Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 10, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2022 | |
Entity File Number | 001-41248 | |
Entity Registrant Name | Knightscope, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-2482575 | |
Entity Address State Or Province | CA | |
Entity Address, Address Line One | 1070 Terra Bella Avenue | |
Entity Address, City or Town | Mountain View | |
Entity Address, Postal Zip Code | 94043 | |
City Area Code | 650 | |
Local Phone Number | 924-1025 | |
Title of 12(b) Security | Class A Common Stock, par value $0.001 per share | |
Trading Symbol | KSCP | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 0 | |
Entity Central Index Key | 0001600983 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | ||
Current assets: | ||||
Cash and cash equivalents | $ 15,639 | $ 10,749 | [1] | |
Restricted cash | [1] | 100 | ||
Accounts receivable (net of allowance for doubtful accounts $147 as of June 30, 2022 and $250 as of December 31, 2021) | 1,637 | 1,189 | [1] | |
Prepaid expenses and other current assets | 1,255 | 1,299 | [1] | |
Total current assets | 18,531 | 13,337 | [1] | |
Non-current assets: | ||||
Autonomous Security Robots, net | 3,959 | 2,971 | [1] | |
Property, equipment and software, net | 172 | 117 | [1] | |
Operating lease right-of-use-assets | 777 | 1,077 | [1] | |
Other assets | 78 | 78 | [1] | |
Total assets | 23,517 | 17,580 | [1] | |
Current liabilities: | ||||
Accounts payable | 1,237 | 1,514 | [1] | |
Accrued expenses | 585 | 1,191 | [1] | |
Deferred revenue | 1,544 | 889 | [1] | |
Debt obligations | [1] | 7,109 | ||
Operating lease liabilities | 696 | 648 | [1] | |
Other current liabilities | 1,237 | 893 | [1] | |
Total current liabilities | 5,299 | 12,244 | [1] | |
Non-current liabilities: | ||||
Preferred stock warrant liabilities | 14,549 | 30,566 | [1] | |
Operating lease liabilities | 125 | 485 | [1] | |
Total liabilities | 19,973 | 43,295 | [1] | |
Commitments and contingencies (Note 8) | [1] | |||
Preferred stock, $0.001 par value; 43,405,324 shares authorized as of June 30, 2022 and December 31, 2021; 11,666,296 and 19,617,107 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively; aggregate liquidation preference of $38,671 as of June 30, 2022 | 36,620 | 57,218 | [1] | |
Stockholders' deficit: | ||||
Additional paid-in capital | 89,314 | 30,745 | [1] | |
Accumulated deficit | (122,426) | (113,697) | [1] | |
Total stockholders' deficit | (33,076) | (82,933) | [1] | |
Total liabilities, preferred stock and stockholders' deficit | 23,517 | 17,580 | [1] | |
Class A common stock | ||||
Stockholders' deficit: | ||||
Common stock | 26 | 6 | [1] | |
Class B Common Stock | ||||
Stockholders' deficit: | ||||
Common stock | $ 10 | $ 13 | [1] | |
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Net of allowance for doubtful accounts | $ 147 | $ 250 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 43,405,324 | 43,405,324 |
Preferred stock, shares issued | 11,666,296 | 19,617,107 |
Preferred stock, shares outstanding | 11,666,296 | 19,617,107 |
Preferred stock, aggregate liquidation preference | $ 38,671 | |
Class A common stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 114,000,000 | 114,000,000 |
Common stock, shares issued | 26,085,487 | 5,936,929 |
Common stock, Share outstanding | 26,085,487 | 5,936,929 |
Class B Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 10,362,170 | 13,131,197 |
Common stock, Share outstanding | 10,362,170 | 13,131,197 |
Condensed Statements of Operati
Condensed Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Condensed Statements of Operations | ||||
Revenue, net | $ 1,042 | $ 912 | $ 1,985 | $ 1,778 |
Cost of revenue, net | 1,732 | 1,335 | 3,225 | 2,518 |
Gross loss | (690) | (423) | (1,240) | (740) |
Operating expenses: | ||||
Research and development | 2,075 | 1,528 | 3,913 | 2,655 |
Sales and marketing | 1,509 | 3,562 | 4,998 | 6,631 |
General and administrative | 2,960 | 1,120 | 5,286 | 1,665 |
Total operating expenses | 6,544 | 6,210 | 14,197 | 10,951 |
Loss from operations | (7,234) | (6,633) | (15,437) | (11,691) |
Other income (expense): | ||||
Change in fair value of warrant liabilities | 8,125 | (10,737) | 15,647 | (10,737) |
Interest income (expense), net | 1 | (594) | (8,910) | (1,133) |
Other income (expense), net | (24) | 801 | (29) | 821 |
Total other income (expense) | 8,102 | (10,530) | 6,708 | (11,049) |
Net income (loss) before income tax expense | 868 | (17,163) | (8,729) | (22,740) |
Net income (loss) | 868 | (17,163) | (8,729) | (22,740) |
Preferred stock dividends | (184) | (359) | ||
Net income (loss) attributable to common stockholders | $ 868 | $ (17,347) | $ (8,729) | $ (23,099) |
Basic net income (loss) per common share | $ 0.02 | $ (1.70) | $ (0.26) | $ (2.27) |
Diluted net income (loss) per common share | $ 0.02 | $ (1.70) | $ (0.26) | $ (2.27) |
Weighted average shares used to compute basic net loss per share | 35,730,648 | 10,189,000 | 33,727,858 | 10,189,000 |
Weighted average shares used to compute diluted net loss per share | 49,675,996 | 10,189,000 | 33,727,858 | 10,189,000 |
Condensed Statements of Stockho
Condensed Statements of Stockholders' Deficit - USD ($) $ in Thousands | Preferred Stock Series m Preferred Stock | Preferred Stock Series m-1 Preferred Stock | Preferred Stock Series m-2 Preferred Stock | Preferred Stock Series m-3 Preferred Stock | Preferred Stock Series m-4 Preferred Stock | Preferred Stock Series S Preferred Stock | Preferred Stock Series A Preferred Stock | Preferred Stock Series B Preferred Stock | Common Stock Class A common stock | Common Stock Class B Common Stock | Additional Paid-in-capital | Accumulative Deficit | Total | |
Balance at the beginning at Dec. 31, 2020 | $ 13,866 | $ 4,982 | $ 46 | $ 5,826 | $ 27,135 | $ 3,865 | $ 9,442 | |||||||
Balance at the beginning (in shares) at Dec. 31, 2020 | 5,339,215 | 1,660,756 | 16,757 | 1,432,786 | 3,731,248 | 8,936,015 | 4,653,583 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Issuance of Series S Preferred stock, net of issuance costs | $ 16,387 | |||||||||||||
Issuance of Series S Preferred stock, net of issuance costs (in shares) | 1,835,923 | |||||||||||||
Series m-4 accrued dividend | $ 359 | $ (359) | $ (359) | |||||||||||
Balance at the end at Jun. 30, 2021 | $ 13,866 | $ 4,982 | $ 46 | $ 6,185 | $ 43,522 | $ 3,865 | $ 9,442 | |||||||
Balance at the end (in shares) at Jun. 30, 2021 | 5,339,215 | 1,660,756 | 1,660,756 | 16,757 | 1,432,786 | 5,567,171 | 8,936,015 | 4,653,583 | ||||||
Balance at the beginning at Dec. 31, 2020 | $ 10 | $ 3,051 | (69,246) | (66,185) | ||||||||||
Balance at the beginning (in shares) at Dec. 31, 2020 | 10,189,000 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock based compensation | 458 | 458 | ||||||||||||
Warrants expired | 14 | 14 | ||||||||||||
Net income (loss) | (22,740) | (22,740) | ||||||||||||
Balance at the end at Jun. 30, 2021 | $ 10 | 3,523 | (92,345) | $ (88,812) | ||||||||||
Balance at the end (in shares) at Jun. 30, 2021 | 10,189,000 | |||||||||||||
Balance at the beginning at Dec. 31, 2020 | $ 13,866 | $ 4,982 | $ 46 | $ 5,826 | $ 27,135 | $ 3,865 | $ 9,442 | |||||||
Balance at the beginning (in shares) at Dec. 31, 2020 | 5,339,215 | 1,660,756 | 16,757 | 1,432,786 | 3,731,248 | 8,936,015 | 4,653,583 | |||||||
Balance at the end at Dec. 31, 2021 | $ 11,881 | $ 1,319 | $ 3,755 | $ 46 | $ 29,995 | $ 2,663 | $ 7,559 | |||||||
Balance at the end (in shares) at Dec. 31, 2021 | 4,574,917 | 186,872 | 1,251,666 | 16,757 | 3,705,239 | 6,155,564 | 3,726,092 | 19,617,107 | ||||||
Balance at the beginning at Dec. 31, 2020 | $ 10 | 3,051 | (69,246) | $ (66,185) | ||||||||||
Balance at the beginning (in shares) at Dec. 31, 2020 | 10,189,000 | |||||||||||||
Balance at the end at Dec. 31, 2021 | $ 6 | $ 13 | 30,745 | (113,697) | (82,933) | [1] | ||||||||
Balance at the end (in shares) at Dec. 31, 2021 | 5,936,929 | 13,131,197 | ||||||||||||
Balance at the beginning at Mar. 31, 2021 | $ 13,866 | $ 4,982 | $ 46 | $ 6,001 | $ 33,558 | $ 3,865 | $ 9,442 | |||||||
Balance at the beginning (in shares) at Mar. 31, 2021 | 5,339,215 | 1,660,756 | 16,757 | 1,432,786 | 4,445,352 | 8,936,015 | 4,653,583 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Issuance of Series S Preferred stock, net of issuance costs | $ 9,964 | |||||||||||||
Issuance of Series S Preferred stock, net of issuance costs (in shares) | 1,121,819 | |||||||||||||
Series m-4 accrued dividend | $ 184 | (184) | (184) | |||||||||||
Balance at the end at Jun. 30, 2021 | $ 13,866 | $ 4,982 | $ 46 | $ 6,185 | $ 43,522 | $ 3,865 | $ 9,442 | |||||||
Balance at the end (in shares) at Jun. 30, 2021 | 5,339,215 | 1,660,756 | 1,660,756 | 16,757 | 1,432,786 | 5,567,171 | 8,936,015 | 4,653,583 | ||||||
Balance at the beginning at Mar. 31, 2021 | $ 10 | 3,282 | (74,998) | (71,706) | ||||||||||
Balance at the beginning (in shares) at Mar. 31, 2021 | 10,189,000 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock based compensation | 227 | 227 | ||||||||||||
Warrants expired | 14 | 14 | ||||||||||||
Net income (loss) | (17,163) | (17,163) | ||||||||||||
Balance at the end at Jun. 30, 2021 | $ 10 | 3,523 | (92,345) | $ (88,812) | ||||||||||
Balance at the end (in shares) at Jun. 30, 2021 | 10,189,000 | |||||||||||||
Balance at the beginning at Dec. 31, 2021 | $ 11,881 | $ 1,319 | $ 3,755 | $ 46 | $ 29,995 | $ 2,663 | $ 7,559 | |||||||
Balance at the beginning (in shares) at Dec. 31, 2021 | 4,574,917 | 186,872 | 1,251,666 | 16,757 | 3,705,239 | 6,155,564 | 3,726,092 | 19,617,107 | ||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Share conversion to common stock | $ (6,864) | $ (1,319) | $ (3,275) | $ (46) | $ (7,463) | $ (1,257) | $ (374) | $ 11 | $ (3) | 20,590 | $ 20,598 | |||
Share conversion to common stock (in shares) | (2,642,896) | (186,872) | (1,091,666) | (16,757) | (921,835) | (2,906,460) | (184,325) | 10,919,703 | (2,794,027) | |||||
Balance at the end at Jun. 30, 2022 | $ 5,017 | $ 480 | $ 22,532 | $ 1,406 | $ 7,185 | |||||||||
Balance at the end (in shares) at Jun. 30, 2022 | 1,932,021 | 160,000 | 2,783,404 | 3,249,104 | 3,541,767 | 11,666,296 | ||||||||
Balance at the beginning at Dec. 31, 2021 | $ 6 | $ 13 | 30,745 | (113,697) | $ (82,933) | [1] | ||||||||
Balance at the beginning (in shares) at Dec. 31, 2021 | 5,936,929 | 13,131,197 | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock based compensation | 1,452 | 1,452 | ||||||||||||
Warrants expired | 370 | |||||||||||||
Warrants Exercised | 370 | |||||||||||||
Warrants Exercised (in shares) | 156,483 | |||||||||||||
Conversion of debt obligations to class A common stock | $ 7 | 16,004 | 16,011 | |||||||||||
Conversion of debt obligations to class A common stock (in shares) | 6,513,385 | |||||||||||||
Stock options exercised | 202 | 202 | ||||||||||||
Stock options exercised (in shares) | 127,746 | 25,000 | ||||||||||||
Offering proceeds, net of issuance costs | $ 2 | 19,623 | 19,625 | |||||||||||
Offering proceeds, net of issuance costs (shares) | 2,236,619,000 | |||||||||||||
Number of shares issued | 378 | 378 | ||||||||||||
Proceeds from equity sale, net of issuance costs (in shares) | 194,622,000 | |||||||||||||
Share conversion costs | (50) | (50) | ||||||||||||
Net income (loss) | (8,729) | (8,729) | ||||||||||||
Balance at the end at Jun. 30, 2022 | $ 5,017 | $ 480 | $ 22,532 | $ 1,406 | $ 7,185 | $ 26 | $ 10 | 89,314 | (122,426) | (33,076) | ||||
Balance at the end (in shares) at Jun. 30, 2022 | 1,932,021 | 160,000 | 2,783,404 | 3,249,104 | 3,541,767 | 26,085,487 | 10,362,170 | |||||||
Balance at the beginning at Mar. 31, 2022 | $ 5,292 | $ 2,480 | $ 23,118 | $ 1,864 | $ 7,217 | |||||||||
Balance at the beginning (in shares) at Mar. 31, 2022 | 2,037,910 | 826,666 | 2,855,743 | 4,308,812 | 3,557,371 | |||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||
Share conversion to common stock | $ (275) | $ (2,000) | $ (586) | $ (458) | $ (32) | $ 2 | 3,349 | $ 3,351 | ||||||
Share conversion to common stock (in shares) | (105,889) | (666,666) | (72,339) | (1,059,708) | (15,604) | 1,958,303 | (16,081) | |||||||
Balance at the end at Jun. 30, 2022 | $ 5,017 | $ 480 | $ 22,532 | $ 1,406 | $ 7,185 | |||||||||
Balance at the end (in shares) at Jun. 30, 2022 | 1,932,021 | 160,000 | 2,783,404 | 3,249,104 | 3,541,767 | 11,666,296 | ||||||||
Balance at the beginning at Mar. 31, 2022 | $ 24 | $ 10 | 84,586 | (123,294) | $ (38,674) | |||||||||
Balance at the beginning (in shares) at Mar. 31, 2022 | 23,877,817 | 10,378,251 | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Stock based compensation | 727 | 727 | ||||||||||||
Stock options exercised | 105 | $ 105 | ||||||||||||
Stock options exercised (in shares) | 54,745 | 152,746 | ||||||||||||
Offering proceeds, net of issuance costs | 169 | $ 169 | ||||||||||||
Number of shares issued | 378 | 378 | ||||||||||||
Proceeds from equity sale, net of issuance costs (in shares) | 194,622,000 | |||||||||||||
Conversion of convertible debt into common stock | 868 | 868 | ||||||||||||
Net income (loss) | 868 | |||||||||||||
Balance at the end at Jun. 30, 2022 | $ 5,017 | $ 480 | $ 22,532 | $ 1,406 | $ 7,185 | $ 26 | $ 10 | $ 89,314 | $ (122,426) | $ (33,076) | ||||
Balance at the end (in shares) at Jun. 30, 2022 | 1,932,021 | 160,000 | 2,783,404 | 3,249,104 | 3,541,767 | 26,085,487 | 10,362,170 | |||||||
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | |
Cash Flows From Operating Activities | ||
Net loss | $ (8,729) | $ (22,740) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 684 | 759 |
Stock compensation expense | 1,452 | 458 |
Change in fair value of warrant liabilities | (15,647) | 10,737 |
Accrued interest | 24 | |
Amortization of debt discount | 8,878 | 833 |
PPP loan and interest foregiveness | (832) | |
(Gain) loss from damage of autonomous security robots | 5 | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (448) | 114 |
Prepaid expenses and other current assets | 44 | 46 |
Other assets | 142 | |
Accounts payable | (277) | 262 |
Accrued expenses | (606) | (104) |
Deferred revenue | 655 | (204) |
Other current and noncurrent liabilities | 332 | 7 |
Net cash used in operating activities | (13,638) | (10,517) |
Cash Flows From Investing Activities | ||
Purchases and related costs incurred for Autonomous Security Robots | (1,651) | (923) |
Purchase of property and equipment | (76) | (11) |
Net cash used in investing activities | (1,727) | (934) |
Cash Flows From Financing Activities | ||
Proceeds from stock options exercised | 202 | |
Proceeds from issuance of Series S Preferred Stock, net of issuance costs | 16,387 | |
Offering proceeds, net of issuance costs | 19,625 | |
Proceeds from equity sale, net of issuance costs | 378 | |
Share conversion costs | 50 | |
Net cash provided by financing activities | 20,155 | 16,387 |
Net change in cash and cash equivalents and restricted cash | 4,790 | 4,936 |
Cash, cash equivalents and restricted cash at beginning of the period | 10,849 | 7,157 |
Cash, cash equivalents and restricted cash at end of the period | 15,639 | 12,093 |
Supplemental Disclosure of Non-Cash Financing Activities | ||
Conversion of preferred stock to common stock | 20,598 | |
Conversion of debt obligations to Class A common stock | $ 16,011 | |
Series m-4 accrued dividend | 359 | |
PPP Loan and interest foregiveness | $ 832 |
The Company and Summary of Sign
The Company and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
The Company and Summary of Significant Accounting Policies | |
The Company and Summary of Significant Accounting Policies | NOTE 1: The Company and Summary of Significant Accounting Policies Description of Business Knightscope, Inc. (the “Company”), was incorporated on April 4, 2013 under the laws of the State of Delaware. The Company designs, develops, builds, deploys, and supports advanced physical security technologies. The Knightscope solution to reducing crime combines the physical presence of its proprietary Autonomous Security Robots (“ASRs”) with real-time, on-site data collection and analysis coupled with a proprietary user interface. Two of the Company’s ASRs, the outdoor/indoor “K5” and the indoor “K3”, autonomously patrol client sites, without the need for remote control, to provide a visible, force multiplying, physical security presence to help protect assets, monitor changes in the environment, and deter crime. They gather real-time data using a large array of sensors. The data is accessible through the Knightscope Security Operations Center (“KSOC”), an intuitive, browser-based software interface that enables security professionals and law enforcement officers to review events generated, allowing them to have their eyes, ears, and voice on the ground 24/7/365 in multiple locations at the same time. Basis of Presentation and Liquidity The unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the period presented. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for other future periods. These condensed financial statements should be read in conjunction with the Company’s audited financial statements and accompanying notes for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 31, 2022. The Company’s significant accounting policies are described in Note 1 to those audited financial statements. Since its inception, the Company has incurred significant operating losses and negative cash flows from operations which is principally the result of significant research and development activities related to the development and continued improvement of the Company’s ASRs and KSOC (hardware and software) as well as fulfillment of client demand. Cash and cash equivalents on hand were $15.6 million as of June 30, 2022, compared to $10.7 million as of December 31, 2021. The Company has historically incurred losses and negative cashflows from operations. As of June 30, 2022, the Company also had an accumulated deficit of approximately $122.4 million and stockholders’ deficit of $33.1 million. In connection with its listing on the Nasdaq Global Market on January 27, 2022, the Company completed its Regulation A Offering on January 26, 2022, issuing 2,236,619 shares of Class A common stock and generating net proceeds of approximately $19.6 million. Management plans to seek additional financing activities to support its operations, such as issuances of equity, issuances of debt and convertible debt instruments and other financing instruments. To address this plan, on April 4, 2022, the Company entered into a committed equity financing facility with B Riley Principal Capital, LLC (“B Riley Principal Capital”) that provides the Company with the right, without obligation, to issue and sell up to $100 million of its Class A common stock over a period of 24 months (see Note 6 for details). The Company’s projected cash flows are subject to various risks and uncertainties, and the unavailability or inadequacy of financing to meet future capital needs could force it to modify, curtail, delay, or suspend some or all aspects of its planned operations. Sales of additional equity securities, convertible debt and/or warrants by the Company could result in the dilution of the interests of existing stockholders. Basic and Diluted Net Income (Loss) per Share Net income (loss) per share of common stock is computed using the two-class method required for participating securities based on their participation rights. All series of convertible preferred stock are participating securities as the holders are entitled to participate in common stock dividends with common stock on an as converted basis. Holders of Series m-4 Preferred Stock were entitled to receive cumulative dividends payable semi-annually in arrears at the rate per share of Series m-4 Preferred Stock equal to the Dividend Rate for the Series m-4 Preferred Stock, in each case subject to compliance with applicable law. Dividends to holders of Series m-4 Preferred Stock were paid in kind as a dividend of additional shares of Series m-4 Preferred Stock for each Dividend Period on the applicable Dividend Payment Date using a price per share equal to the original issue price, provided that the Company shall not issue any fractional shares of Series m-4 Preferred Stock. The holders of the Company’s preferred stock, other than m-4 preferred stock, are also entitled to noncumulative dividends prior and in preference, to our common stock and do not have a contractual obligation to share in the losses of the Company. During 2021, all shares of Series m-4 Preferred Stock were converted to Class A common stock, leaving no outstanding balance of the Series m-4 Preferred Stock as of June 30, 2022. In accordance with the two-class method, earnings allocated to these participating securities, which include participation rights in undistributed earnings with common stock, are subtracted from net income (loss) to determine net income (loss) attributable to common stockholders upon their occurrence. Basic net income (loss) per share is computed by dividing net income (loss) attributable to common stockholders (net adjusted for preferred stock dividends declared or accumulated) by the weighted average number of common shares outstanding during the period. All participating securities are excluded from basic weighted-average shares outstanding. In computing diluted net income (loss) attributable to common stockholders, undistributed earnings are re-allocated to reflect the potential impact of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing net income (loss) attributable to common stockholders by diluted weighted-average shares outstanding, including potentially dilutive securities, unless anti-dilutive. Potentially dilutive securities that were excluded from the computation of diluted net income (loss) per share for the three months ended June 30, 2022 and 2021 consist of the following: June 30, June 30, 2022 2021 Series A Preferred Stock (convertible to Class B common stock) — 8,936,015 Series B Preferred Stock (convertible to Class B common stock) — 4,653,583 Series m Preferred Stock (convertible to Class A common stock) — 5,339,215 Series m-2 Preferred Stock (convertible to Class B common stock) — 1,660,756 Series m-3 Preferred Stock (convertible to Class A common stock) — 16,757 Series m-4 Preferred Stock (convertible to Class A common stock) — 1,432,786 Series S Preferred Stock (convertible to Class A common stock) — 5,567,171 Warrants to purchase common stock (convertible to Class B common stock) — 121,913 Warrants to purchase Series B (convertible to Class B common stock) — 53,918 Warrants to purchase of Series m-1 (convertible to Class A common stock) — 266,961 Warrants to purchase of Series m-3 (convertible to Class A common stock) 1,432,786 1,432,786 Warrants to purchase of Series s (convertible to Class A common stock) 4,441,814 2,525,714 Convertible Notes — 1,465,306 Stock options 8,267,003 9,019,814 Total potentially dilutive shares 14,141,603 42,492,695 Potentially dilutive securities that were excluded from the computation of diluted net income (loss) per share for the six months ended June 30, 2022 and 2021 consist of the following: June 30, June 30, 2022 2021 Series A Preferred Stock (convertible to Class B common stock) 3,249,104 8,936,015 Series B Preferred Stock (convertible to Class B common stock) 3,541,767 4,653,583 Series m Preferred Stock (convertible to Class A common stock) 1,932,021 5,339,215 Series m-2 Preferred Stock (convertible to Class B common stock) 160,000 1,660,756 Series m-3 Preferred Stock (convertible to Class A common stock) — 16,757 Series m-4 Preferred Stock (convertible to Class A common stock) — 1,432,786 Series S Preferred Stock (convertible to Class A common stock) 2,783,404 5,567,171 Warrants to purchase common stock (convertible to Class B common stock) — 121,913 Warrants to purchase Series B (convertible to Class B common stock) — 53,918 Warrants to purchase of Series m-1 (convertible to Class A common stock) — 266,961 Warrants to purchase of Series m-3 (convertible to Class A common stock) 1,432,786 1,432,786 Warrants to purchase of Series s (convertible to Class A common stock) 4,441,814 2,525,714 Convertible Notes — 1,465,306 Stock options 8,267,003 9,019,814 Total potentially dilutive shares 25,807,899 42,492,695 As all potentially dilutive securities are anti-dilutive for the six months ended June 30, 2022 and 2021, diluted net income (loss) per share is the same as basic net income (loss) per share for each period. Comprehensive Income (Loss) Comprehensive loss represents the changes in equity of an enterprise, other than those resulting from stockholder transactions. Net income (loss) was equal to comprehensive income (loss) for the three and six month periods ended June 30, 2022 and 2021. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Specific accounts that require management estimates include, but are not limited to, estimating the useful lives of the Company’s ASRs and property and equipment, certain estimates required within revenue recognition, estimating fair values of Company’s common stock, share-based awards and warrant liabilities, inclusive of any contingent assets and liabilities. Actual results could differ from those estimates and such differences may be material to the financial statements. Recent Accounting Pronouncements Not Yet Effective In August 2020, the Financial Accounting Standards Board “(FASB)” issued Accounting Standards Update (“ASU”) No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) In September 2016, the FASB released ASU No. 2016-13 , Financial Instruments – Credit Losses (“ASU 2016-03”) Autonomous Security Robots, net ASRs consist of raw materials, ASRs in progress and finished ASRs. ASRs in progress and finished ASRs include materials, labor and other direct and indirect costs used in their production. Finished ASRs are valued using a discrete bill of materials, which includes an allocation of labor and direct overhead based on assembly hours. Depreciation expense on ASRs is recorded using the straight-line method over their estimated expected lives, which currently ranges from 3 to 4.5 years. Depreciation expense of finished ASRs included in research and development expense amounted to $34 and $41, depreciation expense of finished ASRs included in sales and marketing expense amounted to $27 and $35, and depreciation expense included in cost of revenue, net amounted to $602 and $671 for the six months ended June 30, 2022 and 2021, respectively. ASRs, net, consisted of the following: June 30, December 31, 2022 2021 Raw materials $ 1,711 $ 1,041 ASRs in progress 747 427 Finished ASRs 8,655 7,695 11,113 9,163 Accumulated depreciation on Finished ASRs (7,154) (6,192) ASRs, net $ 3,959 $ 2,971 The components of the Finished ASRs, net as of June 30, 2022 and December 31, 2021 are as follows: ASRs on lease or available for lease $ 7,398 $ 6,489 Demonstration ASRs 600 585 Research and development ASRs 320 320 Docking stations 337 301 8,655 7,695 Less: accumulated depreciation (7,154) (6,192) Finished ASRs, net $ 1,501 $ 1,503 Convertible Preferred Warrant Liabilities and Common Stock Warrants Freestanding warrants to purchase shares of the Company’s preferred stock are classified as liabilities on the balance sheets at their estimated fair value because the underlying shares of preferred stock are contingently redeemable and, therefore, may obligate the Company to transfer assets at some point in the future. The preferred stock warrants are recorded at fair value upon issuance and are subject to remeasurement to their respective estimated fair values. At the end of each reporting period, changes in the estimated fair value of the preferred stock warrants are recorded in the statements of operations. The Company will continue to adjust the liability associated with the preferred stock warrants for changes in the estimated fair value until the earlier of the exercise or expiration of the preferred stock warrants, the completion of a sale of the Company or an initial public offering (“IPO”). Upon an IPO, the preferred stock warrants will convert into warrants to purchase common stock and any liabilities recorded for the preferred stock warrants will be reclassified to additional paid-in capital and will no longer be subject to remeasurement. Common stock warrants that are not considered derivative liabilities are accounted for at fair value at the date of issuance in additional paid-in capital. The fair value of these common stock warrants is determined using the Black-Scholes option-pricing model. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASU 718, Compensation - Stock Compensation, which requires that the estimated fair value on the date of grant be recognized over the requisite service period of the awards, which is generally the option vesting period. Stock-based awards made to nonemployees are measured and recognized based on the estimated fair value on the vesting date and are re-measured at each reporting pricing model, is affected by the fair value of the Company’s common stock as well as other assumptions regarding a number of highly complex and subjective variables. These variables include but are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee option exercise behaviors. Because there is insufficient historical information available to estimate the expected term of the stock-based awards, the Company adopted the simplified method of estimating the expected term of options granted by taking the average of the vesting term and the contractual term of the option. For awards with graded vesting, the Company recognizes stock-based compensation expense over the service period using the straight-line method, based on shares ultimately expected to vest. The Company recognizes forfeitures as they occur when calculating stock-based compensation for its equity awards. |
Revenue and Deferred Revenue
Revenue and Deferred Revenue | 6 Months Ended |
Jun. 30, 2022 | |
Revenue and Deferred Revenue | |
Revenue and Deferred Revenue | NOTE 2: Revenue and Deferred Revenue Revenue Recognition The Company derives its revenues primarily from lease of proprietary ASRs along with access to the browser-based interface KSOC through contracts under the lease accounting that typically have a twelve (12) month term. In addition, the Company derives non-lease revenue items such as professional services related to ASRs’ deployments, special decals and training if any, recognized when control of these services is transferred to the Clients, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. The Company determines revenue recognition through the following steps: ● identification of the contract, or contracts, with a client; ● identification of the performance obligations in the contract; ● determination of the transaction price; ● allocation of the transaction price to the performance obligations in the contract; and ● recognition of revenue when, or as, the Company satisfies a performance obligation. The Company recognizes revenue as follows: ASR subscription revenue ASR subscription revenue is generated from lease of proprietary ASRs along with access to the browser-based interface KSOC through contracts that typically have 12-month terms. These revenue arrangements adhere to lease accounting guidance and are classified as leases for revenue recognition purposes. Currently, all revenue arrangements qualify as operating leases where consideration allocated to the lease deliverables is recognized ratably over the lease term. Deferred revenue In connection with the Company’s Machine-as-a-Service (“MaaS”) subscription for the Company’s ASRs, the Company’s standard billing terms are annual in advance. In these situations, the Company records the invoices as deferred revenue and amortizes the subscription amount when the services are delivered, which generally is a 12-month period. In addition, the Company refers certain transactions to Dimension, whereby Dimension advances the full value of the MaaS subscription to the Company, less a processing fee. The advanced payment is recorded in deferred revenue and amortized over the term of the subscription once the ASR is delivered to the deployment site. See “Liquidity and Capital Resources”. The Company derives its revenue from the lease subscription of its proprietary ASRs along with access to its browser and mobile based software interface, KSOC. MaaS subscription agreements typically have a twelve (12) month term. The Company estimates its revenue in the periods in which the licensee uses the licensed technology. Payments are received in the subsequent period. The following table summarizes revenue by timing of recognition: Three Months Ended Three Months Ended June 30, 2022 June 30, 2021 Point in time $ 31 $ 6 Transferred over time 1,011 906 $ 1,042 $ 912 Six Months Ended Six Months Ended June 30, 2022 June 30, 2021 Point in time $ 46 $ 25 Transferred over time 1,939 1,753 $ 1,985 $ 1,778 Deferred revenue includes billings in excess of revenue recognized. Revenue recognized at a point in time generally does not result in significant increases in deferred revenue. Revenue recognized over a period generally results in a majority of the increases in deferred revenue as the performance obligations are fulfilled after the billing event. Deferred revenue was as follows for the period ended June 30, 2022 and December 31, 2022: June 30, 2022 December 31, 2021 Deferred revenue - short term $ 1,544 $ 889 Revenue recognized in the six months ended related to amounts included in deferred revenue as of the beginning of the year. $ 621 Deferred revenue represents amounts invoiced to customers for contracts for which revenue has yet to be recognized based for subscription services to be delivered to the Company’s clients. Typically, the timing of invoicing is based on the terms of the contract. Other revenue Other non-ASR related revenue such as deployment services, decals, shipping, and training revenue is recognized when services are delivered. |
Fair Value Measurement
Fair Value Measurement | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Measurement | |
Fair Value Measurement | NOTE 3: Fair Value Measurement The Company determines the fair market values of its financial instruments based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following are three levels of inputs that may be used to measure fair value: ● Level 1 – Quoted prices in active markets for identical assets or liabilities. The Company considers a market to be active when transactions for the asset occur with sufficient frequency and volume to provide pricing information on an ongoing basis. ● Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, 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. The valuation of Level 3 investments requires the use of significant management judgments or estimation. In certain cases where there is limited activity or less transparency around inputs to valuation, securities are classified as Level 3. Level 3 liabilities that are measured at fair value on a recurring basis consist of the convertible preferred stock warrant liabilities. The inputs used in estimating the fair value of the warrant liabilities are described in Note 6 -- Capital Stock and Warrants The following tables summarize, for each category of assets or liabilities carried at fair value, the respective fair value as of June 30, 2022 and December 31, 2021, and the classification by level of input within the fair value hierarchy: Total Level 1 Level 2 Level 3 June 30, 2022 Assets Cash equivalents: Money market funds $ 13,024 $ 13,024 $ — $ — Liabilities Warrant liability – Series m-3 Preferred Stock $ 2,388 $ — $ — $ 2,388 Warrant liability – Series S Preferred Stock $ 12,161 $ — $ — $ 12,161 Total Level 1 Level 2 Level 3 December 31, 2021 Assets Cash equivalents: Money market funds $ 6,623 $ 6,623 $ — $ — Liabilities Warrant liability – Series B Preferred Stock $ 370 $ — $ — $ 370 Warrant liability – Series m-3 Preferred Stock $ 7,156 $ — $ — $ 7,156 Warrant liability – Series S Preferred Stock $ 23,040 $ — $ — $ 23,040 During the six month periods ended June 30, 2022 and 2021, there were no transfers between Level 1, Level 2, or Level 3 assets or liabilities reported at fair value on a recurring basis and the valuation techniques used did not change compared to the Company’s established practice. The following table sets forth a summary of the changes in the fair value of Company’s Level 3 financial liabilities during the six month periods ended June 30, 2022 and 2021, which were measured at fair value on a recurring basis: June 30, June 30, Warrant liability 2022 2021 Beginning Balance $ 30,566 $ 5,617 Warrants exercised (370) — Revaluation of Series m-3 and S Preferred Stock warrants (15,647) 10,737 Warrants expired — (14) Ending Balance $ 14,549 $ 16,340 |
Debt Obligations
Debt Obligations | 6 Months Ended |
Jun. 30, 2022 | |
Debt Obligations | |
Debt Obligations | NOTE 4: Debt Obligations Term Loan Agreement In May 2018, the Company entered into a term loan agreement which allowed for individual term loans to be drawn in amounts totaling up to $3.5 million until January 10, 2019 (the “Loan Agreement”). Each individual term loan called for 18 equal monthly payments of principal plus accrued interest which would fully amortize the term loan. Outstanding borrowings under the term loan agreement bear interest at 1.75% above the prime rate per annum. Only one individual term loan in the amount of $0.4 million was drawn by the Company in May 2018. The loan was fully repaid in February 2019. A warrant for 77,413 shares of Class B common stock was also issued to the lender in conjunction with the Loan Agreement, which was fully exercised during the six months period ended June 30, 2022. Convertible Note Financing On April 30, 2019, the Company signed a Note and Warrant Purchase Agreement under the form of which the Company can issue up to $15 million of convertible promissory notes and warrants to purchase up to 3,000,000 shares of Series S Preferred Stock (the “Convertible Note Financing”). Pursuant to the terms of the Convertible Note Financing, the Company became obligated, to the same group of Convertible Note Financing investors, to exchange their outstanding shares of Series m-3 Preferred Stock for newly authorized shares of Series m-4 Preferred stock upon the closing of at least $1 million in aggregate principal amount of convertible promissory notes under the Convertible Note Financing. These warrants to purchase shares of Series S Preferred Stock of the Company were also issued to investors who invested in the Convertible Note Financing. The warrants to purchase shares of Series S Preferred Stock have an exercise price of $4.50 per share and expire on the earlier of December 31, 2021 or 18 months after the closing of the Company’s first firm commitment underwritten initial public offering of the Company’s common stock pursuant to a registration statement filed under the Securities Act. The convertible promissory notes have a maturity date of January 1, 2022, provide for payment of accrued interest at a rate of 12% per annum upon the maturity date, are generally the most senior company security (subject to limited subordination carve-outs) and provide for significant discounts upon a qualified financing or an initial public offering, and for a premium upon a change of control. The convertible notes automatically converts under various scenarios including a qualified financing or IPO. As of January 1, 2020, the convertible notes became convertible at the investors’ option at prices as follows: (i) on or before June 30, 2020, $4.50 per share; (ii) after June 30, 2020, but on or before December 31, 2020, $4.00 per share; (iii) after December 31, 2020, but on or before June 30, 2021, $3.50 per share; and (iv) after June 30, 2021, $2.50 per share. On November 18, 2021, the Company agreed to amend the Note and Warrant Purchase Agreement and the convertible notes and warrants to purchase Series S Preferred Stock issued thereunder principally as follows: (i) the scheduled maturity date of the convertible notes was extended from January 1, 2022 to January 1, 2024, (ii) the interest rate of the convertible notes was reduced from 12% per annum to 3% per annum starting on January 1, 2022, (iii) the conversion terms of the convertible notes were revised so that the convertible notes would automatically convert into Class A common stock upon the listing of the Company’s Class A common stock for trading on a nationally recognized securities exchange (e.g., the New York Stock Exchange) or inter-dealer quotation system (e.g., Nasdaq), (iv) the exercise period of the warrants was extended from December 31, 2021 to December 31, 2024 and will commence on January 1, 2023, and (v) the cashless exercise feature was removed from the warrants. The conversion price of the convertible notes for conversion into Class A common stock was not changed and remains at $2.50 per share and the exercise price of the warrants to purchase Series S Preferred Stock was not changed and remains at $4.50 per share. As of December 31, 2021, the Company had issued convertible notes in the aggregate principal amount of approximately $14.7 million (out of $15 million). Warrants for the purchase of up to 2,941,814 shares of Series S Preferred Stock were also issued and accrued for, respectively, to the same convertible note holders. The warrants have an exercise price of $4.50 per share, originally set to expire on December 31, 2021. On January 5, 2022, all convertible notes and accumulated interest were converted into 6,513,385 shares of Class A Common Stock, leaving no outstanding convertible notes as of June 30, 2022. All of the Company’s outstanding convertible notes and accrued interest, totaling $16 million, net of $0.3 million of debt discount, were converted into Class A common stock during the six months period ended June 30, 2022. The remaining debt discount related to the notes in the amount of $8.8 million was amortized and recorded as interest expense during the six months period ended June 30, 2022. The amortized carrying amount of the Company’s debt obligations consists of the following: June 30, December 31, 2022 2021 Convertible notes, net of fees and discount $ — $ 7,109 Total debt — 7,109 Less: current portion of debt obligations — (7,109) Non-current portion of debt obligations $ — $ — |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Compensation | |
Stock-Based Compensation | NOTE 5: Stock-Based Compensation Equity Incentive Plans In April 2014, the Company adopted the 2014 Equity Incentive Plan (the “2014 Plan”) allowing for the issuance of up to 2,000,000 shares of common stock through grants of options, stock appreciation rights, restricted stock or restricted stock units. In December 2016, the 2014 Plan was terminated, and the Company adopted a new equity incentive plan, the 2016 Equity Incentive Plan (the “2016 Plan”) in which the remaining 1,936,014 shares available for issuance under the 2014 Plan at that time were transferred to the Company’s 2016 Plan. Awards outstanding under the 2014 Plan at the time of the 2014 Plan’s termination will continue to be governed by their existing terms. The shares underlying any awards that are forfeited, canceled, repurchased or are otherwise terminated by the Company under the 2014 Plan will be added back to the shares of common stock available for issuance under the Company’s 2016 Plan. The 2016 Plan provides for the granting of stock awards such as incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock or restricted stock units to employees, directors and outside consultants as determined by the Board of Directors. As of June 30, 2022, 595,669 shares were available for future grants under the 2016 Plan. The Board may grant stock options under the 2016 Plan at a price of not less than 100% of the fair market value of the Company’s common stock on the date the option is granted. The option exercise price generally may not be less than the underlying stock’s fair market value at the date of grant and generally have a term of ten years. Incentive stock options granted to employees who, on the date of grant, own stock representing more than 10% of the voting power of all of the Company’s classes of stock, are granted at an exercise price of not less than 110% of the fair market value of the Company’s common stock. The maximum term of incentive stock options granted to employees who, on the date of grant, own stock having more than 10% of the voting power of all the Company’s classes of stock, may not exceed five years. The Board of Directors also determines the terms and conditions of awards, including the vesting schedule and any forfeiture provisions. Options granted under the 2016 Plan may vest upon the passage of time, generally four years, or upon the attainment of certain performance criteria established by the Board of Directors. The Company may from time-to-time grant options to purchase common stock to nonemployees for advisory and consulting services The amounts granted each calendar year to an employee or non-employee is limited depending on the type of award. Stock options comprise all of the awards granted since the Plan’s inception. On June 23, 2022, following approval by the Board of Directors, the Company’s stockholders adopted the 2022 Equity Incentive Plan (the “2022 Plan”) allowing for the issuance of up to 5,000,000 shares of Class A common stock through grants of options, stock appreciation rights, restricted stock awards, restricted stock units, performance awards, and other stock or cash-based awards. In connection with the adoption of the 2022 Plan, shares previously available for new grants under the 2016 Plan, which; totaled 595,669 shares of Class A common stock as of June 30, 2022, will become available for new grants under the 2022 Plan, and shares subject to outstanding stock options under the prior plans as of the date of stockholder approval of the 2022 Plan, subsequently cease to be subject to such stock options (other than by reason of exercise of such stock options). As of June 30, 2022, 8,267,003 shares of Class A common stock and Class B common stock were subject to outstanding stock options under the prior plans. The number of shares authorized under the 2022 Plan will be increased each January 1 st st The Board of Directors also determines the terms and conditions of awards, including the vesting schedule and any forfeiture provisions. Options granted under the 2022 Plan may vest upon the passage of time, generally four years, or upon the attainment of certain performance criteria established by the Board of Directors. The Company may from time-to-time grant options to purchase common stock to nonemployees for advisory and consulting services. The amounts granted each calendar year to an employee or non-employee is limited depending on the type of award. Stock options comprise all of the awards granted since the Plan’s inception. Stock option activity under all of the Company’s equity incentive plans for the six month period ended of June 30, 2022 is as follows: Weighted Weighted Average Shares Number of Average Remaining Aggregate Available for Shares Exercise Contractual Intrinsic Grant Outstanding Price Life (Years) Value(000's) Available and outstanding as of December 31, 2021 216,003 8,799,415 $ 3.07 8.12 $ 60,924 Granted (100,000) 100,000 10.00 Exercised (152,746) 1.33 Expired 11,666 (11,666) 2.34 Forfeited 468,000 (468,000) 3.87 Available and outstanding as of June 30, 2022 595,669 8,267,003 $ 3.15 7.60 $ 10,630 Vested and exercisable as of June 30, 2022 4,230,115 $ 1.22 6.66 $ 7,522 Awards expected to vest as of June 30, 2022 4,036,888 $ 5.17 8.59 $ 3,108 The weighted average grant date fair value of options granted during the six month period ended June 30, 2022 was $5.08 per share. There were 152,746 options exercised during the six month period ended June 30, 2022. No options were exercised during the six month period ended June 30, 2021. The fair value of the options that vested during the six months ended June 30, 2022 and 2021 was $523 and $295, respectively. All options available and outstanding at June 30, 2022 are vested or expected to vest. As of June 30, 2022, the Company had unamortized stock-based compensation expense of $8,315 that will be recognized over the average remaining vesting term of options of 2.47 years. The assumptions utilized for option grants during the three and six months ended June 30, 2022 and 2021 are as follows: Three months ended Six months ended June 30, June 30, 2022 2021 2022 2021 Risk-free interest rate — % 1.09 % 0.96 % 0.98 % Expected dividend yield — % — % — % — % Expected volatility — % 52.66 % 53.84 % 52.12 % Expected term (in years) — 6.03 6.08 6.03 A summary of stock-based compensation expense recognized in the Company’s statements of operations is as follows: Three months ended Six months ended June 30, June 30, 2022 2021 2022 2021 Cost of revenue, net $ 82 $ 51 $ 162 $ 101 Research and development 243 96 470 175 Sales and marketing 61 20 132 61 General and Administrative 341 60 688 121 Total $ 727 $ 227 $ 1,452 $ 458 |
Capital Stock and Warrants
Capital Stock and Warrants | 6 Months Ended |
Jun. 30, 2022 | |
Capital Stock and Warrants | |
Capital Stock and Warrants | NOTE 6: Capital Stock and Warrants Preferred Stock In connection with the Convertible Note Financing, later amended on November 18, 2021, William Santana Li, Chairman and Chief Executive Officer of the Company, was granted a voting proxy to vote substantially all of the shares of the Company’s Series m-4 Preferred Stock, the stock issued upon the conversion of warrants to purchase all of the shares of the Company’s Series m-3 Preferred Stock, the stock issued upon the conversion of warrants to purchase shares of the Company’s Series S Preferred Stock, and the stock issued upon conversion of the convertible promissory notes issued as part of the Convertible Note Financing, in each case to the extent that such shares are held by participants in the Convertible Note Financing (the “Voting Proxy”). The votes held by Mr. Li, as a result of the Voting Proxy and related to the outstanding securities to which the Voting Proxy applies, represents approximately 0.86% of the Company’s aggregate voting power as of June 30, 2022. The Series S Preferred Stock has a right to convert at any time into Class A common stock. The initial conversion rate was 1:1, which conversion rate will continue to be adjusted pursuant to the broad-based weighted average anti-dilution adjustment provisions provided for in the Company’s amended and restated certificate of incorporation, including without limitation as a result of the issuance of warrants to purchase Series S Preferred Stock in connection with the Convertible Note Financing referenced in the paragraph above, which may continue to have closings simultaneously with the Regulation D Offering of Series S Preferred Stock. As of December 31, 2021, the conversion rate has been adjusted to approximately 1.1069 shares of Class A common stock for every 1 share of Series S Preferred Stock, and remains subject to further adjustment. In connection with the placement of the Series m-3 Preferred Stock during the years ended December 31, 2017 and 2018, the Company issued to the purchasers warrants to purchase an aggregate of 1,432,786 shares of Series m-3 Preferred Stock. These warrants have an exercise price of $4.00 per share. Pursuant to a second amendment to the Warrants to Purchase Shares of Series M-3 Preferred Stock Agreement dated November 18, 2021, the exercise period of the warrants was extended from December 31, 2021 to December 31, 2024 and shall be exercisable, in whole or in part, beginning January 1, 2023. In addition, the cashless exercise feature was removed from the warrants. Common Stock Each share of Class B Common Stock is convertible into one fully paid and non-assessable share of Class A common stock at the option of the holder at any time. Each share of Class B Common Stock will automatically convert into one fully paid and non-assessable share of Class A Common Stock upon the sale, assignment, transfer or disposition of the share or any interest in the share, except for certain permitted transfers to related persons. On October 15, 2021, the Company filed an offering statement in connection with a proposed offering of up to $40 million of its Class A common stock pursuant to Regulation A of the Securities Act, to raise additional capital for operations (the “2021 Regulation A Offering”). The offering statement was qualified by the SEC on November 29, 2021, and the Company commenced the 2021 Regulation A Offering shortly thereafter, and terminated on January 26, 2022, issuing 2,236,619 shares of Class A common stock with net proceeds generated through this offering of $19.6 million. Outstanding Class A common stock will increase as the various classes of Preferred Stock elect to convert from preferred stock to Class A common stock. On April 4, 2022, the Company entered into a Common Stock Purchase Agreement (as amended to date, the “ Purchase Agreement Registration Rights Agreement As consideration for B. Riley Principal Capital’s commitment to purchase shares of Class A common stock at the Company’s direction upon the terms and subject to the conditions set forth in the Purchase Agreement, upon execution of the Purchase Agreement, the Company issued 98,888 shares of Class A common stock to B. Riley Principal Capital as initial commitment shares. In addition, (i) upon the Company’s receipt of total aggregate gross cash proceeds equal to $25,000,000 as payment by B. Riley Principal Capital for all shares of Class A common stock purchased under the Purchase Agreement, the Company will issue 59,333 additional shares of Class A common stock to B. Riley Principal Capital as additional commitment shares, and (ii) upon the Company’s receipt of total aggregate gross cash proceeds equal to $50,000,000 from B. Riley Principal Capital under the Purchase Agreement, the Company will issue an additional 39,555 shares of Class A common stock to B. Riley Principal Capital as additional commitment shares, totaling 98,888 additional commitment shares (in addition to the 98,888 initial commitment shares the Company issued to B. Riley Principal Capital upon execution of the Purchase Agreement). Pursuant to the Registration Rights Agreement, the Company filed a registration statement on Form S-1 to register the resale of 12,197,776 shares of Class A common stock by B. Riley Principal Capital, which was declared effective by the SEC on May 11, 2022. During the three and six months ended June 30, 2022, we sold 95,734 shares of Class A common stock under the Purchase Agreement. Net proceeds from such sales totaled $0.4 million. Warrants On April 30, 2019, the Company entered into the “Convertible Note Financing”. Pursuant to the terms of the Convertible Note Financing, the Company became obligated to exchange its outstanding shares of Series m-3 Preferred Stock for the newly authorized shares of Series m-4 Preferred stock upon the closing of at least $1 million in aggregate principal amount of convertible promissory notes under the Convertible Note Financing. Warrants to purchase shares of Series S Preferred Stock of the Company were also issued to investors who invested in the Convertible Note Financing. The warrants to purchase shares of Series S Preferred Stock have an exercise price of $4.50 per share and expire on the earlier of December 31, 2024, or 18 months after the closing of the Company’s first firm commitment underwritten initial public offering of the Company’s common stock pursuant to a registration statement filed under the Securities Act. As of June 30, 2022, the Company had issued and accrued warrants to purchase up to 2,941,814 shares of Series S Preferred Stock. These warrants issued qualify as liability instruments as the warrants are exercisable into Series S Preferred Stock which are redeemable upon a change of control or any liquidation or winding up of the Company whether voluntary or involuntary. The warrants have been classified as a current liability on the Company’s balance sheets and were recorded as a component of the issuance costs related to Convertible Note. The Series S warrant is valued at market at the end of every reporting period until the warrant is exercised or expires with the change in fair value being recorded in other income (expense), net on the Company’s condensed statements of operations. Pursuant to the terms of the Convertible Note Financing, the Company became obligated to exchange certain of its outstanding shares of Series m-3 Preferred Stock for the newly authorized shares of Series m-4 Preferred Stock. On September 10, 2019, the Company issued 1,432,786 shares of its Series m-4 Preferred Stock in exchange for 1,432,786 shares of its shares of Series m-3 Preferred Stock, which remained outstanding as of June 30, 2022. On July 23, 2019, the Company issued a warrant to purchase 1,500,000 shares of its Series S Preferred Stock, (the “Warrant”), to Proud Productions LLC (“Proud”) pursuant to the terms of a Distribution Assignment and Warrant Purchase Agreement, dated as of July 22, 2019 (the “Purchase Agreement”). The Warrant is exercisable at $8.00 per share beginning July 24, 2021 and expiring on July 31, 2024. The Warrant was issued in connection with an upcoming television series to be produced by Proud featuring the Company’s products. A summary of the Company’s outstanding warrants as of June 30, 2022 is as follows: Class of shares Number of Warrants Exercise Price Expiration Date Series m-3 Preferred Stock 1,432,786 $ 4.0000 December 31, 2024 Series S Preferred Stock 2,941,814 $ 4.5000 December 31, 2024 Series S Preferred Stock 1,500,000 $ 8.0000 July 31, 2024 Common Stock Reserved for Future Issuance Shares of common stock reserved for future issuance relate to outstanding preferred stock, warrants and stock options as follows: June 30, 2022 Series A Preferred Stock 3,249,104 Series B Preferred Stock 3,541,767 Series m Preferred Stock 1,932,021 Series m-2 Preferred Stock 160,000 Series S Preferred Stock 2,783,404 Stock options to purchase common stock 8,267,003 Warrants outstanding for future issuance of convertible preferred stock and common stock 5,874,600 Stock options available for future issuance 595,669 Total shares of common stock reserved 26,403,568 |
Related parties and related-par
Related parties and related-party transactions | 6 Months Ended |
Jun. 30, 2022 | |
Related parties and related-party transactions | |
Related parties and related-party transactions | NOTE 7: Related parties and related-party transactions One of the Company’s vendors, Konica Minolta, Inc. (“Konica Minolta”), is a stockholder of the Company. Konica Minolta provides the Company with repair services to its ASRs. The Company paid Konica Minolta $101 and $80 and $192 and $140 in service fees for the three and six-month periods ended June 30, 2022 and 2021, respectively. The Company had payables of $47 and $29 owed to Konica Minolta as of June 30, 2022 and December 31, 2021, respectively. |
Commitments and contingencies
Commitments and contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and contingencies. | |
Commitments and contingencies | NOTE 8: Commitments and contingencies Leases The Company leases facilities for office space under non-cancelable operating lease agreements. The Company leases space for its corporate headquarters in Mountain View, California through August 2023. Lease costs for the three and six month periods ended June 30, 2022 are as follows: Three months ended Six months ended June 30, 2022 June 30, 2022 Operating lease costs Operating lease right-of-use assets $ 193 $ 373 As of June 30, 2022, future minimum operating lease payments for each of the next three years and thereafter is as follows: Years ending December 31, Amount 2022 (remaining) $ 377 2023 507 Total future minimum lease payments 884 Less - Interest (63) Present value of lease liabilities $ 821 Weighted average remaining lease term is 1.2 years as of June 30, 2022 and the weighted average discount rate is 12.0%. Legal Matters The Company may be subject to pending legal proceedings and regulatory actions in the ordinary course of business; however, no such claims have been identified as of June 30, 2022 that would have a material adverse effect on the Company’s financial position, results of operations or cash flows. The Company from time to time enters into contracts that contingently require the Company to indemnify parties against third party claims. These contracts primarily relate to: (i) arrangements with Clients which generally include certain provisions for indemnifying Clients against liabilities if the services infringe a third party’s intellectual property rights, (ii) the Regulation A Issuer Agreement where the Company may be required to indemnify the placement agent for any loss, damage, expense or liability incurred by the other party in any claim arising out of a material breach (or alleged breach) as a result of any potential violation of any law or regulation, or any third party claim arising out of any investment or potential investment in the offering, and (iii) agreements with the Company’s officers and directors, under which the Company may be required to indemnify such persons from certain liabilities arising out of such persons’ relationships with the Company. The Company has not incurred any material costs as a result of such obligations and has not accrued any liabilities related to such obligations in the financial statements as of June 30, 2022 and December 31, 2021. Sales Tax Contingencies The Company has historically not collected state sales tax on the sale of its “MaaS” product offering but has paid sales tax and use tax on all purchases of raw materials and in conjunction with the Financing Arrangement of the Company’s ASRs with Farnam. The Company’s MaaS product offering may be subject to sales tax in certain jurisdictions. If a taxing authority were to successfully assert that the Company has not properly collected sales or other transaction taxes, or if sales or other transaction tax laws or the interpretation thereof were to change, and the Company was unable to enforce the terms of their contracts with Clients that give the right to reimbursement for the assessed sales taxes, tax liabilities in amounts that could be material may be incurred. Based on the Company’s assessment, the Company has recorded a use tax liability of $0.5 million as of June 30, 2022 and December 31, 2021, respectively, which has been included in other current liabilities on the accompanying condensed balance sheets. The Company continues to analyze possible sales tax exposure but does not currently believe that any individual claim or aggregate claims that might arise will ultimately have a material effect on its results of operations, financial position or cash flows. |
The Company and Summary of Si_2
The Company and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
The Company and Summary of Significant Accounting Policies | |
Description of Business | Description of Business Knightscope, Inc. (the “Company”), was incorporated on April 4, 2013 under the laws of the State of Delaware. The Company designs, develops, builds, deploys, and supports advanced physical security technologies. The Knightscope solution to reducing crime combines the physical presence of its proprietary Autonomous Security Robots (“ASRs”) with real-time, on-site data collection and analysis coupled with a proprietary user interface. Two of the Company’s ASRs, the outdoor/indoor “K5” and the indoor “K3”, autonomously patrol client sites, without the need for remote control, to provide a visible, force multiplying, physical security presence to help protect assets, monitor changes in the environment, and deter crime. They gather real-time data using a large array of sensors. The data is accessible through the Knightscope Security Operations Center (“KSOC”), an intuitive, browser-based software interface that enables security professionals and law enforcement officers to review events generated, allowing them to have their eyes, ears, and voice on the ground 24/7/365 in multiple locations at the same time. |
Basis of Presentation and Liquidity | Basis of Presentation and Liquidity The unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the period presented. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for other future periods. These condensed financial statements should be read in conjunction with the Company’s audited financial statements and accompanying notes for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 31, 2022. The Company’s significant accounting policies are described in Note 1 to those audited financial statements. Since its inception, the Company has incurred significant operating losses and negative cash flows from operations which is principally the result of significant research and development activities related to the development and continued improvement of the Company’s ASRs and KSOC (hardware and software) as well as fulfillment of client demand. Cash and cash equivalents on hand were $15.6 million as of June 30, 2022, compared to $10.7 million as of December 31, 2021. The Company has historically incurred losses and negative cashflows from operations. As of June 30, 2022, the Company also had an accumulated deficit of approximately $122.4 million and stockholders’ deficit of $33.1 million. In connection with its listing on the Nasdaq Global Market on January 27, 2022, the Company completed its Regulation A Offering on January 26, 2022, issuing 2,236,619 shares of Class A common stock and generating net proceeds of approximately $19.6 million. Management plans to seek additional financing activities to support its operations, such as issuances of equity, issuances of debt and convertible debt instruments and other financing instruments. To address this plan, on April 4, 2022, the Company entered into a committed equity financing facility with B Riley Principal Capital, LLC (“B Riley Principal Capital”) that provides the Company with the right, without obligation, to issue and sell up to $100 million of its Class A common stock over a period of 24 months (see Note 6 for details). The Company’s projected cash flows are subject to various risks and uncertainties, and the unavailability or inadequacy of financing to meet future capital needs could force it to modify, curtail, delay, or suspend some or all aspects of its planned operations. Sales of additional equity securities, convertible debt and/or warrants by the Company could result in the dilution of the interests of existing stockholders. |
Basic and Diluted Net Income (Loss) per Share | Basic and Diluted Net Income (Loss) per Share Net income (loss) per share of common stock is computed using the two-class method required for participating securities based on their participation rights. All series of convertible preferred stock are participating securities as the holders are entitled to participate in common stock dividends with common stock on an as converted basis. Holders of Series m-4 Preferred Stock were entitled to receive cumulative dividends payable semi-annually in arrears at the rate per share of Series m-4 Preferred Stock equal to the Dividend Rate for the Series m-4 Preferred Stock, in each case subject to compliance with applicable law. Dividends to holders of Series m-4 Preferred Stock were paid in kind as a dividend of additional shares of Series m-4 Preferred Stock for each Dividend Period on the applicable Dividend Payment Date using a price per share equal to the original issue price, provided that the Company shall not issue any fractional shares of Series m-4 Preferred Stock. The holders of the Company’s preferred stock, other than m-4 preferred stock, are also entitled to noncumulative dividends prior and in preference, to our common stock and do not have a contractual obligation to share in the losses of the Company. During 2021, all shares of Series m-4 Preferred Stock were converted to Class A common stock, leaving no outstanding balance of the Series m-4 Preferred Stock as of June 30, 2022. In accordance with the two-class method, earnings allocated to these participating securities, which include participation rights in undistributed earnings with common stock, are subtracted from net income (loss) to determine net income (loss) attributable to common stockholders upon their occurrence. Basic net income (loss) per share is computed by dividing net income (loss) attributable to common stockholders (net adjusted for preferred stock dividends declared or accumulated) by the weighted average number of common shares outstanding during the period. All participating securities are excluded from basic weighted-average shares outstanding. In computing diluted net income (loss) attributable to common stockholders, undistributed earnings are re-allocated to reflect the potential impact of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing net income (loss) attributable to common stockholders by diluted weighted-average shares outstanding, including potentially dilutive securities, unless anti-dilutive. Potentially dilutive securities that were excluded from the computation of diluted net income (loss) per share for the three months ended June 30, 2022 and 2021 consist of the following: June 30, June 30, 2022 2021 Series A Preferred Stock (convertible to Class B common stock) — 8,936,015 Series B Preferred Stock (convertible to Class B common stock) — 4,653,583 Series m Preferred Stock (convertible to Class A common stock) — 5,339,215 Series m-2 Preferred Stock (convertible to Class B common stock) — 1,660,756 Series m-3 Preferred Stock (convertible to Class A common stock) — 16,757 Series m-4 Preferred Stock (convertible to Class A common stock) — 1,432,786 Series S Preferred Stock (convertible to Class A common stock) — 5,567,171 Warrants to purchase common stock (convertible to Class B common stock) — 121,913 Warrants to purchase Series B (convertible to Class B common stock) — 53,918 Warrants to purchase of Series m-1 (convertible to Class A common stock) — 266,961 Warrants to purchase of Series m-3 (convertible to Class A common stock) 1,432,786 1,432,786 Warrants to purchase of Series s (convertible to Class A common stock) 4,441,814 2,525,714 Convertible Notes — 1,465,306 Stock options 8,267,003 9,019,814 Total potentially dilutive shares 14,141,603 42,492,695 Potentially dilutive securities that were excluded from the computation of diluted net income (loss) per share for the six months ended June 30, 2022 and 2021 consist of the following: June 30, June 30, 2022 2021 Series A Preferred Stock (convertible to Class B common stock) 3,249,104 8,936,015 Series B Preferred Stock (convertible to Class B common stock) 3,541,767 4,653,583 Series m Preferred Stock (convertible to Class A common stock) 1,932,021 5,339,215 Series m-2 Preferred Stock (convertible to Class B common stock) 160,000 1,660,756 Series m-3 Preferred Stock (convertible to Class A common stock) — 16,757 Series m-4 Preferred Stock (convertible to Class A common stock) — 1,432,786 Series S Preferred Stock (convertible to Class A common stock) 2,783,404 5,567,171 Warrants to purchase common stock (convertible to Class B common stock) — 121,913 Warrants to purchase Series B (convertible to Class B common stock) — 53,918 Warrants to purchase of Series m-1 (convertible to Class A common stock) — 266,961 Warrants to purchase of Series m-3 (convertible to Class A common stock) 1,432,786 1,432,786 Warrants to purchase of Series s (convertible to Class A common stock) 4,441,814 2,525,714 Convertible Notes — 1,465,306 Stock options 8,267,003 9,019,814 Total potentially dilutive shares 25,807,899 42,492,695 As all potentially dilutive securities are anti-dilutive for the six months ended June 30, 2022 and 2021, diluted net income (loss) per share is the same as basic net income (loss) per share for each period. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive loss represents the changes in equity of an enterprise, other than those resulting from stockholder transactions. Net income (loss) was equal to comprehensive income (loss) for the three and six month periods ended June 30, 2022 and 2021. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Specific accounts that require management estimates include, but are not limited to, estimating the useful lives of the Company’s ASRs and property and equipment, certain estimates required within revenue recognition, estimating fair values of Company’s common stock, share-based awards and warrant liabilities, inclusive of any contingent assets and liabilities. Actual results could differ from those estimates and such differences may be material to the financial statements. |
Recent Accounting Pronouncements Not Yet Effective | Recent Accounting Pronouncements Not Yet Effective In August 2020, the Financial Accounting Standards Board “(FASB)” issued Accounting Standards Update (“ASU”) No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) In September 2016, the FASB released ASU No. 2016-13 , Financial Instruments – Credit Losses (“ASU 2016-03”) |
Autonomous Security Robots, net | Autonomous Security Robots, net ASRs consist of raw materials, ASRs in progress and finished ASRs. ASRs in progress and finished ASRs include materials, labor and other direct and indirect costs used in their production. Finished ASRs are valued using a discrete bill of materials, which includes an allocation of labor and direct overhead based on assembly hours. Depreciation expense on ASRs is recorded using the straight-line method over their estimated expected lives, which currently ranges from 3 to 4.5 years. Depreciation expense of finished ASRs included in research and development expense amounted to $34 and $41, depreciation expense of finished ASRs included in sales and marketing expense amounted to $27 and $35, and depreciation expense included in cost of revenue, net amounted to $602 and $671 for the six months ended June 30, 2022 and 2021, respectively. ASRs, net, consisted of the following: June 30, December 31, 2022 2021 Raw materials $ 1,711 $ 1,041 ASRs in progress 747 427 Finished ASRs 8,655 7,695 11,113 9,163 Accumulated depreciation on Finished ASRs (7,154) (6,192) ASRs, net $ 3,959 $ 2,971 The components of the Finished ASRs, net as of June 30, 2022 and December 31, 2021 are as follows: ASRs on lease or available for lease $ 7,398 $ 6,489 Demonstration ASRs 600 585 Research and development ASRs 320 320 Docking stations 337 301 8,655 7,695 Less: accumulated depreciation (7,154) (6,192) Finished ASRs, net $ 1,501 $ 1,503 |
Convertible Preferred Warrant Liabilities and Common Stock Warrants | Convertible Preferred Warrant Liabilities and Common Stock Warrants Freestanding warrants to purchase shares of the Company’s preferred stock are classified as liabilities on the balance sheets at their estimated fair value because the underlying shares of preferred stock are contingently redeemable and, therefore, may obligate the Company to transfer assets at some point in the future. The preferred stock warrants are recorded at fair value upon issuance and are subject to remeasurement to their respective estimated fair values. At the end of each reporting period, changes in the estimated fair value of the preferred stock warrants are recorded in the statements of operations. The Company will continue to adjust the liability associated with the preferred stock warrants for changes in the estimated fair value until the earlier of the exercise or expiration of the preferred stock warrants, the completion of a sale of the Company or an initial public offering (“IPO”). Upon an IPO, the preferred stock warrants will convert into warrants to purchase common stock and any liabilities recorded for the preferred stock warrants will be reclassified to additional paid-in capital and will no longer be subject to remeasurement. Common stock warrants that are not considered derivative liabilities are accounted for at fair value at the date of issuance in additional paid-in capital. The fair value of these common stock warrants is determined using the Black-Scholes option-pricing model. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASU 718, Compensation - Stock Compensation, which requires that the estimated fair value on the date of grant be recognized over the requisite service period of the awards, which is generally the option vesting period. Stock-based awards made to nonemployees are measured and recognized based on the estimated fair value on the vesting date and are re-measured at each reporting pricing model, is affected by the fair value of the Company’s common stock as well as other assumptions regarding a number of highly complex and subjective variables. These variables include but are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee option exercise behaviors. Because there is insufficient historical information available to estimate the expected term of the stock-based awards, the Company adopted the simplified method of estimating the expected term of options granted by taking the average of the vesting term and the contractual term of the option. For awards with graded vesting, the Company recognizes stock-based compensation expense over the service period using the straight-line method, based on shares ultimately expected to vest. The Company recognizes forfeitures as they occur when calculating stock-based compensation for its equity awards. |
The Company and Summary of Si_3
The Company and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
The Company and Summary of Significant Accounting Policies | |
Summary of potentially dilutive securities that were excluded from the computation of diluted net loss per share | June 30, June 30, 2022 2021 Series A Preferred Stock (convertible to Class B common stock) — 8,936,015 Series B Preferred Stock (convertible to Class B common stock) — 4,653,583 Series m Preferred Stock (convertible to Class A common stock) — 5,339,215 Series m-2 Preferred Stock (convertible to Class B common stock) — 1,660,756 Series m-3 Preferred Stock (convertible to Class A common stock) — 16,757 Series m-4 Preferred Stock (convertible to Class A common stock) — 1,432,786 Series S Preferred Stock (convertible to Class A common stock) — 5,567,171 Warrants to purchase common stock (convertible to Class B common stock) — 121,913 Warrants to purchase Series B (convertible to Class B common stock) — 53,918 Warrants to purchase of Series m-1 (convertible to Class A common stock) — 266,961 Warrants to purchase of Series m-3 (convertible to Class A common stock) 1,432,786 1,432,786 Warrants to purchase of Series s (convertible to Class A common stock) 4,441,814 2,525,714 Convertible Notes — 1,465,306 Stock options 8,267,003 9,019,814 Total potentially dilutive shares 14,141,603 42,492,695 Potentially dilutive securities that were excluded from the computation of diluted net income (loss) per share for the six months ended June 30, 2022 and 2021 consist of the following: June 30, June 30, 2022 2021 Series A Preferred Stock (convertible to Class B common stock) 3,249,104 8,936,015 Series B Preferred Stock (convertible to Class B common stock) 3,541,767 4,653,583 Series m Preferred Stock (convertible to Class A common stock) 1,932,021 5,339,215 Series m-2 Preferred Stock (convertible to Class B common stock) 160,000 1,660,756 Series m-3 Preferred Stock (convertible to Class A common stock) — 16,757 Series m-4 Preferred Stock (convertible to Class A common stock) — 1,432,786 Series S Preferred Stock (convertible to Class A common stock) 2,783,404 5,567,171 Warrants to purchase common stock (convertible to Class B common stock) — 121,913 Warrants to purchase Series B (convertible to Class B common stock) — 53,918 Warrants to purchase of Series m-1 (convertible to Class A common stock) — 266,961 Warrants to purchase of Series m-3 (convertible to Class A common stock) 1,432,786 1,432,786 Warrants to purchase of Series s (convertible to Class A common stock) 4,441,814 2,525,714 Convertible Notes — 1,465,306 Stock options 8,267,003 9,019,814 Total potentially dilutive shares 25,807,899 42,492,695 |
Summary of ASRs, net and components of the Finished ASRs, net | ASRs, net, consisted of the following: June 30, December 31, 2022 2021 Raw materials $ 1,711 $ 1,041 ASRs in progress 747 427 Finished ASRs 8,655 7,695 11,113 9,163 Accumulated depreciation on Finished ASRs (7,154) (6,192) ASRs, net $ 3,959 $ 2,971 The components of the Finished ASRs, net as of June 30, 2022 and December 31, 2021 are as follows: ASRs on lease or available for lease $ 7,398 $ 6,489 Demonstration ASRs 600 585 Research and development ASRs 320 320 Docking stations 337 301 8,655 7,695 Less: accumulated depreciation (7,154) (6,192) Finished ASRs, net $ 1,501 $ 1,503 |
Revenue and Deferred Revenue (T
Revenue and Deferred Revenue (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenue and Deferred Revenue | |
Summary of revenue by timing of recognition | Three Months Ended Three Months Ended June 30, 2022 June 30, 2021 Point in time $ 31 $ 6 Transferred over time 1,011 906 $ 1,042 $ 912 Six Months Ended Six Months Ended June 30, 2022 June 30, 2021 Point in time $ 46 $ 25 Transferred over time 1,939 1,753 $ 1,985 $ 1,778 |
Summary of Deferred revenue | June 30, 2022 December 31, 2021 Deferred revenue - short term $ 1,544 $ 889 Revenue recognized in the six months ended related to amounts included in deferred revenue as of the beginning of the year. $ 621 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Measurement | |
Summary of category of assets or liabilities carried at fair value | Total Level 1 Level 2 Level 3 June 30, 2022 Assets Cash equivalents: Money market funds $ 13,024 $ 13,024 $ — $ — Liabilities Warrant liability – Series m-3 Preferred Stock $ 2,388 $ — $ — $ 2,388 Warrant liability – Series S Preferred Stock $ 12,161 $ — $ — $ 12,161 Total Level 1 Level 2 Level 3 December 31, 2021 Assets Cash equivalents: Money market funds $ 6,623 $ 6,623 $ — $ — Liabilities Warrant liability – Series B Preferred Stock $ 370 $ — $ — $ 370 Warrant liability – Series m-3 Preferred Stock $ 7,156 $ — $ — $ 7,156 Warrant liability – Series S Preferred Stock $ 23,040 $ — $ — $ 23,040 |
Summary of changes in fair value of Company's Level 3 financial liabilities | June 30, June 30, Warrant liability 2022 2021 Beginning Balance $ 30,566 $ 5,617 Warrants exercised (370) — Revaluation of Series m-3 and S Preferred Stock warrants (15,647) 10,737 Warrants expired — (14) Ending Balance $ 14,549 $ 16,340 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Obligations | |
Schedule of amortized carrying amount of debt obligations | June 30, December 31, 2022 2021 Convertible notes, net of fees and discount $ — $ 7,109 Total debt — 7,109 Less: current portion of debt obligations — (7,109) Non-current portion of debt obligations $ — $ — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Compensation | |
Summary of the activity of Incentive Units | Weighted Weighted Average Shares Number of Average Remaining Aggregate Available for Shares Exercise Contractual Intrinsic Grant Outstanding Price Life (Years) Value(000's) Available and outstanding as of December 31, 2021 216,003 8,799,415 $ 3.07 8.12 $ 60,924 Granted (100,000) 100,000 10.00 Exercised (152,746) 1.33 Expired 11,666 (11,666) 2.34 Forfeited 468,000 (468,000) 3.87 Available and outstanding as of June 30, 2022 595,669 8,267,003 $ 3.15 7.60 $ 10,630 Vested and exercisable as of June 30, 2022 4,230,115 $ 1.22 6.66 $ 7,522 Awards expected to vest as of June 30, 2022 4,036,888 $ 5.17 8.59 $ 3,108 |
Schedule of stock options average assumptions | Three months ended Six months ended June 30, June 30, 2022 2021 2022 2021 Risk-free interest rate — % 1.09 % 0.96 % 0.98 % Expected dividend yield — % — % — % — % Expected volatility — % 52.66 % 53.84 % 52.12 % Expected term (in years) — 6.03 6.08 6.03 |
Schedule of classification of equity-based compensation in the consolidated statements of operations | Three months ended Six months ended June 30, June 30, 2022 2021 2022 2021 Cost of revenue, net $ 82 $ 51 $ 162 $ 101 Research and development 243 96 470 175 Sales and marketing 61 20 132 61 General and Administrative 341 60 688 121 Total $ 727 $ 227 $ 1,452 $ 458 |
Capital Stock and Warrants (Tab
Capital Stock and Warrants (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Capital Stock and Warrants | |
Schedule of outstanding warrants | A summary of the Company’s outstanding warrants as of June 30, 2022 is as follows: Class of shares Number of Warrants Exercise Price Expiration Date Series m-3 Preferred Stock 1,432,786 $ 4.0000 December 31, 2024 Series S Preferred Stock 2,941,814 $ 4.5000 December 31, 2024 Series S Preferred Stock 1,500,000 $ 8.0000 July 31, 2024 |
Schedule of common stock reserved for future issuance | June 30, 2022 Series A Preferred Stock 3,249,104 Series B Preferred Stock 3,541,767 Series m Preferred Stock 1,932,021 Series m-2 Preferred Stock 160,000 Series S Preferred Stock 2,783,404 Stock options to purchase common stock 8,267,003 Warrants outstanding for future issuance of convertible preferred stock and common stock 5,874,600 Stock options available for future issuance 595,669 Total shares of common stock reserved 26,403,568 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and contingencies. | |
Schedule of components of lease costs | Lease costs for the three and six month periods ended June 30, 2022 are as follows: Three months ended Six months ended June 30, 2022 June 30, 2022 Operating lease costs Operating lease right-of-use assets $ 193 $ 373 |
Schedule of future minimum operating lease payments | As of June 30, 2022, future minimum operating lease payments for each of the next three years and thereafter is as follows: Years ending December 31, Amount 2022 (remaining) $ 377 2023 507 Total future minimum lease payments 884 Less - Interest (63) Present value of lease liabilities $ 821 |
The Company and Summary of Si_4
The Company and Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | Apr. 04, 2022 | Jan. 26, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | [1] | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
The Company and Summary of Significant Accounting Policies | |||||||||
Cash and cash equivalents | $ 15,639 | $ 10,749 | |||||||
Accumulated deficit | 122,426 | 113,697 | |||||||
Stockholders' deficit | $ 33,076 | $ 38,674 | $ 82,933 | $ 88,812 | $ 71,706 | $ 66,185 | |||
Number of shares issued (in shares) | 2,236,619 | ||||||||
Proceeds from equity sale, net of issuance costs | $ 19,600 | ||||||||
Value of stock issued without obligations | $ 100,000 | ||||||||
Time limit for exercising the agreement | 24 months | ||||||||
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
The Company and Summary of Si_5
The Company and Summary of Significant Accounting Policies - Diluted net loss per share (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 14,141,603 | 42,492,695 | 25,807,899 | 42,492,695 |
Series A Preferred Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 8,936,015 | 3,249,104 | 8,936,015 | |
Series B Preferred Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 4,653,583 | 3,541,767 | 4,653,583 | |
Series m Preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 5,339,215 | 1,932,021 | 5,339,215 | |
Series m-2 Preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 1,660,756 | 160,000 | 1,660,756 | |
Series m-3 Preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 16,757 | 16,757 | ||
Series m-4 Preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 1,432,786 | 1,432,786 | ||
Series S Preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 5,567,171 | 2,783,404 | 5,567,171 | |
Warrants to Purchase Common Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 121,913 | 121,913 | ||
Warrants to purchase Series B (convertible to Class B common stock) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 53,918 | 53,918 | ||
Warrants to purchase of Series m-1 (convertible to Class A common stock) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 266,961 | 266,961 | ||
Warrants to purchase of Series m-3 (convertible to Class A common stock) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 1,432,786 | 1,432,786 | 1,432,786 | 1,432,786 |
Warrants to purchase of Series s (convertible to Class A common stock) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 4,441,814 | 2,525,714 | 4,441,814 | 2,525,714 |
Convertible Debt Securities | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 1,465,306 | 1,465,306 | ||
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total potentially dilutive shares | 8,267,003 | 9,019,814 | 8,267,003 | 9,019,814 |
The Company and Summary of Si_6
The Company and Summary of Significant Accounting Policies - Autonomous Security Robots, net (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Research and development expense. | ||
Inventory, Noncurrent [Line Items] | ||
Depreciation expense of finished ASRs | $ 34 | $ 41 |
Sales and marketing expense | ||
Inventory, Noncurrent [Line Items] | ||
Depreciation expense of finished ASRs | 27 | 35 |
Cost of revenue, net | ||
Inventory, Noncurrent [Line Items] | ||
Depreciation expense of finished ASRs | $ 602 | $ 671 |
Minimum | ||
Inventory, Noncurrent [Line Items] | ||
Estimated expected lives | 3 years | 3 years |
Maximum | ||
Inventory, Noncurrent [Line Items] | ||
Estimated expected lives | 4 years 6 months | 4 years 6 months |
The Company and Summary of Si_7
The Company and Summary of Significant Accounting Policies - ASRs, net consisted (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
The Company and Summary of Significant Accounting Policies | |||
Raw materials | $ 1,711 | $ 1,041 | |
ASRs in progress | 747 | 427 | |
Finished ASRs | 8,655 | 7,695 | |
ASRs, gross | 11,113 | 9,163 | |
Accumulated depreciation on Finished ASRs | (7,154) | (6,192) | |
ASRs, net | $ 3,959 | $ 2,971 | [1] |
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
The Company and Summary of Si_8
The Company and Summary of Significant Accounting Policies - Components of the Finished ASRs (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
The Company and Summary of Significant Accounting Policies | ||
ASRs on lease or available for lease | $ 7,398 | $ 6,489 |
Demonstration ASRs | 600 | 585 |
Research and development ASRs | 320 | 320 |
Docking stations | 337 | 301 |
Finished ASRs, gross | 8,655 | 7,695 |
Less: accumulated depreciation | (7,154) | (6,192) |
Finished ASRs, net | $ 1,501 | $ 1,503 |
Revenue and Deferred Revenue (D
Revenue and Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | $ 1,042 | $ 912 | $ 1,985 | $ 1,778 |
Point in Time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | 31 | 6 | 46 | 25 |
Transferred over Time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | $ 1,011 | $ 906 | $ 1,939 | $ 1,753 |
Revenue and Deferred Revenue _2
Revenue and Deferred Revenue (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2022 | Dec. 31, 2021 | [1] | |
Revenue and Deferred Revenue | |||
Deferred revenue - short term | $ 1,544 | $ 889 | |
Revenue recognized in the six months ended related to amounts included in deferred revenue as of the beginning of the year. | $ 621 | ||
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
Fair Value Measurement - Classi
Fair Value Measurement - Classification by level of input within the fair value hierarchy (Details) - Recurring basis - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Warrant liability - Series B Preferred Stock | ||
Liabilities | ||
Warrant liability | $ 370 | |
Warrant liability - Series m-3 Preferred Stock | ||
Liabilities | ||
Warrant liability | $ 2,388 | 7,156 |
Warrant liability - Series S Preferred Stock | ||
Liabilities | ||
Warrant liability | 12,161 | 23,040 |
Money market funds | ||
Assets | ||
Money market funds | 13,024 | 6,623 |
Level 1 | Money market funds | ||
Assets | ||
Money market funds | 13,024 | 6,623 |
Level 3 | Warrant liability - Series B Preferred Stock | ||
Liabilities | ||
Warrant liability | 370 | |
Level 3 | Warrant liability - Series m-3 Preferred Stock | ||
Liabilities | ||
Warrant liability | 2,388 | 7,156 |
Level 3 | Warrant liability - Series S Preferred Stock | ||
Liabilities | ||
Warrant liability | $ 12,161 | $ 23,040 |
Fair Value Measurement (Details
Fair Value Measurement (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Jun. 30, 2021 |
Fair Value Measurement | ||
Fair Value, Assets, Level 1 to Level 2 Transfers | $ 0 | $ 0 |
Fair Value, Assets, Level 2 to Level 1 Transfers | 0 | 0 |
Fair Value, Liabilities, Level 1 to Level 2 Transfers | 0 | 0 |
Fair Value, Liabilities, Level 2 to Level 1 Transfers | $ 0 | $ 0 |
Fair Value Measurement - Change
Fair Value Measurement - Changes in the fair value of Company's Level 3 financial liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | ||
Changes in the fair value of Company's Level 3 financial liabilities | |||
Beginning Balance | [1] | $ 30,566 | |
Ending Balance | 14,549 | ||
Warrant Liability | Level 3 | |||
Changes in the fair value of Company's Level 3 financial liabilities | |||
Beginning Balance | 30,566 | $ 5,617 | |
Warrants exercised | (370) | 0 | |
Revaluation of Series m-3 and S Preferred Stock warrants | (15,647) | 10,737 | |
Warrants expired | (14) | ||
Ending Balance | $ 14,549 | $ 16,340 | |
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
Debt Obligations - Additional i
Debt Obligations - Additional information (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||
Jan. 01, 2022 | Nov. 18, 2021 $ / shares | Apr. 30, 2019 USD ($) $ / shares shares | May 31, 2018 USD ($) payment | Jun. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) $ / shares shares | Jul. 01, 2021 $ / shares | Jun. 29, 2021 $ / shares | Dec. 31, 2020 $ / shares | Jun. 30, 2020 $ / shares | |
Debt obligations | ||||||||||||
Conversion of convertible debt into common stock | $ 868 | |||||||||||
Amortization of debt discount | $ 8,878 | $ 833 | ||||||||||
Preferred stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||
Series S Preferred Stock | ||||||||||||
Debt obligations | ||||||||||||
Number of warrants issued to purchase shares | shares | 2,941,814 | 2,941,814 | ||||||||||
Term Loan Agreement | ||||||||||||
Debt obligations | ||||||||||||
Maximum borrowing capacity | $ 3,500 | |||||||||||
Number of equal monthly payments | payment | 18 | |||||||||||
Interest rate | 1.75% | |||||||||||
Proceeds from issuance of loans payable, net of origination costs | $ 400 | |||||||||||
Term Loan Agreement | Class B Common Stock | ||||||||||||
Debt obligations | ||||||||||||
Number of warrants issued to purchase shares | shares | 77,413 | 77,413 | ||||||||||
Convertible Note Financing | ||||||||||||
Debt obligations | ||||||||||||
Interest rate | 12% | |||||||||||
Convertible instrument amount | $ 15,000 | $ 15,000 | ||||||||||
Aggregate principal amount | $ 1,000 | $ 14,700 | ||||||||||
Exercise price | $ / shares | $ 2.50 | $ 4.50 | ||||||||||
Conversion price | $ / shares | $ 2.50 | $ 3.50 | $ 4 | $ 4.50 | ||||||||
Percentage of interest rate on convertible notes | 3% | 12% | ||||||||||
Number of shares issued on Conversion of convertible notes | shares | 6,513,385 | |||||||||||
Outstanding convertible notes | $ 0 | $ 0 | ||||||||||
Conversion of convertible debt into common stock | 16,000 | |||||||||||
Debt discount | $ 300 | 300 | ||||||||||
Amortization of debt discount | $ 8,800 | |||||||||||
Convertible Note Financing | Series S Preferred Stock | ||||||||||||
Debt obligations | ||||||||||||
Number of warrants issued to purchase shares | shares | 2,941,814 | |||||||||||
Number of shares issued in exchange of debt | shares | 3,000,000 | |||||||||||
Exercise price | $ / shares | $ 4.50 | $ 4.50 | ||||||||||
Expiration of warrants term | 18 months |
Debt Obligations - Amortized ca
Debt Obligations - Amortized carrying amount of debt (Details) $ in Thousands | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | ||
Total debt | $ 7,109 | |
Less: current portion of debt obligations | (7,109) | [1] |
Convertible Note Financing | ||
Debt Instrument [Line Items] | ||
Total debt | $ 7,109 | |
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
Stock-Based Compensation - Equi
Stock-Based Compensation - Equity Incentive Plans (Details) - shares | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 23, 2022 | Dec. 31, 2016 | Apr. 30, 2014 | |
Incentive Units | ||||||
Number of shares issuable under plan | 8,267,003 | 8,267,003 | ||||
Number of shares available for grant | 595,669 | 595,669 | 216,003 | |||
Shares available for future issuance | 26,403,568 | 26,403,568 | ||||
Vesting period of options (in years) | 4 years | |||||
Percentage of outstanding common stock considered for annual increase in authorized shares under the plan (in percent) | 5% | |||||
Outstanding as of ending of year | 7 years 7 months 6 days | 8 years 1 month 13 days | ||||
2014 Equity Incentive Plan | ||||||
Incentive Units | ||||||
Number of shares issuable under plan | 2,000,000 | |||||
2016 Equity Incentive Plan | ||||||
Incentive Units | ||||||
Number of shares available for grant | 1,936,014 | |||||
Shares available for future issuance | 595,669 | 595,669 | ||||
Vesting period of options (in years) | 4 years | |||||
2016 Equity Incentive Plan | Term of stock options, If price of 100 % of Fair Market Value | ||||||
Incentive Units | ||||||
Maximum percentage of fair market value of Stock Options Price | 100% | |||||
Stock options term | 10 years | |||||
Percentage of voting power held | 10% | |||||
2016 Equity Incentive Plan | Term of stock options, If price of 110 % of Fair Market Value | ||||||
Incentive Units | ||||||
Maximum percentage of fair market value of Stock Options Price | 110% | |||||
Stock options term | 5 years | |||||
Percentage of voting power held | 10% | |||||
2022 Equity Incentive Plan | ||||||
Incentive Units | ||||||
Number of shares issuable under plan | 5,000,000 | |||||
2022 Equity Incentive Plan | Class A common stock | ||||||
Incentive Units | ||||||
Number of shares available for grant | 595,669 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock option activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Shares Available for Grant | ||||
Outstanding as of beginning of year | 216,003 | |||
Granted | (100,000) | |||
Forfeited | 468,000 | |||
Expired | 11,666 | |||
Outstanding as of ending of year | 595,669 | 595,669 | 216,003 | |
Number of Shares Outstanding | ||||
Outstanding as of beginning of year | 8,799,415 | |||
Granted | 100,000 | |||
Exercised | (152,746) | |||
Forfeited | (468,000) | |||
Expired | (11,666) | |||
Outstanding as of ending of year | 8,267,003 | 8,267,003 | 8,799,415 | |
Vested and exercisable | 4,230,115 | 4,230,115 | ||
Awards expected to vest | 4,036,888 | 4,036,888 | ||
Weighted Average Exercise Price | ||||
Outstanding as of beginning of year | $ 3.07 | |||
Granted | 10 | |||
Exercised | 1.33 | |||
Forfeited | 3.87 | |||
Expired | 2.34 | |||
Outstanding as of ending of year | $ 3.15 | 3.15 | $ 3.07 | |
Vested and exercisable as of ending of year | 1.22 | 1.22 | ||
Awards expected to vest | $ 5.17 | $ 5.17 | ||
Weighted Average Remaining Contractual Life (in years) | ||||
Outstanding as of ending of year | 7 years 7 months 6 days | 8 years 1 month 13 days | ||
Vested and exercisable as of ending of year | 6 years 7 months 28 days | |||
Awards expected to vest | 8 years 7 months 2 days | |||
Aggregate Intrinsic Value | ||||
Aggregate Intrinsic Value | $ 10,630 | $ 10,630 | $ 60,924 | |
Vested and exercisable | 7,522 | 7,522 | ||
Awards expected to vest | 3,108 | $ 3,108 | ||
Weighted average grant date fair value of options granted | $ 5.08 | |||
Share based payment award shares options exercise | 152,746 | 0 | ||
Fair value of the shares subject to stock options vested | $ 523 | $ 295 | ||
Unamortized stock-based compensation expense | $ 8,315 | $ 8,315 | ||
Vesting Term | 2 years 5 months 19 days |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions utilized for option (Details) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | |
Incentive Units | |||
Expected volatility | 52.12% | ||
Expected term (in years) | 6 years 10 days | ||
Stock options | |||
Incentive Units | |||
Risk-free interest rate | 1.09% | ||
Expected volatility | 52.66% | ||
Expected term (in years) | 0 years | 6 years 10 days | |
Stock options | Maximum | |||
Incentive Units | |||
Risk-free interest rate | 0.98% | ||
Stock options | Minimum | |||
Incentive Units | |||
Risk-free interest rate | 0.96% | ||
Expected volatility | 53.84% | ||
Expected term (in years) | 6 years 29 days |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of stock-based compensation expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Classification of equity-based compensation | ||||
Total equity based compensation | $ 727 | $ 227 | $ 1,452 | $ 458 |
Cost of revenue, net | ||||
Classification of equity-based compensation | ||||
Total equity based compensation | 82 | 51 | 162 | 101 |
Research and development expense. | ||||
Classification of equity-based compensation | ||||
Total equity based compensation | 243 | 96 | 470 | 175 |
Sales and marketing expense | ||||
Classification of equity-based compensation | ||||
Total equity based compensation | 61 | 20 | 132 | 61 |
General and Administrative | ||||
Classification of equity-based compensation | ||||
Total equity based compensation | $ 341 | $ 60 | $ 688 | $ 121 |
Capital Stock and Warrants (Det
Capital Stock and Warrants (Details) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Capital Stock and Warrants | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 43,405,324 | 43,405,324 |
Class A common stock | ||
Capital Stock and Warrants | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 114,000,000 | 114,000,000 |
Class B Common Stock | ||
Capital Stock and Warrants | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Capital Stock and Warrants - Pr
Capital Stock and Warrants - Preferred Stock (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | ||||||||
Jun. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) $ / shares shares | Nov. 18, 2021 $ / shares | Sep. 10, 2019 shares | Apr. 30, 2019 $ / shares | Dec. 31, 2018 $ / shares shares | Dec. 31, 2017 $ / shares shares | ||
Capital Stock and Warrants | |||||||||
Preferred stock, shares authorized | 43,405,324 | 43,405,324 | |||||||
Preferred stock, value | $ | $ 36,620 | $ 57,218 | [1] | ||||||
Preferred stock, par value | $ / shares | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares issued | 11,666,296 | 19,617,107 | |||||||
Issuance costs | $ | $ 50 | ||||||||
Proceeds from redeemable preferred stock | $ | $ 16,387 | ||||||||
Convertible Note Financing | |||||||||
Capital Stock and Warrants | |||||||||
Exercise price | $ / shares | $ 4.50 | $ 2.50 | |||||||
Mr.Li | Convertible Note Financing | |||||||||
Capital Stock and Warrants | |||||||||
Percentage of voting power held | 0.86% | ||||||||
Series m-3 Preferred Stock | Convertible Note Financing | |||||||||
Capital Stock and Warrants | |||||||||
Preferred stock, repurchased as exchange upon conversion | 1,432,786 | ||||||||
Number of warrants issued to purchase shares | 1,432,786 | 1,432,786 | |||||||
Exercise price | $ / shares | $ 4 | $ 4 | |||||||
Series S Preferred Stock | |||||||||
Capital Stock and Warrants | |||||||||
Number of warrants issued to purchase shares | 2,941,814 | ||||||||
Series S Preferred Stock | Convertible Note Financing | |||||||||
Capital Stock and Warrants | |||||||||
Preferred stock, conversion ratio | 1 | ||||||||
Adjusted conversion ratio | 1.1069 | ||||||||
Number of warrants issued to purchase shares | 2,941,814 | ||||||||
Exercise price | $ / shares | $ 4.50 | $ 4.50 | |||||||
Series m-4 Preferred Stock | Convertible Note Financing | |||||||||
Capital Stock and Warrants | |||||||||
Preferred stock, shares issued upon conversion | 1,432,786 | ||||||||
[1]The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date. |
Capital Stock and Warrants - Co
Capital Stock and Warrants - Convertible preferred stock authorized and issued and outstanding (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Capital Stock and Warrants | ||
Shares Authorized | 43,405,324 | 43,405,324 |
Aggregate Liquidation Preference | $ 38,671 |
Capital Stock and Warrants - _2
Capital Stock and Warrants - Common Stock (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Apr. 04, 2022 | Jan. 26, 2022 | Oct. 15, 2021 | Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Capital Stock and Warrants | ||||||
Value of stock issued without obligations | $ 100,000,000 | |||||
Number of shares issued | $ 378,000 | $ 378,000 | ||||
Number of shares issued (in shares) | 2,236,619 | |||||
Common shares issued in offering | 378,000 | 378,000 | ||||
Net proceeds from issuance of shares | $ 169,000 | $ 19,625,000 | ||||
Registration Rights Agreement | ||||||
Capital Stock and Warrants | ||||||
Number of shares resold | 12,197,776 | |||||
Class B Common Stock | ||||||
Capital Stock and Warrants | ||||||
Common stock, Share outstanding | 10,362,170 | 10,362,170 | 13,131,197 | |||
Class A common stock | ||||||
Capital Stock and Warrants | ||||||
Common stock, Share outstanding | 26,085,487 | 26,085,487 | 5,936,929 | |||
Number of shares issued (in shares) | 98,888 | |||||
Class A common stock | Stock purchase agreement | ||||||
Capital Stock and Warrants | ||||||
Value of stock issued without obligations | $ 100,000,000 | |||||
Number of shares issued (in shares) | 95,734 | 95,734 | ||||
Total number of additional commitment shares | 98,888 | |||||
Net proceeds from issuance of shares | $ 400,000 | |||||
Class A common stock | Upon receipt of $25,000,000 total aggregate gross cash proceeds | Stock purchase agreement | ||||||
Capital Stock and Warrants | ||||||
Aggregate gross share proceeds | $ 25,000,000 | |||||
Additional commitment shares to be issued | 59,333 | |||||
Class A common stock | Upon receipt of $50,000,000 total aggregate gross cash proceeds | Stock purchase agreement | ||||||
Capital Stock and Warrants | ||||||
Aggregate gross share proceeds | $ 50,000,000 | |||||
Additional commitment shares to be issued | 39,555 | |||||
Class A common stock | 2021 Regulation A Offering | ||||||
Capital Stock and Warrants | ||||||
Maximum amount of stock offered as per regulations | $ 40,000,000 | |||||
Number of shares issued | $ 2,236,619,000 | |||||
Common shares issued in offering | 2,236,619,000 | |||||
Net proceeds from issuance of shares | $ 19,600,000 |
Capital Stock and Warrants - Wa
Capital Stock and Warrants - Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||
Jan. 01, 2022 | Nov. 18, 2021 | Apr. 30, 2019 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Sep. 10, 2019 | Jul. 23, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Capital Stock and Warrants | ||||||||||||
Change in fair value of warrant liabilities | $ 8,125 | $ (10,737) | $ 15,647 | $ (10,737) | ||||||||
Interest income (expense), net | $ 1 | $ (594) | $ (8,910) | $ (1,133) | ||||||||
Convertible Note Financing | ||||||||||||
Capital Stock and Warrants | ||||||||||||
Convertible instrument amount | $ 15,000 | $ 15,000 | ||||||||||
Aggregate principal amount | $ 1,000 | $ 14,700 | ||||||||||
Exercise price | $ 2.50 | $ 4.50 | ||||||||||
Percentage of interest rate on convertible notes | 3% | 12% | ||||||||||
Series S Preferred Stock | ||||||||||||
Capital Stock and Warrants | ||||||||||||
Number of warrants issued to purchase shares | 2,941,814 | 2,941,814 | ||||||||||
Series S Preferred Stock | Productions LLC [Member] | ||||||||||||
Capital Stock and Warrants | ||||||||||||
Exercise price | $ 8 | |||||||||||
Number of warrants issued to purchase shares | 1,500,000 | |||||||||||
Series S Preferred Stock | Convertible Note Financing | ||||||||||||
Capital Stock and Warrants | ||||||||||||
Number of shares issued in exchange of debt | 3,000,000 | |||||||||||
Exercise price | $ 4.50 | $ 4.50 | ||||||||||
Expiration of warrants term | 18 months | |||||||||||
Number of warrants issued to purchase shares | 2,941,814 | |||||||||||
Series m-4 Preferred Stock | Convertible Note Financing | ||||||||||||
Capital Stock and Warrants | ||||||||||||
Preferred stock, shares issued upon conversion | 1,432,786 | |||||||||||
Series m-3 Preferred Stock | Convertible Note Financing | ||||||||||||
Capital Stock and Warrants | ||||||||||||
Exercise price | $ 4 | $ 4 | ||||||||||
Preferred stock, repurchased as exchange upon conversion | 1,432,786 | |||||||||||
Number of warrants issued to purchase shares | 1,432,786 | 1,432,786 |
Capital Stock and Warrants - Ou
Capital Stock and Warrants - Outstanding warrants (Details) | Jun. 30, 2022 $ / shares shares |
Capital Stock and Warrants | |
Number of warrants | 5,874,600 |
Series m-3 Preferred Stock | Warrants expiration date, December 31, 2024 | |
Capital Stock and Warrants | |
Number of warrants | 1,432,786 |
Exercise price | $ / shares | $ 4 |
Series S Preferred Stock | Warrants expiration date, December 31, 2024 | |
Capital Stock and Warrants | |
Number of warrants | 2,941,814 |
Exercise price | $ / shares | $ 4.5000 |
Series S Preferred Stock | Warrants expiration date, July 31, 2024 | |
Capital Stock and Warrants | |
Number of warrants | 1,500,000 |
Exercise price | $ / shares | $ 8 |
Capital Stock and Warrants - _3
Capital Stock and Warrants - Common stock reserved for future issuance (Details) - shares | Jun. 30, 2022 | Dec. 31, 2021 |
Capital Stock and Warrants | ||
Stock options to purchase common stock | 8,267,003 | 8,799,415 |
Warrants outstanding for future issuance of convertible preferred stock and common stock | 5,874,600 | |
Stock options available for future issuance | 595,669 | 216,003 |
Total shares of common stock reserved | 26,403,568 | |
Series A Preferred Stock | ||
Capital Stock and Warrants | ||
Preferred stock reserved for future issuance | 3,249,104 | |
Series B Preferred Stock | ||
Capital Stock and Warrants | ||
Preferred stock reserved for future issuance | 3,541,767 | |
Series m Preferred Stock | ||
Capital Stock and Warrants | ||
Preferred stock reserved for future issuance | 1,932,021 | |
Series m-2 Preferred Stock | ||
Capital Stock and Warrants | ||
Preferred stock reserved for future issuance | 160,000 | |
Series S Preferred Stock | ||
Capital Stock and Warrants | ||
Preferred stock reserved for future issuance | 2,783,404 |
Related parties and related-p_2
Related parties and related-party transactions (Details) - Konica Minolta, Inc. - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Related parties and related-party transactions | |||||
Service fees | $ 101 | $ 80 | $ 192 | $ 140 | |
Payables | $ 47 | $ 47 | $ 29 |
Commitments and contingencies -
Commitments and contingencies - Components of lease costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2022 | |
Commitments and contingencies. | ||
Operating lease right-of-use-assets | $ 193 | $ 373 |
Commitments and contingencies_2
Commitments and contingencies - Future minimum operating lease payments (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Commitments and contingencies. | |
2022 (remaining) | $ 377 |
2023 | 507 |
Total future minimum lease payments | 884 |
Less - Interest | (63) |
Present value of lease liabilities | $ 821 |
Weighted average remaining lease term | 1 year 2 months 12 days |
Weighted average discount rate | 12% |
Commitments and contingencies_3
Commitments and contingencies - Sales Tax Contingencies (Details) - USD ($) $ in Millions | Jun. 30, 2022 | Dec. 31, 2021 |
Commitments and contingencies. | ||
Sales tax liability | $ 0.5 | $ 0.5 |