning balance, weighted average exercise price (in dollars per share) | $ 1.31 | $ 0.38 | |||
Stock options granted, weighted average exercise price (in dollars per share) | 22.16 | 5.28 | |||
Stock options exercised, weighted average exercise price (in dollars per share) | 0.34 | 0.46 | |||
Stock options forfeited, weighted average exercise price (in dollars per share) | 12.04 | 1.40 | |||
Options outstanding, ending balance, weighted average exercise price (in dollars per share) | $ 1.31 | $ 0.38 | $ 0.38 | $ 3.65 | $ 1.31 |
Stock options exercisable, weighted average exercise price (in dollars per share) | $ 0.82 | ||||
Stock options outstanding, remaining contractual term | 6 years 11 months 27 days | 7 years 1 month 28 days | |||
Stock options exercisable, remaining contractual term | 6 years 11 days | ||||
Stock options outstanding, aggregate intrinsic value | $ 0 | $ 248,119 | $ 73,642 | ||
Stock options exercisable, aggregate intrinsic value | 172,415 | ||||
Stock options granted, weighted average grant date fair value | $ 12.16 | $ 5.63 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||||
Remaining unamortized compensation cost related to unvested stock options | $ 34,572 | $ 16,574 | |||
Remaining unamortized compensation cost related to unvested stock options, period of recognition | 3 years 2 months 19 days | ||||
Restricted Share Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |||||
RSUs outstanding, beginning balance (in shares) | 0 | 0 | |||
RSUs granted | 503,701 | ||||
RSUs forfeited | (75,135) | ||||
RSUs outstanding, ending balance (in shares) | 428,566 | 0 | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||||
RSUs outstanding, beginning balance, average grant date fair value | $ 0 | $ 0 | |||
RSUs granted, average grant date fair value | 32.01 | ||||
RSUs forfeited/cancelled, average grant date fair value | 30.95 | ||||
RSUs outstanding, ending balance, average grant date fair value | $ 32.19 | $ 0 | $ 0 | ||
Class A Subordinate Voting | Stock Option Plan | Stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Stock options exercisable | 684,125 | ||||
Class B Multiple Voting | Legacy Option Plan | Stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Stock options exercisable | 10,519,901 |
Shareholders' Equity - Fair Val
Shareholders' Equity - Fair Value Assumptions of Stock Options (Details) - Stock options | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 64.30% | 62.40% | 73.90% |
Risk free interest rate | 1.62% | 1.82% | 1.67% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Average expected life | 5 years 3 months 4 days | 5 years 8 months 23 days | 6 years 22 days |
Shareholders' Equity - Classifi
Shareholders' Equity - Classification of Stock-based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 8,158 | $ 4,443 | $ 1,766 |
Cost of revenues | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 282 | 259 | 113 |
Sales and marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 1,099 | 696 | 354 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 4,509 | 2,776 | 1,152 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 2,268 | $ 712 | $ 147 |
Earnings per Share (Details)
Earnings per Share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share [Abstract] | |||
Basic and diluted weighted average number of shares outstanding (in shares) | 61,716,065 | 38,940,252 | 37,248,710 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average number of shares outstanding (in shares) | 11,680,830 | 42,338,979 | 40,487,160 |
Stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average number of shares outstanding (in shares) | 11,204,026 | 15,031,388 | 12,737,893 |
Restricted share units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average number of shares outstanding (in shares) | 428,566 | 0 | 0 |
Restricted shares | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average number of shares outstanding (in shares) | 48,238 | 148,314 | 589,990 |
Convertible preferred shares | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive shares excluded from diluted weighted average number of shares outstanding (in shares) | 0 | 27,159,277 | 27,159,277 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Tax Recovery/Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
Earnings (loss) before income taxes | $ (18,790) | $ (22,311) | $ (4,837) |
Expected income tax expense (recovery) at Canadian statutory income tax rate of 26.51% (2014-26.51%) | (4,980) | (5,915) | (1,282) |
Permanent differences | 1,333 | 1,203 | 435 |
Share issuance costs | (3,734) | 0 | 0 |
Effect of change in tax rates | 0 | 0 | (163) |
Utilization of tax credits | 0 | 0 | (93) |
Other | (8) | (43) | 0 |
Foreign rate differential | (44) | (3) | (2) |
Increase (decrease) in valuation allowance | 7,433 | 4,758 | 1,105 |
Provision for income tax (recovery) expense | 0 | 0 | 0 |
Foreign income (loss) | $ 234 | $ 14 | $ (14) |
Canada Revenue Agency | |||
Operating Loss Carryforwards [Line Items] | |||
Canadian statutory income tax rate | 26.51% | 26.51% |
Income Taxes - Tax Assets and L
Income Taxes - Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets | ||
Temporary differences on capital and intangible assets | $ 415 | $ 606 |
Tax loss carryforwards | 3,799 | 3,415 |
SR&ED expenditure carryforwards | 1,687 | 974 |
Share issue costs | 3,345 | 39 |
Investment tax credits | 1,253 | 497 |
Lease accruals and other provisions | 4,316 | 1,664 |
Total deferred tax assets | 14,815 | 7,195 |
Valuation allowance | (14,011) | (6,578) |
Total deferred tax asset | 804 | 617 |
Deferred tax liabilities | ||
Capitalized software development costs | (804) | (380) |
Investment tax credits used or refunded | 0 | (237) |
Total deferred tax liabilities | (804) | (617) |
Net deferred tax asset | $ 0 | $ 0 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | $ 14,264 | $ 13,475 |
SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 6,364 | 3,673 |
Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 1,486 | $ 532 |
2031 Expiration | ||
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | 0 | |
2031 Expiration | SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 0 | |
2031 Expiration | Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 45 | |
2032 Expiration | ||
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | 13 | |
2032 Expiration | SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 0 | |
2032 Expiration | Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 117 | |
2033 Expiration | ||
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | 11,235 | |
2033 Expiration | SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 0 | |
2033 Expiration | Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 232 | |
2034 Expiration | ||
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | 825 | |
2034 Expiration | SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 0 | |
2034 Expiration | Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 197 | |
2035 Expiration | ||
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | 2,191 | |
2035 Expiration | SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 0 | |
2035 Expiration | Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 895 | |
Indefinite | ||
Tax Credit Carryforward [Line Items] | ||
Non-capital tax losses | 0 | |
Indefinite | SR&ED Expenditures | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | 6,364 | |
Indefinite | Investment Tax Credits | ||
Tax Credit Carryforward [Line Items] | ||
Tax credits | $ 0 |
Supplemental Cash Flow Inform73
Supplemental Cash Flow Information Items - Changes in Non-cash Working Capital (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Supplemental Cash Flow Elements [Abstract] | |||
Trade and other receivables | $ 1,176 | $ (3,930) | $ (1,196) |
Other current assets | (4,708) | (414) | (725) |
Accounts payable and accrued liabilities | 11,097 | 6,010 | 2,314 |
Change in non-cash working capital items | $ 7,565 | $ 1,666 | $ 393 |
Supplemental Cash Flow Inform74
Supplemental Cash Flow Information Items - Changes in Non-cash Investing and Financing Activities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Supplemental Cash Flow Elements [Abstract] | |||
Acquired property and equipment remaining unpaid | $ 1,295 | $ 853 | $ 0 |
Acquired intangibles assets remaining unpaid | 0 | 250 | 0 |
Capitalized stock-based compensation | 362 | 79 | 26 |
Non-cash acquisitions of businesses | $ 0 | $ 0 | $ 404 |
Geographical Information - Reve
Geographical Information - Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 205,233 | $ 105,018 | $ 50,252 |
Geographic Concentration Risk | Sales Revenue, Net | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 205,233 | $ 105,018 | $ 50,252 |
Revenues (as a percent) | 100.00% | 100.00% | 100.00% |
Geographic Concentration Risk | Sales Revenue, Net | Canada | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 14,691 | $ 7,729 | $ 4,101 |
Revenues (as a percent) | 7.20% | 7.40% | 8.20% |
Geographic Concentration Risk | Sales Revenue, Net | United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 144,748 | $ 72,149 | $ 31,743 |
Revenues (as a percent) | 70.50% | 68.70% | 63.20% |
Geographic Concentration Risk | Sales Revenue, Net | United Kingdom | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 15,436 | $ 7,912 | $ 4,517 |
Revenues (as a percent) | 7.50% | 7.50% | 9.00% |
Geographic Concentration Risk | Sales Revenue, Net | Australia | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 10,531 | $ 6,420 | $ 3,807 |
Revenues (as a percent) | 5.10% | 6.10% | 7.60% |
Geographic Concentration Risk | Sales Revenue, Net | Rest of World | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 19,827 | $ 10,808 | $ 6,084 |
Revenues (as a percent) | 9.70% | 10.30% | 12.00% |
Geographical Information - Long
Geographical Information - Long-lived Assets (Details) - Geographic Concentration Risk - Net Assets, Geographic Area - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 33,048 | $ 21,728 |
Long-lived assets (as a percent) | 100.00% | 100.00% |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 25,886 | $ 17,758 |
Long-lived assets (as a percent) | 78.30% | 81.70% |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 7,162 | $ 3,970 |
Long-lived assets (as a percent) | 21.70% | 18.30% |
Acquisitions (Details)
Acquisitions (Details) - Jet Cooper Ltd. and Atatomic Inc. $ in Thousands | Jul. 31, 2013USD ($)companyshares |
Business Acquisition [Line Items] | |
Percentage of company acquired | 100.00% |
Number of companies acquired | company | 2 |
Consideration Transferred | |
Total consideration transferred | $ 1,232 |
Cash | $ 828 |
Common stock (in shares) | shares | 96,479 |
Common stock, amount | $ 404 |
Acquisitions - Escrow Agreement
Acquisitions - Escrow Agreement (Details) - Jet Cooper Ltd. and Atatomic Inc. - Sellers' Continued Employment Agreement $ in Thousands | Jul. 31, 2013CADshares | Dec. 31, 2015CADshares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014CADshares | Dec. 31, 2014USD ($)shares | Dec. 31, 2013CADshares | Dec. 31, 2013USD ($)shares |
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Restricted cash transferred to escrow | CAD | CAD 468,000 | ||||||
Restricted cash released from escrow | CAD | CAD 0 | CAD 280,000 | CAD 188,000 | ||||
Restricted shares | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Restricted shares transferred to escrow (in shares) | shares | 289,435 | ||||||
Share vesting period | 3 years | ||||||
Restricted shares released from escrow (in shares) | shares | 82,697 | 82,697 | 118,301 | 118,301 | 40,200 | 40,200 | |
Restricted shares released from escrow, fair value amount | $ | $ 345 | $ 493 | $ 168 |