Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 21, 2023 | Jun. 30, 2022 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Offerpad Solutions Inc. | ||
Entity Central Index Key | 0001825024 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Public Float | $ 200.8 | ||
Entity Shell Company | false | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
ICFR Auditor Attestation Flag | true | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation, State or Country Code | DE | ||
Entity File Number | 001-39641 | ||
Entity Tax Identification Number | 85-2800538 | ||
Entity Address, Address Line One | 2150 E. Germann Road | ||
Entity Address, Address Line Two | Suite 1 | ||
Entity Address, City or Town | Chandler | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85286 | ||
City Area Code | 844 | ||
Local Phone Number | 388-4539 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive Proxy Statement relating to its 2023 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days after December 31, 2022 are incorporated by reference into Part III of this Annual Report on Form 10-K | ||
Auditor Firm ID | 34 | ||
Auditor Location | Tempe, Arizona | ||
Auditor Name | DELOITTE & TOUCHE LLP | ||
Class A Common Stock | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Class A common stock, $0.0001 par value per share | ||
Trading Symbol | OPAD | ||
Security Exchange Name | NYSE | ||
Entity Common Stock, Shares Outstanding | 232,571,810 | ||
Anti-dilutive warrants | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Warrants to purchase Class A common stock, at an exercise price of $11.50 per share | ||
Trading Symbol | OPADWS | ||
Security Exchange Name | NYSE | ||
Class B Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 14,816,236 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Current assets: | |||
Cash and cash equivalents | $ 97,241 | $ 169,817 | |
Restricted cash | 43,058 | 24,616 | |
Accounts receivable | 2,350 | 6,165 | |
Inventory | 664,697 | 1,132,571 | |
Prepaid expenses and other current assets | 6,833 | 9,808 | |
Total current assets | 814,179 | 1,342,977 | |
Property and equipment, net | 5,194 | 5,146 | |
Other non-current assets | 5,696 | 4,959 | |
Total assets | [1] | 825,069 | 1,353,082 |
Current liabilities: | |||
Accounts payable | 4,647 | 6,399 | |
Accrued and other current liabilities | 28,252 | 35,027 | |
Secured credit facilities and other debt, net | 605,889 | 861,762 | |
Secured credit facilities and other debt - related party | 60,176 | 164,434 | |
Total current liabilities | 698,964 | 1,067,622 | |
Warrant liabilities | 539 | 24,061 | |
Other long-term liabilities | 3,689 | 3,830 | |
Total liabilities | [2] | 703,192 | 1,095,513 |
Commitments and contingencies (Note 16) | |||
Temporary equity: | |||
Total temporary equity | 0 | 0 | |
Stockholders' equity: | |||
Additional paid in capital | 402,521 | 389,601 | |
Accumulated deficit | (280,669) | (132,056) | |
Total stockholders' equity | 121,877 | 257,569 | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 825,069 | 1,353,082 | |
Series A Convertible Preferred Stock | |||
Temporary equity: | |||
Total temporary equity | 0 | 0 | |
Series A-1 Convertible Preferred Stock | |||
Temporary equity: | |||
Total temporary equity | 0 | 0 | |
Series A-2 Convertible Preferred Stock | |||
Temporary equity: | |||
Total temporary equity | 0 | 0 | |
Series B Convertible Preferred Stock | |||
Temporary equity: | |||
Total temporary equity | 0 | 0 | |
Series C Convertible Preferred Stock | |||
Temporary equity: | |||
Total temporary equity | 0 | 0 | |
Class A Common Stock | |||
Stockholders' equity: | |||
Common stock value | 23 | 22 | |
Class B Common Stock | |||
Stockholders' equity: | |||
Common stock value | $ 2 | $ 2 | |
[1] Our consolidated assets as of December 31, 2022 and 2021 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $ 42,958 and $ 24,616 ; Accounts receivable, $ 1,841 and $ 4,845 ; Inventory, $ 664,697 and $ 1,132,571 ; Prepaid expenses and other current assets, $ 212 and $ 2,871 ; Total assets of $ 709,708 and $ 1,164,903 , respectively. Our consolidated liabilities as of December 31, 2022 and 2021 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $ 1,976 and $ 2,810 ; Accrued and other current liabilities, $ 4,408 and $ 3,537 ; Secured credit facilities and other debt, net, $ 666,065 and $ 1,026,196 ; Total liabilities, $ 672,449 and $ 1,032,543 , respectively. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Restricted cash | $ 43,058 | $ 24,616 | |
Accounts receivable | 2,350 | 6,165 | |
Inventory | 664,697 | 1,132,571 | |
Prepaid expenses and other current assets | 6,833 | 9,808 | |
Total assets | [1] | 825,069 | 1,353,082 |
Accounts payable | 4,647 | 6,399 | |
Accrued and other current liabilities | 28,252 | 35,027 | |
Secured credit facilities and other debt, net | 605,889 | 861,762 | |
Total liabilities | [2] | 703,192 | 1,095,513 |
Variable Interest Entity | |||
Restricted cash | 42,958 | 24,616 | |
Accounts receivable | 1,841 | 4,845 | |
Inventory | 664,697 | 1,132,571 | |
Prepaid expenses and other current assets | 212 | 2,871 | |
Total assets | 709,708 | 1,164,903 | |
Accounts payable | 1,976 | 2,810 | |
Accrued and other current liabilities | 4,408 | 3,537 | |
Secured credit facilities and other debt, net | 666,065 | 1,026,196 | |
Total liabilities | $ 672,449 | $ 1,032,543 | |
Series A Convertible Preferred Stock | |||
Temporary equity, shares outstanding | 0 | 0 | |
Series A-1 Convertible Preferred Stock | |||
Temporary equity, shares outstanding | 0 | 0 | |
Series A-2 Convertible Preferred Stock | |||
Temporary equity, shares outstanding | 0 | 0 | |
Series B Convertible Preferred Stock | |||
Temporary equity, shares outstanding | 0 | 0 | |
Series C Convertible Preferred Stock | |||
Temporary equity, shares outstanding | 0 | 0 | |
Class A Common Stock | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 | |
Common stock, shares issued | 232,378,752 | 224,154,000 | |
Common stock, shares outstanding | 232,378,752 | 224,154,000 | |
Class B Common Stock | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 20,000,000 | 20,000,000 | |
Common stock, shares issued | 14,816,236 | 14,816,000 | |
Common stock, shares outstanding | 14,816,236 | 14,816,000 | |
[1] Our consolidated assets as of December 31, 2022 and 2021 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $ 42,958 and $ 24,616 ; Accounts receivable, $ 1,841 and $ 4,845 ; Inventory, $ 664,697 and $ 1,132,571 ; Prepaid expenses and other current assets, $ 212 and $ 2,871 ; Total assets of $ 709,708 and $ 1,164,903 , respectively. Our consolidated liabilities as of December 31, 2022 and 2021 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $ 1,976 and $ 2,810 ; Accrued and other current liabilities, $ 4,408 and $ 3,537 ; Secured credit facilities and other debt, net, $ 666,065 and $ 1,026,196 ; Total liabilities, $ 672,449 and $ 1,032,543 , respectively. |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||
Revenue | $ 3,952,314 | $ 2,070,446 | $ 1,064,257 |
Costs of revenue | 3,769,892 | 1,862,631 | 976,478 |
Gross profit | 182,422 | 207,815 | 87,779 |
Operating expenses: | |||
Sales, marketing and operating | 238,931 | 146,872 | 76,786 |
General and administrative | 58,718 | 30,317 | 17,481 |
Technology and development | 12,090 | 10,860 | 7,270 |
Total operating expenses | 309,739 | 188,049 | 101,537 |
(Loss) income from operations | (127,317) | 19,766 | (13,758) |
Other income (expense): | |||
Change in fair value of warrant liabilities | 23,522 | 2,464 | 0 |
Interest expense | (45,991) | (15,848) | (10,031) |
Other income, net | 1,532 | 248 | 834 |
Total other expense | (20,937) | (13,136) | (9,197) |
(Loss) income before income taxes | (148,254) | 6,630 | (22,955) |
Income tax expense | (359) | (170) | (163) |
Net (loss) income | $ (148,613) | $ 6,460 | $ (23,118) |
Net (loss) income per share, basic | $ (0.61) | $ 0.05 | $ (0.40) |
Net (loss) income per share, diluted | $ (0.61) | $ 0.05 | $ (0.40) |
Weighted average common shares outstanding, basic | 245,148 | 118,571 | 57,865 |
Weighted average common shares outstanding, diluted | 245,148 | 143,220 | 57,865 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Treasury Stock | Series A Convertible Preferred Stock | Series A-1 Convertible Preferred Stock | Series A-2 Convertible Preferred Stock | Series B Convertible Preferred Stock | Series C Convertible Preferred Stock |
Beginning balance at Dec. 31, 2019 | $ (121,503) | $ 0 | $ 4,545 | $ (115,398) | $ (10,650) | |||||
Beginning balance, shares at Dec. 31, 2019 | 57,865,000 | 4,794,000 | ||||||||
Temporary Equity, Balance at Dec. 31, 2019 | 154,300 | $ 14,921 | $ 7,470 | $ 7,463 | $ 49,845 | $ 74,601 | ||||
Temporary Equity, Balance, shares at Dec. 31, 2019 | 20,907,000 | 10,905,000 | 8,322,000 | 58,390,000 | 28,358,000 | |||||
Issuance of series C stock net of offering costs | $ 29,823 | $ 29,823 | ||||||||
Issuance of series C stock net of offering costs, shares | 11,627,000 | |||||||||
Options, Excercised | 0 | |||||||||
Conversion of preferred stock to common stock | $ 0 | $ 0 | ||||||||
Stock-based compensation expense | 1,363 | 1,363 | ||||||||
Net income (loss) | (23,118) | (23,118) | ||||||||
Ending balance at Dec. 31, 2020 | (143,258) | $ 0 | 5,908 | (138,516) | $ (10,650) | |||||
Ending balance, shares at Dec. 31, 2020 | 57,865,000 | 4,794,000 | ||||||||
Temporary Equity, Balance at Dec. 31, 2020 | 184,123 | $ 14,921 | $ 7,470 | $ 7,463 | $ 49,845 | $ 104,424 | ||||
Temporary Equity, Balance, shares at Dec. 31, 2020 | 20,907,000 | 10,905,000 | 8,322,000 | 58,390,000 | 39,985,000 | |||||
Issuance of common stock upon exercise of stock options | $ 647 | 647 | ||||||||
Options, Excercised | 2,490,000 | (2,279,000) | ||||||||
Stock Issued During Period, Value, Stock Options Exercised | $ 647 | 647 | ||||||||
Issuance of common stock upon early exercise of stock options, shares | 211,000 | |||||||||
Vesting of early exercised stock options | 171 | 171 | ||||||||
Conversion of preferred stock to common stock | (184,123) | $ (14,921) | $ (7,470) | $ (7,463) | $ (49,845) | $ (104,424) | ||||
Conversion of preferred stock to common stock, Shares | (20,907,000) | (10,905,000) | (8,322,000) | (58,390,000) | (39,985,000) | |||||
Conversion of preferred stock to common stock | 184,123 | $ 14 | 184,109 | $ 10,650 | ||||||
Conversion of preferred stock to common stock, shares | 138,612,000 | |||||||||
Issuance of Class A common stock and Class B common stock in connection with Business Combination | 206,347 | $ 10 | 195,687 | $ 10,650 | ||||||
Issuance of Class A common stock and Class B common stock in connection with Business Combination, shares | 40,073,000 | (4,794,000) | ||||||||
Repurchased shares, shares | (70,000) | |||||||||
Stock-based compensation expense | 3,079 | 3,079 | ||||||||
Net income (loss) | 6,460 | 6,460 | ||||||||
Ending balance at Dec. 31, 2021 | 257,569 | $ 24 | 389,601 | (132,056) | ||||||
Ending balance, shares at Dec. 31, 2021 | 238,970,000 | |||||||||
Temporary Equity, Balance at Dec. 31, 2021 | 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Temporary Equity, Balance, shares at Dec. 31, 2021 | 0 | 0 | 0 | 0 | 0 | |||||
Issuance of common stock upon exercise of stock options | 4,671 | $ 1 | 4,670 | |||||||
Issuance of common stock upon vesting of restricted stock units, shares | 124,000 | |||||||||
Issuance of common stock upon vesting of restricted stock units | $ (57) | (57) | ||||||||
Options, Excercised | 8,101,000 | 8,101,000 | ||||||||
Stock Issued During Period, Value, Stock Options Exercised | $ 4,671 | $ 1 | 4,670 | |||||||
Conversion of preferred stock to common stock | 0 | $ 0 | ||||||||
Stock-based compensation expense | 8,307 | 8,307 | ||||||||
Net income (loss) | (148,613) | (148,613) | ||||||||
Ending balance at Dec. 31, 2022 | 121,877 | $ 25 | $ 402,521 | $ (280,669) | ||||||
Ending balance, shares at Dec. 31, 2022 | 247,195,000 | |||||||||
Temporary Equity, Balance at Dec. 31, 2022 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Temporary Equity, Balance, shares at Dec. 31, 2022 | 0 | 0 | 0 | 0 | 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net (loss) income | $ (148,613) | $ 6,460 | $ (23,118) |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | |||
Depreciation | 1,022 | 523 | 434 |
Gain on sale of property and equipment | 0 | (246) | 0 |
Amortization of debt financing costs | 2,948 | 916 | 262 |
Impairment of inventory | 93,810 | 2,843 | 3,170 |
Stock-based compensation | 8,307 | 3,079 | 1,363 |
Change in fair value of warrant liabilities | (23,522) | (2,464) | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable | 3,815 | (3,845) | 937 |
Inventory | 374,064 | (949,591) | 169,079 |
Prepaid expenses and other assets | (275) | (5,288) | 115 |
Accounts payable | (1,752) | 4,130 | 841 |
Accrued and other liabilities | (4,402) | 21,563 | 1,781 |
Net cash provided by (used in) operating activities | 305,402 | (921,920) | 154,864 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (1,070) | (13,687) | (2,858) |
Proceeds from sales of property and equipment | 0 | 2,032 | 0 |
Net cash used in investing activities | (1,070) | (11,655) | (2,858) |
Cash flows from financing activities: | |||
Borrowings from credit facilities and other debt | 3,178,033 | 2,764,071 | 799,997 |
Repayments of credit facilities and other debt | (3,540,466) | (1,912,837) | (960,510) |
Payment of debt financing costs | (646) | (7,632) | (457) |
Proceeds from exercise of stock options | 4,898 | 902 | |
Payments for taxes related to stock-based awards | (285) | 0 | 0 |
Proceeds from Business Combination | 0 | 284,011 | 0 |
Issuance cost of common stock | 0 | (51,249) | 0 |
Proceeds from issuance of Class C preferred stock, net | 0 | 0 | 29,823 |
Net cash (used in) provided by financing activities | (358,466) | 1,077,266 | (131,147) |
Net change in cash, cash equivalents and restricted cash | (54,134) | 143,691 | 20,859 |
Cash, cash equivalents and restricted cash, beginning of period | 194,433 | 50,742 | 29,883 |
Cash, cash equivalents and restricted cash, end of period | 140,299 | 194,433 | 50,742 |
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet: | |||
Cash and cash equivalents | 97,241 | 169,817 | 43,938 |
Restricted cash | 43,058 | 24,616 | 6,804 |
Supplemental disclosure of cash flow information: | |||
Cash payments for interest | 59,732 | 21,875 | 14,048 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Transfer of property and equipment, net to inventory | 0 | 14,464 | 0 |
Acquisition of warrant liabilities | 0 | 26,525 | 0 |
Conversion of preferred stock to common stock | 0 | 184,123 | 0 |
Conversion of treasury stock | 0 | 184,123 | 0 |
Treasury Stock | |||
Supplemental disclosure of non-cash investing and financing activities: | |||
Conversion of preferred stock to common stock | 0 | 10,650 | 0 |
Conversion of treasury stock | $ 0 | $ 10,650 | $ 0 |
Nature of Operations and Signif
Nature of Operations and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Nature of Operations and Significant Accounting Policies | Note 1. Nature of Operations and Significant Accounting Policies Description of Business Offerpad was founded in 2015 and together with its subsidiaries, is a customer-centric, home buying and selling platform that provides customers with the ultimate home transaction experience, offering convenience, control, certainty, and value. The Company is headquartered in Chandler, Arizona and operated in over 1,800 cities and towns in 28 metropolitan markets across 16 states as of December 31, 2022 . Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). Offerpad Solutions Inc. was formed on September 1, 2021 through a business combination (the “Business Combination”) with Supernova Partners Acquisition Company, Inc. (“Supernova”). In connection with the closing of the Business Combination, Supernova changed its name to Offerpad Solutions Inc. T he Business Combination was accounted for as a reverse recapitalization. Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant estimates include those related to the net realizable value of inventory, among others. Actual results could differ from those estimates. Principles of Consolidation The Company’s consolidated financial statements include the assets, liabilities, revenues and expenses of the Company, its wholly owned operating subsidiaries and variable interest entities where the Company is the primary beneficiary. All intercompany accounts and transactions have been eliminated in consolidation. Segment Reporting Operating segments are components of an entity for which discrete financial information is available and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources and in assessing operating performance. The Company’s CODM is its Chief Executive Officer. The Company is not organized around specific services or geographic regions, but rather, operates in one service line, providing a home buying and selling platform. The Company’s CODM reviews the financial information presented on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. As such, the Company has determined that it is organized and operated as one operating and reportable segment on a consolidated basis for each of the periods presented. Cash and Cash Equivalents Cash includes demand deposits with banks and financial institutions. Cash equivalents include only investments with original maturities to us of three months or less that are highly liquid and readily convertible to known amounts of cash. Restricted Cash Restricted cash primarily consists of cash received from the resale of homes that is specifically designated to repay borrowings under one of the Company’s secured credit facilities and is typically released within a few days of the home sale. Concentrations of Credit Risk Financial instruments that are potentially subject to concentrations of credit risk are primarily cash and cash equivalents. Cash and cash equivalents are placed with major financial institutions deemed to be of high-credit-quality in order to limit credit exposure. Cash is regularly maintained in excess of federally insured limits at the financial institutions. Management believes that the Company is not exposed to any significant credit risk related to cash deposits. Accounts Receivable Accounts receivable are generated through the sale of a home and generally results in a one- or two-day delay in receiving cash from the title company. Accounts receivable are stated at the amount management expects to collect from outstanding balances. Most of the Company’s transactions are processed through escrow and therefore, collectability is reasonably assured. The Company reviews accounts receivable on a regular basis and estimates an amount of losses for uncollectible accounts based on its historical collections, age of the receivable, and any other known conditions that may affect collectability. Inventory Inventory consists of acquired homes and is stated at the lower of cost or net realizable value, with cost and net realizable value determined by the specific identification of each home. Costs include initial purchase costs and renovation costs, as well as holding costs and interest incurred during the renovation period, prior to the listing date. Selling costs, including commissions and holding costs incurred after the listing date, are expensed as incurred and included in sales, marketing and operating expenses. The Company reviews inventory for impairment on a quarterly basis, or more frequently if events or changes in circumstances indicate that the carrying value of inventory may not be recoverable. The Company evaluates inventory for indicators that net realizable value is lower than cost at the individual home level. The Company generally considers multiple factors in determining net realizable value for each home, including recent comparable home sale transactions in the specific area where the home is located, the residential real estate market conditions in both the local market in which the home is located and in the U.S. in general, the impact of national, regional or local economic conditions and expected selling costs. When evidence exists that the net realizable value of inventory is lower than its cost, the difference is recognized as impairment in cost of revenue and the related inventory is adjusted to its net realizable value. For individual homes or portfolios of homes under contract to sell as of the impairment assessment date, if the carrying value exceeds the contract price less expected selling costs, the carrying value of these homes are adjusted to the contract price less expected selling costs. For all other homes, if the carrying value exceeds the expected sale price less expected selling costs, the carrying value of these homes are adjusted to the expected sale price less expected selling costs. Changes in the Company’s pricing assumptions may lead to a change in the outcome of the impairment analysis, and actual results may differ from the Company’s assumptions. The Company recorded inventory impairments of $ 93.8 million, $ 2.8 million and $ 3.2 million during the years ended December 31, 2022, 2021 and 2020, respectively. Refer to Note 3. Inventory, for further details. Property and Equipment Property and equipment is recorded at cost less accumulated depreciation, and primarily consists of rooftop solar panel systems installed on residential real estate . Th e Company depreciates its property and equipment using the straight-line method over the estimated useful lives of the related assets, which are as follows: Property and Equipment Category Estimated Useful Life Rooftop solar panel systems Twenty years Leasehold improvements Lesser of estimated useful life or remaining lease term Computers and equipment Five years Office equipment and furniture Seven years Software systems Three to five years Refer to Note 4. Property and Equipment, for further details. Leases The Company determines if an arrangement is or contains a lease at inception of the arrangement. For leases with terms greater than 12 months, the Company records the related operating or finance right-of-use asset and lease liability at the present value of the future lease payments over the lease term at the lease commencement date. The Company is generally not able to readily determine the implicit rate in its lease arrangements, and therefore, uses its incremental borrowing rate at lease commencement to determine the present value of lease payments. The incremental borrowing rate represents the Company’s estimate of the interest rate the Company would incur at lease commencement to borrow an amount similar to the lease payments on a collateralized basis over the term of a lease. Renewal and early termination options are not included in the measurement of the right-of-use asset and lease liability unless the Company is reasonably certain to exercise the option. Additionally, certain leases contain lease incentives, such as construction allowances from landlords. These incentives reduce the right-of-use asset related to the lease. Certain of the Company’s leases contain rent escalations over the lease term. The Company recognizes expense for operating leases on a straight-line basis over the lease term. Certain of the Company’s lease agreements also contain variable lease payments for common area maintenance, utility, and taxes. The Company has elected the practical expedient to combine lease and non-lease components for all asset categories. Therefore, the lease payments used to measure the lease liability for these leases include fixed minimum rentals along with non-lease component charges. The Company does not have significant residual value guarantees or restrictive covenants in its lease portfolio. Operating lease assets and liabilities are included on the Company’s Consolidated Balance Sheet in Other non-current assets , Accrued and other current liabilities , and Other long-term liabilities . Refer to Note 5. Leases, for further details. Long-Lived Asset Impairments Long-lived assets, including property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment loss is recognized to the extent the carrying amount of the underlying asset exceeds its fair value. The Company recognized no impairment charges on its long-lived assets during the years ended December 31, 2022, 2021 and 2020 . Warrant Liabilities The Company evaluates its financial instruments, including its outstanding warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The Company has outstanding public and private warrants, both of which do not meet the criteria for equity classification and are accounted for as liabilities. Accordingly, the Company recognizes the warrants as liabilities at fair value and adjusts the warrants to fair value at each reporting period. The warrant liabilities are subject to re-measurement at each balance sheet date until exercised or expired, and any change in fair value is recognized in the Company’s consolidated statements of operations. The fair value of the public warrants is estimated based on the quoted market price of such warrants on the valuation date. The fair value of the private warrants is estimated using the Black-Scholes-Merton option-pricing model. Refer to Note 8. Warrant Liabilities, for further details. Revenue Recognition Revenue is recognized when (or as) performance obligations are satisfied by transferring control of the promised products or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those products or services. The Company applies the following steps in determining the timing and amount of revenue to recognize: (1) identify the contract with our customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract, if applicable; and (5) recognize revenue when (or as) the performance obligation is satisfied. Revenue from the sale of homes is derived from the resale of homes on the open market. Home sales revenue is recognized at the time of the closing when title to and possession of the property are transferred to the buyer. The amount of revenue recognized for each home sale is equal to the sale price of the home net of resale concessions and credits to the buyer. Cost of Revenue Cost of revenue includes the initial purchase costs, renovation costs, holding costs and interest incurred during the renovation period, prior to listing date and real estate inventory valuation adjustments, if any. These costs are accumulated in real estate inventory up until the home is ready for resale, and then charged to cost of revenue under the specific identification method when the property is sold. Sales, Marketing and Operating Sales, marketing and operating expenses consist of real estate agent commissions, advertising, and holding costs on homes incurred during the period that homes are listed for sale, which includes utilities, taxes, maintenance, and other costs. Sales, marketing and operating expense includes any headcount expenses in support of sales, marketing, and real estate inventory operations such as salaries, benefits, and stock-based compensation. Sales, marketing and operating expenses are charged to operations as incurred. The Company incurred advertising expenses o f $ 46.5 million, $ 45.3 million and $ 11.5 million during the years ended December 31, 2022, 2021 and 2020 , respectively. Technology and Development Technology and development expenses consist of headcount expenses, including salaries, benefits and stock-based compensation expense for employees and contractors engaged in the design, development, and testing of website applications and software development. Technology and development expenses are charged to operations as incurred. Stock-Based Compensation Stock-based compensation awards consist of stock options, restricted stock units and performance-based restricted stock units. The Company measures and recognizes compensation expense for all stock-based compensation awards based on their estimated fair values on the grant date. The Company records compensation expense for all stock-based compensation awards on a straight-line basis over the requisite service period of the awards, which is generally the vesting period of the award. These amounts are reduced by forfeitures in the period the forfeitures occur. Stock Options The Company uses the Black-Scholes-Merton option pricing model to determine the fair value of stock option awards as of the grant date. The Black-Scholes-Merton option pricing model requires the Company to estimate the following key assumptions based on both historical information and management judgment regarding market factors and trends: • Expected term – The Company uses the simplified method when calculating the expected term due to insufficient historical exercise data. The expected term is estimated using the mid-point between the vesting period and the contractual term of the options. • Risk-free interest rate – The Company estimates the risk-free interest rate using the rate of return on U.S. treasury notes interpolated between the years equal to the expected term assumption. • Expected stock price volatility – As the Company’s shares were not publicly traded prior to the Business Combination, and have a limited trading history subsequent to the Business Combination, the Company estimates expected volatility for stock option awards based on the average historical volatility of similar publicly traded companies. • Expected dividend yield – The expected dividend yield assumption considers that the Company has not historically paid dividends and does not expect to pay dividends in the foreseeable future. • Stock price – The Company has issued stock options with exercise prices equal to the fair value of the underlying stock price. Prior to the completion of the Business Combination and listing of the Company’s common stock on the public stock exchange, the fair value of Old Offerpad common stock that underlies the stock options was determined based on then-current valuation estimates at the time of grant. Because such grants occurred prior to the public trading of the Company’s common stock, the fair value of Old Offerpad common stock was typically determined with assistance of periodic valuation analyses from an independent third-party valuation firm. Subsequent to the Business Combination, the fair value of the Company’s common stock is based on the closing price of the Company’s Class A common stock on the grant date. Restricted Stock Units The Company determines the fair value of restricted stock units based on the closing price of the Company’s Class A common stock on the grant date. Performance-Based Restricted Stock Units The Company determines the fair value of performance-based restricted stock units using a Monte Carlo simulation model that determines the probability of satisfying the market condition stipulated in the award. The Monte Carlo simulation model incorporates various key assumptions, including expected stock price volatility, contractual term, risk-free interest rate, dividend yield and stock price on the grant date. The Company estimates expected stock price volatility based on the average historical volatility of similar publicly traded companies. The Company estimates the risk-free interest rate using the rate of return on U.S. treasury notes equal to the contractual term of the award. The expected dividend yield assumption considers that the Company has not historically paid dividends and does not expect to pay dividends in the foreseeable future. The Company determines the requisite service period for performance-based restricted stock units by comparing the derived service period to achieve the market-based condition and the explicit service-based period, using the longer of the two service periods as the requisite service period. Refer to Note 11. Stock-Based Awards, for further details. Employee Benefit Plan The Company offers a 401(k) plan which provides employees the opportunity to contribute a portion of their pre-tax or post-tax earnings, subject to certain restrictions as set forth in the Internal Revenue Code. Beginning January 1, 2022, the Company matches 100 % of participant contributions, up to 2.5 % of eligible compensation. The Company contributed $ 1.6 million to the 401(k) plan during the year ended December 31, 2022 . Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and deferred tax liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period when the new rate is enacted. The Company records a valuation allowance to reduce deferred tax assets to the amount that it believes is more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax laws, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company evaluates and accounts for uncertain tax positions using a two-step approach. Recognition (step one) occurs when the Company concludes that a tax position, based solely on its technical merits, is more likely than not to be sustained upon examination. Measurement (step two) determines the amount of benefit that is greater than 50% likely to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. Derecognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more likely than not threshold of being sustained. Refer to Note 14. Income Taxes, for further details. Consolidation of Variable Interest Entities The Company is a variable interest holder in certain entities in which equity investors at risk do not have the characteristics of a controlling financial interest or where the entity does not have enough equity at risk to finance its activities without additional subordinated financial support from other parties; these entities are VIEs. The Company’s variable interest arises from contractual, ownership or other monetary interest in the entity, which fluctuates based on the VIE’s economic performance. The Company consolidates a VIE if it is the primary beneficiary. The Company is the primary beneficiary if it has a controlling financial interest, which includes both the power to direct the activities that most significantly impact the economic performance of the VIE and a variable interest that obligates the Company to absorb losses or the right to receive benefits that potentially could be significant to the VIE. The Company assesses whether it is the primary beneficiary of a VIE on an ongoing basis. Refer to Note 12. Variable Interest Entities, for further details. Fair Value Measurements The Company accounts for assets and liabilities in accordance with accounting standards that define fair value and establish a consistent framework for measuring fair value on either a recurring or a nonrecurring basis. Fair value is an exit price representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Accounting standards include disclosure requirements relating to the fair values used for certain financial instruments and establish a fair value hierarchy. The hierarchy prioritizes valuation inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of three levels: Level 1 —Quoted prices in active markets for identical assets or liabilities. Level 2 —Assets or liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities. Level 3 —Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which is internally developed, and considers risk premiums that a market participant would require. Refer to Note 9. Fair Value Measurements, for further details. New Accounting Standards Recently Adopted Reference Rate Reform In March 2020, the FASB issued a new standard which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Inter Bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. This guidance is optional for a limited period of time to ease the potential burden in accounting for, or recognizing the effects of, reference rate reform on financial reporting. In December 2022, the FASB issued an additional standard which defers the expiration date of the reference rate reform guidance to December 31, 2024. The Company adopted the guidance related to reference rate reform during 2022 and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2022 | |
Business Combinations [Abstract] | |
Business Combination | Note 2. Business Combination On September 1, 2021 (the “Closing Date”), we consummated the transactions contemplated by the Agreement and Plan of Merger, dated March 17, 2021 (the “Merger Agreement”), by and among OfferPad, Inc. (“Old Offerpad”), Supernova Partners Acquisition Company, Inc., a Delaware corporation (“Supernova”), and Orchids Merger Sub, Inc., a Delaware corporation (“Merger Sub”). Pursuant to these transactions, Merger Sub merged with and into Old Offerpad, with Old Offerpad becoming a wholly owned subsidiary of Supernova (the “Business Combination” and, collectively with the other transactions described in the Merger Agreement, the “Transactions”). On the Closing Date, and in connection with the closing of the Transactions (the “Closing”), Supernova changed its name to Offerpad Solutions Inc. (“Offerpad Solutions”). At the Closing, each share of common stock and preferred stock of Old Offerpad that was issued and outstanding immediately prior to the effective time of the Merger (other than excluded shares as contemplated by the Merger Agreement) was cancelled and converted into the right to receive approximately 7.533 shares (the “Exchange Ratio”) of Offerpad Solutions Inc. common stock. The shares of Offerpad Solutions Inc. common stock received as consideration by Brian Bair, the Chief Executive Officer and Founder of the Company, are Class B shares. At the Closing, each option to purchase Old Offerpad’s common stock, whether vested or unvested, was assumed and converted into an option to purchase a number of shares of Offerpad Solutions Class A common stock in the manner set forth in the Merger Agreement. Additionally, in connection with the execution of the Merger Agreement, Supernova entered into subscription agreements, pursuant to which certain Supernova investors agreed to purchase at the closing of the Transactions an aggregate of 20,000,000 shares of Offerpad Solutions Class A common stock, for a price of $ 10.00 per share for an aggregate purchase price of $ 200.0 million (the “PIPE Investment”). The PIPE Investment was consummated simultaneously with the Closing. Further, in connection with the closing of Supernova’s initial public offering, Supernova entered into forward purchase agreements pursuant to which certain affiliates of Supernova agreed to purchase, upon the closing of the Transactions, an aggregate of 5,000,000 shares of Offerpad Solutions Class A common stock and an aggregate of 1,666,667 warrants to purchase one share of Offerpad Solutions Class A common stock, for an aggregate purchase price of $ 50,000,000 , or $ 10.00 per share of Offerpad Solutions Class A common stock and one-third of one warrant to purchase one share of Offerpad Solutions Class A common stock (“Forward Purchase Agreements”). Offerpad Solutions received the funds under the Forward Purchase Agreements upon the Closing. We accounted for the Business Combination as a reverse recapitalization whereby Old Offerpad was determined as the accounting acquirer and Supernova as the accounting acquiree. Accordingly, the Business Combination was treated as the equivalent of Old Offerpad issuing stock for the net assets of Supernova, accompanied by a recapitalization. The net assets of Supernova are stated at historical cost, with no goodwill or other intangible assets recorded. Upon the closing of the Transactions, Offerpad Solutions received total gross proceeds of $ 284.0 million, which consisted of $ 34.0 million from Supernova’s trust and operating accounts, $ 200.0 million from the PIPE Investment and $ 50.0 million from the Forward Purchase Agreements. Total transaction costs were $ 51.2 million, which principally consisted of advisory, legal and other professional fees. Cumulative debt repayments of $ 63.4 million, inclusive of accrued but unpaid interest, were paid in conjunction with the close. |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 3. Inventory The components of inventory, net of applicable lower of cost or net realizable value adjustments, consist of the following as of December 31: ($ in thousands) 2022 2021 Homes preparing for and under renovation $ 54,499 $ 327,455 Homes listed for sale 440,862 400,308 Homes under contract to sell 169,336 404,808 Inventory $ 664,697 $ 1,132,571 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 4. Property and Equipment Property and equipment consist of the following as of December 31: ($ in thousands) 2022 2021 Rooftop solar panel systems $ 5,075 $ 5,075 Leasehold improvements 1,087 797 Office equipment and furniture 736 160 Software systems 386 318 Computers and equipment 265 265 Construction in progress 136 — Property and equipment, gross 7,685 6,615 Less: accumulated depreciation ( 2,491 ) ( 1,469 ) Property and equipment, net $ 5,194 $ 5,146 Depreciation expense totale d $ 1.0 million, $ 0.5 million and $ 0.4 million during the years ended December 31, 2022, 2021 and 2020 , respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Note 5. Leases The Company’s operating lease arrangements consist of its corporate headquarters in Chandler, Arizona and field office facilities in most of the metropolitan markets in which the Company operates in the United States. These leases typically have original lease terms of 1 year to 6 years, and some leases contain multiyear renewal options. The Company does not have any finance lease arrangements. The Company’s operating lease costs are included in operating expenses in our consolidated statements of operations. During the years ended December 31, 2022 and 2021 , operating lease cost was $ 2.1 million, and $ 1.4 million, respectively, and variable and short-term lease costs wer e $ 0.3 million and $ 0.2 million, respectively. Rent expense for operating leases, as previously reported under former lease accounting standards, was $ 1.4 million during the year ended December 31, 2020. During the years ended December 31, 2022 and 2021, cash payments for amounts included in the measurement of operating lease liabilit ies were $ 2.0 million and $ 1.4 million, respectively, and r ight-of-use assets obtained in exchange for new or acquired operating lease liabilities were $ 2.5 million and $ 1.6 million during the respective periods. As of December 31, 2022 and 2021, the Company’s operating leases had a weighted-average remaining lease term of 2.7 years and 3.5 years, respectively, and a weighted-average discount rate of 4.2 % and 4.1 %, respectively. The Company’s operating lease liability maturities as of December 31, 2022 are as follows: ($ in thousands) 2023 $ 2,461 2024 2,373 2025 1,103 2026 269 2027 79 Thereafter — Total future lease payments 6,285 Less: Imputed interest ( 332 ) Total lease liabilities $ 5,953 The Company’s operating lease right-of-use assets and operating lease liabilities, and the associated financial statement line items, are as follows as of December 31: ($ in thousands) Financial Statement Line Items 2022 2021 Right-of-use assets Other non-current assets $ 5,469 $ 4,784 Lease liabilities: Current liabilities Accrued and other current liabilities 2,264 1,345 Non-current liabilities Other long-term liabilities 3,689 3,830 Total lease liabilities $ 5,953 $ 5,175 |
Accrued and Other Liabilities
Accrued and Other Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
ACCRUED AND OTHER LIABILITIES | Note 6. Accrued and Other Liabilities Accrued and other current liabilities consist of the following as of December 31: ($ in thousands) 2022 2021 Payroll and other employee related expenses $ 10,670 $ 12,836 Interest 4,360 3,537 Marketing 4,161 5,795 Home renovation 3,168 8,540 Operating lease liabilities 2,264 1,345 Legal and professional obligations 1,035 1,743 Other 2,594 1,231 Accrued and other current liabilities $ 28,252 $ 35,027 Other long-term liabilities as of December 31, 2022 consists of the non-current portion of our operating lease liabilities. |
Credit Facilities and Other Deb
Credit Facilities and Other Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Note 7. Credit Facilities and Other Debt | Note 7. Credit Facilities and Other Debt The carrying value of the Company’s credit facilities and other debt consists of the following as of December 31: ($ in thousands) 2022 2021 Credit facilities and other debt, net Senior secured credit facilities with financial institutions $ 471,860 $ 747,514 Senior secured credit facility with a related party 17,398 81,926 Senior secured debt - other 89,024 33,320 Mezzanine secured credit facilities with third-party lenders 49,626 87,851 Mezzanine secured credit facilities with a related party 42,778 82,508 Debt issuance costs ( 4,621 ) ( 6,923 ) Total credit facilities and other debt, net 666,065 1,026,196 Current portion - credit facilities and other debt, net Total credit facilities and other debt, net 605,889 861,762 Total credit facilities and other debt - related party 60,176 164,434 Total credit facilities and other debt, net $ 666,065 $ 1,026,196 The Company utilizes inventory financing facilities consisting of senior secured credit facilities, mezzanine secured credit facilities and other senior secured borrowing arrangements to provide financing for the Company’s real estate inventory purchases and renovation. Borrowings under the Company’s credit facilities and other debt are classified as current liabilities on the accompanying consolidated balance sheets as amounts drawn to purchase and renovate homes are required to be repaid as the related real estate inventory is sold, which is expected to be within 12 months. As of December 31, 2022 , the Company had total borrowing capacity of $ 1,927.5 million under its senior secured credit facilities and mezzanine secured credit facilities, of which $ 838.4 million was committed. Any borrowings above the committed amounts are subject to the applicable lender’s discretion. Under the Company’s senior secured credit facilities and mezzanine secured credit facilities, amounts can be borrowed, repaid and borrowed again during the revolving period. The borrowing capacity is generally available until the end of the applicable revolving period as reflected in the tables below. Outstanding amounts drawn under each senior secured credit facility and mezzanine secured credit facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The Company’s senior secured credit facilities and mezzanine secured credit facilities have aggregated borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility and the time that those properties are in the Company’s possession. When the Company resells a home, the proceeds are used to reduce the corresponding outstanding balance under the related senior and mezzanine secured revolving credit facilities. The borrowing base for a given facility may be reduced as properties age beyond certain thresholds or the performance of the properties financed under that facility declines, and any borrowing base deficiencies may be satisfied through contributions of additional properties or partial repayment of the facility. Senior Secured Credit Facilities The following summarizes certain details related to the Company’s senior secured credit facilities (in thousands, except interest rates): Borrowing Capacity Outstanding Weighted- End of Final As of December 31, 2022 Committed Uncommitted Total Amount Rate Period Date Financial institution 1 $ 300,000 $ 300,000 $ 600,000 $ 228,823 4.74 % June 2024 June 2024 Financial institution 2 200,000 200,000 400,000 123,478 4.11 % September 2023 March 2024 Financial institution 3 125,000 375,000 500,000 119,559 4.48 % December 2023 December 2023 Related party 50,000 25,000 75,000 17,398 6.46 % March 2024 September 2024 Senior secured credit facilities $ 675,000 $ 900,000 $ 1,575,000 $ 489,258 Borrowing Capacity Outstanding Weighted- As of December 31, 2021 Committed Uncommitted Total Amount Rate Financial institution 1 $ 300,000 $ 100,000 $ 400,000 $ 365,392 2.60 % Financial institution 2 400,000 — 400,000 375,063 2.60 % Financial institution 3 300,000 200,000 500,000 7,059 2.60 % Related party 85,000 — 85,000 81,926 4.10 % Senior secured credit facilities $ 1,085,000 $ 300,000 $ 1,385,000 $ 829,440 As of December 31, 2022 , the Company had four senior secured credit facilities, three with separate financial institutions and one with a related party, which holds more than 5 % of our Class A common stock. Borrowings under the senior secured credit facilities accrue interest at a rate based on a Secured Overnight Financing Rate (“SOFR”) reference rate, plus a margin which varies by facility. The Company may also pay fees on its senior secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity, as defined in the respective credit agreements. Borrowings under the Company’s senior secured credit facilities are collateralized by the real estate inventory financed by the senior secured credit facility. The lenders have legal recourse only to the assets securing the debt and do not have general recourse against the Company with limited exceptions. The Company has, however, provided limited non-recourse carve-out guarantees under its senior and mezzanine secured credit facilities for certain of the SPEs’ obligations in situations involving “bad acts” by an Offerpad entity and certain other limited circumstances that are generally under the Company’s control. Each senior secured facility contains eligibility requirements that govern whether a property can be financed. During February 2023, the Company amended its credit facility with financial institution 2, which, among other things, reduced the total borrowing capacity on the facility from $ 400.0 million to $ 200.0 million, $ 100.0 million of which is committed. Mezzanine Secured Credit Facilities The following summarizes certain details related to the Company’s mezzanine secured credit facilities (in thousands, except interest rates): Borrowing Capacity Outstanding Weighted- End of Final As of December 31, 2022 Committed Uncommitted Total Amount Rate Period Date Related party facility 1 $ 65,000 $ 32,500 $ 97,500 $ 38,937 11.00 % June 2024 June 2024 Third-party lender 1 45,000 45,000 90,000 31,239 9.55 % September 2023 March 2024 Third-party lender 2 18,387 94,113 112,500 18,387 9.50 % December 2023 December 2023 Related party facility 2 35,000 17,500 52,500 3,841 11.05 % March 2024 September 2024 Mezzanine secured credit facilities $ 163,387 $ 189,113 $ 352,500 $ 92,404 Borrowing Capacity Outstanding Weighted- As of December 31, 2021 Committed Uncommitted Total Amount Rate Related party facility 1 $ 65,000 $ — $ 65,000 $ 58,767 13.00 % Third-party lender 1 90,000 — 90,000 86,262 9.50 % Third-party lender 2 67,500 45,000 112,500 1,588 9.50 % Related party facility 2 14,000 — 14,000 23,742 13.00 % Mezzanine secured credit facilities $ 236,500 $ 45,000 $ 281,500 $ 170,359 As of December 31, 2022 , the Company had four mezzanine secured credit facilities, two with separate third-party lenders and two with a related party, which holds more than 5% of our Class A common stock. Borrowings under the Company’s mezzanine secured credit facilities accrue interest at fixed rates, which vary by facility and range from 9.5 % to 13.0 %. The Company may also pay fees on its mezzanine secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity, as defined in the respective credit agreements. Borrowings under the Company’s mezzanine secured credit facilities are collateralized by a second lien on the real estate inventory financed by the relevant credit facility. The lenders have legal recourse only to the assets securing the debt, and do not have general recourse to Offerpad with limited exceptions. The Company’s mezzanine secured credit facilities are structurally and contractually subordinated to the related senior secured credit facilities. During February 2023, the Company amended its credit facility with third-party lender 1, which, among other things, reduced the total borrowing capacity on the facility from $ 90.0 million to $ 45.0 million, $ 22.5 million of which is committed. Maturities As of December 31, 2022, certain of the Company’s senior secured credit facilities and mezzanine secured credit facilities mature within the next twelve months following the date these consolidated financial statements are issued. The Company expects to enter into new financing arrangements or amend existing arrangements to meet its obligations as they come due, which the Company believes is probable based on its history of prior credit facility renewals. The Company believes cash on hand, together with proceeds from the resale of homes and cash from future borrowings available under each of the Company’s existing credit facilities or the entry into new financing arrangements (including the Private Placement (as defined in Note 17. Subsequent Events ), will be sufficient to meet its obligations as they become due in the ordinary course of business for at least 12 months following the date these consolidated financial statements are issued. Covenants for Senior Secured Credit Facilities and Mezzanine Secured Credit Facilities The secured credit facilities include customary representations and warranties, covenants and events of default. Financed properties are subject to customary eligibility criteria and concentration limits. The terms of these facilities and related financing documents require the Company to comply with a number of customary financial and other covenants, such as maintaining certain levels of liquidity, tangible net worth or leverage (ratio of debt to tangible net worth). As of December 31, 2022, the Company was in compliance with all covenants and no event of default had occurred. Senior Secured Debt - Other As of December 31, 2022, the Company has borrowing arrangements with two separate third-party lenders to support purchases of real estate inventory. Borrowings under each of these arrangements accrue interest at a rate based on a SOFR reference rate, plus a margin which varies by arrangement. As of December 31, 2022 and 2021, the weighted-average interest rates under the Company’s other senior secured debt were 7.23 % and 5.79 %, respectively. |
Warrant Liabilities
Warrant Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Warrant Liabilities | Note 8. Warrant Liabilities In connection with the Business Combination, the Company assumed 13.4 million public warrants and 6.7 million private placement warrants, both of which were previously issued by Supernova. Further, upon the closing of the Business Combination, an additional 1.7 million private placement warrants were issued. As such, as of September 1, 2021, the Company had outstanding warrants to purchase an aggregate of up to 21.8 million shares of Offerpad Solutions Class A common stock that will become exercisable securities in the future after certain requirements have been met. During 2022, a private placement warrant holder elected to transfer 1.8 million private placement warrants, upon which the warrants were converted into public warrants pursuant to the terms of the Warrant Agreement. Accordingly, as of December 31, 2022 , the Company had 15.2 million public warrants and 6.6 million private placement warrants outstanding . Public Warrants Each public warrant entitles the registered holder to acquire one share of the Company’s Class A common stock at a price of $ 11.50 per share, subject to adjustment as discussed below. The warrants became exercisable on October 23, 2021. A holder may exercise its warrants only for a whole number of shares of Class A common stock. This means only a whole warrant may be exercised at a given time by a warrant holder. The public warrants will expire September 1, 2026 , or earlier upon redemption or liquidation. Redemption of warrants for cash The Company may call the public warrants for redemption for cash: • in whole and not in part; • at a price of $ 0.01 per warrant; • upon not less than 30 days prior written notice of redemption to each warrant holder; and • if, and only if, the last reported sale price of the Company’s Class A common stock equals or exceeds $ 18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of the Company’s Class A common stock and equity-linked securities) for any 20 trading days within a 30 -trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders. If and when the warrants become redeemable by the Company for cash, the Company may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of warrants for shares of Class A common stock The Company may redeem the outstanding warrants for shares of Class A common stock: • in whole and not in part; • at $ 0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants prior to redemption and receive that number of shares determined by reference to an agreed table, based on the redemption date and the “fair market value” of Class A common stock (as defined below) except as otherwise described below; • if, and only if, the last reported sale price of the Company’s Class A common stock equals or exceeds $ 10.00 per share (as adjusted per stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of the Company’s Class A common stock and equity-linked securities) on the trading day prior to the date on which the Company sends the notice of redemption to the warrant holders; and • if and only if, the private placement warrants are also concurrently exchanged at the same price (equal to a number of shares of our Class A common stock) as the outstanding public warrants, as described above. The “fair market value” of the Class A common stock shall mean the average of the last reported sales price for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 shares of Class A common stock per warrant (subject to adjustment). Private Placement Warrants The private placement warrants are not redeemable by us so long as they are held by the Supernova Sponsor or its permitted transferees, except in certain limited circumstances. The Supernova Sponsor, or its permitted transferees, has the option to exercise the private placement warrants on a cashless basis and the Supernova Sponsor and its permitted transferees has certain registration rights related to the private placement warrants (including the shares of Class A common stock issuable upon exercise of the private placement warrants). Except as described in this section, the private placement warrants have terms and provisions that are identical to those of the public warrants. If the private placement warrants are held by holders other than the Supernova Sponsor or its permitted transferees, the private placement warrants will be redeemable by the Company and exercisable by the holders on the same basis as the public warrants. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Note 9. Fair Value Measurements | Note 9. Fair Value Measurements The fair values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and certain prepaid and other current assets and accrued expenses approximate carrying values because of their short-term nature. The Company’s credit facilities are carried at amortized cost and the carrying value approximates fair value because of their short-term nature. The Company’s liabilities that are measured at fair value on a recurring basis consist of the following (in thousands): As of December 31, 2022 Quoted Prices in Significant Other Significant Public warrant liabilities $ 343 $ — $ — Private placement warrant liabilities $ — $ — $ 196 As of December 31, 2021 Quoted Prices in Significant Other Significant Public warrant liabilities $ 14,356 $ — $ — Private placement warrant liabilities $ — $ — $ 9,705 Public Warrants The public warrants were initially recognized as a liability in connection with the Business Combination on September 1, 2021. The fair value of the public warrants is estimated based on the quoted market price of such warrants on the valuation date. The Company recorded changes in the fair value of the public warrants of $ 14.0 million and $ 1.8 million during the years ended December 31, 2022 and 2021, respectively. These changes are recorded in Change in fair value of warrant liabilities in our consolidated statements of operations. Private Placement Warrants The private placement warrants were initially recognized as a liability in connection with the Business Combination on September 1, 2021. The following summarizes the changes in the Company’s private placement warrant liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the respective periods: Year Ended December 31, ($ in thousands) 2022 2021 Beginning balance $ 9,705 $ — Initial fair value of private placement warrants — 10,291 Change in fair value of private placement warrants included in net (loss) income ( 9,509 ) ( 586 ) Ending balance $ 196 $ 9,705 The following summarizes the range of assumptions used in the Black-Scholes-Merton option-pricing model to determine the fair value of the private placement warrants during the respective periods: Year Ended December 31, 2022 2021 Volatility 47.00 % - 83.50 % 25.00 % - 40.50 % Stock price $ 0.46 - $ 5.03 $ 6.40 - $ 8.80 Expected life of the options to convert 3.669 - 4.419 4.669 - 5.000 Risk-free rate 2.43 % - 4.16 % 0.78 % - 1.22 % Dividend yield 0.00 % 0.00 % Volatility: Expected volatility is estimated using a Monte Carlo simulation model to determine volatility based on the trading price of the public warrants and to reflect the probability of different outcomes. Expected Life: The expected life of the warrants is assumed to be equivalent to their remaining contractual term. Risk-Free Interest Rate: The risk-free interest rate is estimated based on the U.S. Treasury zero-coupon yield curve on the valuation date for a maturity similar to the expected remaining life of the warrants. Expected Dividend Yield: The expected dividend yield assumption considers that we have not historically paid dividends and we do not expect to pay dividends in the foreseeable future. There were no transfers between Levels 1, 2, and 3 during the years ended December 31, 2022, 2021 and 2020 . |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | Note 10. Stockholders’ Equity Authorized Capital Stock The Company’s charter authorizes the issuance of 2,370,000,000 shares, which includes Class A common stock, Class B common stock, Class C common stock and preferred stock. Class A Common Stock Subsequent to the Closing of the Business Combination, our Class A common stock and warrants began trading on the New York Stock Exchange (“NYSE”) under the symbols “OPAD” and “OPAD WS,” respectively. Pursuant to the Company’s charter, the Company is authorized to issue 2,000,000,000 shares of Class A common stock, par value $ 0.0001 per share. As of December 31, 2022 , we had 232,378,752 s hares of Class A common stock issued and outstanding. Prior to the Business Combination, Old Offerpad had outstanding shares of Series A, Series A-1, Series A-2, Series B and Series C convertible preferred stock (collectively, “Preferred Stock”). Upon the Closing of the Business Combination, each share of Old Offerpad’s Preferred Stock and common stock that was issued and outstanding immediately prior to the effective time of the Merger was cancelled and converted into Offerpad Solutions Inc. Class A common stock with the application of the Exchange Ratio as discussed in Note 3, Business Combination . Additionally, we have outstanding warrants to purchase shares of Offerpad Solutions Class A common stock that will become exercisable securities in the future after certain requirements have been met. Refer to Note 8. Warrant Liabilities . Class B Common Stock Pursuant to the Company’s charter, the Company is authorized to issue 20,000,000 shares of Class B common stock, par value $ 0.0001 per share. In connection with the Closing of the Business Combination, Brian Bair, the Chief Executive Officer and Founder of the Company, or entities controlled by Mr. Bair, received Class B shares of Offerpad Solutions Inc. common stock as consideration. These Class B shares entitle Mr. Bair or his permitted transferees to 10 votes per share until the earlier of (a) the date that is nine months following the date on which Mr. Bair (x) is no longer providing services, whether upon death, resignation, removal or otherwise, to Offerpad Solutions as a member of the senior leadership team, officer or director and (y) has not provided any such services for the duration of such nine-month period; and (b) the date as of which Mr. Bair or his permitted transferees have transferred, in the aggregate, more than seventy-five ( 75 %) of the shares of Class B common stock that were held by Mr. Bair and his permitted transferees immediately following the Closing. As of December 31, 2022 , we had 14,816,236 shares of Class B common stock issued and outstanding. In January 2023, Mr. Bair notified the Company’s Board of Directors that he will convert all shares of Class B common stock beneficially owned by him to shares of Class A common stock immediately following the conclusion of the Company’s 2023 annual meeting of stockholders. Class C Common Stock Pursuant to the Company’s charter, the Company is authorized to issue 250,000,000 shares of Class C common stock, par value $ 0.0001 per share. Our Class C common stock will entitle its holder to have substantially the same rights as Class A common stock, except it will not have any voting rights. As of December 31, 2022 , there were no shares of Class C common stock issued and outstanding. Preferred Stock Pursuant to the Company’s charter, the Company is authorized to issue 100,000,000 shares of preferred stock, par value $ 0.0001 per share. Our board of directors has the authority without action by the stockholders, to designate and issue shares of preferred stock in one or more classes or series, and the number of shares constituting any such class or series, and to fix the voting powers, designations, preferences, limitations, restrictions and relative rights of each class or series of preferred stock, including, without limitation, dividend rights, conversion rights, redemption privileges and liquidation preferences, which rights may be greater than the rights of the holders of the common stock. As of December 31, 2022 , there were no shares of preferred stock issued and outstanding. Dividends Our Class A and Class B common stock are entitled to dividends if and when any dividend is declared by our board of directors, subject to the rights of all classes of stock outstanding having priority rights to dividends. We have not paid any cash dividends on common stock to date. We may retain future earnings, if any, for the further development and expansion of our business and have no current plans to pay cash dividends for the foreseeable future. Any future determination to pay dividends will be made at the discretion of our board of directors and will depend on, among other things, our financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as our board of directors may deem relevant. |
Stock-Based Awards
Stock-Based Awards | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Awards | Note 11. Stock-Based Awards 2016 Stock Plan Prior to the Closing of the Business Combination, the Company maintained the OfferPad 2016 Stock Option and Grant Plan (the “2016 Plan”) that allowed for granting of incentive and non-qualified stock options to employees, directors, and consultants. In connection with the Business Combination, each option granted under the 2016 Plan that was outstanding immediately prior to the Business Combination, whether vested or unvested, was assumed and converted into an option to purchase a number of shares of Class A common stock (rounded down to the nearest whole share) equal to the product of (i) the number of shares of Old Offerpad common stock subject to such Old Offerpad option immediately prior to the Business Combination and (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to the quotient obtained by dividing (A) the exercise price per share of such Old Offerpad option immediately prior to the consummation of the Business Combination by (B) the Exchange Ratio. Stock option activity prior to the Business Combination was retroactively adjusted to reflect this conversion. Awards outstanding under the 2016 Plan were assumed by Offerpad Solutions upon the Closing and continue to be governed by the terms and conditions of the 2016 Plan and applicable award agreement. Shares of our common stock subject to awards granted under the 2016 Plan that expire unexercised or are cancelled, terminated, or forfeited in any manner without issuance of shares thereunder following the effective date of the 2021 Plan (as defined below), will not again become available for issuance under the 2016 Plan or the 2021 Plan. In connection with the completion of the Business Combination and the adoption of the 2021 Plan, no additional awards will be granted under the 2016 Plan. 2021 Equity Incentive Plans In connection with the Business Combination, our board of directors adopted, and our stockholders approved, the Offerpad Solutions Inc. 2021 Incentive Award Plan (the “2021 Plan”) under which 26,333,222 shares of Class A common stock were initially reserved for issuance. The 2021 Plan allows for the issuance of incentive and non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units and other stock or cash based awards. The number of shares of the Company’s Class A common stock available for issuance under the 2021 Plan increases annually on the first day of each calendar year, beginning on and including January 1, 2022 and ending on and including January 1, 2031 equal to the lesser of (i) a number of shares such that the aggregate number of shares of Class A common stock available for grant under the 2021 Plan immediately following such increase shall be equal to 5 % of the number of fully-diluted shares on the final day of the immediately preceding calendar year and (ii) such smaller number of shares of Class A common stock as is determined by the Company’s board of directors. As of December 31, 2022, the Company has granted stock options, restricted stock units (“RSUs”) and performance-based RSUs (“PSUs”) under the 2021 Plan. In connection with the close of the Business Combination, our board of directors adopted, and our stockholders approved the Offerpad Solutions Inc. 2021 Employee Stock Purchase Plan (“ESPP”). There are 2,633,322 shares of Class A common stock initially reserved for issuance under the ESPP. The number of shares of the Company’s Class A common stock available for issuance under the ESPP increases annually on the first day of each calendar year, beginning on and including January 1, 2022 and ending on and including January 1, 2031, by the lesser of (a) a number of shares such that the aggregate number of shares of Class A common stock available for grant under the ESPP immediately following such increase shall be equal to 1 % of the number of fully-diluted shares on the final day of the immediately preceding calendar year and (b) such smaller number of shares of Class A common stock as determined by the Company’s board of directors; provided that, no more than 50,000,000 shares of Class A common stock may be issued under the ESPP. As of December 31, 2022 , no shares have been issued under the ESPP. Stock Options During the years ended December 31, 2022, 2021 and 2020, the Company granted stock option awards with a service vesting condition that is generally four years. The range of assumptions used in the Black-Scholes-Merton option pricing model to determine the fair value of stock option awards granted during the respective years are as follows: 2022 Range 2021 Range 2020 Range Expected term (in years) 6.25 5.97 - 6.10 5.36 - 6.11 Risk-free interest rate 1.63 % - 3.37 % 0.64 % - 0.67 % 0.38 % - 0.46 % Expected stock price volatility 57.8 % - 60.0 % 52.5 % - 52.7 % 51.7 % - 52.9 % Expected dividend yield — — — Fair value on grant date $ 1.43 - $ 5.11 $ 4.49 - $ 4.55 $ 4.27 - $ 4.49 The following summarizes stock option activity during the years ended December 31, 2022, 2021 and 2020: Number of (in thousands) Weighted- Weighted-Average (in years) Aggregate (in thousands) Outstanding as of December 31, 2019 23,669 0.55 7.71 $ 16,275 Granted 5,258 1.22 Exercised — — Forfeited or cancelled ( 1,336 ) 0.54 Outstanding as of December 31, 2020 27,591 0.68 7.40 14,619 Granted 1,559 1.22 Exercised ( 2,490 ) 0.36 Forfeited or cancelled ( 1,084 ) 0.85 Outstanding as of December 31, 2021 25,576 0.73 6.82 137,170 Granted 1,147 4.90 Exercised ( 8,101 ) 0.58 Forfeited or cancelled ( 895 ) 1.46 Outstanding as of December 31, 2022 17,727 1.02 5.82 953 Exercisable as of December 31, 2022 14,122 0.72 5.24 953 Vested and expected to vest as of December 31, 2022 17,727 1.02 5.82 953 The total intrinsic value of stock options exercised during the years ended December 31, 2022 and 2021 was $ 35.8 million and $ 10.5 million, respectively. No stock options were exercised during the year ended December 31, 2020. The weighted-average grant date fair value per option granted during the years ended December 31, 2022, 2021 and 2020 was $ 2.73 , $ 0.60 and $ 0.61 , respectively. As of December 31, 2022, the Company had $ 3.5 million of unrecognized stock-based compensation expense related to unvested stock options. This expense is expected to be recognized over a weighted average period of 1.98 years. The fair value of stock options that vested during the years ended December 31, 2022, 2021 and 2020 was $ 2.1 million, $ 2.6 million and $ 1.2 million, respectively. Restricted Stock Units The Company did no t grant restricted stock unit (“RSU”) awards during the year December 31, 2020 . During the years ended December 31, 2022 and 2021, the Company granted RSUs with service vesting conditions to employees and non-employee members of our board of directors. The vesting period for RSUs granted to employees is generally three years , subject to continued employment, and the vesting period for RSUs granted to non-employee members of our board of directors generally ranges from three months to three years , subject to continued service on the board of director s. The following summarizes RSU award activity during the years ended December 31, 2022 and 2021: Number of (in thousands) Weighted Outstanding as of December 31, 2020 — $ — Granted 203 7.88 Vested and settled — — Forfeited or expired — — Outstanding as of December 31, 2021 203 7.88 Granted 2,118 4.50 Vested and settled ( 163 ) 5.33 Forfeited or expired ( 193 ) 5.05 Outstanding as of December 31, 2022 1,965 4.73 As of December 31, 2022 , 351,600 RSUs have vested, but have not yet been settled in shares of the Company’s Class A common stock, pursuant to elections made by certain non-employee members of our board of directors to defer settlement thereof under the Offerpad Solutions Inc. Deferred Compensation Plan for Directors. As of December 31, 2022, the Company had $ 6.2 million of unrecognized stock-based compensation expense related to unvested RSUs. This expense is expected to be recognized over a weighted average period of 1.89 years. The fair value of RSUs that vested during the years ended December 31, 2022 and 2021 was $ 1.6 million and $ 0.1 million, respectively. Performance-Based Restricted Stock Units The Company did no t grant PSUs during the years ended December 31, 2020 and 2021, respectively. During the year ended December 31, 2022, The Company granted PSUs which include both a service vesting condition and a performance vesting condition that is associated with the share price of the Company’s Class A common stock. Subject to the employee’s continued employment or service through the end of the performance period, the PSUs will vest based on the achievement of predetermined price per share goals over the performance period calculated based on the average price per share over any 60 consecutive calendar-day period during the performance period. Shares earned under the PSU awards are transferred to the award holders upon the completion of the requisite service period of three years . If the average price per share does not meet the minimum price per share goal as of the last day of the performance period, the PSUs automatically will be forfeited and terminated without consideration. The assumptions used in the Monte Carlo simulation model to determine the fair value of the PSU awards granted during the year ended December 31, 2022 are as follows: Risk-free interest rate 1.47 % Expected stock price volatility 60.0 % Expected dividend yield 0.0 % Fair value on grant date $ 5.11 The following summarizes PSU award activity during the year ended December 31, 2022: Number of (in thousands) Weighted Outstanding as of December 31, 2021 — $ — Granted 2,115 4.72 Vested — — Forfeited or expired ( 175 ) 4.72 Outstanding as of December 31, 2022 1,940 4.72 As of December 31, 2022, the Company had $ 6.6 million of unrecognized stock-based compensation expense related to unvested PSUs. This expense is expected to be recognized over a weighted average period of 2.16 years. Stock-based Compensation Expense The following details stock-based compensation expense for the years ended December 31: Year Ended December 31, ($ in thousands) 2022 2021 2020 Sales, marketing and operating $ 2,023 $ 700 $ 375 General and administrative 5,743 1,889 544 Technology and development 541 490 444 Stock-based compensation expense $ 8,307 $ 3,079 $ 1,363 |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2022 | |
Variable Interest Entities [Abstract] | |
Note 12. Variable Interest Entities | Note 12. Variable Interest Entities The Company formed certain special purpose entities (each, an “SPE”) to purchase and sell residential properties. Each SPE is a wholly owned subsidiary of the Company and a separate legal entity, and neither the assets nor credit of any such SPE are available to satisfy the debts and other obligations of any affiliate or other entity. The credit facilities are secured by the assets and equity of one or more SPEs. These SPEs are variable interest entities, and the Company is the primary beneficiary as it has the power to control the activities that most significantly impact the SPEs’ economic performance and the obligation to absorb losses of the SPEs or the right to receive benefits from the SPEs that could potentially be significant to the SPEs. The SPEs are consolidated within the Company’s consolidated financial statements. The following summarizes the assets and liabilities related to the VIEs as of December 31: ($ in thousands) 2022 2021 Assets Restricted cash $ 42,958 $ 24,616 Accounts receivable 1,841 4,845 Inventory 664,697 1,132,571 Prepaid expenses and other current assets 212 2,871 Total assets $ 709,708 $ 1,164,903 Liabilities Accounts payable $ 1,976 $ 2,810 Accrued and other current liabilities 4,408 3,537 Secured credit facilities and other debt, net - current portion 666,065 1,026,196 Total liabilities $ 672,449 $ 1,032,543 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 13. Earnings Per Share Basic earnings per share is calculated based on the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated based on the weighted average number of common shares plus the incremental effect of dilutive potential common shares outstanding during the period. In periods when losses are reported, the weighted average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive. The components of basic and diluted earnings per share are as follows: Year Ended December 31, (In thousands, except per share data) 2022 2021 2020 Numerator: Net (loss) income $ ( 148,613 ) $ 6,460 $ ( 23,118 ) Denominator: Weighted average common shares outstanding, basic 245,148 118,571 57,865 Dilutive effect of stock options (1) — 24,644 — Dilutive effect of restricted stock units (1) — 5 — Dilutive effect of preferred stock (1) — — — Dilutive effect of warrants (1) — — — Weighted average common shares outstanding, diluted 245,148 143,220 57,865 Net (loss) income per share, basic $ ( 0.61 ) $ 0.05 $ ( 0.40 ) Net (loss) income per share, diluted $ ( 0.61 ) $ 0.05 $ ( 0.40 ) Anti-dilutive securities excluded from diluted (loss) income per share: Anti-dilutive stock options (1) 5,520 — 27,591 Anti-dilutive restricted stock units (1) 1,748 — — Anti-dilutive performance-based restricted stock units 2,047 — — Anti-dilutive warrants (1) 21,783 — 1,887 Anti-dilutive preferred stock (1) — — 138,612 (1) Due to the net loss during each of the years ended December 31, 2022 and 2020 , no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | Note 14. Income Taxes The Company is subject to federal and state income taxes in the United States. (Loss) income before income taxes was $( 148.3 ) million, $ 6.6 million and $( 23.0 ) million during the years ended December 31, 2022, 2021 and 2020, respectively. Income tax expense consisted of the following for the respective periods: Years Ended December 31, ($ in thousands) 2022 2021 2020 Current: Federal $ — $ — $ — State 359 170 163 Total current 359 170 163 Deferred: Federal — — — State — — — Total deferred — — — Income tax expense $ 359 $ 170 $ 163 The provision for income taxes differs from the tax computed using the statutory U.S. federal income tax rate as a result of the following items for the respective periods: Years Ended December 31, (In thousands, except percentages) 2022 2021 2020 (Benefit) provision at federal statutory income tax rate $ ( 31,133 ) 21.0 % $ 1,392 21.0 % $ ( 4,821 ) 21.0 % State income taxes ( 7,636 ) 5.2 % 360 5.4 % ( 446 ) 1.9 % Change in fair value of warrant liabilities ( 4,940 ) 3.3 % ( 517 ) ( 7.8 )% — 0.0 % Return-to-provision ( 2,277 ) 1.5 % 221 3.3 % 218 ( 0.9 )% Transaction costs ( 1,874 ) 1.3 % ( 1,226 ) ( 18.5 )% — 0.0 % Stock-based compensation ( 1,091 ) 0.7 % 647 9.8 % 286 ( 1.2 )% Valuation allowance 48,690 ( 32.8 )% ( 675 ) ( 10.2 )% 4,999 ( 21.8 )% Other 620 ( 0.4 )% ( 32 ) ( 0.4 )% ( 73 ) 0.3 % Effective income tax rate $ 359 ( 0.2 )% $ 170 2.6 % $ 163 ( 0.7 )% Deferred tax assets and liabilities consist of the following as of December 31: ($ in thousands) 2022 2021 Deferred tax assets: Federal net operating loss carryforwards $ 50,178 $ 26,721 State net operating loss carryforwards 9,847 4,703 Inventory 14,771 341 Research and development expenditures 3,190 — Stock-based compensation 1,852 — Transaction costs 1,707 — Operating lease liabilities 1,507 1,284 Other 2,117 2,421 Gross deferred tax assets 85,169 35,470 Valuation allowance ( 82,026 ) ( 33,336 ) Deferred tax assets, net of valuation allowance 3,143 2,134 Deferred tax liabilities: Operating lease right-of-use assets ( 1,385 ) ( 1,187 ) Property and equipment ( 739 ) ( 874 ) Other ( 1,019 ) ( 73 ) Gross deferred tax liabilities ( 3,143 ) ( 2,134 ) Net deferred income taxes $ — $ — As of December 31, 2022 , the Company had federal net operating loss carryforwards of $ 231.4 million to offset future taxable income, of which $ 26.0 million expires in 2036 and 2037 if not utilized, with the remaining $ 205.4 million having no expiration. The Company also has U.S. state net operating loss carryforwards of $ 195.1 million, of which $ 121.7 million expires at various dates ranging from 2032 through 2042 if not utilized, with the remaining $ 73.4 million having no expiration. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. As a result of historical cumulative losses, the Company has determined that, based on all available evidence, there was substantial uncertainty as to whether it will recover recorded net deferred taxes in future periods. Therefore, the Company recorded a full valuation allowance equal to the amount of the net deferred tax assets as of December 31, 2022 and 2021 . The valuation allowance increased by $ 48.7 million during the year ended December 31, 2022 , decreased by $ 0.7 million during the year ended December 31, 2021 and increased $ 5.0 million during the year ended December 31, 2020. The Internal Revenue Code contains provisions that limit the utilization of net operating loss carryforwards and tax credit carryforwards if there has been an ownership change. Such ownership change, as described in Section 382 of the Internal Revenue Code, may limit the Company’s ability to utilize its net operating loss carryforwards and tax credit carryforwards on a yearly basis. To the extent that any single-year limitation is not utilized to the full amount of the limitation, such unused amounts are carried over to subsequent years until the earlier of utilization or the expiration of the relevant carryforward period. The Company determined that an ownership change occurred on February 10, 2017. An analysis was performed and while utilization of net operating losses would be limited in years prior to December 31, 2020, subsequent to that date, there is no limitation on the Company’s ability to utilize its net operating losses. As such, the ownership change has no impact to the carrying value of the Company’s net operating loss carryforwards or ability to use them in future years. Uncertain Tax Positions During the years ended December 31, 2022, 2021 and 2020 , the Company had no uncertain tax positions. Income Tax Audits The Company files in U.S. federal and various state income tax jurisdictions. The Company is subject to U.S. federal and state income tax examinations by authorities for all tax years beginning in 2017 due to the accumulated net operating losses that are carried forward. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 15. Related-Party Transactions LL Credit Facilities As of December 31, 2022 , we have one senior secured credit facility with a related party and two mezzanine secured credit facilities with a related party. The following summarizes certain details related to these facilities as of December 31: 2022 2021 ($ in thousands) Borrowing Outstanding Borrowing Outstanding Senior secured credit facility with a related party $ 75,000 $ 17,398 $ 85,000 $ 81,926 Mezzanine secured credit facilities with a related party $ 150,000 $ 42,778 $ 79,000 $ 82,509 Since October 2016, we have been party to a loan and security agreement (the “LL Funds Loan Agreement”), with LL Private Lending Fund, L.P. and LL Private Lending Fund II, L.P., both of which are affiliates of LL Capital Partners I, L.P., which holds more than 5 % of our Class A common stock. Additionally, Roberto Sella, who is a member of our board of directors, is the managing partner of LL Funds. The LL Funds Loan Agreement is comprised of a senior secured credit facility and a mezzanine secured credit facility, under which we may borrow funds up to a maximum principal amount of $ 75.0 million and $ 52.5 million, respectively. The LL Funds Loan Agreement also provides us with the option to borrow above the fully committed borrowing capacity, subject to the lender’s discretion. Refer to Note 7. Credit Facilities and Other Debt , for further details about the facilities under the LL Funds Loan Agreement. Since March 2020, we have also been party to a mezzanine loan and security agreement (the “LL Mezz Loan Agreement”), with LL Private Lending Fund II, L.P., which is an affiliate of LL Capital Partners I, L.P. Under the LL Mezz Loan Agreement, we may borrow funds up to a maximum principal amount of $ 97.5 million. Refer to Note 7. Credit Facilities and Other Debt , for further details about the mezzanine facility under the LL Mezz Loan Agreement. We paid interest for borrowings under the LL facilities of $ 9.4 million, $ 11.7 million and $ 8.2 million during the years ended December 31, 2022, 2021 and 2020, respectively. Use of First American Financial Corporation’s Services First American Financial Corporation (“First American”), which holds more than 5 % of our Class A common stock, through its subsidiaries is a provider of title insurance and settlement services for real estate transactions and a provider of property data services. Additionally, Kenneth DeGiorgio, who is a member of the Company’s board of directors, is the chief executive officer of First American. We use First American’s services in the ordinary course of our home-buying and home-selling activities. We paid First American $ 18.1 million, $ 11.9 million and $ 7.1 million during the years ended December 31, 2022, 2021 and 2020, respectively, for its services, inclusive of the fees for property data services. Private Placement On January 31, 2023, the Company entered into a pre-funded warrants subscription agreement with the investors named therein (the “Investors”) pursuant to which the Company sold and issued to the Investors an aggregate of 160,742,959 pre-funded warrants to purchase shares of the Company’s Class A common stock. The Investors included Brian Bair, Roberto Sella, First American, and Kenneth DeGiorgio. Refer to Note 17. Subsequent Events , for further details. Warehouse Lending Facility with FirstFunding, Inc. During July 2022 , Offerpad Mortgage, LLC (“Offerpad Home Loans” or “OPHL”), a wholly owned subsidiary of the Company, entered into a warehouse lending facility with FirstFunding, Inc. (“FirstFunding”), a wholly owned subsidiary of First American, which holds more than 5 % of our Class A common stock. Offerpad Home Loans uses the warehouse lending facility to fund mortgage loans it originates and then sells to third-party mortgage servicers. The committed amount under the facility is $ 15.0 million and OPHL pays certain customary and ordinary course fees to FirstFunding under the facility, including a funding fee per loan and interest. There were no amounts outstanding under the facility as of December 31, 2022 and amounts paid under the facility were immaterial during the year ended December 31, 2022. Compensation of Immediate Family Members of Brian Bair Offerpad employs two of Brian Bair’s brothers, along with Mr. Bair’s sister-in-law. The following details the total compensation paid to Mr. Bair’s brothers and Mr. Bair’s sister-in-law, which includes both base salary and annual performance-based cash incentives during the respective periods: Year Ended December 31, ($ in thousands) 2022 2021 2020 Mr. Bair’s brother 1 $ 631 $ 572 $ 260 Mr. Bair’s brother 2 594 469 313 Mr. Bair’s sister-in-law 123 141 120 $ 1,348 $ 1,182 $ 693 During the year ended December 31, 2022, Mr. Bair’s brothers and Mr. Bair’s sister-in-law received grants of equity awards under the Offerpad Solutions Inc. 2021 Incentive Award Plan, which included awards of restricted stock units (“RSUs”), performance-based RSUs (“PSUs”) and/or stock options, as follows: Number of Number of Number of Mr. Bair’s brother 1 84,367 126,551 — Mr. Bair’s brother 2 79,404 119,107 — Mr. Bair’s sister-in-law 3,000 — 6,000 166,771 245,658 6,000 In June 2022, Mr. Bair’s brothers each entered into employment agreements with the Company with customary severance and other terms provided to similarly situated executives. During February 2023, Mr. Bair’s brothers and Mr. Bair’s sister-in-law each received annual performance-based cash incentive payments, which totaled $ 0.5 million. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Note 16. Commitments and Contingencies Homes Purchase Commitments As of December 31, 2022 , the Company was under contract to purchase 98 homes for an aggregate purchase price of $ 24.9 million. Other Purchase Obligations The Company’s other purchase obligations principally include commitments relating to insurance, marketing, information technology and administration services. As of December 31, 2022 , the Company had other purchase obligations of $ 6.5 million, with $ 5.8 million payable within 12 months. Lease Commitments The Company has entered into operating lease agreements for its corporate headquarters in Chandler, Arizona and field office facilities in most of the metropolitan markets in which the Company operates in the United States. Refer to Note 5. Leases , for further details. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | Note 17. Subsequent Events The Company has determined that there have been no events that have occurred that would require recognition in the consolidated financial statements or additional disclosure herein, except as described below and elsewhere in the notes to the consolidated financial statements. Private Placement On January 31, 2023, the Company entered into a pre-funded warrants subscription agreement (the “Subscription Agreement”) with the investors named therein (the “Investors”) pursuant to which the Company sold and issued to the Investors an aggregate of 160,742,959 pre-funded warrants (the “Pre-funded Warrants”) to purchase shares (the “Pre-funded Warrant Shares”) of the Company’s Class A common stock. Each Pre-funded Warrant was sold at a price of $ 0.5599 per Pre-funded Warrant and has an initial exercise price of $ 0.0001 per Pre-funded Warrant, subject to certain customary anti-dilution adjustment provisions. The exercise price for the Pre-funded Warrants can be paid in cash or on a cashless basis, and the Pre-funded Warrants have no expiration date. The aggregate gross proceeds to the Company was approximately $ 90.0 million. The Investors included Brian Bair, Roberto Sella, First American, and Kenneth DeGiorgio. Class B Common Stock Conversion In January 2023, Brian Bair notified the Company’s Board of Directors that he will convert all shares of Class B common stock beneficially owned by him to shares of Class A common stock immediately following the conclusion of the Company’s 2023 annual meeting of stockholders. |
Nature of Operations and Sign_2
Nature of Operations and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Offerpad was founded in 2015 and together with its subsidiaries, is a customer-centric, home buying and selling platform that provides customers with the ultimate home transaction experience, offering convenience, control, certainty, and value. The Company is headquartered in Chandler, Arizona and operated in over 1,800 cities and towns in 28 metropolitan markets across 16 states as of December 31, 2022 . |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). Offerpad Solutions Inc. was formed on September 1, 2021 through a business combination (the “Business Combination”) with Supernova Partners Acquisition Company, Inc. (“Supernova”). In connection with the closing of the Business Combination, Supernova changed its name to Offerpad Solutions Inc. T he Business Combination was accounted for as a reverse recapitalization. |
Use of Estimates | Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant estimates include those related to the net realizable value of inventory, among others. Actual results could differ from those estimates. |
Principles of Consolidation | Principles of Consolidation The Company’s consolidated financial statements include the assets, liabilities, revenues and expenses of the Company, its wholly owned operating subsidiaries and variable interest entities where the Company is the primary beneficiary. All intercompany accounts and transactions have been eliminated in consolidation. |
Segment Reporting | Segment Reporting Operating segments are components of an entity for which discrete financial information is available and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources and in assessing operating performance. The Company’s CODM is its Chief Executive Officer. The Company is not organized around specific services or geographic regions, but rather, operates in one service line, providing a home buying and selling platform. The Company’s CODM reviews the financial information presented on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. As such, the Company has determined that it is organized and operated as one operating and reportable segment on a consolidated basis for each of the periods presented. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash includes demand deposits with banks and financial institutions. Cash equivalents include only investments with original maturities to us of three months or less that are highly liquid and readily convertible to known amounts of cash. |
Restricted Cash | Restricted Cash Restricted cash primarily consists of cash received from the resale of homes that is specifically designated to repay borrowings under one of the Company’s secured credit facilities and is typically released within a few days of the home sale. |
Concentration of Credit Risk | Concentrations of Credit Risk Financial instruments that are potentially subject to concentrations of credit risk are primarily cash and cash equivalents. Cash and cash equivalents are placed with major financial institutions deemed to be of high-credit-quality in order to limit credit exposure. Cash is regularly maintained in excess of federally insured limits at the financial institutions. Management believes that the Company is not exposed to any significant credit risk related to cash deposits. |
Accounts Receivable | Accounts Receivable Accounts receivable are generated through the sale of a home and generally results in a one- or two-day delay in receiving cash from the title company. Accounts receivable are stated at the amount management expects to collect from outstanding balances. Most of the Company’s transactions are processed through escrow and therefore, collectability is reasonably assured. The Company reviews accounts receivable on a regular basis and estimates an amount of losses for uncollectible accounts based on its historical collections, age of the receivable, and any other known conditions that may affect collectability. |
Inventory | Inventory Inventory consists of acquired homes and is stated at the lower of cost or net realizable value, with cost and net realizable value determined by the specific identification of each home. Costs include initial purchase costs and renovation costs, as well as holding costs and interest incurred during the renovation period, prior to the listing date. Selling costs, including commissions and holding costs incurred after the listing date, are expensed as incurred and included in sales, marketing and operating expenses. The Company reviews inventory for impairment on a quarterly basis, or more frequently if events or changes in circumstances indicate that the carrying value of inventory may not be recoverable. The Company evaluates inventory for indicators that net realizable value is lower than cost at the individual home level. The Company generally considers multiple factors in determining net realizable value for each home, including recent comparable home sale transactions in the specific area where the home is located, the residential real estate market conditions in both the local market in which the home is located and in the U.S. in general, the impact of national, regional or local economic conditions and expected selling costs. When evidence exists that the net realizable value of inventory is lower than its cost, the difference is recognized as impairment in cost of revenue and the related inventory is adjusted to its net realizable value. For individual homes or portfolios of homes under contract to sell as of the impairment assessment date, if the carrying value exceeds the contract price less expected selling costs, the carrying value of these homes are adjusted to the contract price less expected selling costs. For all other homes, if the carrying value exceeds the expected sale price less expected selling costs, the carrying value of these homes are adjusted to the expected sale price less expected selling costs. Changes in the Company’s pricing assumptions may lead to a change in the outcome of the impairment analysis, and actual results may differ from the Company’s assumptions. The Company recorded inventory impairments of $ 93.8 million, $ 2.8 million and $ 3.2 million during the years ended December 31, 2022, 2021 and 2020, respectively. Refer to Note 3. Inventory, for further details. |
Property and Equipment | Property and Equipment Property and equipment is recorded at cost less accumulated depreciation, and primarily consists of rooftop solar panel systems installed on residential real estate . Th e Company depreciates its property and equipment using the straight-line method over the estimated useful lives of the related assets, which are as follows: Property and Equipment Category Estimated Useful Life Rooftop solar panel systems Twenty years Leasehold improvements Lesser of estimated useful life or remaining lease term Computers and equipment Five years Office equipment and furniture Seven years Software systems Three to five years Refer to Note 4. Property and Equipment, for further details. |
Leases | Leases The Company determines if an arrangement is or contains a lease at inception of the arrangement. For leases with terms greater than 12 months, the Company records the related operating or finance right-of-use asset and lease liability at the present value of the future lease payments over the lease term at the lease commencement date. The Company is generally not able to readily determine the implicit rate in its lease arrangements, and therefore, uses its incremental borrowing rate at lease commencement to determine the present value of lease payments. The incremental borrowing rate represents the Company’s estimate of the interest rate the Company would incur at lease commencement to borrow an amount similar to the lease payments on a collateralized basis over the term of a lease. Renewal and early termination options are not included in the measurement of the right-of-use asset and lease liability unless the Company is reasonably certain to exercise the option. Additionally, certain leases contain lease incentives, such as construction allowances from landlords. These incentives reduce the right-of-use asset related to the lease. Certain of the Company’s leases contain rent escalations over the lease term. The Company recognizes expense for operating leases on a straight-line basis over the lease term. Certain of the Company’s lease agreements also contain variable lease payments for common area maintenance, utility, and taxes. The Company has elected the practical expedient to combine lease and non-lease components for all asset categories. Therefore, the lease payments used to measure the lease liability for these leases include fixed minimum rentals along with non-lease component charges. The Company does not have significant residual value guarantees or restrictive covenants in its lease portfolio. Operating lease assets and liabilities are included on the Company’s Consolidated Balance Sheet in Other non-current assets , Accrued and other current liabilities , and Other long-term liabilities . Refer to Note 5. Leases, for further details. |
Long-Lived Asset Impairments | Long-Lived Asset Impairments Long-lived assets, including property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment loss is recognized to the extent the carrying amount of the underlying asset exceeds its fair value. The Company recognized no impairment charges on its long-lived assets during the years ended December 31, 2022, 2021 and 2020 . |
Warrant Liabilities | Warrant Liabilities The Company evaluates its financial instruments, including its outstanding warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The Company has outstanding public and private warrants, both of which do not meet the criteria for equity classification and are accounted for as liabilities. Accordingly, the Company recognizes the warrants as liabilities at fair value and adjusts the warrants to fair value at each reporting period. The warrant liabilities are subject to re-measurement at each balance sheet date until exercised or expired, and any change in fair value is recognized in the Company’s consolidated statements of operations. The fair value of the public warrants is estimated based on the quoted market price of such warrants on the valuation date. The fair value of the private warrants is estimated using the Black-Scholes-Merton option-pricing model. Refer to Note 8. Warrant Liabilities, for further details. |
Revenue Recognition | Revenue Recognition Revenue is recognized when (or as) performance obligations are satisfied by transferring control of the promised products or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those products or services. The Company applies the following steps in determining the timing and amount of revenue to recognize: (1) identify the contract with our customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract, if applicable; and (5) recognize revenue when (or as) the performance obligation is satisfied. Revenue from the sale of homes is derived from the resale of homes on the open market. Home sales revenue is recognized at the time of the closing when title to and possession of the property are transferred to the buyer. The amount of revenue recognized for each home sale is equal to the sale price of the home net of resale concessions and credits to the buyer. |
Cost of Revenue | Cost of Revenue Cost of revenue includes the initial purchase costs, renovation costs, holding costs and interest incurred during the renovation period, prior to listing date and real estate inventory valuation adjustments, if any. These costs are accumulated in real estate inventory up until the home is ready for resale, and then charged to cost of revenue under the specific identification method when the property is sold. |
Sales, Marketing and Operating | Sales, Marketing and Operating Sales, marketing and operating expenses consist of real estate agent commissions, advertising, and holding costs on homes incurred during the period that homes are listed for sale, which includes utilities, taxes, maintenance, and other costs. Sales, marketing and operating expense includes any headcount expenses in support of sales, marketing, and real estate inventory operations such as salaries, benefits, and stock-based compensation. Sales, marketing and operating expenses are charged to operations as incurred. The Company incurred advertising expenses o f $ 46.5 million, $ 45.3 million and $ 11.5 million during the years ended December 31, 2022, 2021 and 2020 , respectively. |
Technology and Development | Technology and Development Technology and development expenses consist of headcount expenses, including salaries, benefits and stock-based compensation expense for employees and contractors engaged in the design, development, and testing of website applications and software development. Technology and development expenses are charged to operations as incurred. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation awards consist of stock options, restricted stock units and performance-based restricted stock units. The Company measures and recognizes compensation expense for all stock-based compensation awards based on their estimated fair values on the grant date. The Company records compensation expense for all stock-based compensation awards on a straight-line basis over the requisite service period of the awards, which is generally the vesting period of the award. These amounts are reduced by forfeitures in the period the forfeitures occur. Stock Options The Company uses the Black-Scholes-Merton option pricing model to determine the fair value of stock option awards as of the grant date. The Black-Scholes-Merton option pricing model requires the Company to estimate the following key assumptions based on both historical information and management judgment regarding market factors and trends: • Expected term – The Company uses the simplified method when calculating the expected term due to insufficient historical exercise data. The expected term is estimated using the mid-point between the vesting period and the contractual term of the options. • Risk-free interest rate – The Company estimates the risk-free interest rate using the rate of return on U.S. treasury notes interpolated between the years equal to the expected term assumption. • Expected stock price volatility – As the Company’s shares were not publicly traded prior to the Business Combination, and have a limited trading history subsequent to the Business Combination, the Company estimates expected volatility for stock option awards based on the average historical volatility of similar publicly traded companies. • Expected dividend yield – The expected dividend yield assumption considers that the Company has not historically paid dividends and does not expect to pay dividends in the foreseeable future. • Stock price – The Company has issued stock options with exercise prices equal to the fair value of the underlying stock price. Prior to the completion of the Business Combination and listing of the Company’s common stock on the public stock exchange, the fair value of Old Offerpad common stock that underlies the stock options was determined based on then-current valuation estimates at the time of grant. Because such grants occurred prior to the public trading of the Company’s common stock, the fair value of Old Offerpad common stock was typically determined with assistance of periodic valuation analyses from an independent third-party valuation firm. Subsequent to the Business Combination, the fair value of the Company’s common stock is based on the closing price of the Company’s Class A common stock on the grant date. Restricted Stock Units The Company determines the fair value of restricted stock units based on the closing price of the Company’s Class A common stock on the grant date. Performance-Based Restricted Stock Units The Company determines the fair value of performance-based restricted stock units using a Monte Carlo simulation model that determines the probability of satisfying the market condition stipulated in the award. The Monte Carlo simulation model incorporates various key assumptions, including expected stock price volatility, contractual term, risk-free interest rate, dividend yield and stock price on the grant date. The Company estimates expected stock price volatility based on the average historical volatility of similar publicly traded companies. The Company estimates the risk-free interest rate using the rate of return on U.S. treasury notes equal to the contractual term of the award. The expected dividend yield assumption considers that the Company has not historically paid dividends and does not expect to pay dividends in the foreseeable future. The Company determines the requisite service period for performance-based restricted stock units by comparing the derived service period to achieve the market-based condition and the explicit service-based period, using the longer of the two service periods as the requisite service period. Refer to Note 11. Stock-Based Awards, for further details. |
Employee Benefit Plan | Employee Benefit Plan The Company offers a 401(k) plan which provides employees the opportunity to contribute a portion of their pre-tax or post-tax earnings, subject to certain restrictions as set forth in the Internal Revenue Code. Beginning January 1, 2022, the Company matches 100 % of participant contributions, up to 2.5 % of eligible compensation. The Company contributed $ 1.6 million to the 401(k) plan during the year ended December 31, 2022 . |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and deferred tax liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period when the new rate is enacted. The Company records a valuation allowance to reduce deferred tax assets to the amount that it believes is more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax laws, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company evaluates and accounts for uncertain tax positions using a two-step approach. Recognition (step one) occurs when the Company concludes that a tax position, based solely on its technical merits, is more likely than not to be sustained upon examination. Measurement (step two) determines the amount of benefit that is greater than 50% likely to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. Derecognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more likely than not threshold of being sustained. Refer to Note 14. Income Taxes, for further details. |
Consolidation of Variable Interest Entities | Consolidation of Variable Interest Entities The Company is a variable interest holder in certain entities in which equity investors at risk do not have the characteristics of a controlling financial interest or where the entity does not have enough equity at risk to finance its activities without additional subordinated financial support from other parties; these entities are VIEs. The Company’s variable interest arises from contractual, ownership or other monetary interest in the entity, which fluctuates based on the VIE’s economic performance. The Company consolidates a VIE if it is the primary beneficiary. The Company is the primary beneficiary if it has a controlling financial interest, which includes both the power to direct the activities that most significantly impact the economic performance of the VIE and a variable interest that obligates the Company to absorb losses or the right to receive benefits that potentially could be significant to the VIE. The Company assesses whether it is the primary beneficiary of a VIE on an ongoing basis. Refer to Note 12. Variable Interest Entities, for further details. |
Fair Value Measurement | Fair Value Measurements The Company accounts for assets and liabilities in accordance with accounting standards that define fair value and establish a consistent framework for measuring fair value on either a recurring or a nonrecurring basis. Fair value is an exit price representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Accounting standards include disclosure requirements relating to the fair values used for certain financial instruments and establish a fair value hierarchy. The hierarchy prioritizes valuation inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of three levels: Level 1 —Quoted prices in active markets for identical assets or liabilities. Level 2 —Assets or liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities. Level 3 —Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which is internally developed, and considers risk premiums that a market participant would require. Refer to Note 9. Fair Value Measurements, for further details. |
New Accounting Standards Recently Adopted | New Accounting Standards Recently Adopted Reference Rate Reform In March 2020, the FASB issued a new standard which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Inter Bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. This guidance is optional for a limited period of time to ease the potential burden in accounting for, or recognizing the effects of, reference rate reform on financial reporting. In December 2022, the FASB issued an additional standard which defers the expiration date of the reference rate reform guidance to December 31, 2024. The Company adopted the guidance related to reference rate reform during 2022 and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. |
Nature of Operations and Sign_3
Nature of Operations and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Property and Equipment Useful Lives | Th e Company depreciates its property and equipment using the straight-line method over the estimated useful lives of the related assets, which are as follows: Property and Equipment Category Estimated Useful Life Rooftop solar panel systems Twenty years Leasehold improvements Lesser of estimated useful life or remaining lease term Computers and equipment Five years Office equipment and furniture Seven years Software systems Three to five years |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Components of Inventory | The components of inventory, net of applicable lower of cost or net realizable value adjustments, consist of the following as of December 31: ($ in thousands) 2022 2021 Homes preparing for and under renovation $ 54,499 $ 327,455 Homes listed for sale 440,862 400,308 Homes under contract to sell 169,336 404,808 Inventory $ 664,697 $ 1,132,571 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consist of the following as of December 31: ($ in thousands) 2022 2021 Rooftop solar panel systems $ 5,075 $ 5,075 Leasehold improvements 1,087 797 Office equipment and furniture 736 160 Software systems 386 318 Computers and equipment 265 265 Construction in progress 136 — Property and equipment, gross 7,685 6,615 Less: accumulated depreciation ( 2,491 ) ( 1,469 ) Property and equipment, net $ 5,194 $ 5,146 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Company Operating Lease Liability Maturities | The Company’s operating lease liability maturities as of December 31, 2022 are as follows: ($ in thousands) 2023 $ 2,461 2024 2,373 2025 1,103 2026 269 2027 79 Thereafter — Total future lease payments 6,285 Less: Imputed interest ( 332 ) Total lease liabilities $ 5,953 |
Schedule of Company Operating Lease Right of Use Assets and Operating Lease Liabilities | The Company’s operating lease right-of-use assets and operating lease liabilities, and the associated financial statement line items, are as follows as of December 31: ($ in thousands) Financial Statement Line Items 2022 2021 Right-of-use assets Other non-current assets $ 5,469 $ 4,784 Lease liabilities: Current liabilities Accrued and other current liabilities 2,264 1,345 Non-current liabilities Other long-term liabilities 3,689 3,830 Total lease liabilities $ 5,953 $ 5,175 |
Accrued and Other Liabilities (
Accrued and Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Schedule of Accrued and Other Liabilities | Accrued and other current liabilities consist of the following as of December 31: ($ in thousands) 2022 2021 Payroll and other employee related expenses $ 10,670 $ 12,836 Interest 4,360 3,537 Marketing 4,161 5,795 Home renovation 3,168 8,540 Operating lease liabilities 2,264 1,345 Legal and professional obligations 1,035 1,743 Other 2,594 1,231 Accrued and other current liabilities $ 28,252 $ 35,027 |
Credit Facilities and Other D_2
Credit Facilities and Other Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Line Of Credit Facility [Line Items] | |
Schedule of Carrying Values of Company Debt | The carrying value of the Company’s credit facilities and other debt consists of the following as of December 31: ($ in thousands) 2022 2021 Credit facilities and other debt, net Senior secured credit facilities with financial institutions $ 471,860 $ 747,514 Senior secured credit facility with a related party 17,398 81,926 Senior secured debt - other 89,024 33,320 Mezzanine secured credit facilities with third-party lenders 49,626 87,851 Mezzanine secured credit facilities with a related party 42,778 82,508 Debt issuance costs ( 4,621 ) ( 6,923 ) Total credit facilities and other debt, net 666,065 1,026,196 Current portion - credit facilities and other debt, net Total credit facilities and other debt, net 605,889 861,762 Total credit facilities and other debt - related party 60,176 164,434 Total credit facilities and other debt, net $ 666,065 $ 1,026,196 |
Revolving Credit Facilities | |
Line Of Credit Facility [Line Items] | |
Summary of Company Senior Secured Credit Facilities | The following summarizes certain details related to the Company’s senior secured credit facilities (in thousands, except interest rates): Borrowing Capacity Outstanding Weighted- End of Final As of December 31, 2022 Committed Uncommitted Total Amount Rate Period Date Financial institution 1 $ 300,000 $ 300,000 $ 600,000 $ 228,823 4.74 % June 2024 June 2024 Financial institution 2 200,000 200,000 400,000 123,478 4.11 % September 2023 March 2024 Financial institution 3 125,000 375,000 500,000 119,559 4.48 % December 2023 December 2023 Related party 50,000 25,000 75,000 17,398 6.46 % March 2024 September 2024 Senior secured credit facilities $ 675,000 $ 900,000 $ 1,575,000 $ 489,258 Borrowing Capacity Outstanding Weighted- As of December 31, 2021 Committed Uncommitted Total Amount Rate Financial institution 1 $ 300,000 $ 100,000 $ 400,000 $ 365,392 2.60 % Financial institution 2 400,000 — 400,000 375,063 2.60 % Financial institution 3 300,000 200,000 500,000 7,059 2.60 % Related party 85,000 — 85,000 81,926 4.10 % Senior secured credit facilities $ 1,085,000 $ 300,000 $ 1,385,000 $ 829,440 |
Mezzanine Revolving Credit Facilities | |
Line Of Credit Facility [Line Items] | |
Summary of Company Senior Secured Credit Facilities | The following summarizes certain details related to the Company’s mezzanine secured credit facilities (in thousands, except interest rates): Borrowing Capacity Outstanding Weighted- End of Final As of December 31, 2022 Committed Uncommitted Total Amount Rate Period Date Related party facility 1 $ 65,000 $ 32,500 $ 97,500 $ 38,937 11.00 % June 2024 June 2024 Third-party lender 1 45,000 45,000 90,000 31,239 9.55 % September 2023 March 2024 Third-party lender 2 18,387 94,113 112,500 18,387 9.50 % December 2023 December 2023 Related party facility 2 35,000 17,500 52,500 3,841 11.05 % March 2024 September 2024 Mezzanine secured credit facilities $ 163,387 $ 189,113 $ 352,500 $ 92,404 Borrowing Capacity Outstanding Weighted- As of December 31, 2021 Committed Uncommitted Total Amount Rate Related party facility 1 $ 65,000 $ — $ 65,000 $ 58,767 13.00 % Third-party lender 1 90,000 — 90,000 86,262 9.50 % Third-party lender 2 67,500 45,000 112,500 1,588 9.50 % Related party facility 2 14,000 — 14,000 23,742 13.00 % Mezzanine secured credit facilities $ 236,500 $ 45,000 $ 281,500 $ 170,359 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of Liabilities Measured at Fair Value on Recurring Basis | The Company’s liabilities that are measured at fair value on a recurring basis consist of the following (in thousands): As of December 31, 2022 Quoted Prices in Significant Other Significant Public warrant liabilities $ 343 $ — $ — Private placement warrant liabilities $ — $ — $ 196 As of December 31, 2021 Quoted Prices in Significant Other Significant Public warrant liabilities $ 14,356 $ — $ — Private placement warrant liabilities $ — $ — $ 9,705 |
Schedule of Changes in Private Placement Warrant Liabilities Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs | The following summarizes the changes in the Company’s private placement warrant liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the respective periods: Year Ended December 31, ($ in thousands) 2022 2021 Beginning balance $ 9,705 $ — Initial fair value of private placement warrants — 10,291 Change in fair value of private placement warrants included in net (loss) income ( 9,509 ) ( 586 ) Ending balance $ 196 $ 9,705 |
Schedule of Fair Value of Private Placement Warrants Estimated Using Black-Scholes-Merton Option Pricing Model | The following summarizes the range of assumptions used in the Black-Scholes-Merton option-pricing model to determine the fair value of the private placement warrants during the respective periods: Year Ended December 31, 2022 2021 Volatility 47.00 % - 83.50 % 25.00 % - 40.50 % Stock price $ 0.46 - $ 5.03 $ 6.40 - $ 8.80 Expected life of the options to convert 3.669 - 4.419 4.669 - 5.000 Risk-free rate 2.43 % - 4.16 % 0.78 % - 1.22 % Dividend yield 0.00 % 0.00 % |
Stock-Based Awards (Tables)
Stock-Based Awards (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Schedule of assumptions used | The range of assumptions used in the Black-Scholes-Merton option pricing model to determine the fair value of stock option awards granted during the respective years are as follows: 2022 Range 2021 Range 2020 Range Expected term (in years) 6.25 5.97 - 6.10 5.36 - 6.11 Risk-free interest rate 1.63 % - 3.37 % 0.64 % - 0.67 % 0.38 % - 0.46 % Expected stock price volatility 57.8 % - 60.0 % 52.5 % - 52.7 % 51.7 % - 52.9 % Expected dividend yield — — — Fair value on grant date $ 1.43 - $ 5.11 $ 4.49 - $ 4.55 $ 4.27 - $ 4.49 |
Summary of stock option activity | The following summarizes stock option activity during the years ended December 31, 2022, 2021 and 2020: Number of (in thousands) Weighted- Weighted-Average (in years) Aggregate (in thousands) Outstanding as of December 31, 2019 23,669 0.55 7.71 $ 16,275 Granted 5,258 1.22 Exercised — — Forfeited or cancelled ( 1,336 ) 0.54 Outstanding as of December 31, 2020 27,591 0.68 7.40 14,619 Granted 1,559 1.22 Exercised ( 2,490 ) 0.36 Forfeited or cancelled ( 1,084 ) 0.85 Outstanding as of December 31, 2021 25,576 0.73 6.82 137,170 Granted 1,147 4.90 Exercised ( 8,101 ) 0.58 Forfeited or cancelled ( 895 ) 1.46 Outstanding as of December 31, 2022 17,727 1.02 5.82 953 Exercisable as of December 31, 2022 14,122 0.72 5.24 953 Vested and expected to vest as of December 31, 2022 17,727 1.02 5.82 953 |
Summary of RSU award activity | The following summarizes RSU award activity during the years ended December 31, 2022 and 2021: Number of (in thousands) Weighted Outstanding as of December 31, 2020 — $ — Granted 203 7.88 Vested and settled — — Forfeited or expired — — Outstanding as of December 31, 2021 203 7.88 Granted 2,118 4.50 Vested and settled ( 163 ) 5.33 Forfeited or expired ( 193 ) 5.05 Outstanding as of December 31, 2022 1,965 4.73 |
Summary of PSU award activity | The following summarizes PSU award activity during the year ended December 31, 2022: Number of (in thousands) Weighted Outstanding as of December 31, 2021 — $ — Granted 2,115 4.72 Vested — — Forfeited or expired ( 175 ) 4.72 Outstanding as of December 31, 2022 1,940 4.72 |
Schedule of stock-based compensation expense | The following details stock-based compensation expense for the years ended December 31: Year Ended December 31, ($ in thousands) 2022 2021 2020 Sales, marketing and operating $ 2,023 $ 700 $ 375 General and administrative 5,743 1,889 544 Technology and development 541 490 444 Stock-based compensation expense $ 8,307 $ 3,079 $ 1,363 |
Performance-Based Restricted Stock Units [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Schedule of assumptions used | The assumptions used in the Monte Carlo simulation model to determine the fair value of the PSU awards granted during the year ended December 31, 2022 are as follows: Risk-free interest rate 1.47 % Expected stock price volatility 60.0 % Expected dividend yield 0.0 % Fair value on grant date $ 5.11 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Variable Interest Entities [Abstract] | |
Summary of Assets and Liabilities Related to VIEs | The following summarizes the assets and liabilities related to the VIEs as of December 31: ($ in thousands) 2022 2021 Assets Restricted cash $ 42,958 $ 24,616 Accounts receivable 1,841 4,845 Inventory 664,697 1,132,571 Prepaid expenses and other current assets 212 2,871 Total assets $ 709,708 $ 1,164,903 Liabilities Accounts payable $ 1,976 $ 2,810 Accrued and other current liabilities 4,408 3,537 Secured credit facilities and other debt, net - current portion 666,065 1,026,196 Total liabilities $ 672,449 $ 1,032,543 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Components of Basic and Diluted Earnings Per Share | The components of basic and diluted earnings per share are as follows: Year Ended December 31, (In thousands, except per share data) 2022 2021 2020 Numerator: Net (loss) income $ ( 148,613 ) $ 6,460 $ ( 23,118 ) Denominator: Weighted average common shares outstanding, basic 245,148 118,571 57,865 Dilutive effect of stock options (1) — 24,644 — Dilutive effect of restricted stock units (1) — 5 — Dilutive effect of preferred stock (1) — — — Dilutive effect of warrants (1) — — — Weighted average common shares outstanding, diluted 245,148 143,220 57,865 Net (loss) income per share, basic $ ( 0.61 ) $ 0.05 $ ( 0.40 ) Net (loss) income per share, diluted $ ( 0.61 ) $ 0.05 $ ( 0.40 ) Anti-dilutive securities excluded from diluted (loss) income per share: Anti-dilutive stock options (1) 5,520 — 27,591 Anti-dilutive restricted stock units (1) 1,748 — — Anti-dilutive performance-based restricted stock units 2,047 — — Anti-dilutive warrants (1) 21,783 — 1,887 Anti-dilutive preferred stock (1) — — 138,612 (1) Due to the net loss during each of the years ended December 31, 2022 and 2020 , no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | Income tax expense consisted of the following for the respective periods: Years Ended December 31, ($ in thousands) 2022 2021 2020 Current: Federal $ — $ — $ — State 359 170 163 Total current 359 170 163 Deferred: Federal — — — State — — — Total deferred — — — Income tax expense $ 359 $ 170 $ 163 |
Schedule of Effective Income Tax Rate Reconciliation | The provision for income taxes differs from the tax computed using the statutory U.S. federal income tax rate as a result of the following items for the respective periods: Years Ended December 31, (In thousands, except percentages) 2022 2021 2020 (Benefit) provision at federal statutory income tax rate $ ( 31,133 ) 21.0 % $ 1,392 21.0 % $ ( 4,821 ) 21.0 % State income taxes ( 7,636 ) 5.2 % 360 5.4 % ( 446 ) 1.9 % Change in fair value of warrant liabilities ( 4,940 ) 3.3 % ( 517 ) ( 7.8 )% — 0.0 % Return-to-provision ( 2,277 ) 1.5 % 221 3.3 % 218 ( 0.9 )% Transaction costs ( 1,874 ) 1.3 % ( 1,226 ) ( 18.5 )% — 0.0 % Stock-based compensation ( 1,091 ) 0.7 % 647 9.8 % 286 ( 1.2 )% Valuation allowance 48,690 ( 32.8 )% ( 675 ) ( 10.2 )% 4,999 ( 21.8 )% Other 620 ( 0.4 )% ( 32 ) ( 0.4 )% ( 73 ) 0.3 % Effective income tax rate $ 359 ( 0.2 )% $ 170 2.6 % $ 163 ( 0.7 )% |
Schedule of Deferred Income Tax Assets and Liabilities | Deferred tax assets and liabilities consist of the following as of December 31: ($ in thousands) 2022 2021 Deferred tax assets: Federal net operating loss carryforwards $ 50,178 $ 26,721 State net operating loss carryforwards 9,847 4,703 Inventory 14,771 341 Research and development expenditures 3,190 — Stock-based compensation 1,852 — Transaction costs 1,707 — Operating lease liabilities 1,507 1,284 Other 2,117 2,421 Gross deferred tax assets 85,169 35,470 Valuation allowance ( 82,026 ) ( 33,336 ) Deferred tax assets, net of valuation allowance 3,143 2,134 Deferred tax liabilities: Operating lease right-of-use assets ( 1,385 ) ( 1,187 ) Property and equipment ( 739 ) ( 874 ) Other ( 1,019 ) ( 73 ) Gross deferred tax liabilities ( 3,143 ) ( 2,134 ) Net deferred income taxes $ — $ — |
Related-Party Transactions (Tab
Related-Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |
Summary of Related Parties | Year Ended December 31, ($ in thousands) 2022 2021 2020 Mr. Bair’s brother 1 $ 631 $ 572 $ 260 Mr. Bair’s brother 2 594 469 313 Mr. Bair’s sister-in-law 123 141 120 $ 1,348 $ 1,182 $ 693 |
Grants of Equity Awards to Related Parties | During the year ended December 31, 2022, Mr. Bair’s brothers and Mr. Bair’s sister-in-law received grants of equity awards under the Offerpad Solutions Inc. 2021 Incentive Award Plan, which included awards of restricted stock units (“RSUs”), performance-based RSUs (“PSUs”) and/or stock options, as follows: Number of Number of Number of Mr. Bair’s brother 1 84,367 126,551 — Mr. Bair’s brother 2 79,404 119,107 — Mr. Bair’s sister-in-law 3,000 — 6,000 166,771 245,658 6,000 |
LL Credit Facilities [Member] | |
Related Party Transaction [Line Items] | |
Summary of Related Parties | The following summarizes certain details related to these facilities as of December 31: 2022 2021 ($ in thousands) Borrowing Outstanding Borrowing Outstanding Senior secured credit facility with a related party $ 75,000 $ 17,398 $ 85,000 $ 81,926 Mezzanine secured credit facilities with a related party $ 150,000 $ 42,778 $ 79,000 $ 82,509 |
Nature of Operations and Sign_4
Nature of Operations and Significant Accounting Policies - Schedule of Property and Equipment Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Rooftop Solar Panel Systems | |
Property Plant And Equipment [Line Items] | |
Property and Equipment, Useful Life | 20 years |
Leasehold Improvements | |
Property Plant And Equipment [Line Items] | |
Property and Equipment, Useful Life | Lesser of estimated useful life or remaining lease term |
Computer Equipment | |
Property Plant And Equipment [Line Items] | |
Property and Equipment, Useful Life | 5 years |
Office Equipment and Furniture | |
Property Plant And Equipment [Line Items] | |
Property and Equipment, Useful Life | 7 years |
Software systems | Maximum | |
Property Plant And Equipment [Line Items] | |
Property and Equipment, Useful Life | 5 years |
Software systems | Minimum | |
Property Plant And Equipment [Line Items] | |
Property and Equipment, Useful Life | 3 years |
Nature of Operations and Sign_5
Nature of Operations and Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of Reportable Segments | Segment | 1 | ||
Number of Operating Segments | Segment | 1 | ||
Impairment charges on long-lived assets | $ 0 | $ 0 | $ 0 |
Advertising expenses | 46,500,000 | 45,300,000 | 11,500,000 |
Inventory impairments | $ 93,810,000 | $ 2,843,000 | $ 3,170,000 |
Employee benefit plan maximum contribution plan | 100% | ||
Employee benefit plan eligible compensation | 2.50% | ||
Employee benefit plan contribution amount | $ 1,600,000 |
Business Combination - Addition
Business Combination - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Sep. 01, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||||
Proceeds from Business Combination | $ 284,000,000 | $ 0 | $ 284,011,000 | $ 0 |
Business combination transaction cost | 51,200,000 | |||
Repayment of debt | 63,400,000 | |||
Supernova's Trust and Operating Accounts | ||||
Business Acquisition [Line Items] | ||||
Proceeds from Business Combination | 34,000,000 | |||
Forward Purchase Agreements | ||||
Business Acquisition [Line Items] | ||||
Proceeds from Business Combination | 50,000,000 | |||
PIPE Investment | ||||
Business Acquisition [Line Items] | ||||
Proceeds from Business Combination | $ 200,000,000 | |||
Supernova | Forward Purchase Agreements | ||||
Business Acquisition [Line Items] | ||||
Warrants issued in business combination | 1,666,667 | |||
Business combination, Equity interest in acquiree, Description | an aggregate of 5,000,000 shares of Offerpad Solutions Class A common stock and an aggregate of 1,666,667 warrants to purchase one share of Offerpad Solutions Class A common stock, for an aggregate purchase price of $50,000,000, or $10.00 per share of Offerpad Solutions Class A common stock and one-third of one warrant to purchase one share of Offerpad Solutions Class A common stock (“Forward Purchase Agreements”). | |||
Class A Common Stock | Supernova | Forward Purchase Agreements | ||||
Business Acquisition [Line Items] | ||||
Stock issued in business combination, Shares | 5,000,000 | |||
Stock issued price per share in business combination | $ 10 | |||
Stock issued in business combination, Value | $ 50,000,000 | |||
Class A Common Stock | Supernova | PIPE Investment | ||||
Business Acquisition [Line Items] | ||||
Stock issued in business combination, Shares | 20,000,000 | |||
Stock issued price per share in business combination | $ 10 | |||
Stock issued in business combination, Value | $ 200,000,000 | |||
Old Offerpad and Supernova | ||||
Business Acquisition [Line Items] | ||||
Conversion of stock, shares converted | 7,533 | |||
Old Offerpad and Supernova | Class B Common Stock | Minimum | ||||
Business Acquisition [Line Items] | ||||
Percentage of common stock transferred | 75% |
Inventory - Schedule of Compone
Inventory - Schedule of Components of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Homes preparing for and under renovation | $ 54,499 | $ 327,455 |
Homes listed for sale | 440,862 | 400,308 |
Homes under contract to sell | 169,336 | 404,808 |
Inventory | $ 664,697 | $ 1,132,571 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 7,685 | $ 6,615 |
Less: accumulated depreciation | (2,491) | (1,469) |
Property and equipment, net | 5,194 | 5,146 |
Rooftop Solar Panel Systems | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 5,075 | 5,075 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 1,087 | 797 |
Office Equipment and Furniture | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 736 | 160 |
Software systems | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 386 | 318 |
Computers and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 265 | 265 |
Construction in progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 136 | $ 0 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 1,022 | $ 523 | $ 434 |
Leases - Schedule of Company Op
Leases - Schedule of Company Operating Lease Liability Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2023 | $ 2,461 | |
2024 | 2,373 | |
2025 | 1,103 | |
2026 | 269 | |
2027 | 79 | |
Thereafter | 0 | |
Total future lease payments | 6,285 | |
Less: Imputed interest | (332) | |
Total lease liabilities | $ 5,953 | $ 5,175 |
Leases - Schedule of Company _2
Leases - Schedule of Company Operating Lease Right-of-Use Assets and Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Right-Of-Use-Asset | $ 5,469 | $ 4,784 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Noncurrent | Other Assets, Noncurrent |
Operating Lease, Liability, Current | $ 2,264 | $ 1,345 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued and other current liabilities | Accrued and other current liabilities |
Operating Lease, Liability, Noncurrent | $ 3,689 | $ 3,830 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Operating Lease, Liability, Total | $ 5,953 | $ 5,175 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Line Items] | |||
Short-Term Lease, Cost | $ 0.3 | $ 0.2 | |
Rent Expense | $ 1.4 | ||
Operating Lease, Weighted Average Remaining Lease Term | 2 years 8 months 12 days | 3 years 6 months | |
Operating Lease, Weighted Average Discount Rate, Percent | 4.20% | 4.10% | |
Operating Expense [Member] | |||
Leases [Line Items] | |||
Operating Lease, Cost | $ 2.1 | $ 1.4 | |
Measurement Of Operating Lease Liabilities [Member] | |||
Leases [Line Items] | |||
Operating Lease, Payments | 2 | 1.4 | |
Acquired Operating Lease Liabilities [Member] | |||
Leases [Line Items] | |||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 2.5 | $ 1.6 | |
Minimum | |||
Leases [Line Items] | |||
Lessee, Operating Lease, Lease Term | 1 year | ||
Maximum | |||
Leases [Line Items] | |||
Lessee, Operating Lease, Lease Term | 6 years |
Accrued and Other Liabilities -
Accrued and Other Liabilities - Schedule of Accrued and Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Payroll and other employee related expenses | $ 10,670 | $ 12,836 |
Interest | 4,360 | 3,537 |
Marketing | 4,161 | 5,795 |
Home renovation | 3,168 | 8,540 |
Operating lease liabilities | 2,264 | 1,345 |
Legal and professional obligations | 1,035 | 1,743 |
Other | 2,594 | 1,231 |
Total accrued and other current liabilities | $ 28,252 | $ 35,027 |
Credit Facilities and Other D_3
Credit Facilities and Other Debt - Schedule of Carrying Values of the Company's Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Credit facilities and notes payable, net | ||
Senior secured debt - other | $ 89,024 | $ 33,320 |
Debt issuance costs | (4,621) | (6,923) |
Total credit facilities and other debt, net | 666,065 | 1,026,196 |
Current portion - credit facilities and other debt, net | ||
Total credit facilities and other debt, net | 605,889 | 861,762 |
Total credit facilities and other debt - related party | 60,176 | 164,434 |
Total credit facilities and other debt, net | 666,065 | 1,026,196 |
Mezzanine Secured Credit Facilities [Member] | ||
Credit facilities and notes payable, net | ||
Secured credit facilities | 42,778 | 82,508 |
Mezzanine Secured Credit Facilities [Member] | Third-party lenders [Member] | ||
Credit facilities and notes payable, net | ||
Secured credit facilities | 49,626 | 87,851 |
Senior Secured Credit Facilities [Member] | ||
Credit facilities and notes payable, net | ||
Secured credit facilities | 17,398 | 81,926 |
Senior Secured Credit Facilities [Member] | Financial Institutions [Member] | ||
Credit facilities and notes payable, net | ||
Secured credit facilities | $ 471,860 | $ 747,514 |
Credit Facilities and Other D_4
Credit Facilities and Other Debt - Schedule of Company's Senior Secured Credit Facilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Senior Secured Credit Facilities With Financial Institutions | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 675,000 | $ 1,085,000 |
Borrowing Capacity, Uncommitted | 900,000 | 300,000 |
Total Borrowing Capacity | 1,575,000 | 1,385,000 |
Outstanding Amount | 489,258 | 829,440 |
Revolving Credit Facility [Member] | ||
Line Of Credit Facility [Line Items] | ||
Total Borrowing Capacity | 75,000 | 85,000 |
Outstanding Amount | 17,398 | 81,926 |
Two Thousand and Twenty Four June Revolving Credit Facility [Member] | Senior Secured Credit Facilities With Financial Institutions | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | 300,000 | 300,000 |
Borrowing Capacity, Uncommitted | 300,000 | 100,000 |
Total Borrowing Capacity | 600,000 | 400,000 |
Outstanding Amount | $ 228,823 | $ 365,392 |
Weighted- Average Interest Rate | 4.74% | 2.60% |
End of Revolving / Withdrawal Period | Jun. 30, 2024 | |
Maturity Date | Jun. 30, 2024 | |
Two Thousand And Twenty Three December Revolving Credit Facility Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 18,387 | |
Borrowing Capacity, Uncommitted | 94,113 | |
Two Thousand And Twenty Three December Revolving Credit Facility Member | Senior Secured Credit Facilities With Financial Institutions 2 [Member] | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | 125,000 | $ 300,000 |
Borrowing Capacity, Uncommitted | 375,000 | 200,000 |
Total Borrowing Capacity | 500,000 | 500,000 |
Outstanding Amount | $ 119,559 | $ 7,059 |
Weighted- Average Interest Rate | 4.48% | 2.60% |
End of Revolving / Withdrawal Period | Dec. 31, 2023 | |
Maturity Date | Dec. 31, 2023 | |
Two Thousand And Twenty Four September Revolving Credit Facility Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 35,000 | |
Borrowing Capacity, Uncommitted | 17,500 | |
Two Thousand And Twenty Four September Revolving Credit Facility Member | Revolving Credit Facility [Member] | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | 50,000 | $ 85,000 |
Borrowing Capacity, Uncommitted | 25,000 | 0 |
Total Borrowing Capacity | 75,000 | 85,000 |
Outstanding Amount | $ 17,398 | $ 81,926 |
Weighted- Average Interest Rate | 6.46% | 4.10% |
End of Revolving / Withdrawal Period | Mar. 31, 2024 | |
Maturity Date | Sep. 30, 2024 | |
Two Thousand And Twenty Four March Revolving Credit Facility [Member] | Senior Secured Credit Facility With Financial Institution Two Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 200,000 | $ 400,000 |
Borrowing Capacity, Uncommitted | 200,000 | 0 |
Total Borrowing Capacity | 400,000 | 400,000 |
Outstanding Amount | $ 123,478 | $ 375,063 |
Weighted- Average Interest Rate | 4.11% | 2.60% |
End of Revolving / Withdrawal Period | Sep. 30, 2023 | |
Maturity Date | Mar. 31, 2024 |
Credit Facilities and Notes Pay
Credit Facilities and Notes Payable - Additional Information (Details) | 12 Months Ended | |
Dec. 31, 2022 USD ($) Facility | Dec. 31, 2021 USD ($) | |
Related Parties [Member] | ||
Line Of Credit Facility [Line Items] | ||
Number of facilities | Facility | 1 | |
TwoThousand And Twenty Four March Mezzanine Credit Facility With Related Party Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 45,000,000 | |
Uncommitted amount | $ 45,000,000 | |
Class A Common Stock | ||
Line Of Credit Facility [Line Items] | ||
Related party, holding percentage | 5% | |
Minimum | ||
Line Of Credit Facility [Line Items] | ||
Debt instrument, interest rate | 9.50% | |
Senior Secured Credit Facilities With Financial Institutions | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity | $ 400,000,000 | |
Total Borrowing Capacity | 1,575,000,000 | $ 1,385,000,000 |
Borrowing Capacity, Committed | 675,000,000 | 1,085,000,000 |
Uncommitted amount | 900,000,000 | 300,000,000 |
Senior Secured Credit Facilities With Financial Institutions | Two Thousand And Twenty Three February Mezzanine Credit Facility With Related Party | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity | $ 90,000,000 | |
Financial Institutions [Member] | ||
Line Of Credit Facility [Line Items] | ||
Number of facilities | Facility | 3 | |
Senior Secured Credit Facility | ||
Line Of Credit Facility [Line Items] | ||
Total Borrowing Capacity | $ 1,927,500 | |
Borrowing Capacity, Committed | $ 838,400,000 | |
Number of facilities | Facility | 4 | |
Mezzanine Revolving Credit Facilities | ||
Line Of Credit Facility [Line Items] | ||
Total Borrowing Capacity | $ 352,500,000 | 281,500,000 |
Borrowing Capacity, Committed | 163,387,000 | 236,500,000 |
Uncommitted amount | 189,113,000 | 45,000,000 |
Mezzanine Revolving Credit Facilities | TwoThousand And Twenty Four March Mezzanine Credit Facility With Related Party Member | ||
Line Of Credit Facility [Line Items] | ||
Total Borrowing Capacity | $ 90,000,000 | 90,000,000 |
Borrowing Capacity, Committed | $ 90,000,000 | |
Weighted- Average Interest Rate | 9.55% | 9.50% |
Maturity Date | Mar. 31, 2024 | |
Mezzanine Revolving Credit Facilities | Maximum | ||
Line Of Credit Facility [Line Items] | ||
Debt instrument, interest rate | 13% | |
Senior Secured Debt [Member] | ||
Line Of Credit Facility [Line Items] | ||
Weighted- Average Interest Rate | 7.23% | 5.79% |
Revolving Credit Facility [Member] | ||
Line Of Credit Facility [Line Items] | ||
Total Borrowing Capacity | $ 75,000,000 | $ 85,000,000 |
Senior Secured Credit Facility With Financial Institution Two Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity | 200,000,000 | |
Senior Secured Credit Facility With Financial Institution Two Member | Two Thousand And Twenty Three February Mezzanine Credit Facility With Related Party | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity | 45,000,000 | |
Senior Secured Credit Facility With Financial Institution Three Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity | 100,000,000 | |
Senior Secured Credit Facility With Financial Institution Three Member | Two Thousand And Twenty Three February Mezzanine Credit Facility With Related Party | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity | $ 22,500,000 |
Credit Facilities and Notes P_2
Credit Facilities and Notes Payable - Schedule of Company's Mezzanine Secured Credit Facilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Mezzanine Revolving Credit Facilities | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 163,387 | $ 236,500 |
Borrowing Capacity, Uncommitted | 189,113 | 45,000 |
Total Borrowing Capacity | 352,500 | 281,500 |
Outstanding Amount | 92,404 | 170,359 |
Two Thousand And Twenty Four June Mezzanine Credit Facility With Related Party [Member] | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | 65,000 | |
Borrowing Capacity, Uncommitted | 32,500 | |
Two Thousand And Twenty Four June Mezzanine Credit Facility With Related Party [Member] | Mezzanine Revolving Credit Facilities | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | 65,000 | |
Total Borrowing Capacity | 97,500 | 65,000 |
Outstanding Amount | $ 38,937 | $ 58,767 |
Weighted- Average Interest Rate | 11% | 13% |
End of Revolving / Withdrawal Period | Jun. 30, 2024 | |
Maturity Date | Jun. 30, 2024 | |
TwoThousand And Twenty Four March Mezzanine Credit Facility With Related Party Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 45,000 | |
Borrowing Capacity, Uncommitted | 45,000 | |
TwoThousand And Twenty Four March Mezzanine Credit Facility With Related Party Member | Mezzanine Revolving Credit Facilities | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 90,000 | |
Total Borrowing Capacity | 90,000 | 90,000 |
Outstanding Amount | $ 31,239 | $ 86,262 |
Weighted- Average Interest Rate | 9.55% | 9.50% |
End of Revolving / Withdrawal Period | Sep. 30, 2023 | |
Maturity Date | Mar. 31, 2024 | |
Two Thousand And Twenty Three December Revolving Credit Facility Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 18,387 | |
Borrowing Capacity, Uncommitted | 94,113 | |
Two Thousand And Twenty Three December Revolving Credit Facility Member | Mezzanine Revolving Credit Facilities | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 67,500 | |
Borrowing Capacity, Uncommitted | 45,000 | |
Total Borrowing Capacity | 112,500 | 112,500 |
Outstanding Amount | $ 18,387 | $ 1,588 |
Weighted- Average Interest Rate | 9.50% | 9.50% |
End of Revolving / Withdrawal Period | Dec. 31, 2023 | |
Maturity Date | Dec. 31, 2023 | |
Two Thousand And Twenty Four September Revolving Credit Facility Member | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 35,000 | |
Borrowing Capacity, Uncommitted | 17,500 | |
Two Thousand And Twenty Four September Revolving Credit Facility Member | Mezzanine Revolving Credit Facilities | ||
Line Of Credit Facility [Line Items] | ||
Borrowing Capacity, Committed | $ 14,000 | |
Total Borrowing Capacity | 52,500 | 14,000 |
Outstanding Amount | $ 3,841 | $ 23,742 |
Weighted- Average Interest Rate | 11.05% | 13% |
End of Revolving / Withdrawal Period | Mar. 31, 2024 | |
Maturity Date | Sep. 30, 2024 |
Warrant Liabilities - Additiona
Warrant Liabilities - Additional Information (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 01, 2021 | |
Derivative Warrant Liabilities [Line Items] | |||
Warrants expiration period after completion of business combination or earlier upon redemption or liquidation date | Sep. 01, 2026 | ||
Redemption Of Warrants When Price Per Share Of Class A Common Stock Equals Or Exceeds 18.00 | |||
Derivative Warrant Liabilities [Line Items] | |||
Warrants exercisable | $ 0.01 | ||
Redemption price per share | $ 18 | ||
Trading day period | 20 days | ||
Minimum period prior written notice of redemption | 30 days | ||
Common Stock Value | $ 18 | ||
Redemption Of Warrants When Price Per Share Of Class A Common Stock Equals or Exceeds 10.00 | |||
Derivative Warrant Liabilities [Line Items] | |||
Overall trading period | 10 days | ||
Warrants exercisable | $ 0.10 | ||
Redemption price per share | $ 10 | ||
Minimum period prior written notice of redemption | 30 days | ||
Common Stock Value | $ 10 | ||
Class A Common Stock | |||
Derivative Warrant Liabilities [Line Items] | |||
Common stock, shares issued | 232,378,752 | 224,154,000 | |
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Maximum | Class A Common Stock | |||
Derivative Warrant Liabilities [Line Items] | |||
Number of warrants to be issued | 21,800,000 | ||
Minimum | Redemption Of Warrants When Price Per Share Of Class A Common Stock Equals or Exceeds 10.00 | |||
Derivative Warrant Liabilities [Line Items] | |||
Warrants exercisable in connection with redemption feature per share | $ 0.361 | ||
Supernova | |||
Derivative Warrant Liabilities [Line Items] | |||
Class of warrants issued | 1,700,000 | ||
Public Warrant | |||
Derivative Warrant Liabilities [Line Items] | |||
Class of warrant or right outstanding | 15,200,000 | ||
Warrants exercisable | $ 11.50 | ||
Public Warrant | Class A Common Stock | |||
Derivative Warrant Liabilities [Line Items] | |||
Number of securities into which each warrant or right may be converted | 1 | ||
Public Warrant | Supernova | |||
Derivative Warrant Liabilities [Line Items] | |||
Class of warrant or right outstanding | 13,400,000 | ||
Private Placement | |||
Derivative Warrant Liabilities [Line Items] | |||
Class of warrant or right outstanding | 6,600,000 | ||
Number of private placement warrant elected to transfer | 1,800,000 | ||
Private Placement | Supernova | |||
Derivative Warrant Liabilities [Line Items] | |||
Class of warrant or right outstanding | 6,700,000 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Warrant liabilities | $ 539 | $ 24,061 |
Quoted Prices in Active Markets for Identical Liabilities (Level 1) | Public Warrant | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Warrant liabilities | 343 | 14,356 |
Significant Unobservable Inputs (Level 3) | Private Placement Warrant | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Warrant liabilities | $ 196 | $ 9,705 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Change in fair value of warrant liabilities | $ (23,522,000) | $ (2,464,000) | $ 0 |
Fair value, measurement with unobservable inputs reconciliation, recurring basis, liability, transfers, net | 0 | 0 | $ 0 |
Public Warrant | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Change in fair value of warrant liabilities | $ 14,000,000 | $ 1,800,000 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Liabilities Measured on Recurring Basis Unobservable Input Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Net Income (Loss) Attributable to Parent | Net Income (Loss) Attributable to Parent |
Private Placement Warrant | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Beginning balance | $ 9,705 | $ 0 |
Initial fair value of private placement warrants | 0 | 10,291 |
Change in fair value of private placement warrants included in net loss | (9,509) | (586) |
Ending balance | $ 196 | $ 9,705 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Fair Value of Private Placement Warrants Estimated Using Black-Scholes-Merton Option Pricing Model (Details) - Private Placement Warrant | Dec. 31, 2022 $ / shares | Dec. 31, 2021 $ / shares |
Dividend Yield | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 0 | 0 |
Maximum | Volality | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 83.50 | 40.50 |
Maximum | Stock Price | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | $ 5.03 | $ 8.80 |
Maximum | Expected Life of the Options to Convert | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 4 years 5 months | 5 years |
Maximum | Risk-free Rate | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 4.16 | 1.22 |
Minimum | Volality | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 47 | 25 |
Minimum | Stock Price | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | $ 0.46 | $ 6.40 |
Minimum | Expected Life of the Options to Convert | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 3 years 8 months | 4 years 8 months |
Minimum | Risk-free Rate | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Warrants and rights outstanding measurement input | 2.43 | 0.78 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Class Of Stock [Line Items] | ||
Preferred stock, shares authorized | 100,000,000 | |
Preferred stock, par value per share | $ 0.0001 | |
Preferred stock, shares issued | 0 | |
Preferred stock, shares outstanding | 0 | |
Shares Authorized | 2,370,000,000 | |
Class A Common Stock | ||
Class Of Stock [Line Items] | ||
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares issued | 232,378,752 | 224,154,000 |
Common stock, shares outstanding | 232,378,752 | 224,154,000 |
Class B Common Stock | ||
Class Of Stock [Line Items] | ||
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares issued | 14,816,236 | 14,816,000 |
Common stock, shares outstanding | 14,816,236 | 14,816,000 |
Class B Common Stock | Old Offerpad and Supernova | Minimum | ||
Class Of Stock [Line Items] | ||
Percentage of common stock transferred | 75% | |
Class B Common Stock | Founder | ||
Class Of Stock [Line Items] | ||
Common stock voting rights | 10 votes per share | |
Class C Common Stock | ||
Class Of Stock [Line Items] | ||
Common stock, shares authorized | 250,000,000 | |
Common stock, par value | $ 0.0001 | |
Common stock, shares issued | 0 | |
Common stock, shares outstanding | 0 |
Stock-Based Awards - Additional
Stock-Based Awards - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock option exercised, intrinsic value | $ 35.8 | $ 10.5 | |
Stock options exercised | 8,101,000 | 2,490,000 | 0 |
Option granted, weighted-average grant date fair value | $ 2.73 | $ 0.60 | $ 0.61 |
Unrecognized stock based compensation expense | $ 3.5 | ||
Unrecognized stock based compensation expense, recognition period | 1 year 11 months 23 days | ||
Fair value of restricted stock units vested | $ 2.1 | $ 2.6 | $ 1.2 |
Restricted Stock Units (RSUs) [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized stock based compensation expense | $ 6.2 | ||
Unrecognized stock based compensation expense, recognition period | 1 year 10 months 20 days | ||
Fair value of restricted stock units vested | $ 1.6 | $ 0.1 | |
Performance-based restricted stock units granted | 2,118,000 | 203,000 | 0 |
Vested | 163,000 | 0 | |
Restricted Stock Units (RSUs) [Member] | Employee [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Performance-based restricted stock units vesting period | 3 years | ||
Restricted Stock Units (RSUs) [Member] | Non-Employee [Member] | Minimum [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Performance-based restricted stock units vesting period | 3 months | ||
Restricted Stock Units (RSUs) [Member] | Non-Employee [Member] | Maximum [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Performance-based restricted stock units vesting period | 3 years | ||
Performance-Based Restricted Stock Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized stock based compensation expense | $ 6.6 | ||
Unrecognized stock based compensation expense, recognition period | 2 years 1 month 28 days | ||
Performance-based restricted stock units granted | 2,115,000 | 0 | 0 |
Performance-based restricted stock units vesting period | 3 years | ||
Vested | 0 | ||
Class A Common Stock | Restricted Stock Units (RSUs) [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Vested | 351,600 | ||
2021 Equity Incentive plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Diluted shares conversion percentage | 5% | ||
2021 Equity Incentive plan | Restricted Stock Units (RSUs) [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Performance-based restricted stock units granted | 166,771 | ||
2021 Equity Incentive plan | Performance-Based Restricted Stock Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Performance-based restricted stock units granted | 245,658 | ||
2021 Equity Incentive plan | Class A Common Stock | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Shares reserved for future issuance | 26,333,222 | ||
Employee Stock Purchase Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Diluted shares conversion percentage | 1% | ||
Number of Shares Available for Grant | 50,000,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued | 0 | ||
Employee Stock Purchase Plan | Class A Common Stock | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of Shares Available for Grant | 2,633,322 |
Stock-Based Awards - Schedule o
Stock-Based Awards - Schedule of Assumptions Used in Black-Scholes Model for Options Granted (Details) - Options Issued Under Plan - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 3 months | ||
Expected dividend yield | 0% | 0% | 0% |
Minimum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (in years) | 5 years 11 months 19 days | 5 years 4 months 9 days | |
Risk-free interest rate | 1.63% | 0.64% | 0.38% |
Expected stock price volatility | 57.80% | 52.50% | 51.70% |
Fair value on grant date | $ 1.43 | $ 4.49 | $ 4.27 |
Maximum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 9 days | |
Risk-free interest rate | 3.37% | 0.67% | 0.46% |
Expected stock price volatility | 60% | 52.70% | 52.90% |
Fair value on grant date | $ 5.11 | $ 4.55 | $ 4.49 |
Stock-Based Awards - Summary of
Stock-Based Awards - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options, Outstanding at beginning of period | 25,576 | 27,591 | 23,669 | |
Options, Granted | 1,147 | 1,559 | 5,258 | |
Options, Excercised | (8,101) | (2,490) | 0 | |
Options, Forfeited or cancelled | (895) | (1,084) | (1,336) | |
Options, Outstanding at end of period | 17,727 | 25,576 | 27,591 | 23,669 |
Options, Exercisable | 14,122 | |||
Options, Vested and expected to vest | 17,727 | |||
Weighted Average Exercise Price | ||||
Weighted average exercise price per share, outstanding beginning of period | $ 0.73 | $ 0.68 | $ 0.55 | |
Weighted average exercise price per share, Granted | 4.90 | 1.22 | 1.22 | |
Weighted average exercise price per share, Exercised | 0.58 | 0.36 | 0 | |
Weighted average exercise price per share, Forfeited or cancelled | 1.46 | 0.85 | 0.54 | |
Weighted average exercise price per share, Outstanding at end of period | 1.02 | $ 0.73 | $ 0.68 | $ 0.55 |
Weighted average exercise price per share, Exercisable | 0.72 | |||
Weighted average exercise price per share, Vested and expected to vest | $ 1.02 | |||
Weighted average remaining contractual term | 5 years 9 months 25 days | 6 years 9 months 25 days | 7 years 4 months 24 days | 7 years 8 months 15 days |
Weighted average remaining contractual term, Exercisable | 5 years 2 months 26 days | |||
Weighted average remaining contractual term, Vested and expected to vest | 5 years 9 months 25 days | |||
Aggregate intrinsic value, Outstanding beginning of period | $ 137,170 | $ 14,619 | $ 16,275 | |
Aggregate intrinsic value, Outstanding end of period | 953 | $ 137,170 | $ 14,619 | $ 16,275 |
Aggregate intrinsic value, Exercisable | 953 | |||
Aggregate intrinsic value, Vested and expected to vest | $ 953 |
Stock-Based Awards - Summary _2
Stock-Based Awards - Summary of RSU award activity (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Beginning Balance | 203,000 | 0 | |
Granted | 2,118,000 | 203,000 | 0 |
Vested and settled | (163,000) | 0 | |
Forfeited or expired | (193,000) | 0 | |
Ending Balance | 1,965,000 | 203,000 | 0 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ 7.88 | $ 0 | |
Weighted Average Grant Date Fair Value, Granted | 4.50 | 7.88 | |
Weighted Average Grant Date Fair Value, Vested and settled | 5.33 | 0 | |
Weighted Average Grant Date Fair Value, Forfeited or expired | 5.05 | 0 | |
Weighted Average Grant Date Fair Value, Ending Balance | $ 4.73 | $ 7.88 | $ 0 |
Stock-Based Awards - Schedule_2
Stock-Based Awards - Schedule of Assumptions Used in Monte Carlo Simulation Model (Details) - Performance-Based Restricted Stock Units [Member] | 12 Months Ended |
Dec. 31, 2022 $ / shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Risk-free interest rate | 1.47% |
Expected stock price volatility | 60% |
Expected dividend yield | 0% |
Fair value on grant date | $ 5.11 |
Stock-Based Awards - Summary _3
Stock-Based Awards - Summary of PSU Award Activity (Details) - Performance-Based Restricted Stock Units [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Beginning Balance | 0 | ||
Granted | 2,115,000 | 0 | 0 |
Vested | 0 | ||
Forfeited or expired | (175,000) | ||
Ending Balance | 1,940,000 | 0 | |
Weighted Average Grant Date Fair Value, Beginning Balance | $ 0 | ||
Weighted Average Grant Date Fair Value, Granted | 4.72 | ||
Weighted Average Grant Date Fair Value, Vested | 0 | ||
Weighted Average Grant Date Fair Value, Forfeited or expired | 4.72 | ||
Weighted Average Grant Date Fair Value, Ending Balance | $ 4.72 | $ 0 |
Stock-Based Awards - Summary _4
Stock-Based Awards - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 8,307 | $ 3,079 | $ 1,363 |
Sales, Marketing and Operating [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock-based compensation expense | 2,023 | 700 | 375 |
General and Administrative [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock-based compensation expense | 5,743 | 1,889 | 544 |
Technology and Development [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 541 | $ 490 | $ 444 |
Variable Interest Entities - Su
Variable Interest Entities - Summary of Assets and Liabilities Related to VIEs (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
ASSETS | ||||
Restricted cash | $ 43,058 | $ 24,616 | $ 6,804 | |
Accounts receivable | 2,350 | 6,165 | ||
Inventory | 664,697 | 1,132,571 | ||
Prepaid expenses and other current assets | 6,833 | 9,808 | ||
Property and equipment, net | 5,194 | 5,146 | ||
Total assets | [1] | 825,069 | 1,353,082 | |
Liabilities | ||||
Accounts payable | 4,647 | 6,399 | ||
Total liabilities | [2] | 703,192 | 1,095,513 | |
Variable Interest Entity | ||||
ASSETS | ||||
Restricted cash | 42,958 | 24,616 | ||
Accounts receivable | 1,841 | 4,845 | ||
Inventory | 664,697 | 1,132,571 | ||
Prepaid expenses and other current assets | 212 | 2,871 | ||
Total assets | 709,708 | 1,164,903 | ||
Liabilities | ||||
Accounts payable | 1,976 | 2,810 | ||
Accrued liabilities | 4,408 | 3,537 | ||
Secured credit facilities and other debt, net - current portion | 666,065 | 1,026,196 | ||
Total liabilities | $ 672,449 | $ 1,032,543 | ||
[1] Our consolidated assets as of December 31, 2022 and 2021 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $ 42,958 and $ 24,616 ; Accounts receivable, $ 1,841 and $ 4,845 ; Inventory, $ 664,697 and $ 1,132,571 ; Prepaid expenses and other current assets, $ 212 and $ 2,871 ; Total assets of $ 709,708 and $ 1,164,903 , respectively. Our consolidated liabilities as of December 31, 2022 and 2021 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $ 1,976 and $ 2,810 ; Accrued and other current liabilities, $ 4,408 and $ 3,537 ; Secured credit facilities and other debt, net, $ 666,065 and $ 1,026,196 ; Total liabilities, $ 672,449 and $ 1,032,543 , respectively. |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Components of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Net income (loss) | $ (148,613) | $ 6,460 | $ (23,118) | |
Weighted average common shares outstanding, basic | 245,148 | 118,571 | 57,865 | |
Dilutive effect of stock options | [1] | 0 | 24,644 | 0 |
Dilutive effect of restricted stock units | [1] | 0 | 5 | 0 |
Dilutive effect of preferred stock | [1] | 0 | 0 | 0 |
Dilutive effect of warrants | [1] | 0 | 0 | 0 |
Weighted average common shares outstanding, diluted | 245,148 | 143,220 | 57,865 | |
Net (loss) income per share, basic | $ (0.61) | $ 0.05 | $ (0.40) | |
Net (loss) income per share, diluted | $ (0.61) | $ 0.05 | $ (0.40) | |
Anti-dilutive warrants | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive preferred stock | [1] | 21,783 | 0 | 1,887 |
Anti-dilutive performance-based restricted stock units | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive preferred stock | [1] | 2,047 | 0 | 0 |
Anti-dilutive restricted stock units | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive preferred stock | [1] | 1,748 | 0 | 0 |
Anti-dilutive stock options | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive preferred stock | [1] | 5,520 | 0 | 27,591 |
Preferred Stock | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive preferred stock | [1] | 0 | 0 | 138,612 |
[1] Due to the net loss during each of the years ended December 31, 2022 and 2020 , no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive. |
Earnings Per Share - Summary _2
Earnings Per Share - Summary of Components of Basic and Diluted Earnings Per Share (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share [Abstract] | ||
Dilutive Securities, Effect on Basic Earnings Per Share, Total | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | |||
(Loss) income before income taxes | $ (148,254,000) | $ 6,630,000 | $ (22,955,000) |
Valuation allowance, amount | 48,690,000 | (675,000) | 4,999,000 |
Unrecognized Tax Benefits | 0 | $ 0 | $ 0 |
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 231,400,000 | ||
Net Operating Loss Carryforwards Expiration | 205,400,000 | ||
Net Operating Loss Carryforwards Not Utilized | 26,000,000 | ||
U.S. State | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 195,100,000 | ||
Net Operating Loss Carryforwards Expiration | 73,400,000 | ||
Net Operating Loss Carryforwards Not Utilized | $ 121,700,000 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Current provision federal | $ 0 | $ 0 | $ 0 |
Current provision state | 359 | 170 | 163 |
Total current | 359 | 170 | 163 |
Deferred provision federal | 0 | 0 | 0 |
Deferred provision state | 0 | 0 | 0 |
Total deferred | 0 | 0 | 0 |
Total income tax expense | $ 359 | $ 170 | $ 163 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
(Benefit) provision at federal statutory tax rate, amount | $ (31,133) | $ 1,392 | $ (4,821) |
(Benefit) provision at federal statutory tax rate, percent | 21% | 21% | 21% |
State income taxes, amount | $ (7,636) | $ 360 | $ (446) |
State income taxes, percent | 5.20% | 5.40% | 1.90% |
Change in fair value of warrant liabilities, Amount | $ (4,940) | $ (517) | $ 0 |
Change in fair value of warrant liabilities, percentage | 3.30% | (7.80%) | 0% |
Return-to-provision, Amount | $ (2,277) | $ 221 | $ 218 |
Return-to-provision, percentage | 1.50% | 3.30% | (0.90%) |
Stock-based compensation, Amount | $ (1,091) | $ 647 | $ 286 |
Stock-based compensation, percent | (0.70%) | 9.80% | (1.20%) |
Valuation allowance, amount | $ 48,690 | $ (675) | $ 4,999 |
Valuation allowance, percent | (32.80%) | (10.20%) | (21.80%) |
Transaction costs, amount | $ 1,874 | $ (1,226) | $ 0 |
Transaction costs, percentage | 1.30% | (18.50%) | 0% |
Other, amount | $ (620) | $ 32 | $ 73 |
Other, percent | (0.40%) | 0.40% | (0.30%) |
Effective tax rate, amount | $ 359 | $ 170 | $ 163 |
Effective tax rate, percent | (0.20%) | 2.60% | (0.70%) |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Federal net operating loss carryforwards | $ 50,178 | $ 26,721 |
State net operating loss carryforwards | 9,847 | 4,703 |
Inventory | 14,771 | 341 |
Research and development expenditures | 3,190 | 0 |
Stock-based compensation | 1,852 | 0 |
Transaction costs | 1,707 | 0 |
Operating lease liabilities | 1,507 | 1,284 |
Other | 2,117 | 2,421 |
Gross deferred tax asset | 85,169 | 35,470 |
Valuation allowance | (82,026) | (33,336) |
Deferred Tax Assets, Net of Valuation Allowance | 3,143 | 2,134 |
Deferred tax liabilities: | ||
Operating lease Right Of Use Asset | (1,385) | (1,187) |
Property and equipment | (739) | (874) |
Other | (1,019) | (73) |
Gross deferred tax liability | (3,143) | (2,134) |
Net deferred income taxes | $ 0 | $ 0 |
Related-Party Transactions - Su
Related-Party Transactions - Summary of Credit Facilities as Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Senior Secured Credit Facility With Related Party | ||
Related Party Transaction [Line Items] | ||
Outstanding Amount | $ 17,398 | $ 81,926 |
Total Borrowing Capacity | 75,000 | 85,000 |
Mezzanine Secured Credit Facilities With a Related Party | ||
Related Party Transaction [Line Items] | ||
Outstanding Amount | 42,778 | 82,509 |
Total Borrowing Capacity | $ 150,000 | $ 79,000 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) | 12 Months Ended | ||||||
Feb. 28, 2023 USD ($) | Jan. 31, 2023 shares | Dec. 31, 2022 USD ($) Facility shares | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Mar. 16, 2020 USD ($) | Oct. 26, 2016 USD ($) | |
Related Party Transaction [Line Items] | |||||||
Preferred stock, shares issued | shares | 0 | ||||||
Class A Common Stock | Subsequent Event [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Sale of stock number of shares issued pre funded warrants to purchase share | shares | 160,742,959 | ||||||
First Funding Inc Member | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership percentage | 5% | ||||||
Total Borrowing Capacity | $ 15,000,000 | ||||||
L L Funds Loan Agreement | Class A Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership percentage | 5% | ||||||
First American Financial Corporation | |||||||
Related Party Transaction [Line Items] | |||||||
Fees paid for services | $ 18,100,000 | $ 11,900,000 | $ 7,100,000 | ||||
First American Financial Corporation | Class A Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Ownership percentage | 5% | ||||||
Senior Secured Credit Line | |||||||
Related Party Transaction [Line Items] | |||||||
Number of facilities | Facility | 1 | ||||||
Senior Secured Credit Line | L L Funds Loan Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Maximum principal amount | $ 75,000,000 | ||||||
Mezzanine Secured Loan | L L Funds Loan Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Maximum principal amount | $ 52,500,000 | ||||||
Mezzanine facility [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Number of facilities | Facility | 2 | ||||||
LL Mezz Loan Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Maximum principal amount | $ 97,500,000 | ||||||
Interest expense, borrowings | $ 9,400,000 | $ 11,700,000 | $ 8,200,000 | ||||
Mr. Bair's brothers [Member] | Subsequent Event [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Cash incentive payments | $ 500 | ||||||
Mr. Bair's sister-in-law [Member] | Subsequent Event [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Cash incentive payments | $ 500 |
Related-Party Transactions - _2
Related-Party Transactions - Summary of Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||
Total compensation | $ 1,348 | $ 1,182 | $ 693 |
Brother 1 | |||
Related Party Transaction [Line Items] | |||
Total compensation | 631 | 572 | 260 |
Brother 2 | |||
Related Party Transaction [Line Items] | |||
Total compensation | 594 | 469 | 313 |
Sister in law | |||
Related Party Transaction [Line Items] | |||
Total compensation | $ 123 | $ 141 | $ 120 |
Related-Party Transactions - Gr
Related-Party Transactions - Grants of Equity Awards to Related Parties (Details) - shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restricted Stock Units (RSUs) [Member] | |||
Related Party Transaction [Line Items] | |||
Granted | 2,118,000 | 203,000 | 0 |
Restricted Stock Units (RSUs) [Member] | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 166,771 | ||
Restricted Stock Units (RSUs) [Member] | Brother 2 | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 79,404 | ||
Restricted Stock Units (RSUs) [Member] | Brother 1 | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 84,367 | ||
Restricted Stock Units (RSUs) [Member] | Sister in law | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 3,000 | ||
Performance-Based Restricted Stock Units [Member] | |||
Related Party Transaction [Line Items] | |||
Granted | 2,115,000 | 0 | 0 |
Performance-Based Restricted Stock Units [Member] | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 245,658 | ||
Performance-Based Restricted Stock Units [Member] | Brother 2 | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 119,107 | ||
Performance-Based Restricted Stock Units [Member] | Brother 1 | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 126,551 | ||
Performance-Based Restricted Stock Units [Member] | Sister in law | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 0 | ||
Share-Based Payment Arrangement, Option [Member] | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 6,000 | ||
Share-Based Payment Arrangement, Option [Member] | Brother 2 | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 0 | ||
Share-Based Payment Arrangement, Option [Member] | Brother 1 | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 0 | ||
Share-Based Payment Arrangement, Option [Member] | Sister in law | 2021 Equity Incentive plan | |||
Related Party Transaction [Line Items] | |||
Granted | 6,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | Dec. 31, 2022 USD ($) Home |
Commitments and Contingencies Disclosure [Abstract] | |
Contract to purchase homes | Home | 98 |
Aggregate purchase price | $ 24.9 |
Purchase obligation payable | 5.8 |
Purchase obligation | $ 6.5 |
Subsequent Events (Additional I
Subsequent Events (Additional Information) (Details) - Subsequent Event [Member] $ / shares in Units, $ in Millions | Jan. 31, 2023 USD ($) $ / shares shares |
Private Placement | |
Subsequent Event [Line Items] | |
Proceeds from warrant exercisable | $ | $ 90 |
Private Placement | Pre-funded Warrants | |
Subsequent Event [Line Items] | |
Warrants exercisable | $ / shares | $ 0.5599 |
Class of warrants issued | shares | 160,742,959 |
Class A Common Stock | |
Subsequent Event [Line Items] | |
Class of warrants issued | shares | 160,742,959 |
Class A Common Stock | Private Placement | Pre-funded Warrants | |
Subsequent Event [Line Items] | |
Warrants exercisable | $ / shares | $ 0.0001 |