Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 10, 2022 | Jun. 30, 2021 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-39817 | ||
Entity Registrant Name | Boxed, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 85-3316188 | ||
Entity Address, Address Line One | 451 Broadway | ||
Entity Address, Address Line Two | Floor 2 | ||
Entity Address, City or Town | New York | ||
Entity Address, State or Province | NY | ||
Entity Address, Postal Zip Code | 10013 | ||
City Area Code | 646 | ||
Local Phone Number | 586-5599 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 255.9 | ||
Entity Common Stock, Shares Outstanding | 68,855,809 | ||
Documents Incorporated by Reference | None. | ||
Entity Central Index Key | 0001828672 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Common stock, par value $0.0001 | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Common stock, par value $0.0001 | ||
Trading Symbol | BOXD | ||
Security Exchange Name | NYSE | ||
Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 per share | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 per share | ||
Trading Symbol | BOXD WS | ||
Security Exchange Name | NYSE |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Firm ID | 34 |
Auditor Name | Deloitte & Touche LLP |
Auditor Location | New York City, New York |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 105,027,484 | $ 30,043,046 |
Restricted cash | 2,767,471 | 0 |
Accounts receivable, net | 3,122,015 | 2,910,079 |
Inventories | 11,427,567 | 13,964,510 |
Prepaid expenses and other current assets | 4,915,305 | 2,131,895 |
Deferred contract costs - current | 7,580,423 | 0 |
TOTAL CURRENT ASSETS | 134,840,265 | 49,049,530 |
Property and equipment, net | 7,019,338 | 10,411,396 |
Unbilled receivables | 8,890,888 | 0 |
Forward purchase receivable | 60,050,189 | 0 |
Goodwill | 7,443,569 | 0 |
Deferred contract costs | 11,847,266 | 0 |
Other long-term assets | 1,513,335 | 204,122 |
TOTAL ASSETS | 231,604,850 | 59,665,048 |
CURRENT LIABILITIES | ||
Accounts payable | 28,936,706 | 9,072,929 |
Accrued expenses | 6,392,029 | 5,802,135 |
Deferred revenue | 2,020,351 | 2,435,909 |
Other current liabilities | 21,899,142 | 14,958,064 |
Term loan – current portion | 0 | 3,750,000 |
SPAC warrant liabilities | 22,044,750 | 0 |
Warrants to purchase common shares | 0 | 49,863 |
Warrants to purchase preferred shares | 0 | 2,072,536 |
TOTAL CURRENT LIABILITIES | 81,292,978 | 38,141,436 |
PIPE Convertible Notes, net of transaction costs | 77,047,475 | 0 |
Long-term debt | 43,286,747 | 3,750,000 |
Forward purchase option derivative | 4,202,562 | 0 |
Earnout liability | 27,133,563 | 0 |
Other long-term liabilities | 217,238 | 1,015,248 |
TOTAL LIABILITIES | 233,180,563 | 42,906,684 |
TOTAL CONVERTIBLE PREFERRED STOCK (Refer to Note 13) | 0 | 325,200,758 |
STOCKHOLDERS’ DEFICIT | ||
Common stock, $0.0001 par value per share; 600,000,000 and 66,486,210 shares authorized as of December 31, 2021 and 2020; 66,647,242 and 9,392,361 shares issued and outstanding as of December 31, 2021 and 2020, respectively | 6,665 | 939 |
Additional paid-in capital | 383,065,836 | 6,982,156 |
Accumulated deficit | (384,648,214) | (315,425,489) |
TOTAL STOCKHOLDERS’ DEFICIT | (1,575,713) | (308,442,394) |
TOTAL LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT | $ 231,604,850 | $ 59,665,048 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 08, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | |||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 600,000,000 | 66,486,210 | |
Common stock, shares issued (in shares) | 66,647,242 | 15,554,790 | 9,392,361 |
Common stock, shares outstanding (in shares) | 66,647,242 | 15,554,790 | 9,392,361 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Net revenue: | $ 177,266,677 | $ 187,173,834 | $ 173,992,897 | |
Cost of sales: | (145,388,571) | (161,270,544) | (164,091,469) | |
Gross profit | 31,878,106 | 25,903,290 | 9,901,428 | |
Advertising expense | (21,959,556) | (4,912,269) | (20,703,071) | |
Selling, general, and administrative expense | (58,961,360) | (49,677,783) | (54,891,680) | |
Loss from operations | (49,042,810) | (28,686,762) | (65,693,323) | |
Other income (expense), net | (20,179,795) | (5,749,814) | 291,323 | |
Loss before income taxes | (69,222,605) | (34,436,576) | (65,402,000) | |
Income taxes | 0 | 0 | 0 | |
Net loss | $ (69,222,605) | $ (34,436,576) | $ (65,402,000) | |
Net loss per common share: | ||||
Basic net loss per common share (in dollars per share) | $ (5.14) | $ (3.80) | $ (7.19) | |
Diluted net loss per common share (in dollars per share) | $ (5.14) | $ (3.80) | $ (7.19) | |
Weighted average shares outstanding: | ||||
Weighted average shares outstanding - Basic (in shares) | 13,063,482 | 9,348,633 | 9,261,222 | |
Weighted average shares outstanding - Diluted (in shares) | 13,063,482 | 9,348,633 | 9,261,222 | |
Retail | ||||
Net revenue: | $ 156,989,110 | $ 187,173,834 | $ 173,992,897 | |
Cost of sales: | (142,949,882) | (161,270,544) | (164,091,469) | |
Loss from operations | (64,863,125) | (26,244,100) | (63,082,583) | |
Software & Services | ||||
Net revenue: | [1] | 20,277,567 | 0 | 0 |
Cost of sales: | [1] | (2,438,689) | 0 | 0 |
Loss from operations | $ 15,820,315 | $ (2,442,662) | $ (2,610,740) | |
[1] | For information related to related party transactions, see Note 17 |
CONSOLIDATED STATEMENTS OF CONV
CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT - USD ($) | Total | Series E Preferred Stock | Previously Reported | Revision of Prior Period, Adjustment | Common | CommonPreviously Reported | CommonRevision of Prior Period, Adjustment | Additional Paid-In Capital | Additional Paid-In CapitalPreviously Reported | Additional Paid-In CapitalRevision of Prior Period, Adjustment | Accumulated Deficit | Accumulated DeficitPreviously Reported | |
Temporary equity, beginning balance (in shares) at Dec. 31, 2018 | 33,672,045 | 35,451,667 | (1,779,622) | ||||||||||
Temporary equity, beginning balance at Dec. 31, 2018 | $ 271,051,511 | $ 271,051,511 | |||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||
Issuance of Series D preferred stock for cash (in shares) | 915,038 | ||||||||||||
Issuance of Series D preferred stock for cash | $ 10,000,000 | ||||||||||||
Retroactive application of recapitalization (in shares) | (45,933) | ||||||||||||
Preferred stock issuance costs | $ (21,308) | ||||||||||||
Other adjustments | $ 1 | ||||||||||||
Temporary equity, ending balance (in shares) at Dec. 31, 2019 | 34,541,150 | 36,366,705 | (1,825,555) | ||||||||||
Temporary equity, ending balance at Dec. 31, 2019 | $ 282,185,326 | $ 282,185,326 | |||||||||||
Beginning balance (in shares) at Dec. 31, 2018 | 9,234,059 | 9,722,081 | (488,022) | ||||||||||
Beginning balance at Dec. 31, 2018 | (210,774,713) | (210,774,713) | $ 923 | $ 98 | $ 825 | $ 4,811,274 | $ 4,812,099 | $ (825) | $ (215,586,910) | $ (215,586,910) | |||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||||||||||||
Stock-based compensation | $ 2,286,349 | 2,286,349 | |||||||||||
Exercises of common stock options (in shares) | 105,867 | 111,482 | |||||||||||
Exercises of common stock options | $ 102,320 | $ 11 | 102,309 | ||||||||||
Retroactive application of recapitalization (in shares) | (5,615) | ||||||||||||
Series C-3 preferred stock remeasurement | 1,155,122 | 1,155,122 | |||||||||||
Other adjustments | (1) | (1) | |||||||||||
Net loss | (65,402,000) | (65,402,000) | |||||||||||
Ending balance (in shares) at Dec. 31, 2019 | 9,339,926 | 9,833,563 | (493,637) | ||||||||||
Ending balance at Dec. 31, 2019 | $ (274,943,167) | $ (274,943,167) | $ 934 | $ 99 | $ 835 | 6,044,809 | 6,045,644 | (835) | (280,988,910) | (280,988,910) | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||
Issuance of Series D preferred stock for cash (in shares) | 4,233,043 | ||||||||||||
Issuance of Series D preferred stock for cash | $ 30,000,000 | ||||||||||||
Issuance of Series E preferred stock for conversion of convertible promissory notes (in shares) | 1,783,768 | ||||||||||||
Issuance of Series E preferred stock for conversion of convertible promissory notes | $ 12,644,170 | ||||||||||||
Retroactive application of recapitalization (in shares) | (302,035) | ||||||||||||
Preferred stock issuance costs | $ (719,033) | ||||||||||||
Other adjustments | $ 1 | ||||||||||||
Temporary equity, ending balance (in shares) at Dec. 31, 2020 | 40,255,926 | 42,383,516 | (2,127,590) | ||||||||||
Temporary equity, ending balance at Dec. 31, 2020 | $ 325,200,758 | $ 325,200,758 | |||||||||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||||||||||||
Stock-based compensation | $ 1,956,009 | 1,956,009 | |||||||||||
Exercises of common stock options (in shares) | 52,435 | 55,213 | |||||||||||
Exercises of common stock options | $ 71,759 | $ 5 | 71,754 | ||||||||||
Retroactive application of recapitalization (in shares) | (2,778) | ||||||||||||
Series C-3 preferred stock remeasurement | 1,090,294 | 1,090,294 | |||||||||||
Other adjustments | (125) | (122) | (3) | ||||||||||
Net loss | (34,436,576) | (34,436,576) | |||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 9,392,361 | 9,888,776 | (496,415) | ||||||||||
Ending balance at Dec. 31, 2020 | $ (308,442,394) | $ (308,442,394) | $ 939 | $ 99 | $ 840 | 6,982,156 | $ 6,982,996 | $ (840) | (315,425,489) | $ (315,425,489) | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||
Issuance of Series E preferred stock for conversion of convertible promissory notes (in shares) | (40,255,926) | ||||||||||||
Issuance of Series E preferred stock for conversion of convertible promissory notes | $ (325,200,758) | ||||||||||||
Temporary equity, ending balance (in shares) at Dec. 31, 2021 | 0 | ||||||||||||
Temporary equity, ending balance at Dec. 31, 2021 | $ 0 | ||||||||||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||||||||||||
Stock-based compensation | $ 4,005,355 | 4,005,355 | |||||||||||
Exercises of common stock options (in shares) | 351,462 | 370,053 | |||||||||||
Exercises of common stock options | $ 768,086 | $ 36 | 768,050 | ||||||||||
Retroactive application of recapitalization (in shares) | (18,591) | ||||||||||||
Exercise and conversion of warrants (in shares) | 58,760 | ||||||||||||
Exercise and conversion of warrants | $ 587,178 | $ 6 | 587,172 | ||||||||||
Conversion of preferred stock (in shares) | 41,289,869 | 41,289,869 | |||||||||||
Conversion of preferred stock | $ 325,200,758 | $ 4,129 | 325,196,629 | ||||||||||
Reverse capitalization, net of transaction costs (in shares) | [1] | 15,554,790 | |||||||||||
Reverse recapitalization, net of transaction costs | [1] | 65,422,934 | $ 1,555 | 65,421,379 | |||||||||
Sponsor Earnout Shares liability | (19,895,062) | (19,895,062) | |||||||||||
Other adjustments | 37 | 157 | (120) | ||||||||||
Net loss | (69,222,605) | (69,222,605) | |||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 66,647,242 | ||||||||||||
Ending balance at Dec. 31, 2021 | $ (1,575,713) | $ 6,665 | $ 383,065,836 | $ (384,648,214) | |||||||||
[1] | Excludes 1,940,625 shares subject to vesting requirements. See Note 1, Description of Business for further detail. |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net loss | $ (69,222,605) | $ (34,436,576) | $ (65,402,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 4,496,519 | 4,785,778 | 4,377,731 |
Stock-based compensation | 4,005,355 | 1,956,009 | 2,286,349 |
Charges to cost and expenses | (43,964) | 199,387 | 133,742 |
Change in fair value of warrant liabilities | 3,281,279 | 883,573 | (178,668) |
Change in fair value of derivatives | 4,202,562 | 4,323,770 | 0 |
Change in fair value of earnout liability | 5,527,501 | 0 | 0 |
Loss on extinguishment of convertible note | 0 | 102,972 | 0 |
Amortization of debt discount | 237,800 | 0 | 0 |
Other non-cash items | 351,524 | 0 | 0 |
Changes in assets and liabilities: | |||
Receivables, net | (88,992) | 552,137 | (163,266) |
Inventories | 2,779,118 | 77,901 | 284,894 |
Prepaid and other current assets | (2,839,423) | 1,020,918 | 1,069,382 |
Unbilled receivables | (8,890,888) | 0 | 0 |
Deferred contract costs | (19,427,689) | 0 | 0 |
Other long-term assets | 40,787 | 0 | 0 |
Accounts payable | 19,278,074 | (7,517,867) | 5,388,131 |
Accrued expenses | 566,521 | 453,575 | (784,360) |
Deferred revenue | (415,558) | 117,497 | 897,512 |
Other current liabilities | 3,567,199 | 2,547,651 | 6,011,974 |
Long-term liabilities | (874,069) | 836,791 | 198,017 |
Net cash used in operating activities | (53,468,949) | (24,096,484) | (45,880,562) |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Capital expenditures | (1,070,741) | (1,536,631) | (3,860,060) |
Acquisition of business, net of cash acquired | (3,600,000) | 0 | 0 |
Forward purchase receivable deposit | (65,062,414) | 0 | 0 |
Forward purchase receipts | 5,012,225 | 0 | 0 |
Other investing activities | 0 | 308,331 | (18,916) |
Net cash used in investing activities | (64,720,930) | (1,228,300) | (3,878,976) |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Business Combination financing, net of redemptions and transaction costs | 159,617,056 | 0 | 0 |
Principal payments on finance lease obligations | (73,903) | (72,130) | (3,048,052) |
Proceeds from option exercises | 768,086 | 71,758 | 102,320 |
Proceeds from sale of preferred stock | 0 | 30,000,000 | 10,000,000 |
Proceeds from convertible note issuance | 0 | 8,217,304 | 0 |
Preferred stock issuance costs | 0 | (719,033) | (21,308) |
Repayment of borrowings | (7,500,000) | (7,520,000) | (980,000) |
Proceeds from borrowings | 43,800,226 | 12,500,000 | 0 |
Debt issuance costs | (669,677) | 0 | 0 |
Net cash provided by financing activities | 195,941,788 | 42,477,899 | 6,052,960 |
Total change in cash | 77,751,909 | 17,153,115 | (43,706,578) |
CASH BEGINNING OF YEAR | 30,043,046 | 12,889,931 | 56,596,509 |
CASH END OF YEAR | 107,794,955 | 30,043,046 | 12,889,931 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||
Cash paid for taxes | 18,833 | 8,284 | 10,292 |
Cash paid for interest | 280,990 | 404,411 | 301,155 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||
Assumed warrant liability in connection with the Business Combination | 17,228,250 | 0 | 0 |
Contingent consideration | 1,711,000 | 0 | 0 |
Cashless exercise of warrants | 587,172 | 0 | 0 |
Conversion of convertible promissory note to preferred stock | 0 | 12,644,170 | 0 |
Conversion of preferred stock to common stock | 325,200,758 | 0 | 0 |
Cash and cash equivalents at end of period | 105,027,484 | 30,043,046 | 12,889,931 |
Restricted cash at end of period | 2,767,471 | 0 | 0 |
Cash, cash equivalents and restricted cash at end of period | $ 107,794,955 | $ 30,043,046 | $ 12,889,931 |
DESCRIPTION OF BUSINESS AND SUM
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Description — Boxed, Inc. (the “Company”) is an e-commerce retailer and e-commerce enabler. The Company operates an e-commerce retail (“Retail”) service that provides bulk pantry consumables to businesses and household customers within the continental United States. The Company generates net revenue through direct retail sales of third-party and private-labeled goods, which includes all sales generated primarily through the Company’s website, mobile-optimized website, mobile applications, and software and services (“Software & Services”) offerings of its enterprise-level e-commerce platform (collectively, “Platforms”). Business Combination — On June 13, 2021, the Company (formerly known as Seven Oaks Acquisition Corp.) entered into a definitive agreement (the “Business Combination Agreement”) with two of its wholly-owned subsidiaries and Giddy Inc. (“Old Boxed”). Under the Business Combination Agreement, the Company agreed to acquire all outstanding equity interests of Old Boxed for approximately $550,000,000 in aggregate consideration, which Old Boxed's stockholders would receive in the form of shares of common stock of the Company (the consummation of the business combination and the other transactions contemplated by the Business Combination Agreement, collectively, the “Business Combination”). On December 8, 2021, the Company consummated the Business Combination and other transactions (the “Closing”). The following occurred upon the Closing: • Old Boxed merged with Blossom Merger Sub, Inc., a wholly-owned subsidiary of the Company, with Old Boxed surviving the merger as a wholly-owned subsidiary of the Company. Immediately following this initial merger, Old Boxed merged with and into Blossom Merger Sub II, LLC, another wholly-owned subsidiary of the Company, with Blossom Merger Sub II, LLC surviving the merger and changing its name to “Boxed LLC.” • The Company changed its name from “Seven Oaks Acquisition Corp.” to “Boxed, Inc.” and is referred to herein as “New Boxed,” the “Company,” or the “Post Business Combination Company”. Unless the context otherwise requires, references to “Seven Oaks” herein refer to the Company prior to Closing. • Holders of 18,098,335 shares of Seven Oaks Class A common stock sold in its initial public offering exercised their right to have such shares redeemed (the “Redemptions”) for a full pro rata portion of the trust account holding the proceeds from Seven Oak's initial public offering. The remaining 7,776,665 shares of Seven Oaks Class A common stock were each automatically reclassified into one share of New Boxed common stock. • The 6,468,750 shares of Seven Oaks Class B common stock held by Seven Oaks Sponsor LLC (the “Sponsor”) were each automatically reclassified into one share of New Boxed common stock, of which 1,940,625 are subject to vesting under certain conditions (the “Sponsor Earnout Shares”). The Sponsor Earnout Shares will be considered outstanding for legal purposes prior to the achievement of the vesting conditions but will not be considered outstanding for accounting purposes until such vesting conditions are achieved. Refer to Note 15 for detail on the Company's valuation of these shares. • Pursuant to subscription agreements entered into in connection with the Business Combination Agreement (the “Subscription Agreements”), certain investors (the “PIPE Investors”) subscribed to purchase an aggregate of 3,250,000 shares of Class A common stock at $10.00 per share and an aggregate of $87,500,000 in principal amount of convertible notes (the “PIPE Convertible Notes” or “Convertible Notes”) upon consummation of the Business Combination (collectively, the “PIPE Investment”). At Closing, the Company consummated the PIPE Investment and 3,250,000 shares of New Boxed common stock were issued. Refer to Note 5 for terms and details of the PIPE Convertible Notes. • After giving effect to the transactions described above, including the Redemptions and the consummation of the PIPE Investment, there were 15,554,790 shares of New Boxed common stock issued and outstanding (excluding the Sponsor Earnout Shares). Prior to the Closing, on November 28, 2021, Seven Oaks entered into an agreement (the “Forward Purchase Agreement”) with ACM AART VII D LLC (“ACM”) for a cash-settled OTC Equity Prepaid Forward Transaction (the “Forward Purchase Transaction”). Pursuant to the terms of the Forward Purchase Agreement, ACM purchased approximately 6,504,768 shares of Seven Oaks' Class A common stock (the “Forward Purchase shares”) and, one business day following the closing of the Business Combination, the Company paid out to ACM an amount (such amount, as adjusted under the Forward Purchase Agreement, the “Prepayment Amount”) equal to the redemption price per share multiplied by the number of subject shares on the date of prepayment. The Prepayment Amount of $65,062,414 was paid out of the funds received by the Company from Seven Oaks' trust account and will be held in deposit account for the benefit of ACM until the “Valuation Date” (the second anniversary of the closing of the Business Combination, subject to certain acceleration provisions). At any time prior to the Valuation Date, ACM may elect an optional early termination to sell some or all of the Forward Purchase shares in the open market. If ACM sells any shares prior to the Valuation Date, a pro-rata portion of the Prepayment Amount will be released from the deposit account and paid to the Company. As of December 31, 2021, ACM has sold 501,109 shares, for which the Company received gross proceeds of $5,012,225. Depending on the manner in which the Forward Purchase Transaction is settled, the Company may never have access to the full remaining Prepayment Amount of $60,050,189. Refer to Note 11 for further detail on the Forward Purchase Agreement and the related settlement scenarios. As discussed above, a total of 18,098,335 shares of Seven Oaks Class A common stock were presented for redemption in connection with the Business Combination (the “Redemptions”). As a result, there was approximately $77,784,265 remaining in Seven Oaks' trust account, following Redemptions. Combined with the total PIPE Investment of $120,000,000, comprised of $32,500,000 in equity and $87,500,000 in Convertible Notes, and after deducting combined company transaction fees of $47,667,386, there was approximately $150,116,879 of cash proceeds received by the Company from the transaction. After paying the Prepayment Amount of $65,062,414 on December 9, 2021, the day after the Closing, the Company had $85,054,465 in net proceeds remaining. As discussed above, as of December 31, 2021, $5,012,225 of the amount initially subject to settlement under the Forward Purchase Transaction, has already been recovered by the Company. The following table illustrates the net proceeds to the Company delivered through the Business Combination. Cash - Seven Oaks trust and cash, net of Redemptions $ 77,784,265 Cash - PIPE Equity 32,500,000 Cash - PIPE Convertible Notes 87,500,000 Gross cash proceeds resulting from the Business Combination 197,784,265 Less: combined company transaction costs (47,667,386) Net cash proceeds from the Business Combination 150,116,879 Less: Prepayment Amount pursuant to Forward Purchase Transaction (65,062,414) Cash proceeds, net of the Forward Purchase Transaction Prepayment Amount $ 85,054,465 Further, the following table reconciles the elements of the Business Combination to the Consolidated Statements of Convertible Preferred Stock and Stockholders' Deficit to the Consolidated Statement of Cash Flows as well as to the amounts disclosed herein in Note 1. Cash - Seven Oaks trust and cash, net of Redemptions $ 77,784,265 Cash - PIPE Equity 32,500,000 Less: net impact of reverse recapitalization (38,648,877) Less: transaction costs reclassed or allocated to equity (6,212,454) Reverse recapitalization, net of transaction costs $ 65,422,934 Cash - PIPE Convertible Notes 87,500,000 Less: transaction costs allocated to debt (10,534,127) Plus: noncash assumed warrant liability in reverse recapitalization 17,228,250 Net cash proceeds from the Business Combination on the Statements of Cash Flows $ 159,617,057 Less: transaction costs allocated to derivative instruments and expensed during the year (9,500,178) Net cash proceeds from the Business Combination within Note 1 $ 150,116,879 Less: Prepayment Amount pursuant to Forward Purchase Transaction (65,062,414) Cash proceeds, net of the Forward Purchase Transaction Prepayment Amount $ 85,054,465 Immediately prior to Closing, each share of Old Boxed convertible preferred stock was converted to common stock based on the applicable conversion rate for each security and then upon Closing converted into the right to receive approximately 0.9498 (the “Exchange Ratio”) shares of New Boxed common stock. Also as a result of the consummation of the Business Combination, each share of Old Boxed common stock was converted into the right to receive approximately 0.9498 shares of New Boxed common stock and each outstanding and unexercised option to purchase Old Boxed common stock, vested or unvested, was assumed and converted into the an option to purchase 0.9498 shares of New Boxed common stock, subject to the same terms and conditions as applied to the underlying options to purchase Old Boxed common stock. Based on the following factors, the Company determined under the Accounting Standards Codification (“ASC”) 805, Business Combinations , that the Business Combination was a reverse capitalization: • Old Boxed stockholders owned approximately 76.7% of the shares in the Post Business Combination Company, and thus had sufficient voting right to exert influence over the Post Business Combination Company. • Old Boxed appointed a majority of the Post Business Combination Company's board of directors and maintained a majority of the composition of management. • Old Boxed was the larger entity based on historical revenues and business operations and comprised the ongoing operations of the Post Business Combination Company. • The Post Business Combination Company assumed the name “Boxed, Inc.” In accordance with the guidance applicable to these circumstances, the equity structure has been recast in all comparative periods up to the consummation of Business Combination on December 8, 2021 to reflect the number of shares of the Company's common stock, $0.0001 par value per share, issued to Old Boxed's stockholders in connection with the Business Combination. As such, the shares and corresponding capital amounts and earnings per share related to Old Boxed convertible preferred stock and Old Boxed common stock prior to the Business Combination has been retroactively recast as shares reflecting the Exchange Ratio of 0.9498 established in the Business Combination. The Post Combination Company common stock and warrants commenced trading on the New York Stock Exchange under the symbols “BOXD” and “BOXD WS,” respectively, on December 9, 2021. COVID-19 — In March 2020, the outbreak of the novel coronavirus (“COVID-19”) was declared a pandemic and resulted in a global slowdown of economic activity. The resulting disruptions have affected Boxed’s business, as well as those of its customers, suppliers, and third-party service providers. The impact of the pandemic on Boxed’s business and actions taken in response to it have had varying effects on the Company's 2020 and 2021operations. In 2020, higher net sales reflected increased demand for the Company's household products as more people stayed at home. This was partially offset, however, by decreased demand for discretionary consumer products, delayed procurement, and supply chain disruptions as well as a meaningful decline in the Company's business-to-business customer base, which consists of SMBs and enterprises, many of whom moved to remote work environments. The environment remained dynamic and rapidly changing throughout 2021, and demand for Boxed’s products and consumer purchasing behavior will continue to evolve as the economy recovers and virus transmission reduces. The Company has considered this impact when developing its estimates and assumptions. Actual results and outcomes may differ from management’s estimates and assumptions. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted to provide certain relief in response to the COVID-19 pandemic. The CARES Act includes numerous tax provisions and other stimulus measures (See Note 8, Income Taxes, for additional information). Among the various provisions in the CARES Act, the Company is utilizing the payroll tax deferrals. The Company did not receive any loans under the CARES Act. Principles of Consolidation — The accompanying Consolidated Financial Statements of Boxed, Inc. include its wholly owned subsidiaries, Boxed, LLC, BOXED MAX LLC, Jubilant LLC, and Ashbrook Commerce Solutions LLC. Any intercompany accounts and transactions have been eliminated in consolidation. Basis of Presentation — The Consolidated Financial Statements presented herein are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), as of December 31, 2021 and 2020, and for the years ended December 31, 2021, 2020, and 2019. Going Concern, Liquidity and Management’s Plan — As of December 31, 2021, the Company had total cash and cash equivalents of $105,027,484, restricted cash of $2,767,471, and an accumulated deficit. In addition, the Company’s net loss and net cash used in operating activities amounted to $(69,222,605) and $(53,468,949), respectively, for the year ended December 31, 2021. As an emerging growth company, the Company is dependent on outside capital to execute its strategy of investing in growth at the expense of short-term profits. As a result, the Company has incurred significant losses and net cash outflows from operating activities since its inception and expects to incur such losses and remain dependent on outside capital for the foreseeable future until such time that the Company can realize its growth strategy by generating profits and reducing its reliance on outside capital. Given the inherent uncertainties associated with executing the Company’s growth strategy, management can provide no assurance that the Company will be able to obtain sufficient outside capital or generate sufficient cash from operations to fund the Company’s obligations as they become due over the next twelve months from the date these Consolidated Financial Statements were issued. In addition, as disclosed in Note 6, the Company entered into a term loan agreement (the “New Term Loan”) in August 2021 for principal of $45,000,000. The New Term Loan contains a certain number of financial covenants, which requires the Company to (i) maintain minimum unrestricted cash balance of $15,000,000, (ii) maintain minimum net Retail revenue based upon agreed quarterly targets; and (iii) maintain a Retail gross margin percentage of at least 8%. In order to achieve these targets, the Company expects to invest in growth initiatives including substantially increasing its marketing spend, resulting in an increase in cash used in operating activities for the next twelve months. As of December 31, 2021, the Company was in compliance with the financial covenants required by its New Term Loan. However, the inherent uncertainties described above may impact the Company’s ability to remain in compliance with these covenants over the next twelve months. If the Company breaches its financial covenants and fails to secure a waiver or forbearance from the third-party lender, such breach or failure could accelerate the repayment of the outstanding borrowings under the New Term Loan or the exercise of other rights or remedies the third-party lender may have under applicable law. No assurance can be provided a waiver or forbearance will be granted or the outstanding borrowings under the New Term Loan will be successfully refinanced on terms that are acceptable to the Company. To date, the Company has raised a substantial amount of capital from outside investors and lenders through the issuance of stock and borrowings, including under our term loans and revolving credit facilities, as well as through the consummation of the Business Combination, and expects this reliance to continue for the foreseeable future. However, as of December 31, 2021, the Company had no additional capital available for borrowing and no firm commitment from current or prospective investors to provide the Company additional capital to fund operations in the foreseeable future. While management believes the Company will be able to obtain additional capital, no assurance can be provided that such capital will be obtained or on terms that are acceptable to the Company. These uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. If management is unsuccessful in securing additional capital and/or executing its strategy of growth whereby the Company realizes profits and generates sufficient cash inflows from operations to fund the Company’s obligations as they become due, management may be required to seek other strategic alternatives such as a further reduction in the Company’s current cost structure, or a recapitalization of the Company’s balance sheet, including related outstanding debt and equity securities. The accompanying Consolidated Financial Statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates that the Company will be able to realize assets and settle liabilities and commitments in the normal course of business for the foreseeable future. Accordingly, the accompanying Consolidated Financial Statements do not include any adjustments that may result from the outcome of these uncertainties. Estimates — The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include (i) revenue recognition and deferral in accordance with ASC 606 (ii) acquired intangible assets and goodwill (iii) contingent considerations and (iv) the fair values of derivative instruments within the scope of ASC 815. Historically, prior to becoming a public company, significant estimates also included the fair value of stock options. On a regular basis, management reviews its estimates utilizing currently available information, changes in fact and circumstances, historical experience, and reasonable assumptions. After such review, those estimates are adjusted accordingly. Actual results could differ from those estimates. Segment Information — ASC 280, Segment Reporting , establishes standards for reporting information about operating segments in financial statements. The Company operates as two reportable business segments which offer different products and services: 1) Retail — This segment engages in the sale of consumer products and goods in bulk sizes to consumers and business in the continental United States. 2) Software & Services — This segment primarily relates to the Company’s research, development, marketing and production of the Company’s proprietary software for sale to third parties. See Note 18 for Segment Reporting for the years ended December 31, 2021, 2020, and 2019, respectively. Cash and Cash Equivalents — The Company considers all highly liquid investments purchased with an original maturity (at the date of purchase) of three months or less to be the equivalent of cash for the purpose of balance sheet presentation. Cash equivalents, which consist primarily of money market accounts, are carried at cost, which approximates market value. Restricted Cash — The Company's restricted cash is comprised of cash that is restricted as to withdrawal or use under the terms of certain contractual agreements. Restricted cash as of December 31, 2021 was $2,767,471 and consists of collateral for letters of credit related to the Company's relationships with certain product vendors, and letters of credit issued in lieu of deposits on certain real estate and facility leases. The Company did not have restricted cash as of December 31, 2020. Accounts Receivable, Net — Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company estimates that the allowance for doubtful accounts based on historical losses, existing economic conditions, and other information available at the balance sheet date. Uncollectible accounts are written off against the allowance after all collection efforts have been exhausted. Accounts receivable includes $2,317,908, $2,705,028, and $2,731,111 of trade receivables as of December 31, 2021, 2020, and 2019, respectively. The Company has recorded an allowance of $95,558, $205,384, and $176,653 as of December 31, 2021, 2020, and 2019, respectively, for doubtful accounts as follows: For the Year Ended December 31, 2021 Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charges to cost and expenses Charged to other accounts Deductions Balance at end of period Reserve for doubtful accounts $ 205,384 — — (109,826) $ 95,558 For the Year Ended December 31, 2020 Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charges to cost and expenses Charged to other accounts Deductions Balance at end of period Reserve for doubtful accounts $ 176,653 28,731 — — $ 205,384 For the Year Ended December 31, 2019 Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charges to cost and expenses Charged to other accounts Deductions Balance at end of period Reserve for doubtful accounts $ 141,282 35,371 — — $ 176,653 Fair Value of Financial Instruments — Assets and liabilities are measured at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The three levels of inputs used to measure fair value are as follows: Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 — Unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable or can be corroborated by observable market data for substantially the full-term of the asset or liability. Level 3 — Unobservable inputs that are supported by little or no market activity that are significant to the fair value of the asset of liability. The hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. Concentrations of Risk — Certain financial instruments potentially subject us to concentrations of credit risk. Financial instruments that subject the Company to credit risk consist of cash and cash equivalents and accounts receivable. The Company’s cash balances are primarily on deposit at high credit quality financial institutions. The cash balances in all accounts held at financial institutions are insured up to $250,000 by the Federal Deposit Insurance Corporation (“FDIC”) through December 31, 2021. At times, cash balances may exceed federally insured amounts and potentially subject the Company to a concentration of credit risk. Management believes that no significant concentration of credit risk exists with respect to these cash balances because of its assessment of the creditworthiness and financial viability of the respective financial institutions. The risk with respect to accounts receivable is managed by the Company through its policy of monitoring the creditworthiness of its customers to which it grants credit terms in the normal course of business. As of December 31, 2021 and 2020, one third party seller accounted for approximately 40.9% and 54.3% of the Company’s outstanding gross receivables, respectively. Leases — The Company leases its office facilities and fulfillment centers under operating lease agreements. Rent expense under the Company’s operating leases typically provide for fixed, non-contingent rent escalations. Rent expense is recognized on a straight-line basis over the non-cancellable term of each underlying lease. The Company also receives landlord contributions related to certain lease agreements that are recognized as deferred rent within other current liabilities on the Consolidated Balance Sheets and treated as reductions of rental expense on a straight-line basis over the term of the lease. The lease term begins on the date the Company becomes legally obligated for the rent payments or when it takes possession of the leased space, whichever is earlier. Inventories — Inventories consisting of finished goods are stated at the lower of cost or net realizable value. Inventory costs are determined using the first in, first out method. Inventory costs include price reductions and allowances offered by vendors. The Company reviews inventories to determine the necessity of write-offs for excess, obsolete, or unsellable inventory. The Company estimates write-offs for inventory obsolescence based on its judgment of future realization. These reviews require the Company to assess customer and market demand. During the year ended December 31, 2021, the Company wrote-down $394,848 of inventory that was estimated to be sold below cost, primarily related to SKUs which were in high demand during the COVID-19 pandemic. There were no material write-offs for the year ended December 31, 2020 and 2019. Property and Equipment, Net — Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided for using the straight-line method over the estimated useful lives of the assets, which range from 3 – 7 years (see table below). Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective leases. Improvements are capitalized while expenditures for maintenance and repairs are expensed as incurred. Estimated Useful Lives Leasehold improvements 7 years Warehouse equipment 5 years Computers and small tools 3 years Furniture and fixtures 7 years Capital lease asset 7 years Software development 4 years Software Development Costs — The Company classifies software development costs as either internal use software or external use software. The Company accounts for costs incurred to develop internal use software in accordance with ASC 350-40, Internal Use Software . Consequently, the Company capitalizes certain external costs and internal labor-related costs associated with the development of its platforms and internal-use software products after the preliminary project stage is complete and until the software is ready for its intended use. Costs incurred in the preliminary stages of development, after the software is ready for its intended use and for maintenance of internal-use software are expensed as incurred. Upgrades and enhancements are capitalized to the extent they will result in added functionality. Capitalized software costs are included in property and equipment, net within the Consolidated Balance Sheets and are amortized over the remaining useful life of four years. In accordance with ASC 985-20, Costs of Software to be Sold, Leased or Marketed , the software development costs incurred in the research and development of software products or the software component of products to be sold, leased, or marketed to external users are expensed as incurred until technological feasibility has been established. Technological feasibility is established upon the completion of a working model. Software development costs incurred after the establishment of technological feasibility and until the product is available for general release are capitalized, provided recoverability is reasonably assured. Software development costs, when material, are stated at the lower of unamortized cost or net realizable value. Net realizable value for each software product is assessed based on anticipated profitability applicable to revenues of the related product in future periods. Amortization of capitalized software costs begins when the related product is available for general release to customers and is provided for using the straight-line method over the estimated life of the respective product. Technological feasibility is typically reached shortly before the release of such products and as a result, development costs that meet the criteria for capitalization were not material for the periods presented in this report. Impairment of Long-Lived Assets — The Company periodically evaluates the need to recognize impairment losses relating to long-lived assets in accordance with ASC 360, Property, Plant, and Equipment . Long-lived assets are evaluated for recoverability whenever events or circumstances indicate that an asset may have been impaired. In evaluating an asset for recoverability, the Company estimates the future cash flows, on an undiscounted basis, expected to result from the use of the asset and eventual disposition. If the sum of the expected future cash flows is less than the carrying amount of the asset, the Company would write the asset down to fair value and record an impairment charge accordingly. As of December 31, 2021 and 2020, respectively, there were no such events or circumstances that indicate a need for such evaluation. Deferred Contract Costs — The Company defers contract costs when there is a known current obligation that is not yet prepaid. In these instances, the Company records deferred contract costs to recognize the asset in its Consolidated Balance Sheets to offset the Company's related liability. Deferred contract costs as of December 31, 2021 relate to the asset associated with the Company's contract with Palantir as described in Note 9 as well as insurance premiums related to becoming a public company. The related liability was recorded to accounts payable for the remaining commitment as of December 31, 2021. Forward Purchase Receivable and Forward Purchase Option Derivative — The Company recorded a Forward Purchase Receivable on its Consolidated Balance Sheets of $65,062,414 to account for the Prepayment Amount of the Forward Purchase Agreement, as discussed above within the discussion of the Business Combination. The Prepayment Amount will be held in a deposit account until the Valuation Date (the second anniversary of the closing of the Business Combination, subject to certain acceleration provisions). On the Valuation Date, the Company will receive a pro rata portion of the then remaining Prepayment Amount. As of December 31, 2021, there was $60,050,189 remaining as ACM sold 501,109 shares after Closing. Also in connection with the Forward Purchase Agreement, the Company recognized a liability for a freestanding derivative, referred to herein as the “forward purchase option derivative,” on its Consolidated Balance Sheets. Refer to the Business Combination discussion above and Note 11 for further detail. Intangible Assets and Goodwill — As part of the acquisition of MaxDelivery, LLC, as discussed in Note 10, the Company recorded intangible assets and goodwill on its Consolidated Balance Sheets. The intangible assets acquired relate to MaxDelivery's customer relationships, trademarks, and internally developed technology which were valued via (i) the multi-period excess-earnings method (ii) relief-from-royalty method and (iii) cost replacement method, respectively, all of which are under the income approach in accordance with ASC 805, Business Combinations. Also in accordance with ASC 805 the Company allocated the purchase price to the assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. Any excess of the purchase price over the fair values of assets acquired, including intangibles and liabilities assumed, was recognized as goodwill. As the Company views MaxDelivery as part of its Retail segment, the goodwill recorded is included within its Retail business unit. The Company's |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment — net consists of the following as of December 31, 2021 and 2020: December 31, 2021 2020 Leasehold improvements $ 8,715,489 $ 8,147,638 Warehouse equipment 3,056,072 2,192,471 Computers and small tools 1,337,493 1,061,177 Furniture and fixtures 85,480 95,064 Software development 14,090,389 13,608,520 Work in progress 7,066 359,992 27,291,989 25,464,862 Less: Accumulated depreciation and amortization (20,272,651) (15,053,466) Property and equipment, net $ 7,019,338 $ 10,411,396 Work in progress includes capitalized costs for on-going software development projects. The Company recorded depreciation and amortization expense of $4,496,519, $4,785,778, and $4,377,731 for the years ended December 31, 2021, 2020, and 2019, respectively, of which, $1,678,704, $2,081,625, and $1,983,936 related to software development costs, respectively. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | PREPAID EXPENSES AND OTHER CURRENT ASSETS As of December 31, 2021 and 2020, the major components of prepaid expenses and other current assets consisted of the following: December 31, 2021 2020 Prepaid services 1,918,299 — Vendor funds receivable 1,057,718 866,276 Other prepaid expenses 1,281,799 765,677 Other receivables 657,489 499,942 Total $ 4,915,305 $ 2,131,895 |
OTHER CURRENT LIABILITIES
OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
OTHER CURRENT LIABILITIES | OTHER CURRENT LIABILITIES As of December 31, 2021 and 2020, the major components of other current liabilities consisted of the following: December 31, 2021 2020 Credit card payable $ 13,738,270 $ 10,473,079 Accrued sales tax payable 1,707,557 1,845,831 Deferred rent – short term 450,776 622,940 Credits liability 640,994 633,287 Obligation for equity consideration (1) 3,000,000 — Other accrued liabilities 2,361,545 1,382,927 Total $ 21,899,142 $ 14,958,064 (1) For further detail on the obligation for equity consideration, refer to Note 10. |
CONVERTIBLE NOTES
CONVERTIBLE NOTES | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE NOTES | CONVERTIBLE NOTES PIPE Convertible Notes Concurrently with the execution of the Business Combination and for the purposes of raising the cash portion of the consideration for the Business Combination, Seven Oaks entered into Subscription Agreements with the PIPE Investors. Pursuant to these agreements, upon the Closing on December 8, 2021, the Company issued an aggregate of $87,500,000 in principal amount of PIPE Convertible Notes. The PIPE Convertible Notes will bear interest at a rate of 7.00% per annum payable semi-annually on June 15 and December 15 of each year, commencing June 15, 2022. The PIPE Convertible Notes will mature on December 15, 2026, unless earlier repurchased by the Company or converted at the option of the holders. Upon conversion, the Company will settle conversions of PIPE Convertible Notes through payment or delivery, as the case may be, of cash, shares of its common stock, or a combination of cash and shares of its common stock, at the Company's election. The initial conversion rate for the PIPE Convertible Notes is 83.333 shares of common stock per $1,000 principal amount of the PIPE Convertible Notes (which represents an initial conversion of approximately $12.00 per share). The conversion rate for the PIPE Convertible Notes will be subject to adjustment upon the occurrence of certain specified events but will not be adjusted for accrued and unpaid interest. In addition, if a make-whole fundamental change (as defined in the indenture governing the PIPE Convertible Notes) or a redemption with respect to the PIPE Convertible Notes occurs prior to the maturity date, under certain circumstances as specified in the relevant indenture, the Company will increase the conversion rate for the PIPE Convertible Notes by a number of additional shares of the Company's common stock for a holder that elects to convert its notes in connection with such make-whole fundamental change or redemption. The Company is required to repurchase the PIPE Convertible Notes upon a fundamental change (as defined in the indenture governing the PIPE Convertible Notes) at a fundamental repurchase price equal to 101% of the principal amount plus any accrued and unpaid interest. On or after December 20, 2024, respectively, the Company may redeem for cash all or any portion of the PIPE Convertible Notes, at the Company's option if the last reported sale price of the Company's common stock has been at least 130% of the conversion price in effect for at least 20 trading days (whether or not consecutive) during any 30-consecutive trading-day period. To the extent that the Company is unable to pay cash interest on the PIPE Convertible Notes on each interest payment date because of restrictions in the Company's new term loan agreement (as discussed in Note 6), or at the election of the Company to defer interest payments, an amount equal to the unpaid interest then due will be added to the principal amount, without any action by the Company or the lender of the new term loan. The interest that is capitalized with, or added to, the principal amount is known as “PIK Interest.” As of December 31, 2021, the Company accrued for $391,319 of interest using the stated interest rate. Prior to each interest period, the Company will determine whether to pay cash interest or defer to PIK Interest. As discussed in Note 1, $10,534,127 of the transaction costs incurred as part of the Business Combination were allocated to the PIPE Convertible Notes and treated as debt issuance costs. As of December 31, 2021, the remaining period over which the debt issuance costs will be amortized was 4.95 years. The indenture related to the Subscription Agreements includes customary affirmative and negative covenants including, among other things, compliance with applicable law, payment terms, events of default, and the terms surrounding the ability to repurchase the PIPE Convertible Notes. Convertible Promissory Notes On May 15, 2020, May 26, 2020 and May 29, 2020, the Company issued Subordinated Convertible Promissory Notes (each, a “Note”) in an aggregate principal amount of $8,215,000 pursuant to the Note Purchase Agreement, dated May 15, 2020, by and among the Company and the noteholders. The maturity date of the Notes is the earlier of (a) two years from the Note issuance; (b) upon acceleration due to an event of default; and (c) upon conversion of the Notes in connection with the Company raising equity proceeds of $25,000,000 or more inclusive of the principal amount of the Notes. The Notes accrue 0.25% simple interest per annum (the short-term AFR fixed on the respective Note issuance date). The Notes converted into Series E-2 preferred stock as a result of the Series E raise in June 2020. In accordance with ASC 815-15-25 the conversion feature of the Promissory Note was considered an embedded derivative instrument that required bifurcation and separate accounting. The feature was recorded at its fair value at issuance date and separated from the underlying note value. The Promissory Note was converted in the same quarter as issuance. Upon conversion, the Company performed a final valuation of the embedded derivative’s fair value which resulted in a loss of $4,323,770 which was recorded in other income (expense), net. The fair market value of the derivative was calculated using a discounted cash flow model, which utilized the original implied discount rate and an adjustment for a change in the market spread. Additionally, the Promissory Note and bifurcated derivative were removed at the carrying amounts, with the difference in the then-current fair value of the shares issued of $102,972 being recorded as a loss on extinguishment within other income (expense), net. There was no impact on the Consolidated Balance Sheets as the issuance and conversion of the note occurred within the same quarter of 2020. I mmediately prior to the consummation of the Business Combination, all of the Old Boxed preferred stock, including the Series E-2 preferred stock discussed above, converted into shares of Old Boxed common stock. Then upon Closing, each share of Old Boxed common stock converted into the right to receive approximately 0.9498 shares of New Boxed common stock. In June 2020, the Company amended and extended the loan and security agreement (the “Credit Agreement”), originally dated previously amended in December 2017, January 2018, and March 2020. The June 2020 amendment, which was the Seventh Amendment to the Credit Agreement, granted the Company a term loan in the principal amount of $7,500,000 with a maturity date of December 22, 2022, of which $5,132,500 was immediately drawn. In July 2020, the Company drew down on the remaining $2,367,500 of principal in this most recent amendment, increasing the Company’s total borrowings to $7,500,000. The Seventh Amendment also reduced the available letters of credit from $11,000,000 to $4,000,000. As of December 31, 2020, the Company had issued $2,571,667 letters of credit, out of the $4,000,000 available. The Credit Agreement provided the bank a first perfected security interest in all of the Company’s assets with a negative pledge on intellectual property. As of December 31, 2020 and 2019, outstanding amounts drawn on the Credit Agreements accrued interest at a floating per annum rate equal to three and one-quarter of one percentage points (3.25%) above the Prime Rate for 2020 and 2019, respectively. In connection with the Credit Agreement and associated amendments, the Company had issued warrants to purchase (i) 15,107 shares of common stock at a price of $0.95 per share on June 24, 2015 (ii) 10,000 shares of common stock at a price of $2.33 per share on December 22, 2016, and (iii) 12,500 shares of common stock at a price of $3.04 per share on May 22, 2018. Refer to Note 12 for a discussion around the cashless exercise of these warrants upon consummation of the Business Combination. On August 4, 2021, the Company entered into a new term loan agreement (the “New Term Loan”). The New Term Loan will provide the Company with $45,000,000 at a floating per annum rate of LIBOR plus 8.5%, with a maturity date of August 4, 2025. Should LIBOR no longer be published, the agreement provides for an alternative benchmark rate (which may include Term SOFR). The agreement provides the lender with a first priority security interest in all of the Company’s assets and contains a certain number of financial covenants, which requires us to (i) maintain minimum unrestricted cash balance of $15,000,000, (ii) maintain minimum net Retail revenue based upon agreed quarterly targets; and (iii) maintain a Retail gross margin percentage of at least 8%. These net Retail revenue and Retail gross margin targets are tested quarterly on a trailing twelve-month basis. The agreement also includes other affirmative and negative covenants, which, among other things, restricts the Company’s ability to pay dividends or make any distributions, incur indebtedness, incur liens, and sell substantially all of its assets. The agreement also subjects the Company to certain reporting covenants. The Company is required to provide monthly, quarterly and annual financial statements, operating budget and metrics, and other financial information as requested. Also in connection with the New Term Loan, the Company issued 126,993 warrants to purchase price stock at an exercise price of $7.0871, which expire on August 4, 2031. A portion of the proceeds from the New Term Loan was first allocated to the warrants in an amount equal to the fair value of the warrants on the date of issuance and the remainder of the proceeds were allocated to debt. These warrants were cashless exercised immediately prior to the closing of the Business Combination and as a result, there were no warrants outstanding associated with the New Term Loan as of December 31, 2021. Refer to Note 11 for further details regarding the Company’s warrants. Further, on August 4, 2021, the Company repaid the outstanding principal balance of the Seventh Amendment of its Credit Agreement of $5,000,000 and recognized a loss on extinguishment of debt in the amount of $202,723. In connection with the loan repayment, the Company’s letter of credit was modified and the Company is now required to maintain cash collateral for the outstanding letters of credit. As a result, the cash collateral related to the outstanding letters of credit are segregated in restricted cash accounts as of the third quarter of 2021. As of December 31, 2021, the Company had approximately $2,767,471 of letters of credit issued, of which none were drawn. Amounts outstanding under long-term term debt, including the PIPE Convertible Notes (discussed in Note 5), consisted of the following as of December 31, 2021 and 2020. The estimated fair value of long-term debt is approximated at its carrying value as of these reporting dates. December 31, 2021 2020 New Term loan, matures August 2025 $ 43,286,747 $ — 7th Amendment term loan, matures December 2022 — 7,500,000 PIPE Convertible Notes 1 77,047,475 — Total debt $ 120,334,222 $ 7,500,000 Less: current portion — (3,750,000) Long-term term loan $ 120,334,222 $ 3,750,000 Aggregate maturities of debt as of December 31, 2021 are as follows: 2022 $ — 2023 — 2024 — 2025 43,286,747 2026 77,047,475 Total $ 120,334,222 1 As discussed in Note 5, the PIPE Convertible Notes will mature in 2026, unless earlier repurchased by the Company or converted at the option of the holders. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
DEBT | CONVERTIBLE NOTES PIPE Convertible Notes Concurrently with the execution of the Business Combination and for the purposes of raising the cash portion of the consideration for the Business Combination, Seven Oaks entered into Subscription Agreements with the PIPE Investors. Pursuant to these agreements, upon the Closing on December 8, 2021, the Company issued an aggregate of $87,500,000 in principal amount of PIPE Convertible Notes. The PIPE Convertible Notes will bear interest at a rate of 7.00% per annum payable semi-annually on June 15 and December 15 of each year, commencing June 15, 2022. The PIPE Convertible Notes will mature on December 15, 2026, unless earlier repurchased by the Company or converted at the option of the holders. Upon conversion, the Company will settle conversions of PIPE Convertible Notes through payment or delivery, as the case may be, of cash, shares of its common stock, or a combination of cash and shares of its common stock, at the Company's election. The initial conversion rate for the PIPE Convertible Notes is 83.333 shares of common stock per $1,000 principal amount of the PIPE Convertible Notes (which represents an initial conversion of approximately $12.00 per share). The conversion rate for the PIPE Convertible Notes will be subject to adjustment upon the occurrence of certain specified events but will not be adjusted for accrued and unpaid interest. In addition, if a make-whole fundamental change (as defined in the indenture governing the PIPE Convertible Notes) or a redemption with respect to the PIPE Convertible Notes occurs prior to the maturity date, under certain circumstances as specified in the relevant indenture, the Company will increase the conversion rate for the PIPE Convertible Notes by a number of additional shares of the Company's common stock for a holder that elects to convert its notes in connection with such make-whole fundamental change or redemption. The Company is required to repurchase the PIPE Convertible Notes upon a fundamental change (as defined in the indenture governing the PIPE Convertible Notes) at a fundamental repurchase price equal to 101% of the principal amount plus any accrued and unpaid interest. On or after December 20, 2024, respectively, the Company may redeem for cash all or any portion of the PIPE Convertible Notes, at the Company's option if the last reported sale price of the Company's common stock has been at least 130% of the conversion price in effect for at least 20 trading days (whether or not consecutive) during any 30-consecutive trading-day period. To the extent that the Company is unable to pay cash interest on the PIPE Convertible Notes on each interest payment date because of restrictions in the Company's new term loan agreement (as discussed in Note 6), or at the election of the Company to defer interest payments, an amount equal to the unpaid interest then due will be added to the principal amount, without any action by the Company or the lender of the new term loan. The interest that is capitalized with, or added to, the principal amount is known as “PIK Interest.” As of December 31, 2021, the Company accrued for $391,319 of interest using the stated interest rate. Prior to each interest period, the Company will determine whether to pay cash interest or defer to PIK Interest. As discussed in Note 1, $10,534,127 of the transaction costs incurred as part of the Business Combination were allocated to the PIPE Convertible Notes and treated as debt issuance costs. As of December 31, 2021, the remaining period over which the debt issuance costs will be amortized was 4.95 years. The indenture related to the Subscription Agreements includes customary affirmative and negative covenants including, among other things, compliance with applicable law, payment terms, events of default, and the terms surrounding the ability to repurchase the PIPE Convertible Notes. Convertible Promissory Notes On May 15, 2020, May 26, 2020 and May 29, 2020, the Company issued Subordinated Convertible Promissory Notes (each, a “Note”) in an aggregate principal amount of $8,215,000 pursuant to the Note Purchase Agreement, dated May 15, 2020, by and among the Company and the noteholders. The maturity date of the Notes is the earlier of (a) two years from the Note issuance; (b) upon acceleration due to an event of default; and (c) upon conversion of the Notes in connection with the Company raising equity proceeds of $25,000,000 or more inclusive of the principal amount of the Notes. The Notes accrue 0.25% simple interest per annum (the short-term AFR fixed on the respective Note issuance date). The Notes converted into Series E-2 preferred stock as a result of the Series E raise in June 2020. In accordance with ASC 815-15-25 the conversion feature of the Promissory Note was considered an embedded derivative instrument that required bifurcation and separate accounting. The feature was recorded at its fair value at issuance date and separated from the underlying note value. The Promissory Note was converted in the same quarter as issuance. Upon conversion, the Company performed a final valuation of the embedded derivative’s fair value which resulted in a loss of $4,323,770 which was recorded in other income (expense), net. The fair market value of the derivative was calculated using a discounted cash flow model, which utilized the original implied discount rate and an adjustment for a change in the market spread. Additionally, the Promissory Note and bifurcated derivative were removed at the carrying amounts, with the difference in the then-current fair value of the shares issued of $102,972 being recorded as a loss on extinguishment within other income (expense), net. There was no impact on the Consolidated Balance Sheets as the issuance and conversion of the note occurred within the same quarter of 2020. I mmediately prior to the consummation of the Business Combination, all of the Old Boxed preferred stock, including the Series E-2 preferred stock discussed above, converted into shares of Old Boxed common stock. Then upon Closing, each share of Old Boxed common stock converted into the right to receive approximately 0.9498 shares of New Boxed common stock. In June 2020, the Company amended and extended the loan and security agreement (the “Credit Agreement”), originally dated previously amended in December 2017, January 2018, and March 2020. The June 2020 amendment, which was the Seventh Amendment to the Credit Agreement, granted the Company a term loan in the principal amount of $7,500,000 with a maturity date of December 22, 2022, of which $5,132,500 was immediately drawn. In July 2020, the Company drew down on the remaining $2,367,500 of principal in this most recent amendment, increasing the Company’s total borrowings to $7,500,000. The Seventh Amendment also reduced the available letters of credit from $11,000,000 to $4,000,000. As of December 31, 2020, the Company had issued $2,571,667 letters of credit, out of the $4,000,000 available. The Credit Agreement provided the bank a first perfected security interest in all of the Company’s assets with a negative pledge on intellectual property. As of December 31, 2020 and 2019, outstanding amounts drawn on the Credit Agreements accrued interest at a floating per annum rate equal to three and one-quarter of one percentage points (3.25%) above the Prime Rate for 2020 and 2019, respectively. In connection with the Credit Agreement and associated amendments, the Company had issued warrants to purchase (i) 15,107 shares of common stock at a price of $0.95 per share on June 24, 2015 (ii) 10,000 shares of common stock at a price of $2.33 per share on December 22, 2016, and (iii) 12,500 shares of common stock at a price of $3.04 per share on May 22, 2018. Refer to Note 12 for a discussion around the cashless exercise of these warrants upon consummation of the Business Combination. On August 4, 2021, the Company entered into a new term loan agreement (the “New Term Loan”). The New Term Loan will provide the Company with $45,000,000 at a floating per annum rate of LIBOR plus 8.5%, with a maturity date of August 4, 2025. Should LIBOR no longer be published, the agreement provides for an alternative benchmark rate (which may include Term SOFR). The agreement provides the lender with a first priority security interest in all of the Company’s assets and contains a certain number of financial covenants, which requires us to (i) maintain minimum unrestricted cash balance of $15,000,000, (ii) maintain minimum net Retail revenue based upon agreed quarterly targets; and (iii) maintain a Retail gross margin percentage of at least 8%. These net Retail revenue and Retail gross margin targets are tested quarterly on a trailing twelve-month basis. The agreement also includes other affirmative and negative covenants, which, among other things, restricts the Company’s ability to pay dividends or make any distributions, incur indebtedness, incur liens, and sell substantially all of its assets. The agreement also subjects the Company to certain reporting covenants. The Company is required to provide monthly, quarterly and annual financial statements, operating budget and metrics, and other financial information as requested. Also in connection with the New Term Loan, the Company issued 126,993 warrants to purchase price stock at an exercise price of $7.0871, which expire on August 4, 2031. A portion of the proceeds from the New Term Loan was first allocated to the warrants in an amount equal to the fair value of the warrants on the date of issuance and the remainder of the proceeds were allocated to debt. These warrants were cashless exercised immediately prior to the closing of the Business Combination and as a result, there were no warrants outstanding associated with the New Term Loan as of December 31, 2021. Refer to Note 11 for further details regarding the Company’s warrants. Further, on August 4, 2021, the Company repaid the outstanding principal balance of the Seventh Amendment of its Credit Agreement of $5,000,000 and recognized a loss on extinguishment of debt in the amount of $202,723. In connection with the loan repayment, the Company’s letter of credit was modified and the Company is now required to maintain cash collateral for the outstanding letters of credit. As a result, the cash collateral related to the outstanding letters of credit are segregated in restricted cash accounts as of the third quarter of 2021. As of December 31, 2021, the Company had approximately $2,767,471 of letters of credit issued, of which none were drawn. Amounts outstanding under long-term term debt, including the PIPE Convertible Notes (discussed in Note 5), consisted of the following as of December 31, 2021 and 2020. The estimated fair value of long-term debt is approximated at its carrying value as of these reporting dates. December 31, 2021 2020 New Term loan, matures August 2025 $ 43,286,747 $ — 7th Amendment term loan, matures December 2022 — 7,500,000 PIPE Convertible Notes 1 77,047,475 — Total debt $ 120,334,222 $ 7,500,000 Less: current portion — (3,750,000) Long-term term loan $ 120,334,222 $ 3,750,000 Aggregate maturities of debt as of December 31, 2021 are as follows: 2022 $ — 2023 — 2024 — 2025 43,286,747 2026 77,047,475 Total $ 120,334,222 1 As discussed in Note 5, the PIPE Convertible Notes will mature in 2026, unless earlier repurchased by the Company or converted at the option of the holders. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION As discussed in Note 1, the Company adopted ASC 606 as of January 1, 2019, using a modified retrospective approach. The Company elects to apply the practical expedient to forego the disclosure of revenue related to performance obligations that are part of a contract whose original expected duration is less than one year. This practical expedient applies to all revenue streams except revenue generated from the Company's software license revenue, as the term of software is greater than one year. The related remaining performance obligations for software license revenue are discussed below. (a) Retail Revenue — The Company’s Retail revenue is generated from the following revenue streams: Merchandise Sales — The Company offers merchandise in the following core merchandise categories: grocery, snacks, beverages, and household and cleaning products. Revenue generated through the Company’s e-commerce platform is recognized when control of the goods ordered are transferred to the customer, which generally occurs upon delivery to the customer. Deferred revenue consists of payments received from customers for goods not yet shipped by the end of the period. As the shipments in-transit represent unsatisfied performance obligations, the revenue is deferred until delivery to the customer is complete. Subscription Sales — The Company charges a membership fee to customers who sign up for the Company’s Boxed Up program. That fee allows customers to earn cash back on every purchase, access to exclusive discounts, and free shipping over a minimum order amount. The duration of the membership is generally 12 months. Because the Company has the obligation to provide access to its website for the duration of the membership term, the Company recognizes membership fees on a straight-line basis over the life of the membership. The Company’s deferred revenue related to membership fees was $751,989, $728,207, and $308,406 on December 31, 2021, 2020, and 2019, respectively. Outbound delivery fees — Outbound delivery fees are included in customer billing and are recorded as revenue as control of the product is transferred to customers upon delivery. Delivery charges to customers were $1,452,400, $3,735,551, and $1,798,394 for the years ended December 31, 2021, 2020, and 2019, respectively. Outbound delivery fees are included in net revenue in the Consolidated Statement of Operations. Marketing fees — The Company provides a mix of marketing services to merchants. The Company provides merchants access to its e-commerce platform where merchants display and sell their products to users. The Company also provides advertising services to help merchants promote their products within the Company’s platform. The Company recognizes revenue when a user’s order is processed, and the related order information has been made available to the merchant. Revenue from marketing fees charged to vendors and partners was $1,518,533, $1,486,848, and $1,393,871 for the years ended December 31, 2021, 2020, and 2019, respectively. Marketing fees are included in net revenue in the Consolidated Statement of Operations. Returns and Refunds — The Company’s contracts with customers are generally sold with a right of return. Historically the returns have been immaterial and recognized in the period which the products are returned. Tax Collected — In the ordinary course of business, we collect sales tax on items purchased by our customers that are taxable in the jurisdictions when the purchases take place. These taxes are then remitted to the appropriate taxing authority. We exclude these taxes collected from net revenue in our financial statements. (b) Software & Services Revenue — The Company's Software & Services revenue is generated from its software licensing agreements. Software License Revenue — The Company generates revenue through software license agreements, which allow the customers the Company engages with to take possession of the software for usage of the Company’s IP, and host that software in an on-premise, or cloud-based infrastructure environment, at the customer’s election. A software license contract with multiple performance obligations typically includes the following elements: implementation services, software license, training services, and maintenance and support services. The total transaction price of a software license contract includes a fixed fee and may include forms of variable consideration, such as platform usage fees. Revenue is recognized as the performance obligations are satisfied. Specifically, implementation revenue is recognized over time utilizing the input method, based on a cost-to-cost analysis; software license revenue is recognized at the point in time at the go-live date of the software and upon settlement of variable fees, accounted using the sales-based royalty exception; training revenue is recognized when the training is delivered to the customer without regard to a detailed evaluation of the point in time criteria due to the short-term nature of the training services (completed within the same quarterly reporting period); and maintenance and support revenue is recognized over time on a straight-line basis over the contract period. For contracts with multiple performance obligations, we allocate the contract price to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices using a cost plus a margin approach. The total transaction price for the Company’s current contract related to software license revenue includes fixed and variable consideration. For software license, revenue allocated to remaining performance obligations, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods, was $1,667,755 and $1,103,226 as of December 31, 2021 for implementation fees and maintenance fees for the remainder of the initial contract term of five years, respectively. Based on the terms of the contract and initial go-live date in the third quarter of 2021, the Company recognized $10,500,000 in floor license fees during the third quarter of 2021. The Company expects to recognize approximately $1,667,755 and $240,000 in implementation and maintenance fees, respectively, over the next 12 months. (c) Contract Assets and Liabilities The difference in the opening and closing balances of the Company's contract assets (unbilled receivables) and contract liabilities (deferred revenue) results from the timing differences between the Company's performance and the customer's payment. The Company fulfills its obligations under contracts with customers by transferring goods and services in exchange for consideration from the customer. The Company recognizes a contract asset when it transfers products or services to a customer for which the billings occur in a future period. As of December 31, 2021, the Company recognized contract assets (unbilled receivables) related to its software licensing agreement under its Software & Services segment. The Company recognizes a contract liability when consideration is received from customers in advance of revenue recognition as described within the revenue streams above. December 31, 2021 2020 Contract assets (unbilled receivables) $ 8,890,888 $ — Contract liabilities (deferred revenue) $ 2,020,351 $ 2,435,909 The unbilled receivables and deferred revenue for the Company’s Software & Services segment are presented net at the contract level. The remaining deferred revenue that is presented separately on the Company’s Consolidated Balance Sheets as of December 31, 2021 is related to the Company’s Retail segment. The increase in unbilled receivables as of December 31, 2021 is driven by the Company’s first software licensing agreement, signed in the first quarter of 2021. The unbilled receivables balance is attributable to the satisfaction of certain performance obligations for which billings were not yet invoiced as of December 31, 2021, partially offset by an increase in new billings for other certain performance obligations that were not yet satisfied. (d) Revenue Disaggregation The Company had total revenue of $177,266,677, $187,173,834, and $173,992,897 for the years ended December 31, 2021, 2020, and 2019, respectively. The Company manages and reports operating results through two reportable segments defined by our products and services: Retail and Software & Services. The Company’s Retail operations represent the majority of its consolidated total revenues. The following table summarizes the Company’s percentage of net Retail revenue disaggregated by sales channel: Years Ended December 31, 2021 2020 2019 Direct Sales (1) $ 139,647,865 $ 176,836,569 $ 143,749,787 Channel Sales (2) $ 17,341,244 $ 10,337,265 $ 30,243,110 Software & Services (3) $ 20,277,568 $ — $ — (1) Direct Sales includes retail direct to consumer sales on the Company’s e-commerce platform. (2) Channel Sales includes retail sales on other third-party platforms. (3) Software & Services includes revenue generated from software licensing agreements. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income Taxes — For financial reporting purposes, loss before income taxes, includes the following components: December 31, 2021 2020 2019 Domestic $ (69,222,605) $ (34,436,576) $ (65,402,000) Foreign — — — Loss before income taxes $ (69,222,605) $ (34,436,576) $ (65,402,000) Total income taxes allocated to operations for the years ended December 31, 2021, 2020, and 2019 were as follows: 2021 Current Deferred Total Federal $ — $ — $ — State — — — Foreign — — — Total $ — $ — $ — 2020 Current Deferred Total Federal $ — $ — $ — State — — — Foreign — — — Total $ — $ — $ — 2019 Current Deferred Total Federal $ — $ — $ — State — — — Foreign — — — Total $ — $ — $ — Tax Rate Reconciliation — A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows: December 31, 2021 2020 2019 Federal statutory rate 21.00 % 21.00 % 21.00 % Permanent items (4.74) (2.74) (0.02) State taxes (net of federal benefit) 0.07 0.00 0.00 Deferred rate change 0.00 — (0.02) Valuation allowance (15.79) (17.28) (20.28) Stock-based compensation (0.54) (0.98) (0.68) Total provision and effective tax rate 0.00 % 0.00 % 0.00 % The difference between income taxes at the U.S. federa l statutory income tax rate of 21% and the amounts reported relate primarily to pre-tax losses for which no tax benefit has been provided as we could not conclude that such amounts would be realized in the future. On March 27, 2020 the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted and signed into law. The CARES Act makes changes to the U.S. tax code, including, but not limited to: (1) modifications to the business interest deduction limitation for tax years 2019 and 2020; (2) a technical correction of the recovery period of qualified improvement property from 39 to 15 years; (3) a repeal of the 80% taxable income limitation on the deduction of net operating losses (“NOLs”) for tax years beginning before January 1, 2021 as well as a five-year carryback period allowed for NOLs generated in tax years beginning after December 31, 2017 and before January 1, 2021; and (4) deferral of payment of the employer share of Social Security payroll taxes the Company would otherwise be responsible for paying in 2020. Fifty percent of the deferred payroll taxes are due on December 31, 2021, and the remaining amounts are due on December 31, 2022. Under ASC 740, the effects of new legislation would need to be recognized in the period of enactment. Therefore, the effects of the CARES Act would need to be accounted for in the year ended December 31, 2020. The Company elected to defer $834,430 of Social Security payroll taxes under the CARES Act and paid fifty percent of the amount deferred during the year ended December 31, 2021. The Company evaluated the other provisions of the CARES Act and determined there was no material impact for the year ended December 31, 2021. On December 21, 2020, Congress passed the Consolidated Appropriations Act, 2021. The act includes the Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the COVID-related Tax Relief Act of 2020, both of which extend many credits and other COVID-19 relief, among other extenders. The Consolidated Appropriations Act is retroactively applied to the original date of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Like the CARES Act, under ASC 740, the effects of new legislation would need to be recognized in the period of enactment. Therefore, the effects of the Consolidated Appropriations Act would need to be accounted for in the year ended December 31, 2020. The Company evaluated the provisions of the Consolidated Appropriations Act and determined that there was no material impact for the year ended December 31, 2020. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU No. 2019-12”), which aims to reduce complexity in accounting standards by improving certain areas of U.S. GAAP without compromising information provided to users of financial statements. ASU No. 2019-12 removes certain exceptions to the general principles in Topic 740 and clarifies and amends existing guidance to improve consistent application. It is effective for interim and annual periods beginning after December 15, 2020 for public companies, with early adoption permitted. There is no material impact to the Company. Components of Deferred Taxes — The tax effects of temporary differences that give rise to the deferred tax assets and deferred tax liabilities at December 31, 2021 and 2020 are presented below: December 31, 2021 2020 Deferred tax assets: Allowance for doubtful accounts $ 23,161 $ 49,815 Accrued expenses 204,937 220,548 Inventory 101,093 116,354 Deferred rent 109,261 151,089 Lease liability 43,254 62,499 Warrants — 463,701 Stock-based compensation 683,139 202,722 Charitable contributions 564,974 460,274 Net operating losses 82,617,414 71,553,413 Payroll tax deferral 101,126 202,385 Disallowed interest expense 853,857 216,444 Transaction costs 1,528,027 — Total deferred tax assets 86,830,243 73,699,244 Less: valuation allowance (85,757,888) (72,057,082) Net deferred tax assets $ 1,072,355 $ 1,642,162 Deferred tax liabilities: Intangible assets $ (649,050) $ (839,927) Property and equipment (423,305) (802,235) Total deferred tax liabilities $ (1,072,355) $ (1,642,162) Net deferred tax assets/liabilities $ — $ — Assessing the realizability of deferred tax assets requires the determination of whether it is more-likely-than-not that some portion or all the deferred tax assets will not be realized. In assessing the need for a valuation allowance, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected futur e taxable income, loss carryback and tax-planning strategies. Given the cumulative losses in recent years, a full valuation allowance has been established as of December 31, 2021 and 2020, and no deferred tax assets and related tax benefit have been recognized in the accompanying financial statements. The valuation allowance increased $13,700,805 and $6,796,688 from the full valuation allowances that were recorded as of December 31, 2020 and 2019, respectively. As of December 31, 2021 and 2020, the Company had approximately $345,369,901 and $299,375,124 of federal net operating losses. Approximately $161,064,722 of the federal net operating losses will expire at various dates beginning in 2033 through 2040 if not utilized, while the remaining amount will have an indefinite life. As of December 31, 2021 and 2020, the Company had approximately $184,664,686 and $158,533,956 of state net operating losses. Some state net operating losses may follow the Tax Cut and Jobs Act and are indefinite life while most are definite life with various expiration dates beginning in 2034 through 2040. Utilization of the net operating loss carryforwards and credits may be subject to a substantial annual limitation due to ownership changes that may have occurred previously or that could occur in the future, as provided by Section 382 of the Internal Revenue Code of 1986, as well as similar state provisions. Such annual limitation could result in the expiration of net operating losses and credits before their utilization. Consistent with the provisions of ASC 740, Income Taxes , the Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The following table shows the changes in the gross amount of unrecognized tax benefits as of December 31, 2021, 2020 and 2019: December 31, 2021 2020 2019 Beginning balance $ 1,348,904 $ 1,348,904 $ 1,372,064 Increases based on tax positions during the current period — — 301,847 (Decreases) based on tax positions during the current period — — (325,007) Ending balance $ 1,348,904 $ 1,348,904 $ 1,348,904 The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate would be $0 for the years ended December 31, 2021 and 2020. The Company recognizes interest and penalties accrued related to unrecognized tax benefits as a component of tax expense. The Company has not accrued any interest or penalties related to unrecognized tax benefits as of December 31, 2021 or 2020. Although it is reasonably possible that certain unrecognized tax benefits may increase or decrease within the next 12 months due to tax examination changes, settlement activities, expirations of statute of limitations, or the impact on recognition and measurement considerations related to the results of published tax cases or other similar activities, the Company does not anticipate any significant changes to unrecognized tax benefits over the next 12 months. The Company files U.S. federal and state income tax returns with varying statutes of limitations. All tax years since inception remain open to examination due to the carryover of unused net operating losses and tax credits. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Operating Leases — The Company maintains its principal offices in New York City, New York and maintains fulfillment centers and office space in various locations throughout the United States. Future minimum rental commitments under non-cancelable leases with initial or remaining terms in excess of one year at December 31, 2021 were as follows: Year Lease Obligation 2022 $ 4,478,016 2023 2,919,511 2024 1,742,148 2025 1,768,962 2026 1,710,581 Thereafter 2,921,321 Total $ 15,540,539 The Company expensed $3,323,677, $3,202,308, and $3,004,423 in rent relat ed to leases in effect during the years ended December 31, 2021, 2020, and 2019, respectively, which is included in selling, general, and administrative expense in the accompanying Consolidated Statements of Operations. Sales or Other Similar Taxes — Based on the location of the Company’s current operations, sales tax is collected and remitted. To date, the Company has had no actual or threatened sales and use tax claims from any state where it does not already claim nexus or any state where it sold products prior to claiming nexus. However, the Company believes that the likelihood of incurring a liability as a result of sales tax nexus being asserted by certain states where it sold products prior to claiming nexus is reasonably possible. As of December 31, 2021 and 2020, the Company estimates that the potential liability is approximately $1,348,904. All years have been recorded as an accrued liability. Although it is reasonably possible that a change in this estimate w ill occur in the near term, the Company believes this is the best estimate of an amount due to taxing agencies, given that such a potential loss is an unasserted liability that would be contested and subject to negotiation between the Company and the state, or decided by a court. Legal Proceedings — From time to time the Company may be involved in claims, legal actions and governmental proceedings that arise from its business operations. As of December 31, 2021 and 2020, the Company was not a party to any legal proceedings or threatened legal proceedings, the adverse outcome of which, individually or in the aggregate, that it believes would have a material adverse effect on its business, financial condition or results of operations. On February 8, 2022, a putative stockholder of the Company filed a complaint in the Delaware Chancery Court alleging that he is entitled to attorney’s fees and expenses in connection with a demand he made on the Company regarding the ability of Seven Oaks Class A common stockholders to vote on certain charter amendments in connection with the Business Combination, which closed on December 8, 2021. The stockholder has not specified the amount of attorneys’ fees and expenses sought. The Company’s response to the complaint is due on March 23, 2022. Given the early stage of this matter and the uncertainty inherent in litigation and investigations, the Company does not believe it is possible to develop estimates of reasonably possible losses (or a range of possible losses) for this matter. Service Agreements — The Company is currently engaged in the below service agreements under which it has certain long-term commitments in exchange for the described services: On June 13, 2021, the Company executed a Master Subscription Agreement with Palantir Technologies Inc. (“Palantir”) under which it will pay $20,000,000 over five years for access to Palantir's Foundry software platform and related services for advanced data management and analytics to be used for the Company's strategic initiatives. In exchange for this agreement, Palantir agreed to purchase, and the Company agreed to sell to Palantir, an aggregate of 2,000,000 shares of Seven Oaks Class A common stock, for a purchase price of $10.00 per share and an aggregate purchase price of $20,000,000, in connection with the PIPE Investment. On December 8, 2021, upon the Closing (as discussed in Note 1), $15,000,000 of the $20,000,000 was due to Palantir, pursuant to the terms of the Master Subscription Agreement, thirty days after Closing. As of December 31, 2021, $4,000,000 was prepaid to Palantir, with the remainder paid in January of 2022. Also upon the Closing, each share of Seven Oaks Class A common stock was reclassified into one share of New Boxed common stock. The Company received access to Palantir's Foundry software platform on June 25, 2021; however; no software expense was recognized until after the consummation of the Business Combination as the Company could cancel the agreement if the Business Combination was not consummated. On December 1, 2021, the Company entered into an addendum to a prior service agreement with Google LLC for access to the Google Cloud Platform. The addendum includes three commitment periods, with the first commitment period beginning on the implementation date and lasting 12 months and the next two commitment periods beginning at the end of the preceding period and lasting 12 months each. The minimum commitments for the first, second, and third commitment periods are $2,000,000, $4,500,000, and $8,500,000, respectively. Any fees the Company incurs in a single commitment period (other than the final commitment period) that in total exceed the minimum commitment for such period will apply towards the Company's minimum commitment for the following commitment period. The implementation date was December 31, 2021. As of December 31, 2021, the total remaining commitment was $15,000,000, with a minimum of $2,000,000 due within the next 12 months. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS | ACQUISITIONS On December 9, 2021, the Company completed an acquisition of substantially all of the assets and operations of MaxDelivery, LLC (“MaxDelivery”), an on-demand grocery delivery business in New York City. Consideration for the MaxDelivery acquisition consisted of $4,000,000 in cash consideration, $3,000,000 in equity consideration, and future potential earnout, or contingent consideration, as listed in the table below. Operating results for this acquisition have been included in the Company's Consolidated Statements of Operations from the date of acquisition and are reflected within the Retail segment. The acquisition was accounted for as a business combination under the acquisition method in accordance with guidance found in ASC 805, Business Combinations . The fair value of the consideration paid for this acquisition has been allocated to the assets acquired and liabilities assumed as of the acquisition date, with any excess recorded to goodwill. The goodwill recorded as part of the acquisition primarily reflects the value of the potential to expand the Company's presence in micro dark-store fulfillment and rapid on-demand delivery as well as the assembled workforce. Goodwill is expected to be deductible for tax purposes and is included in our Retail segment. The Company recorded a contingent consideration liability of $1,711,000 as of the acquisition date, representing the estimated fair value of the contingent payable to former shareholders. The fair value of the contingent consideration was determined using a Monte-Carlo Simulation (Level 3) pricing model. The value of the contingent consideration is included within earnout liability in the Company's Consolidated Balance Sheets. We are currently completing fair value assessments with the assistance of third-party valuation specialists and thus the Company's estimates and assumptions for the allocation of the purchase price to the assets acquired and liabilities assumed are subject to change during the measurement period (up to one year from the acquisition date). Preliminary allocations of the purchase price to acquired assets, including goodwill and intangible assets, are presented in the table below: Allocation as of December 31, 2021 Cash consideration $ 4,000,000 Equity consideration 3,000,000 Contingent consideration 1,711,000 Total purchase price consideration $ 8,711,000 Assets and liabilities assumed: Accounts receivable $ 78,980 Other current assets 186,162 Fixed assets 385,243 Intangible assets (1) 1,350,000 Goodwill 7,443,569 Total acquired assets 9,443,954 Accounts payable (585,702) Other current liabilities (147,252) Total allocation of purchase price consideration $ 8,711,000 (1) The fair value of the identifiable intangible assets includes $800,000 for customer relationships and $550,000 for trademarks and technology. The fair values of these intangible assets acquired were determined using various valuation methods under income approach, including the (i) multiple-period excess earnings method (ii) relief-from-royalty method and (iii) cost replacement method, respectively. The Company recognized transaction costs related to the acquisition of $92,322 for the year ended December 31, 2021. These costs were associated with legal and professional services related to the acquisition and are recognized within selling, general, and administrative expense in the Company's Consolidated Statement of Operations. The following unaudited pro forma financial information presents the combined result of operations as if the acquisition of MaxDelivery had occurred on January 1, 2020. These unaudited pro forma results do not necessarily reflect the actual results of operations that would have been achieved had the acquisition occurred on that date, nor are they necessarily indicative of future results of operations. December 31, 2021 2020 Pro forma net revenue $ 189,283,099 $ 202,341,157 Pro forma net loss $ (69,103,687) $ (34,429,058) There were no material nonrecurring items directly attributable to the acquisition requiring adjustment to the unaudited pro forma amounts above. |
FORWARD PURCHASE AGREEMENT
FORWARD PURCHASE AGREEMENT | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
FORWARD PURCHASE AGREEMENT | FORWARD PURCHASE AGREEMENT As discussed in Note 1, prior to the Closing, on November 28, 2021, Seven Oaks entered into a Forward Purchase Agreement with ACM for a Forward Purchase Transaction. Pursuant to the terms of the Forward Purchase Agreement, ACM purchased approximately 6,504,768 shares of Seven Oaks' Class A common stock in exchange for the Prepayment Amount of $65,062,414, which was paid out of the funds received by the Company from Seven Oaks' trust account and will be held in a deposit account for the benefit of ACM until the Valuation Date. There are a few scenarios in which the Forward Purchase Agreement can be settled either before or on the Valuation Date: (i) At any time prior to the Valuation Date, ACM may elect an optional early termination to sell some or all of the Forward Purchase shares in the open market. If ACM sells any shares prior to the Valuation Date, a pro-rata portion of the Prepayment Amount will be released from the deposit account and paid to the Company. ACM shall retain any proceeds from the sale of such shares in excess of such pro-rata portion paid to the Company. For example, if ACM chooses to exercise its right to an optional early termination and sells the common stock for $7.00 per share, it will be required to return $10.00 per share, plus accrued interest, back to the Company in cash from the deposit account. Similarly, if ACM sells its shares at $12.00 per share, it will be required to return $10.00 per share, plus accrued interest, back to the Company. (ii) On the Valuation Date, if any shares subject to the Forward Purchase Agreement remain unsold and there is a remaining balance in the deposit account corresponding to the unsold shares, the settlement amount of the remaining funds in the deposit account will be allocated based on the difference between ACM's purchase price of $10.00 and the trading price of the shares over a specified valuation period, the length of which is based on the daily trading volume of the shares. Assuming the shares are trading above $10.00, the Company will receive the entire remaining Prepayment Amount held in the deposit account, less any applicable fees. To the extent there is any shortfall between ACM's purchase price of approximately $10.00 (adjusted for accrued interest) and the trading price, there will be a proportionate reduction in the cash from the deposit account that the Company will receive. (iii) If the volume weighted average share price (“VWAP”) of the shares falls below $5.00 per share for 20 out of any 30 consecutive trading days (a “VWAP Trigger Event”), then ACM may elect to accelerate the Valuation Date to the date of such VWAP Trigger Event. If ACM elects to accelerate the Valuation Date, the settlement amount returned to the Company would be approximately equal to the VWAP of the shares on such date of the Trigger Event, net of $0.20 per share in fees. As of December 31, 2021, ACM has sold 501,109 shares, for which the Company received gross proceeds of $5,012,225. Depending on the manner in which the Forward Purchase Transaction is settled, the Company may never have access to all of the remaining Prepayment Amount. In accordance with ASC 815, Derivatives and Hedging , the Company has determined that the forward option within the Forward Purchase Agreement is (i) a freestanding financial instrument and (ii) a derivative. This derivative, referred to throughout as the "forward purchase option derivative" is recorded as a liability on the Company's Consolidated Balance Sheets. The Company has performed fair value measurements for this derivative as of Closing and as of December 31, 2021, which is described in Note 15. The Company will remeasure the fair value of the forward purchase option derivative each reporting period. |
WARRANTS
WARRANTS | 12 Months Ended |
Dec. 31, 2021 | |
Warrants and Rights Note Disclosure [Abstract] | |
WARRANTS | WARRANTS Common Stock Warrants — In connection with the Credit Agreement and subsequent amendments (as discussed in Note 6), the Company issued 37,607 warrants to purchase common stock. Immediately prior to the Closing, all 37,607 warrants to purchase common stock outstanding immediately prior to the Business Combination were cashless exercised. Upon cashless exercise, 29,546 and 96 shares of Old Boxed common stock were issued to warrant holders, using exercise prices of $2.01 and $0.95, respectively, with the total remaining 7,965 shares surrendered to cover the aggregate exercise amount. Then, upon Closing, each share of Old Boxed common stock was converted into the right to receive approximately 0.9498 shares of New Boxed common stock. In addition, immediately prior to Closing, these warrants were marked-to-market, creating a $132,672 fair value adjustment recorded in the Consolidated Statement of Operations. Prior to the Business Combination, these warrants were classified as liabilities and any corresponding changes to the fair value of the warrants were recognized in earnings on the Company’s Consolidated Statements of Operations in each subsequent period. The estimated fair value of these common stock warrants as of December 31, 2020 and 2019 was determined using Level 3 inputs and assumptions within the Black-Scholes pricing model. The Company used the following methods to determine its underlying assumptions: expected volatilities were based upon an analysis of the historical volatility of guideline public companies and factors specific to the Company; the expected term was based on the estimated timing until a liquidity event given that the warrants would automatically exercise upon an acquisition; the risk-free interest rate was based on the a verage of the observed yield of three-year and five-year U.S. Treasury se curities; and the expected dividend yield was based on the expected annual dividend. The key assumptions used in the Black-Scholes model were as follows: 2020 2019 Expected volatility 57.0 % 55.0 % Expected term (in years) 1.0 2.0 Risk-free interest rate 1.7 % 1.7 % Expected dividend yield 0.0 % 0.0 % The accrued value of these warrants as of December 31, 2020 and 2019 was $49,863 and $59,624, respectively. There were 37,607 warrants to purchase common stock outstanding as of December 31, 2020 and 2019. Series E-1 Preferred Warrants — In connection with the Company's New Term Loan, signed on August 4, 2021 (as discussed in Note 6), the Company issued warrants to purchase 126,993 shares of Series E-1 preferred stock at a price of $7.0871 per share. Immediately prior to the Closing, all 126,993 warrants to purchase preferred stock were (i) cashless exercised into 32,233 shares of Old Boxed Series E-1 preferred stock (the remaining 94,760 warrants surrendered to pay the aggregate exercise price), and ii) converted to Old Boxed common stock. Then, upon Closing, each share of Old Boxed common stock was converted into the right to receive approximately 0.9498 shares of New Boxed common stock. In addition, immediately prior to Closing, these warrants were marked-to-market, creating a $52,183 fair value adjustment that is recorded in the Company's Consolidated Statements of Operations. Series C-1 Preferred Warrants — In connection with a sale leaseback agreement the Company entered into in December 2016, the Company issued warrants to purchase 88,361 shares of Series C-1 preferred stock at a price of $10.88 per share. Immediately prior to the consummation of the Business Combination, these warrants were cancelled at the election of the warrant holders and the related accrued liability and fair value adjustments were reversed from the Company's Consolidated Financial Statements. Prior to the consummation of the Business Combination, and in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), the fair value of these warrants were classified as a liability on the Company’s Consolidated Balance Sheets as the warrant terms include a conditional redemption feature through which the holders may participate in a deemed liquidation event when holders of common stock m ay not. The fair value as of the grant date was recorded as a discount to the capital lease principle. Corresponding changes to the fair value of the warrants were recognized in earnings on the Company’s Consolidated Statements of Operations in each subsequent period. At the end of each reporting period, until expiry, the Company used an option pricing model to estimate and report the fair value of the Series C-1 preferred warrants. The following table presents the quantitative inputs, which were classified in Level 3 of the fair value hierarchy, used in estimating the fair value of the warrants: 2020 2019 Expected volatility 60.0 % 45.0 % Expected term (in years) 1.0 2.0 Risk-free interest rate 0.1 % 1.6 % There were 88,361 warrants to purchase Series C-1 preferred stock outstanding as of December 31, 2020 and 2019. The accrued value of these warrants as of December 31, 2020 and 2019 was $153,748 and $87,477, respectively. As a result of the change in fair value of these warrants as of December 31, 2020 and 2019, $(66,271) and $13,254 were recorded in other income (expense), net, respectively, in the Consolidated Statements of Operations. Series C-3 Preferred Warrants — In April 2016, in conjunction with a general marketing agreement, the Company issued warrants to purchase shares up to 1,102,752 shares of Series C-3 preferred stock to a strategic partner at a price of $10.88 per share. Immediately prior to the consummation of the Business Combination, these warrants were cancelled at the election of the warrant holders and the related accrued liability and fair value adjustments were reversed from the Company's Consolidated Financial Statements. Under the initial terms of these warrants, the number of exercisable shares was dependent upon performance conditions. The warrant was exercisable upon vesting through completion of marketing milestones. In accordance with ASC 480, the fair value of these warrants were classified as a liability on the Company’s Consolidated Balance Sheets as the warrant terms included a conditional redemption feature through which the holders may participate in a deemed liquidation event when holders of common stock may not. Therefore, as the performance conditions are met, the warrants were recorded as a liability in the Consolidated Balance Sheets and as marketing expense in the Consolidated Statements of Operations. Corresponding changes to the fair value of the warrants were recognized in earnings on the Company’s Consolidated Statements of Operations in each subsequent period. All milestones related to the warrants were met in 2016 and 2017 and all the warrants were fully vested. At the end of each reporting period, until expiry, the Company used an option pricing model to estimate and report the fair value of the Series C-3 preferred warrants. The following table presents the quantitative inputs, which are classified in Level 3 of the fair value hierarchy, used in estimating the fair value of the warrants: 2020 2019 Expected volatility 60.0 % 45.0 % Expected term (in years) 1.0 2.0 Risk-free interest rate 0.1 % 1.6 % T here were 1,102,752 warrants outstanding to purchase Series C-3 preferred shares as of December 31, 2020 and 2019, respectively. The accrued value of these warrants as of December 31, 2020 and 2019 was $1,918,788 and $1,091,724, respectively. As a result of the change in fair value of these warrants as of December 31, 2020 and 2019, $(827,064) and $165,413 were r ecorded in other income (expense), net, respectively, in the Consolidated Statements of Operations. Public and Private Warrants — In December 2021, in connection with the closing of the Business Combination, the Company assumed a total of 18,525,000 outstanding warrants to purchase one share of Boxed common stock with an exercise price of $11.50. Of these warrants, 12,937,500 warrants (the “Public Warrants”) were originally issued in the initial public offering (“IPO”) of Seven Oaks and 5,587,500 warrants (the “Private Warrants”) were originally issued in a private placement in connection with the IPO. The Private Warrants are identical to the Public Warrants, except the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants were not transferable, assignable or salable until after the completion of the Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants are exercisable on a cashless basis, at the holder's option, and are non-redeemable by the Company so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchases or their transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. T he Company evaluated its warrants under ASC 815-40, Derivatives and Hedging , and concluded that they do not meet the criteria to be classified in stockholders’ equity. Therefore, the Company recorded these warrants as current liabilities on the Consolidated Balance Sheets at fair value upon Closing, with subsequent changes in their respective fair values to be recognized in other income (expense), net in the Consolidated Statements of Operations during future reporting periods. See further disclosure on the change in fair value of Public and Private Warrant liabilities within Note 15. |
STOCKHOLDERS_ DEFICIT AND MEZZA
STOCKHOLDERS’ DEFICIT AND MEZZANINE EQUITY | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS' DEFICIT AND MEZZANINE EQUITY | STOCKHOLDERS’ DEFICIT AND MEZZANINE EQUITY Common Stock — As of December 31, 2021 and 2020, the Company was authorized to issue 600,000,000 shares of its common stock, $0.0001 par value and 66,486,210 shares of common stock, $0.0001 par value, respectively. As of December 31, 2021 and 2020, there was 66,647,242 and 9,392,361 common shares outstanding, respectively. Each share of common stock has the right to one vote per share. Preferred Stock — As of December 31, 2021 and 2020, the Company was authorized to issue 60,000,000 shares of its preferred stock, $0.0001 par value and 41,387,260 shares of preferred stock, $0.0001 par value, respectively. In conjunction with the consummation of the Business Combination, all of the Company's preferred stock outstanding converted into 41,289,869 shares of common stock. As of December 31, 2021, the Company had no preferred stock outstanding. As of December 31, 2020, preferred stock consisted of the following: Shares Shares Issued Issuance Price Carrying Value (1) Liquidation Series A-1 4,168,647 4,168,647 $ 1.56 $ 6,490,026 $ 6,489,982 Series A-2 1,893,035 1,893,035 0.58 1,090,840 1,090,820 Series A-3 541,863 541,863 0.83 442,374 442,367 Series B-1 4,870,769 4,870,769 4.72 22,984,122 22,984,071 Series B-2 533,930 533,930 3.78 2,015,647 2,015,641 Series C-1 10,085,422 10,001,485 11.46 114,562,977 114,587,113 Series C-2 982,272 982,272 9.18 9,003,134 9,003,124 Series C-3 1,607,161 559,764 11.46 7,066,283 6,412,106 Series D-1 8,894,451 8,894,451 11.51 97,926,084 102,340,201 Series D-2 2,094,931 2,094,931 10.37 21,694,134 21,694,112 Series E-1 4,020,556 4,020,556 7.47 33,707,750 30,000,000 Series E-2 1,694,223 1,694,223 4.86 8,217,388 8,217,284 41,387,260 40,255,926 $ 325,200,758 (1) Amounts are net of issuance costs and changes in the redemption value of the Series C-3 preferred stock. Series C-3 Preferred Stock — The Company recorded all shares of preferred stock at their respective fair values less issuance costs on the dates of issuance. The preferred stock was recorded outside of stockholders’ equity (deficit) because, in the event of certain deemed liquidation events, which are events that are not considered solely within the Company’s control, such as a merger, acquisition or sale of all or substantially all of the Company’s assets, the preferred stock would become redeemable. Further, in the case of the C-3 preferred stock exclusively, in the event that all holders of other preferred stock convert into common stock, the holders of the C-3 preferred stock would either be convertible into common stock or cash at the holder’s election, which unlike all other classes of preferred stock, would be deemed probable of becoming redeemable. The redemption value of the C-3 preferred stock was equal to the fair value of the common stock, which the C-3 preferred stock would convert into on the date of redemption. When the preferred stock was considered either currently redeemable or probable of becoming redeemable, the Company had selected a policy of making the determination that the redemption value is equal to the fair value of the preferred stock. As the Series C-3 preferred stock was considered probable of becoming redeemable, the Company had remeasured the value of these shares as of each reporting period date. When preferred stock was not considered either currently redeemable or probable of becoming redeemable, the Company did not remeasure these shares until which point the contingency is probable of occurring. The significant terms of each series of the preferred stock were as follows: i. Dividends — The Company may not declare, pay or set aside dividends on its common st ock (other than dividends on shares of common stock payable in shares of common st ock) unless (in addition to obtaining any consents required) the holders of preferred stock first receive, or simultaneously receive, a dividend at a rate of 6% of the original issue price per share, as adjusted for stock dividends, stock splits, combinations, or other recapitalization. The Board of Directors of the Company was under no obligation to declare dividends, and no rights accrue to the holders of the preferred stock if dividends are not declared or paid in any calendar year, and any dividends paid are non-cumulative. If the Company declared, paid or set aside, on the same date, a dividend on shares of more than one class or series of capital stock of the Company, the dividend payable to the holders of preferred stock would have been calculated based on the dividend on the class or series of capital stock that would result in the largest dividend amount on the preferred stock. No di vidends have been declared or paid as of December 31, 2020. ii. Liquidation Preference — Upon Liquidation (defined below), the holders of preferred stock were entitled to be paid out of the assets of the Company that are available for distribution to its stockholders, before any payment was made to the holders of common stock , an amount per share equal to the greater of (1) the original issue price, plus any declared and unpaid dividends, or (2) such amount per share as would have been payable had all shares of preferred stock been converted into common stock immediately prior to Liquidation. If upon such Liquidation, the assets of the Company available for distribution to its stockholders were insufficient to pay the holders of shares of preferred stock the full amount to which they are entitled, the holders of shares of preferred stock would have shared ratably in the distribution of assets available for distribution in proportion to the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares of preferred stock were paid in full. After the payment of all preferential amounts required to be paid to the holders of shares of preferred stock , the remaining assets of the Company available for distribution to its stockholders would have been distributed pro rata among the holders of shares of common stock. “Liquidation” is defined as “any voluntary or involuntary liquidation, dissolution, or winding up of the Company, or a Deemed Liquidation Event.” A “Deemed Liquidation Event” is defined to include (1) a merger or consolidation involving the Company (other than one for which the holders of voting securities of the Company continue to maintain a majority of voting power after the transaction), and (2) a sale, lease, transfer, exclusive license or other disposition, of all or substantially all of the assets of the Company. A merger or consolidation of the Company would include a change in control for less than 100% of the equity of the Company. iii. Conversion — Each share of preferred stock (other than shares of Series C-3 preferred stock ) was convertible at any time at the option of the holder to common stock at a rate determined by dividing the original issuance price for such series of preferred stock by the conversion price for such series of preferred stock. The “conversion price” is defined as the original issuance price of the preferred stock and is adjusted for stock splits and other subdivisions of common stock, reorganizations, and other dilutive issuances, excluding the issuance of common stock pursuant to the Company’s 2013 stock incentive plan, warrants outstanding at the time of issuance of the preferred stock, and various other exclusions. Each share of preferred stock would be automatically converted into shares of common stock at the then effective conversion price upon the affirmative vote of an investor majority or upon an initial public offering (“IPO”) resulting in at least $50.0 million of gross proceeds. iv. Redemption — Although the Series C-3 preferred stock did not have the conversion feature noted above, if all other holders of preferred stock elect to convert their shares pursuant to this conversion feature, the Series C-3 preferred stockholder would have the option to redeem these shares for cash or common stock based on the fair value of the Series C-3 preferred stock, which would have been made at the shareholder’s election. v. Voting Rights — The holders of preferred stock and common stock voted together as a single class with the holders of preferred stock voting on an as-converted basis. The preferred stock also contained certain protective provisions whereby holders of the preferred stock voted on a class basis. vi. Board — The Board of Directors shall have eight members. The holders of the Series B had the right to select one director, the holders of Series C, with the exception of the holders of Series C-3, had the right to select one director, holders of the Series D-1 had the right to select two directors, and the holders of record of the shares of common stock were entitled to elect four directors. vii. Protective Provisions — At any time when shares of preferred stock were outstanding, the Company did not, either directly or indirectly by amendment, merger, consolidation or otherwise, do any of the following without the written consent or affirmative vote of the holders of at least a majority of the then outstanding shares of preferred stock, consenting or voting together as a single class on an as-converted basis: i. Create any additional class or series of capital stock or security convertible into or exercisable into any additional class or series of capital stock, unless the same ranks junior to the Series A, Series B, Series C, Series D, and Series E preferred stock. ii. Amend the Certificate of Incorporation or By-laws in a manner that is adverse to the preferred stock. iii. Repurchase the Company’s capital stock (except for the repurchase of shares of stock held by employees, consultants, directors, or advisors upon termination of the employment or services). iv. Increase or decrease the authorized directors. v. Liquidate, dissolve or wind-up the business and affairs of the Corporation. vi. Acquire all or a controlling interest in another entity. vii. Pay or declare dividends on any shares of capital stock (other than a dividend on the then outstanding shares of common stock payable solely in shares of common stock). |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Equity Incentive Plan — The Company historically had one Equity Incentive Plan, the 2013 Equity Incentive Plan (the “2013 Plan”), under which the Company had issued equity awards to the Company's officers, directors, employees, and consultants. The option exercise price was determined by the Board of Directors based on the estimated fair value of the Company's common stock. In December 2021, the Board of Directors adopted the Company's 2021 Incentive Award Plan (the “2021 Plan”), upon consummation of the Business Combination . No new awards will be issued under the 2013 Plan following the approval of the 2021 Plan. Under t he 2021 Plan, the Company has the ability to issue incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards, and restricted stock units to selected employees, officers, directors and consultants of the Company as an incentive to such persons. The Company has initially reserved 10,024,848 shares of common stock for issuance to officers, directors, employees, and consultants of the Company pursuant to the 2021 Plan. The number o f shares initially available for issuance will be increased on January 1 of each calendar year beginning in 2022 and ending in 2031, by an amount equal to the lesser of (a) 5% of the shares of common stock outstanding on the final day of the immediately preceding calendar year and (b) such smaller number of shares as determined by the Board. Of such reserved shares of common stock, as of December 31, 2021, 1,280,000 restricted stock units have been granted and are currently outstanding, leaving 8,744,848 shares of common stock remain available for issuance pursuant to the 2021 Plan. Stock Options — Stock options gr anted under both the 2013 Plan and 2021 Plan are generally granted at a price per share not less than the fair value at the date of the grant. Options granted to date generally vest over a four-year period with 25% of the shares underlying the options vesting on the first anniversary of the vesting commencement date with the remaining 75% of the shares vesting on a pro-rata basis over the succeeding thirty-six months, subject to continued service with the Company through each vesting date. Options granted are generally exercisable for up to 10 years, also subject to continued service with the Company. The following is a summary of stock options activity during the years ended December 31, 2021, 2020, and 2019: Number of Weighted Weighted Outstanding as of December 31, 2018 4,331,494 $ 2.43 7.59 Granted 4,342,214 3.37 Exercised (105,867) 1.23 Forfeited (960,475) Outstanding as of December 31, 2019 7,607,366 $ 2.94 8.17 Granted 1,172,294 3.16 Exercised (52,435) 1.07 Forfeited (2,520,076) Outstanding as of December 31, 2020 6,207,149 $ 3.13 7.30 Granted 1,307,713 4.93 Exercised (351,462) 2.14 Forfeited (1,330,881) Outstanding as of December 31, 2021 5,832,519 $ 3.30 5.62 Vested and expected to vest as of December 31, 2021 5,832,519 $ 3.30 5.62 Exercisable as of December 31, 2021 3,872,121 $ 1.35 4.63 Stock-based compensation expense related to stock op tions was $2,492,533, $1,956,009, and $2,286,349 for the years ended December 31, 2021, 2020, and 2019, respectively. All stock-based compensation is recorded within selling, general and administrative expense on the Consolidated Statements of Operations. Incremental expense associated with the modification of stock options for certain key employees who left the Company during the year ended December 31, 2021 was $356,937. The following key assumptions were used in the Black-Scholes-Merton valuation model for the value stock option grants: 2021 2020 2019 Expected volatility 58.0 % 51.8 % 47.4 % Expected term (in years) 4.41 5.99 5.90 Risk-free interest rate 0.8 % 0.3 % 1.8 % Expected dividend yield 0.0 % 0.0 % 0.0 % The weighted-average grant date fair value of the options granted during the years ended December 31, 2021, 2020, and 2019 was $3.59, $1.44, and $1.49 , respectively. As of December 31, 2021, 2020, and 2019, total unrecognized compensation costs related to unvested stock options was approximately $3,994,756, $3,490,761, and $6,321,143, respectively. These costs are expected to be recognized over a weighted-average period of 1.09 years, 1.28 years, and 1.39 years, respectively. The aggregate intrinsic value of options exercised during 2021, 2020, and 2019 was $4,054,823, $109,880, and $277,155, respectively. The total fair value of stock options vested during the years and 2021, 2020, and 2019 was $1,414,334, $2,558,269, and $1,581,077, respectively. Restricted Stock Awards — The company did not grant any restricted stock awards during the years ended December 31, 2021, 2020, and 2019. Restricted Stock Units — In connection with the Business Combination, certain executive officers are eligible for a three-year long-term incentive program (“LTIP”), under which these individuals will be granted shares of restricted stock units ("RSUs") eligible to vest over a three-year period (the “LTIP period”). For each individual, certain portions of the RSUs granted (i) will vest over time based on continued service over the LTIP period (ii) will vest based on the achievement of certain gross profit targets over the LTIP period, and (iii) will vest based on the achievement of certain share price hurdles for the Company's common stock. Each of these grant types will be subject to the officers' continuous employment through each vesting date. As of December 31, 2021, 510,000 time-based RSUs and 770,000 share-price target RSUs have been granted, respectively, to two executive officers. The time-based RSUs will vest annually over the three-year LTIP period, subject to the executives' continued service at each vesting date. The share-price target RSUs are subject to vesting based on the achievement of certain share price hurdles over the LTIP period. For the time-based RSUs, the stock-based compensation expense will be recognized evenly over the three-year LTIP period, with $119,941 being recognized in December 2021. A valuation to determine the fair values for the share-price target RSUs was performed using a Monte-Carlo Simulation, which includes the probability of reaching the share price hurdles in determining the fair value of the award. Total stock-based compensation to be recognized for these share-price target RSUs is based on a derived service period, calculated by the model. Total stock-based compensation expense related to these awards recognized for the year ended December 31, 2021 was $1,035,944. As of December 31, 2021, total unrecognized compensation costs related to unvested time-based RSUs and share-price target RSUs was approximately $5,964,359 and $4,732,496, respectively, which is expected to be recognized over a weighted-average period of 2.94 years and 0.90 years, respectively. No RSUs have vested as of December 31, 2021. To date, the Company has not yet granted RSUs which vest based on the achievement of certain gross profit targets. Employee Stock Purchase Plan — In connection with the Business Combination, the Company adopted the 2021 Employee Stock Purchase Plan (the “ESPP”), which will allow eligible employees to acquire a stock ownership in the Company. A total of 2,004,969 shares of common stock were initially reserved for issuance under the ESPP. In addition, the number of shares available for issuance under the ESPP will be annually increased on January 1 of each calendar year beginning in 2022 and ending on and including January 31, 2031, by an amount equal to the lesser of (a) 1% of the aggregate number of common stock outstanding on the final day of the immediately preceding calendar year and (b) such smaller number of shares as is determined by the Board. As of December 31, 2021, there have been no issuances under the ESPP. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Assets and liabilities measured at fair value during the year on a recurring basis consisted of the following as of December 31, 2021, 2020, and 2019: Fair Value Hierarchy December 31, 2021 Level 1 Level 2 Level 3 Assets – cash & cash equivalents $ 105,027,484 $ — $ — Assets – restricted cash 2,767,471 — — Total assets $ 107,794,955 $ — $ — Liabilities: Forward purchase option derivative $ — $ — $ 4,202,562 Earnout liability — — 27,133,563 Public Warrants 15,395,625 — — Private Warrants — 6,649,125 — Total liabilities $ 15,395,625 $ 6,649,125 $ — December 31, 2020 Level 1 Level 2 Level 3 Assets – cash & cash equivalents $ 30,043,046 $ — $ — Total assets $ 30,043,046 $ — $ — Liabilities: Common stock warrants $ — $ — $ 49,863 Preferred stock warrants — — 2,072,536 Total liabilities $ — $ — $ 2,122,399 December 31, 2019 Level 1 Level 2 Level 3 Assets – cash & cash equivalents $ 12,889,931 $ — $ — Total assets $ 12,889,931 $ — $ — Liabilities: Common stock warrants $ — $ — $ 59,624 Preferred stock warrants — — 1,179,201 Total liabilities $ — $ — $ 1,238,825 The following table represents the changes in these Level 3 financial liabilities for the year ended December 31, 2021: Level 3 Rollforward Common stock warrants Preferred stock warrants Forward purchase option derivative Earnout liability Beginning balances $ 49,863 $ 2,072,536 $ — $ — Additions — — 14,700,778 21,606,062 Changes in fair value 231,149 (1,766,370) (10,498,216) 5,527,501 Reclassified to equity (281,012) (306,166) — — Ending balances $ — $ — $ 4,202,562 $ 27,133,563 Historically, the Company measured the common stock warrants and preferred stock warrants using Level 3 unobservable inputs within the Black-Scholes Merton model. The Company used various key assumptions, such as the fair value of common stock and preferred stock, respectively, volatility, and expected term. The Company monitored the fair value of the common stock and preferred stock warrants annually, with subsequent revisions reflected in the Consolidated Statements of Operations. As of December 31, 2021, the Company's common stock warrants are publicly traded on the NYSE under the ticker symbol BOXD WS. The Company monitors the fair value of the common stock warrants annually, with subsequent revisions reflected in the Consolidated Statements of Operations based on the stock price. The Public Warrants are categorized as Level 1 fair value measurements as they are publicly traded and the Private Warrants are categorized as Level 2 fair value measurements as they are valued based on the trading price of the Public Warrants. As of December 31, 2021, there were no preferred stock warrants outstanding. The fair value of the forward purchase option derivative was estimated using a Monte-Carlo Simulation in a risk-neutral framework (a special case of the Income Approach). Specifically, the future stock price is simulated assuming a Geometric Brownian Motion (“GBM”). For each simulated path, the forward purchase value is calculated based on the contractual terms and then discounted at the term-matched risk-free rate. Finally, the value of the forward is calculated as the average present value over all simulated paths. The Company measured the fair value of the forward purchase option derivative upon the consummation of the Business Combination and as of December 31, 2021, with the respective fair value adjustments recorded within its Consolidated Statements of Operations. The Company will continue to monitor the fair value of the forward option derivative annually, with subsequent revisions to be recorded in the Consolidated Statements of Operations. There are two components of the Company's earnout liability: (i) the valuation of the contingent consideration for the MaxDelivery acquisition (as discussed in Note 10) and (ii) the valuation of Sponsor Earnout Shares (as discussed in Note 1). For the contingent consideration related to MaxDelivery, the fair value was estimated using a Monte-Carlo Simulation in a risk-neutral framework (a special case of the Income Approach). Specifically, future EBITDA is simulated assuming a GBM. For each simulated path, the contingent consideration payments are calculated based on the contractual terms and then discounted at the term-matched risk-free rate plus Company credit spread. The Company measured the fair value of the contingent consideration upon the acquisition date and as of December 31, 2021, with the respective fair value adjustments recorded within its Consolidated Statements of Operations. For the valuation of the Sponsor Earnout Shares, the fair value was estimated using a Monte-Carlo Simulation in which the fair value was based on the simulated stock price of the Company over the maturity date of the contingent consideration. The key inputs used in the determination of the fair value included current stock price, volatility, and expected term. The Company measured the fair value of the Sponsor Earnout Shares upon the consummation of the Business Combination and as of December 31, 2021, with the respective fair value adjustments recorded within its Consolidated Statements of Operations. The Company will continue to monitor the fair value of components of the earnout liability annually, with subsequent revisions to be recorded in the Consolidated Statement of Operations. All significant Level 3 fair value measurements were recorded during the years ended December 31, 2021, 2020, and 2019. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | NET LOSS PER SHARE The Company historically used the two-class method to compute basic and diluted earnings per common share. In periods of net loss, no effect was given to the Company’s participating securities as they did not contractually participate in the losses of the Company. As of and for the year ended December 31, 2021, the Company no longer had participating securities under the two-class method. The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except share and per share data): For the Years Ended December 31, 2021 2020 2019 Numerator: Net loss $ (69,222,605) $ (34,436,576) $ (65,402,000) Less: accretion adjustment (2,039,144) 1,090,294 1,155,122 Net loss attributable to common shareholders $ (67,183,461) $ (35,526,870) $ (66,557,122) Denominator: Weighted-average shares – basic and diluted 13,063,482 9,348,633 9,261,222 Net loss per common share – basic and diluted $ (5.14) $ (3.80) $ (7.19) The following securities were excluded from the computation of diluted loss per share in the periods presented, as their effect would be anti-dilutive: 2021 2020 2019 Series preferred stock, outstanding — 40,255,926 34,541,150 Common stock warrants, outstanding — 35,717 35,717 Preferred stock warrants, outstanding — 1,188,848 1,188,848 Common stock options, outstanding 5,832,519 6,207,149 7,607,366 PIPE convertible notes, if-converted 1 7,291,667 — — Restricted stock units, outstanding 1,280,000 — — Private warrants, outstanding 12,937,500 — — Public warrants, outstanding 5,587,500 — — 1 The PIPE convertible notes are presented using a conversion rate of $12.00, in line with the if-converted method under ASC 260, Earnings Per Share . |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The majority holder of the Series C-1 class is a vendor from whom the Company purchases inventory. Prior to the Closing, the shareholders of the Series C-1 class of preferred stock had the right to elect one Director to the Board of Directors and, the elected Director was an employee of this vendor. In connection with the inventory purchases, the Company receives various volume rebates and incentives to continue doing business. Total inventory purchases for the years ended December 31, 2020 and 2019 were approximately $12,880,934, and $13,879,944, respectively. Volume rebates and incentives received for the years ended December 31, 2020 and 2019 were approximately $908,867 and $1,674,169, respectively. Inventory purchases from January 1, 2021 through December 8, 2021, the date of the Closing, were approximately $11,752,870 and volume rebates and incentives were approximately $214,258. Immediately prior to the consummation of the Business Combination, all shares of Old Boxed preferred stock converted into shares of Old Boxed common stock. Upon Closing, each share of Old Boxed common stock then converted into the right to receive approximately 0.9498 shares of New Boxed common stock. As a result, the majority holder of the Series C-1 class was no longer a related party as this holder no longer holds more than 10% of the Company's voting interest and the elected Director is no longer on the Board of Directors. A holder of the Series D-1 class is a vendor from whom the Company purchases inventory. Prior to the Closing, the collective shareholders of the Series D-1 class of preferred stock had the right to elect two Directors to the Board of Directors. The Directors elected by the collective Series D-1 shareholders were not employees of this vendor. In connection with the inventory purchases, the Company receives various volume rebates and incentives to continue doing business. Total inventory purchases for the year ended December 31, 2020 and 2019 were approximately $3,878,138 and $2,267,312, respectively and total dunnage purchases for the year ended December 31, 2020 and 2019 were approximately $2,729,376 and $2,747,384, respectively. Volume rebates and incentives received for the year ended December 31, 2020 and 2019 were approximately $25,937 and $230,848, respectively. Inventory purchases from January 1, 2021 through December 8, 2021 were $1,930,888 and total dunnage purchases were $2,276,366. Volume rebates and incentives were immaterial from January 1, 2021 through December 8, 2021, the date of the Closing. Immediately prior to the consummation of the Business Combination, all shares of Old Boxed preferred stock converted into shares of Old Boxed common stock. Upon Closing, each share of Old Boxed common stock then converted into the right to receive approximately 0.9498 shares of New Boxed common stock. As a result, the holder of the Series D-1 class, was no longer a related party. On February 12, 2021, the Company entered into an agreement with AEON Integrated Business Services Co., Ltd., a wholly-owned subsidiary of AEON Co., Ltd. (“AEON”), a Series D-1 shareholder, to license its e-commerce platform through a software licensing arrangement. The objective of the agreement is for the Company to design, develop and support the e-commerce platform customized for the digital marketplace operations of AEON and AEON affiliates. The services provided through implementation services, license of the e-commerce software platform, training, and maintenance and support. The Company has been engaged to provide services to AEON and AEON Malaysia. The total transaction price for the contract includes fixed and variable consideration. Based on the Company’s estimates of the standalone selling prices of the performance obligations identified in the contract, the Company has allocated $7,300,000 to implementation services specific to AEON, $4,500,000 to the implementation services specific to AEON Malaysia, and $20,000 per month to software maintenance services with respect to the licensed software for AEON Malaysia. The transaction price attributable to the software license to AEON Malaysia is variable and consists of sales and usage-based royalties. Yuki Habu, a director of the Company, is affiliated with AEON. Refer to Note 1 Summary of Significant Accounting Policies for more details. Immediately prior to the consummation of the Business Combination, all shares of Old Boxed preferred stock converted into shares of Old Boxed common stock, which then upon Closing converted into the right to receive approximately 0.9498 shares of New Boxed common stock. Prior to the agreement signed in February in 2021, in May 2019, the Company entered into an advisory services agreement and provided a proof of concept in connection with the future software as a service licensing arrangement. Fees recognized for the proof of concept was approximately $300,000 in the year ended December 31, 2019. No services were provided in 2020. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is its Chief Executive Officer. The profitability measure employed by the Company’s CODM for allocating resources to operating segments and assessing operating segment performance is operating profit or loss. The CODM does not receive or regularly review asset information when allocating resources and assessing segment performance. Therefore, asset information by segment has not been disclosed. Substantially all of the Company’s identifiable assets are located in the United States. The Company currently does not have sales outside the United States, nor does any customer represent more than 10 percent of total revenues for any period presented. There were no material inter-segment net sales and expenses to be eliminated in computing total revenue and operating income. In addition, the Company allocates its selling, general and administrative expenses to its segment results based on usage, which is generally reflected in the segment in which the costs are incurred. Prior to fiscal year 2021, the Company did not accumulate net revenue information by product or groups of products, and therefore did not disclose net revenue by product because to do so would be impracticable. The following table provides information for the Company’s reportable segments, including product category disaggregation for its Retail segment beginning in fiscal year 2021: Information about Reported Segment Profit or Loss Retail Software & Services Total For the Year Ended December 31, 2021 Grocery net revenue $ 98,925,157 $ — $ 98,925,157 Home & Household net revenue 53,352,950 — 53,352,950 Other net revenue (1) 4,711,003 — 4,711,003 Software & Services net revenue — 20,277,567 20,277,567 Total net revenue $ 156,989,110 $ 20,277,567 $ 177,266,677 Operating income (loss) $ (64,863,125) $ 15,820,315 $ (49,042,810) For the Year Ended December 31, 2020 Total net revenue $ 187,173,834 $ — $ 187,173,834 Operating income (loss) $ (26,244,100) $ (2,442,662) $ (28,686,762) For the Year Ended December 31, 2019 Total net revenue $ 173,692,897 $ 300,000 $ 173,992,897 Operating income (loss) $ (63,082,583) $ (2,610,740) $ (65,693,323) (1) Includes revenues related to our subscription services program, advertising and marketing fees, and third-party marketplace service fees. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSManagement has evaluated subsequent events to determine if events or transaction occurring through the filing date of this Annual Report on Form 10-K require adjustments to or disclosures in the Company’s Consolidated Financial Statements. The Company did not have any subsequent events that required recognition or disclosure in the Consolidated Financial Statements for the year ended December 31, 2021. |
DESCRIPTION OF BUSINESS AND S_2
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation | Principles of Consolidation — The accompanying Consolidated Financial Statements of Boxed, Inc. include its wholly owned subsidiaries, Boxed, LLC, BOXED MAX LLC, Jubilant LLC, and Ashbrook Commerce Solutions LLC. Any intercompany accounts and transactions have been eliminated in consolidation. |
Basis of Presentation | Basis of Presentation — The Consolidated Financial Statements presented herein are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), as of December 31, 2021 and 2020, and for the years ended December 31, 2021, 2020, and 2019. |
Estimates | Estimates — The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include (i) revenue recognition and deferral in accordance with ASC 606 (ii) acquired intangible assets and goodwill (iii) contingent considerations and (iv) the fair values of derivative instruments within the scope of ASC 815. Historically, prior to becoming a public company, significant estimates also included the fair value of stock options. On a regular basis, management reviews its estimates utilizing currently available information, changes in fact and circumstances, historical experience, and reasonable assumptions. After such review, those estimates are adjusted accordingly. Actual results could differ from those estimates. |
Segment Information | Segment Information — ASC 280, Segment Reporting , establishes standards for reporting information about operating segments in financial statements. The Company operates as two reportable business segments which offer different products and services: 1) Retail — This segment engages in the sale of consumer products and goods in bulk sizes to consumers and business in the continental United States. 2) Software & Services — This segment primarily relates to the Company’s research, development, marketing and production of the Company’s proprietary software for sale to third parties. |
Cash and Cash Equivalents | Cash and Cash Equivalents — The Company considers all highly liquid investments purchased with an original maturity (at the date of purchase) of three months or less to be the equivalent of cash for the purpose of balance sheet presentation. Cash equivalents, which consist primarily of money market accounts, are carried at cost, which approximates market value. |
Restricted Cash | Restricted Cash — The Company's restricted cash is comprised of cash that is restricted as to withdrawal or use under the terms of certain contractual agreements. Restricted cash as of December 31, 2021 was $2,767,471 and consists of collateral for letters of credit related to the Company's relationships with certain product vendors, and letters of credit issued in lieu of deposits on certain real estate and facility leases. |
Accounts Receivable, Net | Accounts Receivable, Net — Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company estimates that the allowance for doubtful accounts based on historical losses, existing economic conditions, and other information available at the balance sheet date. Uncollectible accounts are written off against the allowance after all collection efforts have been exhausted. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments — Assets and liabilities are measured at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The three levels of inputs used to measure fair value are as follows: Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 — Unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable or can be corroborated by observable market data for substantially the full-term of the asset or liability. Level 3 — Unobservable inputs that are supported by little or no market activity that are significant to the fair value of the asset of liability. The hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. |
Concentrations of Risk | Concentrations of Risk — Certain financial instruments potentially subject us to concentrations of credit risk. Financial instruments that subject the Company to credit risk consist of cash and cash equivalents and accounts receivable. The Company’s cash balances are primarily on deposit at high credit quality financial institutions. The cash balances in all accounts held at financial institutions are insured up to $250,000 by the Federal Deposit Insurance Corporation (“FDIC”) through December 31, 2021. At times, cash balances may exceed federally insured amounts and potentially subject the Company to a concentration of credit risk. Management believes that no significant concentration of credit risk exists with respect to these cash balances because of its assessment of the creditworthiness and financial viability of the respective financial institutions. |
Leases | Leases — The Company leases its office facilities and fulfillment centers under operating lease agreements. Rent expense under the Company’s operating leases typically provide for fixed, non-contingent rent escalations. Rent expense is recognized on a straight-line basis over the non-cancellable term of each underlying lease. The Company also receives landlord contributions related to certain lease agreements that are recognized as deferred rent within other current liabilities on the Consolidated Balance Sheets and treated as reductions of rental expense on a straight-line basis over the term of the lease. The lease term begins on the date the Company becomes legally obligated for the rent payments or when it takes possession of the leased space, whichever is earlier. |
Inventories | Inventories — Inventories consisting of finished goods are stated at the lower of cost or net realizable value. Inventory costs are determined using the first in, first out method. Inventory costs include price reductions and allowances offered by vendors. The Company reviews inventories to determine the necessity of write-offs for excess, obsolete, or unsellable inventory. The Company estimates write-offs for inventory obsolescence based on its judgment of future realization. These reviews require the Company to assess customer and market demand. During the year ended December 31, 2021, the Company wrote-down $394,848 of inventory that was estimated to be sold below cost, primarily related to SKUs which were in high demand during the COVID-19 pandemic. There were no material write-offs for the year ended December 31, 2020 and 2019. |
Property, and Equipment, Net | Property and Equipment, Net — Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided for using the straight-line method over the estimated useful lives of the assets, which range from 3 – 7 years (see table below). Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective leases. Improvements are capitalized while expenditures for maintenance and repairs are expensed as incurred. Estimated Useful Lives Leasehold improvements 7 years Warehouse equipment 5 years Computers and small tools 3 years Furniture and fixtures 7 years Capital lease asset 7 years Software development 4 years |
Software Development Costs | Software Development Costs — The Company classifies software development costs as either internal use software or external use software. The Company accounts for costs incurred to develop internal use software in accordance with ASC 350-40, Internal Use Software . Consequently, the Company capitalizes certain external costs and internal labor-related costs associated with the development of its platforms and internal-use software products after the preliminary project stage is complete and until the software is ready for its intended use. Costs incurred in the preliminary stages of development, after the software is ready for its intended use and for maintenance of internal-use software are expensed as incurred. Upgrades and enhancements are capitalized to the extent they will result in added functionality. Capitalized software costs are included in property and equipment, net within the Consolidated Balance Sheets and are amortized over the remaining useful life of four years. In accordance with ASC 985-20, Costs of Software to be Sold, Leased or Marketed , the software development costs incurred in the research and development of software products or the software component of products to be sold, leased, or marketed to external users are expensed as incurred until technological feasibility has been established. Technological feasibility is established upon the completion of a working model. Software development costs incurred after the establishment of technological feasibility and until the product is available for general release are capitalized, provided recoverability is reasonably assured. Software development costs, when material, are stated at the lower of unamortized cost or net realizable value. Net realizable value for each software product is assessed based on anticipated profitability applicable to revenues of the related product in future periods. Amortization of capitalized software costs begins when the related product is available for general release to customers and is provided for using the straight-line method over the estimated life of the respective product. Technological feasibility is typically reached shortly before the release of such products and as a result, development costs that meet the criteria for capitalization were not material for the periods presented in this report. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets — The Company periodically evaluates the need to recognize impairment losses relating to long-lived assets in accordance with ASC 360, Property, Plant, and Equipment |
Deferred Contract Costs | Deferred Contract Costs — The Company defers contract costs when there is a known current obligation that is not yet prepaid. In these instances, the Company records deferred contract costs to recognize the asset in its Consolidated Balance Sheets to offset the Company's related liability. Deferred contract costs as of December 31, 2021 relate to the asset associated with the Company's contract with Palantir as described in Note 9 as well as insurance premiums related to becoming a public company. The related liability was recorded to accounts payable for the remaining commitment as of December 31, 2021. |
Forward Purchase Receivable and Forward Purchase Option Derivative | Forward Purchase Receivable and Forward Purchase Option Derivative — The Company recorded a Forward Purchase Receivable on its Consolidated Balance Sheets of $65,062,414 to account for the Prepayment Amount of the Forward Purchase Agreement, as discussed above within the discussion of the Business Combination. The Prepayment Amount will be held in a deposit account until the Valuation Date (the second anniversary of the closing of the Business Combination, subject to certain acceleration provisions). On the Valuation Date, the Company will receive a pro rata portion of the then remaining Prepayment Amount. As of December 31, 2021, there was $60,050,189 remaining as ACM sold 501,109 shares after Closing. Also in connection with the Forward Purchase Agreement, the Company recognized a liability for a freestanding derivative, referred to herein as the “forward purchase option derivative,” on its Consolidated Balance Sheets. |
Intangible Assets and Goodwill | Intangible Assets and Goodwill — As part of the acquisition of MaxDelivery, LLC, as discussed in Note 10, the Company recorded intangible assets and goodwill on its Consolidated Balance Sheets. The intangible assets acquired relate to MaxDelivery's customer relationships, trademarks, and internally developed technology which were valued via (i) the multi-period excess-earnings method (ii) relief-from-royalty method and (iii) cost replacement method, respectively, all of which are under the income approach in accordance with ASC 805, Business Combinations. Also in accordance with ASC 805 the Company allocated the purchase price to the assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. Any excess of the purchase price over the fair values of assets acquired, including intangibles and liabilities assumed, was recognized as goodwill. As the Company views MaxDelivery as part of its Retail segment, the goodwill recorded is included within its Retail business unit. The Company's goodwill will be subject to annual impairment testing. |
Debt | Debt — The Company defers costs directly associated with acquiring third-party financing. Debt issuance costs related to the Company's long-term debt, including its PIPE Convertible Notes and New Term Loan (as defined in Note 5 and Note 6, respectively), are recorded as a direct deduction from the carrying amount of the debt. |
Equity and Equity Issuance Costs | Equity — Prior to the closing of the Business Combination, the Company’s equity structure consisted of common stock, Series A preferred stock, Series B preferred stock, Series C preferred stock, Series D preferred stock, and Series E preferred stock. The Company analyzed the relevant provisions of ASC 480, Distinguishing Liabilities from Equity Equity Issuance Costs Costs incurred in connection with the issuance of the Company’s series preferred stock have historically been recorded as a direct reduction against preferred stock within the Consolidated Balance Sheets. |
Employee Benefit Plan | Employee Benefit Plan — The Company sponsors a qualified 401(k) defined contribution plan covering eligible employees. Participants may contribute a portion of their annual compensation limited to a maximum annual amount set by the Internal Revenue Service. |
Stock-Based Compensation | Stock-Based Compensation — The Company measures and records the expense related to stock-based awards based upon the fair value at the date of grant. Employee stock-based compensation awards are recorded in accordance with ASC Topic 718, Compensation — Stock Compensation (“ASC 718”). ASC 718 requires all stock-based payments to employees to be recognized as expenses in the consolidated Statements of Operations based on their grant date fair values. The Company has granted stock options, restricted stock units, and restricted stock awards. Restricted stock units and awards are determined based on the fair market value of the common stock on the date of the grant. The use of the Black-Scholes Merton model requires management to make the following assumptions: Expected Volatility — The Company estimated volatility for option grants by evaluating the average historical volatility of a peer group of companies for the period immediately preceding the option grant for a term that is approximately equal to the options’ expected term. Expected Term — Derived from the life of the options granted under the option plan and is based on the simplified method which is essentially the weighted average of the vesting period and contractual term. Risk-Free Interest Rate — The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero-coupon issues with a term that is equal to the options’ expected term at the grant date. Dividend Yield — The Company has not declared or paid dividends to date and does not anticipate declaring dividends. As such, the dividend yield has been estimated to be zero. Prior to becoming a public company, the Company estimated the fair value of common stock. The Board of Directors considered numerous objective and subjective factors to determine the fair value of the Company’s common stock at each meeting in which awards are approved. The factors considered included, but was not limited to: (i) the results of contemporaneous independent third-party valuations of the Company’s common stock; (ii) the prices, rights, preferences, and privileges of the Company’s convertible preferred stock relative to those of its common stock; (iii) the lack of marketability of the Company’s common stock; (iv) actual operating and financial results; (v) current business conditions and projections; (vi) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, given prevailing market conditions; and (vii) precedent transactions involving the Company’s shares. Since the Company's common shares began trading on the New York Stock Exchange, the Company utilizes the closing share trade price of the Company's shares as the fair value of the Company's common stock. |
Net Loss Per Share | Net Loss Per Share — Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, the convertible preferred stock, common stock warrants, preferred stock warrants, PIPE Convertible Notes, and restricted stock units and common stock options outstanding are considered to be potentially dilutive securities for all periods presented, and as a result, diluted net loss per common share is the same as basic net loss per share for those periods. |
Income Taxes | Income Taxes — In accordance with ASC 740, Income Taxes , the Company applies the guidance accounting for uncertainty in income taxes, which prescribes a recognition threshold and a measurement attribute for the combined balance sheet recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination be taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50% likely of being realized upon the ultimate settlement. Deferred tax assets and liabilities are recognized for the future tax consequences attributable between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company records a valuation allowance to reduce deferred income tax assets to the amount that is more likely than not to be realized. |
Revenue Recognition | Revenue Recognition — In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The Company adopted ASU No. 2014-09 and its related amendments (collectively, known as ASC 606, Revenue from Contracts with Customers |
Other Income (Expenses), Net | Other Income (Expense), Net — Other income (expense), net, consists primarily of gains (losses) resulting from fair value valuations and adjustments of warrants and derivatives, including the liability-classified warrants, Sponsor Earnout Shares, forward purchase option derivative, contingent consideration related to the MaxDelivery acquisition, and the prior year convertible note embedded derivative. |
Customer Incentives | Customer Incentives — The Company offers its customers various sales incentives including sales discounts, loyalty rewards, and free items with purchases. The Company records a reduction of net revenue at the time the discount is taken and at the time loyalty rewards are earned. |
Vendor Rebates | Vendor Rebates — The Company has agreements with its suppliers to receive funds for promotions, volume rebates, and marketing. Amounts earned and due from suppliers under these agreements are included in prepaid expenses and other current assets in the Consolidated Balance Sheets. Vendor rebates received by the Company reduce the carrying cost of inventory and are recognized in cost of sales in the Consolidated Statements of Operations when the related inventory is sold. |
Delivery Costs | Delivery Costs — Outbound shipping and handling costs incurred to deliver merchandise to customers amounted to $26,128,045, $25,275,183, and $26,360,878 for the years ended December 31, 2021, 2020, and 2019, respectively and are included in cost of sales in the Consolidated Statements of Operations. |
Cost of Sales | Cost of Sales — Cost of goods sold consists of the costs of merchandise, expenses for shipping to and from clients and inbound freight, inventory write-offs and changes in the Company’s inventory reserve, payment processing fees, and packaging materials costs, offset by vendor funded promotions and various vendor allowances. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expense — Selling, general and administrative expenses consist primarily of salaries and benefits for warehouse employees as well as all regional and home office employees, including buying personnel. Selling, general and administrative expenses also include substantially all building and equipment depreciation, research and development expense, bank service charges, utilities, as well as other operating costs incurred to support e-commerce website operations. |
Research and Development | In accordance with ASC 730-10-25, Research and Development |
Advertising Expense | Advertising Expense — The Company expenses advertising as incurred. |
Recently Adopted and Announced Accounting Pronouncements | Recently Adopted Accounting Pronouncements — In June 2018, the FASB issued Accounting Standards Update ASU 2018-07, Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which simplifies the accounting for stock-based payments granted to nonemployees for goods and services. This guidance will better align the treatment of stock-based payments to nonemployees with the requirements for such stock-based payments granted to employees. The new standard is effective for fiscal years beginning after December 15, 2019 for private companies, including interim periods within such fiscal year. The company has adopted this standard effective January 1, 2020 in the preparation of its Consolidated Financial Statements. The impact of adopting this pronouncement was not material. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which modifies the existing disclosure requirements for fair value measurements in Topic 820. The new disclosure requirements include disclosure related to changes in unrealized gains or losses included in other comprehensive income (loss) for recurring Level 3 fair value measurements held at the end of each reporting period and the explicit requirement to disclose the range and weighted-average of significant unobservable inputs used for Level 3 fair value measurements. The other provisions of ASU 2018-13 include eliminated and modified disclosure requirements. An entity is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption of the additional disclosures until their effective date. For all entities, this guidance is required to be adopted for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The guidance was adopted effective January 1, 2020 and did not have a material impact on the Consolidated Financial Statements and disclosures. In August 2020, the FASB issued ASU 2020-06 — Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) — Accounting For Convertible Instruments and Contracts in an Entity’s Own Equity . The ASU simplifies accounting for convertible instruments by removing major separation models required under current U.S. GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU also simplifies the diluted net income per share calculation in certain areas. The Company early adopted this standard in the first quarter of 2021, effective as of January 1, 2021, on a modified retrospective basis. The effect of this standard was not material to the Company’s Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other-Internal-Use Software (Subtopic 35-40) Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract , which aligns the accounting for implementation costs incurred in a hosting arrangement that does not include a license to internal-use software (a cloud computing arrangement) with one that does. The new standard is effective for fiscal years beginning after December 15, 2020 for private companies, and interim periods within fiscal years beginning after December 15, 2021. The guidance was adopted effective December 31, 2021 and did not have a material impact on the Consolidated Financial Statements and disclosures. Recently Announced Accounting Pronouncements — As an emerging growth company (“EGC”), the Jumpstart Our Business Startup Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act until such time as the Company is no longer considered to be an EGC. Changes to U.S. GAAP are established by the FASB in the form of ASUs to the FASB’s ASC. Management considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the financial position or results of operations of the Company. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This new guidance will change how entities account for credit impairment for trade and other receivables, as well as for certain financial assets and other instruments. ASU 2016-13 will replace the current “incurred loss” model with an “expected loss” model. Under the “incurred loss” model, a loss (or allowance) is recognized only when an event has occurred (such as a payment delinquency) that causes the entity to believe that a loss is probable (i.e., that it has been “incurred”). Under the “expected loss” model, an entity will recognize a loss (or allowance) upon initial recognition of the asset that reflects all future events that will lead to a loss being realized, regardless of whether it is probable that the future event will occur. The “incurred loss” model considers past events and current conditions, while the “expected loss” model includes expectations for the future which have yet to occur. ASU 2016-13 is effective for private companies beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently evaluating the impact of adoption of the new standard on the Consolidated Financial Statements. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (“ASC 740”). This standard simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in ASC 740 related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The standard also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard is effective for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. Early adoption is permitted. The Company is currently evaluating the effect that implementation of this standard will have on the Company’s Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (“ASC 842”), which requires a lessee to recognize in its balance sheet an asset and liability for most leases with a term greater than 12 months. Lessees should recognize a liability to make lease payments and a right-of-use asset representing the lessee’s right to use the underlying asset for the lease term. On June 3, 2020, the FASB deferred the effective date of ASC 842 for private companies to fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. The Company is currently evaluating the impact the adoption of this standard will have on its Consolidated Financial Statements but believes that there will be right of use assets and lease liabilities recognized on the Company’s Consolidated Balance Sheets and an immaterial impact on the Company’s Consolidated Statement of Operations. |
DESCRIPTION OF BUSINESS AND S_3
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule Of Reverse Recapitalization | The following table illustrates the net proceeds to the Company delivered through the Business Combination. Cash - Seven Oaks trust and cash, net of Redemptions $ 77,784,265 Cash - PIPE Equity 32,500,000 Cash - PIPE Convertible Notes 87,500,000 Gross cash proceeds resulting from the Business Combination 197,784,265 Less: combined company transaction costs (47,667,386) Net cash proceeds from the Business Combination 150,116,879 Less: Prepayment Amount pursuant to Forward Purchase Transaction (65,062,414) Cash proceeds, net of the Forward Purchase Transaction Prepayment Amount $ 85,054,465 Further, the following table reconciles the elements of the Business Combination to the Consolidated Statements of Convertible Preferred Stock and Stockholders' Deficit to the Consolidated Statement of Cash Flows as well as to the amounts disclosed herein in Note 1. Cash - Seven Oaks trust and cash, net of Redemptions $ 77,784,265 Cash - PIPE Equity 32,500,000 Less: net impact of reverse recapitalization (38,648,877) Less: transaction costs reclassed or allocated to equity (6,212,454) Reverse recapitalization, net of transaction costs $ 65,422,934 Cash - PIPE Convertible Notes 87,500,000 Less: transaction costs allocated to debt (10,534,127) Plus: noncash assumed warrant liability in reverse recapitalization 17,228,250 Net cash proceeds from the Business Combination on the Statements of Cash Flows $ 159,617,057 Less: transaction costs allocated to derivative instruments and expensed during the year (9,500,178) Net cash proceeds from the Business Combination within Note 1 $ 150,116,879 Less: Prepayment Amount pursuant to Forward Purchase Transaction (65,062,414) Cash proceeds, net of the Forward Purchase Transaction Prepayment Amount $ 85,054,465 |
Schedule of Doubtful Accounts | The Company has recorded an allowance of $95,558, $205,384, and $176,653 as of December 31, 2021, 2020, and 2019, respectively, for doubtful accounts as follows: For the Year Ended December 31, 2021 Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charges to cost and expenses Charged to other accounts Deductions Balance at end of period Reserve for doubtful accounts $ 205,384 — — (109,826) $ 95,558 For the Year Ended December 31, 2020 Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charges to cost and expenses Charged to other accounts Deductions Balance at end of period Reserve for doubtful accounts $ 176,653 28,731 — — $ 205,384 For the Year Ended December 31, 2019 Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charges to cost and expenses Charged to other accounts Deductions Balance at end of period Reserve for doubtful accounts $ 141,282 35,371 — — $ 176,653 |
Schedule of Property, Plant and Equipment | Property and Equipment, Net — Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided for using the straight-line method over the estimated useful lives of the assets, which range from 3 – 7 years (see table below). Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective leases. Improvements are capitalized while expenditures for maintenance and repairs are expensed as incurred. Estimated Useful Lives Leasehold improvements 7 years Warehouse equipment 5 years Computers and small tools 3 years Furniture and fixtures 7 years Capital lease asset 7 years Software development 4 years Property and equipment — net consists of the following as of December 31, 2021 and 2020: December 31, 2021 2020 Leasehold improvements $ 8,715,489 $ 8,147,638 Warehouse equipment 3,056,072 2,192,471 Computers and small tools 1,337,493 1,061,177 Furniture and fixtures 85,480 95,064 Software development 14,090,389 13,608,520 Work in progress 7,066 359,992 27,291,989 25,464,862 Less: Accumulated depreciation and amortization (20,272,651) (15,053,466) Property and equipment, net $ 7,019,338 $ 10,411,396 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and Equipment, Net — Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are provided for using the straight-line method over the estimated useful lives of the assets, which range from 3 – 7 years (see table below). Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the respective leases. Improvements are capitalized while expenditures for maintenance and repairs are expensed as incurred. Estimated Useful Lives Leasehold improvements 7 years Warehouse equipment 5 years Computers and small tools 3 years Furniture and fixtures 7 years Capital lease asset 7 years Software development 4 years Property and equipment — net consists of the following as of December 31, 2021 and 2020: December 31, 2021 2020 Leasehold improvements $ 8,715,489 $ 8,147,638 Warehouse equipment 3,056,072 2,192,471 Computers and small tools 1,337,493 1,061,177 Furniture and fixtures 85,480 95,064 Software development 14,090,389 13,608,520 Work in progress 7,066 359,992 27,291,989 25,464,862 Less: Accumulated depreciation and amortization (20,272,651) (15,053,466) Property and equipment, net $ 7,019,338 $ 10,411,396 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | As of December 31, 2021 and 2020, the major components of prepaid expenses and other current assets consisted of the following: December 31, 2021 2020 Prepaid services 1,918,299 — Vendor funds receivable 1,057,718 866,276 Other prepaid expenses 1,281,799 765,677 Other receivables 657,489 499,942 Total $ 4,915,305 $ 2,131,895 |
OTHER CURRENT LIABILITIES (Tabl
OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Current Liabilities | As of December 31, 2021 and 2020, the major components of other current liabilities consisted of the following: December 31, 2021 2020 Credit card payable $ 13,738,270 $ 10,473,079 Accrued sales tax payable 1,707,557 1,845,831 Deferred rent – short term 450,776 622,940 Credits liability 640,994 633,287 Obligation for equity consideration (1) 3,000,000 — Other accrued liabilities 2,361,545 1,382,927 Total $ 21,899,142 $ 14,958,064 (1) For further detail on the obligation for equity consideration, refer to Note 10. |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Amounts outstanding under long-term term debt, including the PIPE Convertible Notes (discussed in Note 5), consisted of the following as of December 31, 2021 and 2020. The estimated fair value of long-term debt is approximated at its carrying value as of these reporting dates. December 31, 2021 2020 New Term loan, matures August 2025 $ 43,286,747 $ — 7th Amendment term loan, matures December 2022 — 7,500,000 PIPE Convertible Notes 1 77,047,475 — Total debt $ 120,334,222 $ 7,500,000 Less: current portion — (3,750,000) Long-term term loan $ 120,334,222 $ 3,750,000 |
Schedule of Maturities of Long-term Debt | Aggregate maturities of debt as of December 31, 2021 are as follows: 2022 $ — 2023 — 2024 — 2025 43,286,747 2026 77,047,475 Total $ 120,334,222 1 As discussed in Note 5, the PIPE Convertible Notes will mature in 2026, unless earlier repurchased by the Company or converted at the option of the holders. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract Assets and Liabilities | The Company recognizes a contract liability when consideration is received from customers in advance of revenue recognition as described within the revenue streams above. December 31, 2021 2020 Contract assets (unbilled receivables) $ 8,890,888 $ — Contract liabilities (deferred revenue) $ 2,020,351 $ 2,435,909 |
Disaggregation of Revenue | The following table summarizes the Company’s percentage of net Retail revenue disaggregated by sales channel: Years Ended December 31, 2021 2020 2019 Direct Sales (1) $ 139,647,865 $ 176,836,569 $ 143,749,787 Channel Sales (2) $ 17,341,244 $ 10,337,265 $ 30,243,110 Software & Services (3) $ 20,277,568 $ — $ — (1) Direct Sales includes retail direct to consumer sales on the Company’s e-commerce platform. (2) Channel Sales includes retail sales on other third-party platforms. (3) Software & Services includes revenue generated from software licensing agreements. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Loss before Income Taxes | For financial reporting purposes, loss before income taxes, includes the following components: December 31, 2021 2020 2019 Domestic $ (69,222,605) $ (34,436,576) $ (65,402,000) Foreign — — — Loss before income taxes $ (69,222,605) $ (34,436,576) $ (65,402,000) |
Schedule of Total Taxes Allocated to Operations | Total income taxes allocated to operations for the years ended December 31, 2021, 2020, and 2019 were as follows: 2021 Current Deferred Total Federal $ — $ — $ — State — — — Foreign — — — Total $ — $ — $ — 2020 Current Deferred Total Federal $ — $ — $ — State — — — Foreign — — — Total $ — $ — $ — 2019 Current Deferred Total Federal $ — $ — $ — State — — — Foreign — — — Total $ — $ — $ — |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows: December 31, 2021 2020 2019 Federal statutory rate 21.00 % 21.00 % 21.00 % Permanent items (4.74) (2.74) (0.02) State taxes (net of federal benefit) 0.07 0.00 0.00 Deferred rate change 0.00 — (0.02) Valuation allowance (15.79) (17.28) (20.28) Stock-based compensation (0.54) (0.98) (0.68) Total provision and effective tax rate 0.00 % 0.00 % 0.00 % |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to the deferred tax assets and deferred tax liabilities at December 31, 2021 and 2020 are presented below: December 31, 2021 2020 Deferred tax assets: Allowance for doubtful accounts $ 23,161 $ 49,815 Accrued expenses 204,937 220,548 Inventory 101,093 116,354 Deferred rent 109,261 151,089 Lease liability 43,254 62,499 Warrants — 463,701 Stock-based compensation 683,139 202,722 Charitable contributions 564,974 460,274 Net operating losses 82,617,414 71,553,413 Payroll tax deferral 101,126 202,385 Disallowed interest expense 853,857 216,444 Transaction costs 1,528,027 — Total deferred tax assets 86,830,243 73,699,244 Less: valuation allowance (85,757,888) (72,057,082) Net deferred tax assets $ 1,072,355 $ 1,642,162 Deferred tax liabilities: Intangible assets $ (649,050) $ (839,927) Property and equipment (423,305) (802,235) Total deferred tax liabilities $ (1,072,355) $ (1,642,162) Net deferred tax assets/liabilities $ — $ — |
Schedule of Unrecognized Tax Benefits | The following table shows the changes in the gross amount of unrecognized tax benefits as of December 31, 2021, 2020 and 2019: December 31, 2021 2020 2019 Beginning balance $ 1,348,904 $ 1,348,904 $ 1,372,064 Increases based on tax positions during the current period — — 301,847 (Decreases) based on tax positions during the current period — — (325,007) Ending balance $ 1,348,904 $ 1,348,904 $ 1,348,904 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Commitments | Future minimum rental commitments under non-cancelable leases with initial or remaining terms in excess of one year at December 31, 2021 were as follows: Year Lease Obligation 2022 $ 4,478,016 2023 2,919,511 2024 1,742,148 2025 1,768,962 2026 1,710,581 Thereafter 2,921,321 Total $ 15,540,539 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | Preliminary allocations of the purchase price to acquired assets, including goodwill and intangible assets, are presented in the table below: Allocation as of December 31, 2021 Cash consideration $ 4,000,000 Equity consideration 3,000,000 Contingent consideration 1,711,000 Total purchase price consideration $ 8,711,000 Assets and liabilities assumed: Accounts receivable $ 78,980 Other current assets 186,162 Fixed assets 385,243 Intangible assets (1) 1,350,000 Goodwill 7,443,569 Total acquired assets 9,443,954 Accounts payable (585,702) Other current liabilities (147,252) Total allocation of purchase price consideration $ 8,711,000 (1) The fair value of the identifiable intangible assets includes $800,000 for customer relationships and $550,000 for trademarks and technology. The fair values of these intangible assets acquired were determined using various valuation methods under income approach, including the (i) multiple-period excess earnings method (ii) relief-from-royalty method and (iii) cost replacement method, respectively. |
Schedule of Business Acquisition, Pro Forma Information | The following unaudited pro forma financial information presents the combined result of operations as if the acquisition of MaxDelivery had occurred on January 1, 2020. These unaudited pro forma results do not necessarily reflect the actual results of operations that would have been achieved had the acquisition occurred on that date, nor are they necessarily indicative of future results of operations. December 31, 2021 2020 Pro forma net revenue $ 189,283,099 $ 202,341,157 Pro forma net loss $ (69,103,687) $ (34,429,058) |
WARRANTS (Tables)
WARRANTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Warrants and Rights Note Disclosure [Abstract] | |
Schedule of Fair Value inputs and Valuations Techniques | The key assumptions used in the Black-Scholes model were as follows: 2020 2019 Expected volatility 57.0 % 55.0 % Expected term (in years) 1.0 2.0 Risk-free interest rate 1.7 % 1.7 % Expected dividend yield 0.0 % 0.0 % 2020 2019 Expected volatility 60.0 % 45.0 % Expected term (in years) 1.0 2.0 Risk-free interest rate 0.1 % 1.6 % 2020 2019 Expected volatility 60.0 % 45.0 % Expected term (in years) 1.0 2.0 Risk-free interest rate 0.1 % 1.6 % |
STOCKHOLDERS_ DEFICIT AND MEZ_2
STOCKHOLDERS’ DEFICIT AND MEZZANINE EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Schedule of Preferred Stock | , preferred stock consisted of the following: Shares Shares Issued Issuance Price Carrying Value (1) Liquidation Series A-1 4,168,647 4,168,647 $ 1.56 $ 6,490,026 $ 6,489,982 Series A-2 1,893,035 1,893,035 0.58 1,090,840 1,090,820 Series A-3 541,863 541,863 0.83 442,374 442,367 Series B-1 4,870,769 4,870,769 4.72 22,984,122 22,984,071 Series B-2 533,930 533,930 3.78 2,015,647 2,015,641 Series C-1 10,085,422 10,001,485 11.46 114,562,977 114,587,113 Series C-2 982,272 982,272 9.18 9,003,134 9,003,124 Series C-3 1,607,161 559,764 11.46 7,066,283 6,412,106 Series D-1 8,894,451 8,894,451 11.51 97,926,084 102,340,201 Series D-2 2,094,931 2,094,931 10.37 21,694,134 21,694,112 Series E-1 4,020,556 4,020,556 7.47 33,707,750 30,000,000 Series E-2 1,694,223 1,694,223 4.86 8,217,388 8,217,284 41,387,260 40,255,926 $ 325,200,758 (1) Amounts are net of issuance costs and changes in the redemption value of the Series C-3 preferred stock. |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Options Activity | The following is a summary of stock options activity during the years ended December 31, 2021, 2020, and 2019: Number of Weighted Weighted Outstanding as of December 31, 2018 4,331,494 $ 2.43 7.59 Granted 4,342,214 3.37 Exercised (105,867) 1.23 Forfeited (960,475) Outstanding as of December 31, 2019 7,607,366 $ 2.94 8.17 Granted 1,172,294 3.16 Exercised (52,435) 1.07 Forfeited (2,520,076) Outstanding as of December 31, 2020 6,207,149 $ 3.13 7.30 Granted 1,307,713 4.93 Exercised (351,462) 2.14 Forfeited (1,330,881) Outstanding as of December 31, 2021 5,832,519 $ 3.30 5.62 Vested and expected to vest as of December 31, 2021 5,832,519 $ 3.30 5.62 Exercisable as of December 31, 2021 3,872,121 $ 1.35 4.63 |
Schedule of Black-Scholes-Merton Valuation Model for the Value Stock Option Grants | The following key assumptions were used in the Black-Scholes-Merton valuation model for the value stock option grants: 2021 2020 2019 Expected volatility 58.0 % 51.8 % 47.4 % Expected term (in years) 4.41 5.99 5.90 Risk-free interest rate 0.8 % 0.3 % 1.8 % Expected dividend yield 0.0 % 0.0 % 0.0 % |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets and liabilities measured at fair value during the year on a recurring basis consisted of the following as of December 31, 2021, 2020, and 2019: Fair Value Hierarchy December 31, 2021 Level 1 Level 2 Level 3 Assets – cash & cash equivalents $ 105,027,484 $ — $ — Assets – restricted cash 2,767,471 — — Total assets $ 107,794,955 $ — $ — Liabilities: Forward purchase option derivative $ — $ — $ 4,202,562 Earnout liability — — 27,133,563 Public Warrants 15,395,625 — — Private Warrants — 6,649,125 — Total liabilities $ 15,395,625 $ 6,649,125 $ — December 31, 2020 Level 1 Level 2 Level 3 Assets – cash & cash equivalents $ 30,043,046 $ — $ — Total assets $ 30,043,046 $ — $ — Liabilities: Common stock warrants $ — $ — $ 49,863 Preferred stock warrants — — 2,072,536 Total liabilities $ — $ — $ 2,122,399 December 31, 2019 Level 1 Level 2 Level 3 Assets – cash & cash equivalents $ 12,889,931 $ — $ — Total assets $ 12,889,931 $ — $ — Liabilities: Common stock warrants $ — $ — $ 59,624 Preferred stock warrants — — 1,179,201 Total liabilities $ — $ — $ 1,238,825 |
Schedule of Changes in Level 3 Financial Liabilities | The following table represents the changes in these Level 3 financial liabilities for the year ended December 31, 2021: Level 3 Rollforward Common stock warrants Preferred stock warrants Forward purchase option derivative Earnout liability Beginning balances $ 49,863 $ 2,072,536 $ — $ — Additions — — 14,700,778 21,606,062 Changes in fair value 231,149 (1,766,370) (10,498,216) 5,527,501 Reclassified to equity (281,012) (306,166) — — Ending balances $ — $ — $ 4,202,562 $ 27,133,563 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Income (Loss) Per share | The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except share and per share data): For the Years Ended December 31, 2021 2020 2019 Numerator: Net loss $ (69,222,605) $ (34,436,576) $ (65,402,000) Less: accretion adjustment (2,039,144) 1,090,294 1,155,122 Net loss attributable to common shareholders $ (67,183,461) $ (35,526,870) $ (66,557,122) Denominator: Weighted-average shares – basic and diluted 13,063,482 9,348,633 9,261,222 Net loss per common share – basic and diluted $ (5.14) $ (3.80) $ (7.19) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following securities were excluded from the computation of diluted loss per share in the periods presented, as their effect would be anti-dilutive: 2021 2020 2019 Series preferred stock, outstanding — 40,255,926 34,541,150 Common stock warrants, outstanding — 35,717 35,717 Preferred stock warrants, outstanding — 1,188,848 1,188,848 Common stock options, outstanding 5,832,519 6,207,149 7,607,366 PIPE convertible notes, if-converted 1 7,291,667 — — Restricted stock units, outstanding 1,280,000 — — Private warrants, outstanding 12,937,500 — — Public warrants, outstanding 5,587,500 — — 1 The PIPE convertible notes are presented using a conversion rate of $12.00, in line with the if-converted method under ASC 260, Earnings Per Share . |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Reportable Segments | The following table provides information for the Company’s reportable segments, including product category disaggregation for its Retail segment beginning in fiscal year 2021: Information about Reported Segment Profit or Loss Retail Software & Services Total For the Year Ended December 31, 2021 Grocery net revenue $ 98,925,157 $ — $ 98,925,157 Home & Household net revenue 53,352,950 — 53,352,950 Other net revenue (1) 4,711,003 — 4,711,003 Software & Services net revenue — 20,277,567 20,277,567 Total net revenue $ 156,989,110 $ 20,277,567 $ 177,266,677 Operating income (loss) $ (64,863,125) $ 15,820,315 $ (49,042,810) For the Year Ended December 31, 2020 Total net revenue $ 187,173,834 $ — $ 187,173,834 Operating income (loss) $ (26,244,100) $ (2,442,662) $ (28,686,762) For the Year Ended December 31, 2019 Total net revenue $ 173,692,897 $ 300,000 $ 173,992,897 Operating income (loss) $ (63,082,583) $ (2,610,740) $ (65,693,323) (1) Includes revenues related to our subscription services program, advertising and marketing fees, and third-party marketplace service fees. |
DESCRIPTION OF BUSINESS AND S_4
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) | Dec. 09, 2021USD ($) | Dec. 08, 2021USD ($)$ / sharesshares | Nov. 28, 2021USD ($)$ / sharesshares | Aug. 04, 2021USD ($) | Jun. 13, 2021$ / sharesshares | Dec. 31, 2021USD ($)segment$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($) | Jun. 30, 2020USD ($) | Dec. 31, 2018USD ($) |
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Reverse recapitalization, aggregate consideration | $ 550,000,000 | |||||||||
Common stock, shares outstanding (in shares) | shares | 15,554,790 | 66,647,242 | 9,392,361 | |||||||
Number of shares issued (in shares) | shares | 3,250,000 | 3,250,000 | ||||||||
Purchase price, per share (in dollars per share) | $ / shares | $ 10 | |||||||||
Sale of stock (in shares) | shares | 15,554,790 | 66,647,242 | 9,392,361 | |||||||
Forward purchase receivable | $ 65,062,414 | $ 65,062,414 | $ 60,050,189 | $ 0 | ||||||
Reverse recapitalization, cash In trust account | 77,784,265 | |||||||||
Cash - PIPE Equity | $ 120,000,000 | 32,500,000 | ||||||||
Equity | 32,500,000 | |||||||||
Transaction costs | 47,667,386 | 47,667,386 | ||||||||
Payment of Forward Purchase Receivable | $ 65,062,414 | $ 65,062,414 | $ 65,062,414 | $ 0 | $ 0 | |||||
Exchange ratio | 0.9498 | 0.9498 | ||||||||
Ownership percentage | 76.70% | |||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||
Cash and cash equivalents | $ 105,027,484 | $ 30,043,046 | 12,889,931 | |||||||
Restricted cash | 2,767,471 | 0 | ||||||||
Net loss | (69,222,605) | (34,436,576) | (65,402,000) | |||||||
Net cash used in operating activities | $ (53,468,949) | (24,096,484) | (45,880,562) | |||||||
Number of reportable segments | segment | 2 | |||||||||
Credit card receivables | $ 2,317,908 | 2,705,028 | 2,731,111 | |||||||
Allowance for doubtful accounts | 95,558 | 205,384 | 176,653 | $ 141,282 | ||||||
Cash, FDIC insured amount | 250,000 | |||||||||
Inventory write-down | 394,848 | 0 | 0 | |||||||
Interest expense | 2,140,915 | 445,846 | 301,155 | |||||||
Employer contributions | $ 0 | 0 | 0 | |||||||
Expected dividend yield | 0.00% | |||||||||
Cost of sales: | $ 145,388,571 | 161,270,544 | 164,091,469 | |||||||
Research and development expense | 2,018,564 | 2,485,573 | 2,856,051 | |||||||
Advertising expense | 21,959,556 | 4,912,269 | 20,703,071 | |||||||
Future advertising expenses | 78,041 | 9,192 | 500,184 | |||||||
Advisory, legal, accounting And management fees | 4,829,360 | |||||||||
Incremental transaction costs | $ 21,215,856 | |||||||||
Transaction costs related to equity | 6,212,454 | |||||||||
Previously deferred costs | 3,917,093 | |||||||||
Derivative expense | $ 4,469,276 | |||||||||
Software development costs | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Useful life | 4 years | |||||||||
Outbound delivery fees | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Cost of sales: | $ 26,128,045 | $ 25,275,183 | $ 26,360,878 | |||||||
Accounts Receivable | Customer Concentration Risk | Largest Customer | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Concentration risk, percentage | 40.90% | 54.30% | ||||||||
Convertible Debt | PIPE Convertible Notes | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Aggregate principal amount | $ 87,500,000 | $ 87,500,000 | ||||||||
Debt issuance costs | $ 10,534,127 | |||||||||
Secured Debt | Line of Credit | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Aggregate principal amount | $ 45,000,000 | $ 7,500,000 | ||||||||
Debt instrument covenant, minimum unrestricted cash balance | $ 15,000,000 | |||||||||
Debt instrument covenant, retail gross margin percentage | 8.00% | |||||||||
Debt issuance costs | $ 669,677 | |||||||||
Common Class A | ACM | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Number of shares issued (in shares) | shares | 501,109 | |||||||||
Redemption Shareholders | Common Class A | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Common stock, shares outstanding (in shares) | shares | 18,098,335 | |||||||||
Remaining Shareholders | Common Class A | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Common stock, shares outstanding (in shares) | shares | 7,776,665 | |||||||||
Conversion ratio | shares | 1 | |||||||||
Sponsor Members | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Sponsor earnout shares subject to vesting under certain conditions (in shares) | shares | 1,940,625 | |||||||||
Sponsor Members | Common Class B | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Common stock, shares outstanding (in shares) | shares | 6,468,750 | |||||||||
Conversion ratio | shares | 1 | |||||||||
ACM | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Purchase price, per share (in dollars per share) | $ / shares | $ 7 | |||||||||
ACM | Common Class A | ||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||
Purchase price, per share (in dollars per share) | $ / shares | $ 10 | |||||||||
Sale of stock (in shares) | shares | 6,504,768 | |||||||||
Gross proceeds of common stock | $ 65,062,414 | $ 5,012,225 |
DESCRIPTION OF BUSINESS AND S_5
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Business Combination (Details) - USD ($) | Dec. 09, 2021 | Dec. 08, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Cash - Seven Oaks trust and cash, net of Redemptions | $ 77,784,265 | ||||
Cash - PIPE Equity | $ 120,000,000 | 32,500,000 | |||
Proceeds from convertible note issuance | 87,500,000 | $ 0 | $ 8,217,304 | $ 0 | |
Gross cash proceeds resulting from the Business Combination | 197,784,265 | ||||
Less: combined company transaction costs | (47,667,386) | (47,667,386) | |||
Net cash proceeds from the Business Combination | 150,116,879 | ||||
Less: Prepayment Amount pursuant to Forward Purchase Transaction | $ (65,062,414) | (65,062,414) | $ (65,062,414) | $ 0 | $ 0 |
Cash proceeds, net of the Forward Purchase Transaction Prepayment Amount | $ 85,054,465 |
DESCRIPTION OF BUSINESS AND S_6
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reconciliation of Elements of the Business Combination (Details) - USD ($) | Dec. 09, 2021 | Dec. 08, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Cash - Seven Oaks trust and cash, net of Redemptions | $ 77,784,265 | ||||
Cash - PIPE Equity | $ 120,000,000 | 32,500,000 | |||
Less: net impact of reverse recapitalization | (38,648,877) | ||||
Less: transaction costs reclassed or allocated to equity | (6,212,454) | ||||
Reverse recapitalization, net of transaction costs | 65,422,934 | ||||
Proceeds from convertible note issuance | 87,500,000 | $ 0 | $ 8,217,304 | $ 0 | |
Less: transaction costs allocated to debt | (10,534,127) | ||||
Plus: noncash assumed warrant liability in reverse recapitalization | 17,228,250 | ||||
Net cash proceeds from the Business Combination on the Statements of Cash Flows | 159,617,057 | 159,617,056 | 0 | 0 | |
Less: transaction costs allocated to derivative instruments and expensed during the year | (9,500,178) | ||||
Net cash proceeds from the Business Combination within Note 1 | 150,116,879 | ||||
Less: Prepayment Amount pursuant to Forward Purchase Transaction | $ (65,062,414) | (65,062,414) | $ (65,062,414) | $ 0 | $ 0 |
Cash proceeds, net of the Forward Purchase Transaction Prepayment Amount | $ 85,054,465 |
DESCRIPTION OF BUSINESS AND S_7
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Allowance for Doubtful Accounts (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Reserve for doubtful accounts, Balance at beginning of period | $ 205,384 | $ 176,653 | $ 141,282 |
Charges to cost and expenses | 0 | 28,731 | 35,371 |
Charged to other accounts | 0 | 0 | 0 |
Deductions | (109,826) | 0 | 0 |
Reserve for doubtful accounts, Balance at end of period | $ 95,558 | $ 205,384 | $ 176,653 |
DESCRIPTION OF BUSINESS AND S_8
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment, Net (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 3 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 7 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 7 years |
Warehouse equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 5 years |
Computers and small tools | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 3 years |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 7 years |
Capital lease asset | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 7 years |
Software development | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Lives | 4 years |
PROPERTY AND EQUIPMENT - Schedu
PROPERTY AND EQUIPMENT - Schedule of Property and Equipment (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 27,291,989 | $ 25,464,862 |
Less: Accumulated depreciation and amortization | (20,272,651) | (15,053,466) |
Property and equipment, net | 7,019,338 | 10,411,396 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 8,715,489 | 8,147,638 |
Warehouse equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 3,056,072 | 2,192,471 |
Computers and small tools | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,337,493 | 1,061,177 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 85,480 | 95,064 |
Software development | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 14,090,389 | 13,608,520 |
Work in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 7,066 | $ 359,992 |
PROPERTY AND EQUIPMENT - Narrat
PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization | $ 4,496,519 | $ 4,785,778 | $ 4,377,731 |
Amortization related to software development costs | $ 1,678,704 | $ 2,081,625 | $ 1,983,936 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid services | $ 1,918,299 | $ 0 |
Vendor funds receivable | 1,057,718 | 866,276 |
Other prepaid expenses | 1,281,799 | 765,677 |
Other receivables | 657,489 | 499,942 |
Total | $ 4,915,305 | $ 2,131,895 |
OTHER CURRENT LIABILITIES - Com
OTHER CURRENT LIABILITIES - Components of Other Current Liabilities (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Credit card payable | $ 13,738,270 | $ 10,473,079 |
Accrued sales tax payable | 1,707,557 | 1,845,831 |
Deferred rent – short term | 450,776 | 622,940 |
Credits liability | 640,994 | 633,287 |
Obligation for equity consideration | 3,000,000 | 0 |
Other accrued liabilities | 2,361,545 | 1,382,927 |
Total | $ 21,899,142 | $ 14,958,064 |
CONVERTIBLE NOTES (Details)
CONVERTIBLE NOTES (Details) | Dec. 08, 2021USD ($)d$ / shares | May 29, 2020USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 09, 2021USD ($) |
Debt Instrument [Line Items] | ||||||
Transaction costs related to debt | $ 10,534,127 | |||||
Loss on extinguishment of convertible note | $ 0 | $ 102,972 | $ 0 | |||
Exchange ratio | 0.9498 | 0.9498 | ||||
Convertible Debt | PIPE Convertible Notes | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 87,500,000 | $ 87,500,000 | ||||
Stated interest rate percentage | 7.00% | |||||
Conversion ratio | 0.08333 | |||||
Conversion price (in dollars per share) | $ / shares | $ 12 | |||||
Debt instrument, repurchase price percentage | 101.00% | |||||
Threshold percentage of stock price trigger | 130.00% | |||||
Threshold trading days | d | 20 | |||||
Threshold consecutive trading days | d | 30 | |||||
Accrued interest | $ 391,319 | |||||
Transaction costs related to debt | $ 10,534,127 | |||||
Debt issuance costs, amortization period | 4 years 11 months 12 days | |||||
Convertible Debt | Convertible Promissory Notes | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 8,215,000 | |||||
Stated interest rate percentage | 0.25% | |||||
Debt instrument term (in years) | 2 years | |||||
Debt instrument maturity trigger, minimum equity proceeds required inclusive of proceeds from note conversion | $ 25,000,000 | |||||
Loss on embedded derivative | 4,323,770 | |||||
Loss on extinguishment of convertible note | $ 102,972 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - USD ($) | Aug. 04, 2021 | Jul. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | May 31, 2018 | May 22, 2018 | Dec. 22, 2016 | Jun. 24, 2015 |
Debt Instrument [Line Items] | ||||||||||
Total borrowings | $ 120,334,222 | $ 7,500,000 | ||||||||
Loss on extinguishment of convertible note | $ 0 | $ 102,972 | $ 0 | |||||||
Credit Agreement Warrants | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Warrant issued (in shares) | 12,500 | 10,000 | 15,107 | |||||||
Exercise price (in dollars per share) | $ 3.04 | $ 2.33 | $ 0.95 | |||||||
Term Loan Warrants | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Warrant issued (in shares) | 126,993 | |||||||||
Exercise price (in dollars per share) | $ 7.0871 | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 0 | |||||||||
Line of Credit | Prime Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate | 3.25% | 3.25% | ||||||||
Secured Debt | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Aggregate principal amount | $ 45,000,000 | $ 7,500,000 | ||||||||
Proceeds from term loan | $ 2,367,500 | 5,132,500 | ||||||||
Total borrowings | $ 7,500,000 | |||||||||
Debt instrument covenant, minimum unrestricted cash balance | $ 15,000,000 | |||||||||
Debt instrument covenant, retail gross margin percentage | 8.00% | |||||||||
Repayment of term loan | $ 5,000,000 | |||||||||
Loss on extinguishment of convertible note | $ 202,723 | |||||||||
Secured Debt | Line of Credit | London Interbank Offered Rate (LIBOR) | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate | 8.50% | |||||||||
Secured Debt | Line of Credit | Federal Funds Effective Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate | 0.50% | |||||||||
Secured Debt | Line of Credit | Prime Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate | 0.50% | |||||||||
Letter of Credit | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 4,000,000 | $ 4,000,000 | $ 11,000,000 | |||||||
Current borrowing capacity | $ 2,767,471 | $ 2,571,667 |
DEBT - Amounts Outstanding Unde
DEBT - Amounts Outstanding Under Long Term Debt (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 | Jul. 31, 2020 |
Debt Instrument [Line Items] | |||
Total | $ 120,334,222 | $ 7,500,000 | |
Less: current portion | 0 | (3,750,000) | |
Long-term term loan | 120,334,222 | 3,750,000 | |
Secured Debt | Line of Credit | |||
Debt Instrument [Line Items] | |||
Total | $ 7,500,000 | ||
Secured Debt | New Term loan, matures August 2025 | Line of Credit | |||
Debt Instrument [Line Items] | |||
Total | 43,286,747 | 0 | |
Secured Debt | 7th Amendment term loan, matures December 2022 | Line of Credit | |||
Debt Instrument [Line Items] | |||
Total | 0 | 7,500,000 | |
Convertible Debt | PIPE Convertible Notes | |||
Debt Instrument [Line Items] | |||
Total | $ 77,047,475 | $ 0 |
DEBT - Aggregate Principal Matu
DEBT - Aggregate Principal Maturities of Debt (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Maturities of Long-term Debt [Abstract] | ||
2022 | $ 0 | |
2023 | 0 | |
2024 | 0 | |
2025 | 43,286,747 | |
2026 | 77,047,475 | |
Total | $ 120,334,222 | $ 7,500,000 |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Disaggregation of Revenue [Line Items] | |||
Contract liabilities (deferred revenue) | $ 2,020,351 | $ 2,435,909 | |
Total net revenue | $ 177,266,677 | 187,173,834 | $ 173,992,897 |
Number of reportable segments | segment | 2 | ||
Subscription Sales | |||
Disaggregation of Revenue [Line Items] | |||
Membership term | 12 months | ||
Contract liabilities (deferred revenue) | $ 751,989 | 728,207 | 308,406 |
Outbound delivery fees | |||
Disaggregation of Revenue [Line Items] | |||
Total net revenue | 1,452,400 | 3,735,551 | 1,798,394 |
Marketing fees | |||
Disaggregation of Revenue [Line Items] | |||
Total net revenue | $ 1,518,533 | $ 1,486,848 | $ 1,393,871 |
REVENUE RECOGNITION- Performanc
REVENUE RECOGNITION- Performance Obligations (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2021 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Floor license fees | $ 10,500,000 | |
Implementation Fee | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 1,667,755 | |
Revenue performance obligation period | 5 years | |
Maintenance | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 1,103,226 | |
Revenue performance obligation period | 5 years | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Implementation Fee | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 1,667,755 | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 12 months | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Maintenance | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 240,000 | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 12 months |
REVENUE RECOGNITION - Contract
REVENUE RECOGNITION - Contract Assets and Liabilities (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets (unbilled receivables) | $ 8,890,888 | $ 0 |
Contract liabilities (deferred revenue) | $ 2,020,351 | $ 2,435,909 |
REVENUE RECOGNITION - Revenue D
REVENUE RECOGNITION - Revenue Disaggregation (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Total net revenue | $ 177,266,677 | $ 187,173,834 | $ 173,992,897 |
Direct Sales | |||
Disaggregation of Revenue [Line Items] | |||
Total net revenue | 139,647,865 | 176,836,569 | 143,749,787 |
Channel Sales | |||
Disaggregation of Revenue [Line Items] | |||
Total net revenue | 17,341,244 | 10,337,265 | 30,243,110 |
Software & Services | |||
Disaggregation of Revenue [Line Items] | |||
Total net revenue | $ 20,277,568 | $ 0 | $ 0 |
INCOME TAXES - Schedule of Loss
INCOME TAXES - Schedule of Loss before Income Tax (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (69,222,605) | $ (34,436,576) | $ (65,402,000) |
Foreign | 0 | 0 | 0 |
Loss before income taxes | $ (69,222,605) | $ (34,436,576) | $ (65,402,000) |
INCOME TAXES - Schedule of Comp
INCOME TAXES - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Federal | |||
Federal income tax, current | $ 0 | $ 0 | $ 0 |
Federal income tax, deferred | 0 | 0 | 0 |
Federal income tax | 0 | 0 | 0 |
State | |||
State income tax, current | 0 | 0 | 0 |
State income tax, deferred | 0 | 0 | 0 |
State income tax | 0 | 0 | 0 |
Foreign | |||
Foreign income tax, current | 0 | 0 | 0 |
Foreign income tax, deferred | 0 | 0 | 0 |
Foreign income tax | 0 | 0 | 0 |
Current | 0 | 0 | 0 |
Deferred | 0 | 0 | 0 |
Total | $ 0 | $ 0 | $ 0 |
INCOME TAXES - Schedule of Effe
INCOME TAXES - Schedule of Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 21.00% | 21.00% | 21.00% |
Permanent items | (4.74%) | (2.74%) | (0.02%) |
State taxes (net of federal benefit) | 0.07% | 0.00% | 0.00% |
Deferred rate change | 0.00% | 0.00% | (0.02%) |
Valuation allowance | (15.79%) | (17.28%) | (20.28%) |
Stock-based compensation | (0.54%) | (0.98%) | (0.68%) |
Total provision and effective tax rate | (0.00%) | (0.00%) | (0.00%) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2021 | |
Operating Loss Carryforwards [Line Items] | |||
Social security tax, employer, deferral, CARES Act | $ 834,430 | ||
Increase in valuation allowance | $ 13,700,805 | $ 6,796,688 | |
Unrecognized tax benefits that would impact effective tax rate | 0 | 0 | |
Unrecognized tax benefits, income tax penalties and interest accrued | 0 | 0 | |
Domestic Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 299,375,124 | 345,369,901 | |
Operating loss carryforwards, subject to expiration | 161,064,722 | ||
State and Local Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | $ 158,533,956 | $ 184,664,686 |
INCOME TAXES - Schedule of Defe
INCOME TAXES - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 23,161 | $ 49,815 |
Accrued expenses | 204,937 | 220,548 |
Inventory | 101,093 | 116,354 |
Deferred rent | 109,261 | 151,089 |
Lease liability | 43,254 | 62,499 |
Warrants | 0 | 463,701 |
Stock-based compensation | 683,139 | 202,722 |
Charitable contributions | 564,974 | 460,274 |
Net operating losses | 82,617,414 | 71,553,413 |
Payroll tax deferral | 101,126 | 202,385 |
Disallowed interest expense | 853,857 | 216,444 |
Transaction costs | 1,528,027 | 0 |
Total deferred tax assets | 86,830,243 | 73,699,244 |
Less: valuation allowance | (85,757,888) | (72,057,082) |
Net deferred tax assets | 1,072,355 | 1,642,162 |
Deferred tax liabilities: | ||
Intangible assets | (649,050) | (839,927) |
Property and equipment | (423,305) | (802,235) |
Total deferred tax liabilities | (1,072,355) | (1,642,162) |
Net deferred tax assets/liabilities | $ 0 | $ 0 |
INCOME TAXES - Schedule of Unre
INCOME TAXES - Schedule of Unrecognized Tax Benefits (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 1,348,904 | $ 1,348,904 | $ 1,372,064 |
Increases based on tax positions during the current period | 0 | 0 | 301,847 |
(Decreases) based on tax positions during the current period | 0 | 0 | (325,007) |
Ending balance | $ 1,348,904 | $ 1,348,904 | $ 1,348,904 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Schedule of Future Minimum Rental Commitments (Details) | Dec. 31, 2021USD ($) |
Lease Obligation | |
2022 | $ 4,478,016 |
2023 | 2,919,511 |
2024 | 1,742,148 |
2025 | 1,768,962 |
2026 | 1,710,581 |
Thereafter | 2,921,321 |
Total | $ 15,540,539 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Narrative (Details) | Dec. 08, 2021USD ($)shares | Jun. 13, 2021USD ($)$ / sharesshares | Dec. 31, 2021USD ($)commitment_period | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 01, 2021USD ($) |
Loss Contingencies [Line Items] | ||||||
Operating lease rent expense | $ 3,323,677 | $ 3,202,308 | $ 3,004,423 | |||
Loss contingency, estimate of possible loss | 1,348,904 | $ 1,348,904 | ||||
Number of shares issued (in shares) | shares | 3,250,000 | 3,250,000 | ||||
Share price (in dollars per share) | $ / shares | $ 10 | |||||
Amount due | $ 15,000,000 | |||||
Palantir Technologies Inc | ||||||
Loss Contingencies [Line Items] | ||||||
Master Subscription Agreement, contractual amount | $ 20,000,000 | $ 20,000,000 | ||||
Service agreements, term (years) | 5 years | |||||
Prepayment of Master Subscription Agreement | $ 4,000,000 | |||||
Google LLC | Google Cloud Platform | ||||||
Loss Contingencies [Line Items] | ||||||
Number of commitment periods | commitment_period | 3 | |||||
Term of other commitment | 12 months | |||||
Commitment first year | $ 2,000,000 | |||||
Commitment second year | $ 4,500,000 | |||||
Commitment third year | $ 8,500,000 | |||||
Other commitment | $ 15,000,000 | |||||
Private Placement | Palantir Technologies Inc | Common Class A | ||||||
Loss Contingencies [Line Items] | ||||||
Number of shares issued (in shares) | shares | 2,000,000 | |||||
Share price (in dollars per share) | $ / shares | $ 10 | |||||
Aggregate consideration | $ 20,000,000 |
ACQUISITIONS- Narrative (Detail
ACQUISITIONS- Narrative (Details) - USD ($) | Dec. 09, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition, Contingent Consideration [Line Items] | ||||
Contingent consideration | $ 1,711,000 | $ 0 | $ 0 | |
MaxDelivery LLC | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Cash - PIPE Convertible Notes | $ 4,000,000 | 4,000,000 | ||
Equity consideration | 3,000,000 | 3,000,000 | ||
Contingent consideration | $ 1,711,000 | 1,711,000 | ||
Acquisition related transaction costs | $ 92,322 |
ACQUISITIONS - Schedule of Allo
ACQUISITIONS - Schedule of Allocations of the Purchase Price (Details) - USD ($) | Dec. 09, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Combination, Consideration Transferred | ||||
Contingent consideration | $ 1,711,000 | $ 0 | $ 0 | |
Assets and liabilities assumed: | ||||
Goodwill | 7,443,569 | $ 0 | ||
MaxDelivery LLC | ||||
Business Combination, Consideration Transferred | ||||
Cash - PIPE Convertible Notes | $ 4,000,000 | 4,000,000 | ||
Equity consideration | 3,000,000 | 3,000,000 | ||
Contingent consideration | $ 1,711,000 | 1,711,000 | ||
Total purchase price consideration | 8,711,000 | |||
Assets and liabilities assumed: | ||||
Accounts receivable | 78,980 | |||
Other current assets | 186,162 | |||
Fixed assets | 385,243 | |||
Intangible assets | 1,350,000 | |||
Goodwill | 7,443,569 | |||
Total acquired assets | 9,443,954 | |||
Accounts payable | (585,702) | |||
Other current liabilities | (147,252) | |||
Total allocation of purchase price consideration | 8,711,000 | |||
MaxDelivery LLC | Customer Relationships | ||||
Assets and liabilities assumed: | ||||
Total allocation of purchase price consideration | 800,000 | |||
MaxDelivery LLC | Trademarks And Technology | ||||
Assets and liabilities assumed: | ||||
Total allocation of purchase price consideration | $ 550,000 |
ACQUISITIONS - Schedule of Busi
ACQUISITIONS - Schedule of Business Acquisition, Pro Forma Information (Details) - MaxDelivery LLC - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||
Pro forma net revenue | $ 189,283,099 | $ 202,341,157 |
Pro forma net loss | $ (69,103,687) | $ (34,429,058) |
FORWARD PURCHASE AGREEMENT (Det
FORWARD PURCHASE AGREEMENT (Details) - USD ($) | Dec. 08, 2021 | Nov. 28, 2021 | Jun. 13, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Sale of stock (in shares) | 15,554,790 | 66,647,242 | 9,392,361 | ||
Share price (in dollars per share) | $ 10 | ||||
Exercise of stock, price per share return (in dollars per share) | $ 10 | ||||
Number of shares issued (in shares) | 3,250,000 | 3,250,000 | |||
Common Class A | ACM | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Number of shares issued (in shares) | 501,109 | ||||
ACM | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Share price (in dollars per share) | 7 | ||||
Share price (in dollars per share) | $ 12 | ||||
ACM | Common Class A | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Sale of stock (in shares) | 6,504,768 | ||||
Gross proceeds of common stock | $ 65,062,414 | $ 5,012,225 | |||
Share price (in dollars per share) | $ 10 | ||||
Number of trading days | 20 days | ||||
Number of consecutive trading days | 30 days | ||||
Sale of stock, VWAP trigger price floor (in dollars per share) | $ 5 | ||||
Fees per share (in dollars per share) | $ 0.20 |
Warrants - Narrative (Details)
Warrants - Narrative (Details) | Dec. 08, 2021USD ($)$ / sharesshares | Dec. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 09, 2021 | Aug. 04, 2021$ / sharesshares | Jun. 30, 2020shares | Apr. 30, 2016$ / sharesshares |
Class of Warrant or Right [Line Items] | |||||||||
Common stock, shares issued (in shares) | 15,554,790 | 66,647,242 | 9,392,361 | ||||||
Exchange ratio | 0.9498 | 0.9498 | |||||||
Change in fair value of warrant liabilities | $ | $ 3,281,279 | $ 883,573 | $ (178,668) | ||||||
Warrants to purchase common shares | $ | 0 | 49,863 | $ 59,624 | ||||||
Warrants to purchase preferred shares | $ | $ 0 | $ 2,072,536 | |||||||
Common Stock Warrants | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 37,607 | 37,607 | 37,607 | 37,607 | |||||
Number of warrants surrendered (in shares) | 7,965 | ||||||||
Change in fair value of warrant liabilities | $ | $ 132,672 | ||||||||
Common Stock Warrants, Tranche One | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Common stock, shares issued (in shares) | 29,546 | ||||||||
Exercise price (in dollars per share) | $ / shares | $ 2.01 | ||||||||
Common Stock Warrants, Tranche Two | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Common stock, shares issued (in shares) | 96 | ||||||||
Exercise price (in dollars per share) | $ / shares | $ 0.95 | ||||||||
Series E-1 Preferred Warrants | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Exercise price (in dollars per share) | $ / shares | $ 7.0871 | ||||||||
Number of warrants surrendered (in shares) | 94,760 | ||||||||
Warrant issued (in shares) | 126,993 | 126,993 | |||||||
Preferred stock, shares issued (in shares) | 32,233 | ||||||||
Series C-1 Preferred Warrants | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 88,361 | 88,361 | |||||||
Exercise price (in dollars per share) | $ / shares | $ 10.88 | ||||||||
Change in fair value of warrant liabilities | $ | $ (66,271) | $ 13,254 | $ 52,183 | ||||||
Warrant issued (in shares) | 88,361 | ||||||||
Warrants to purchase preferred shares | $ | $ 153,748 | $ 87,477 | |||||||
Series C-3 Preferred Warrants | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 1,102,752 | 1,102,752 | |||||||
Exercise price (in dollars per share) | $ / shares | $ 10.88 | ||||||||
Change in fair value of warrant liabilities | $ | $ (827,064) | $ 165,413 | |||||||
Warrants to purchase preferred shares | $ | $ 1,918,788 | $ 1,091,724 | |||||||
Warrants converted (in shares) | 1,102,752 | ||||||||
Public and Private Warrants | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 18,525,000 | ||||||||
Common stock, shares issued (in shares) | 1 | ||||||||
Exercise price (in dollars per share) | $ / shares | $ 11.50 | ||||||||
Public Warrants | IPO | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 12,937,500 | ||||||||
Private Warrants | Private Placement | |||||||||
Class of Warrant or Right [Line Items] | |||||||||
Warrants to purchase common stock outstanding ( in shares) | 5,587,500 |
WARRANTS - Significant Inputs t
WARRANTS - Significant Inputs to the Warrant Valuation (Details) | Dec. 31, 2020yr | Dec. 31, 2019yr |
Common Stock Warrants | Expected volatility | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.570 | 0.550 |
Common Stock Warrants | Expected term (in years) | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 1 | 2 |
Common Stock Warrants | Risk-free interest rate | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.017 | 0.017 |
Common Stock Warrants | Expected dividend yield | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0 | 0 |
Series C-1 Preferred Warrants | Expected volatility | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.600 | 0.450 |
Series C-1 Preferred Warrants | Expected term (in years) | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 1 | 2 |
Series C-1 Preferred Warrants | Risk-free interest rate | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.001 | 0.016 |
Series C-3 Preferred Warrants | Expected volatility | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.600 | 0.450 |
Series C-3 Preferred Warrants | Expected term (in years) | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 1 | 2 |
Series C-3 Preferred Warrants | Risk-free interest rate | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.001 | 0.016 |
STOCKHOLDERS_ DEFICIT AND MEZ_3
STOCKHOLDERS’ DEFICIT AND MEZZANINE EQUITY - Narrative (Details) | 12 Months Ended | ||||
Dec. 31, 2021USD ($)directorvotemember$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 08, 2021$ / sharesshares | Dec. 31, 2019shares | Dec. 31, 2018shares | |
Class of Stock [Line Items] | |||||
Common stock, shares authorized (in shares) | 600,000,000 | 66,486,210 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Common stock, shares outstanding (in shares) | 66,647,242 | 9,392,361 | 15,554,790 | ||
Number of votes per share | vote | 1 | ||||
Convertible preferred stock, shares authorized (in shares) | 60,000,000 | 41,387,260 | |||
Convertible preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||
Conversion of preferred stock (in shares) | 41,289,869 | ||||
Convertible preferred stock, shares outstanding (in shares) | 0 | 40,255,926 | 34,541,150 | 33,672,045 | |
Dividend rate | 6.00% | ||||
Dividends | $ | $ 0 | ||||
Preferred stock, conversion, minimum proceeds from initial public offering | $ | $ 50,000,000 | ||||
Number of members on board of directors | member | 8 | ||||
Number of directors to be selected by holders of common stock | director | 4 | ||||
Series B preferred stock | |||||
Class of Stock [Line Items] | |||||
Number of directors to be selected by holders of stock series | director | 1 | ||||
Series C with exception of Series C-3 | |||||
Class of Stock [Line Items] | |||||
Number of directors to be selected by holders of stock series | director | 1 | ||||
Series D-1 | |||||
Class of Stock [Line Items] | |||||
Convertible preferred stock, shares authorized (in shares) | 8,894,451 | ||||
Convertible preferred stock, shares outstanding (in shares) | 8,894,451 | ||||
Number of directors to be selected by holders of stock series | director | 2 |
STOCKHOLDERS_ DEFICIT AND MEZ_4
STOCKHOLDERS’ DEFICIT AND MEZZANINE EQUITY - Schedule of Preferred Stock (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 60,000,000 | 41,387,260 | ||
Issued (in shares) | 40,255,926 | |||
Outstanding (in shares) | 0 | 40,255,926 | 34,541,150 | 33,672,045 |
Carrying value | $ 0 | $ 325,200,758 | $ 282,185,326 | $ 271,051,511 |
Series A-1 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 4,168,647 | |||
Issued (in shares) | 4,168,647 | |||
Outstanding (in shares) | 4,168,647 | |||
Issuance Price Per Share | $ 1.56 | |||
Carrying value | $ 6,490,026 | |||
Liquidation Preference | $ 6,489,982 | |||
Series A-2 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 1,893,035 | |||
Issued (in shares) | 1,893,035 | |||
Outstanding (in shares) | 1,893,035 | |||
Issuance Price Per Share | $ 0.58 | |||
Carrying value | $ 1,090,840 | |||
Liquidation Preference | $ 1,090,820 | |||
Series A-3 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 541,863 | |||
Issued (in shares) | 541,863 | |||
Outstanding (in shares) | 541,863 | |||
Issuance Price Per Share | $ 0.83 | |||
Carrying value | $ 442,374 | |||
Liquidation Preference | $ 442,367 | |||
Series B-1 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 4,870,769 | |||
Issued (in shares) | 4,870,769 | |||
Outstanding (in shares) | 4,870,769 | |||
Issuance Price Per Share | $ 4.72 | |||
Carrying value | $ 22,984,122 | |||
Liquidation Preference | $ 22,984,071 | |||
Series B-2 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 533,930 | |||
Issued (in shares) | 533,930 | |||
Outstanding (in shares) | 533,930 | |||
Issuance Price Per Share | $ 3.78 | |||
Carrying value | $ 2,015,647 | |||
Liquidation Preference | $ 2,015,641 | |||
Series C-1 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 10,085,422 | |||
Issued (in shares) | 10,001,485 | |||
Outstanding (in shares) | 10,001,485 | |||
Issuance Price Per Share | $ 11.46 | |||
Carrying value | $ 114,562,977 | |||
Liquidation Preference | $ 114,587,113 | |||
Series C-2 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 982,272 | |||
Issued (in shares) | 982,272 | |||
Outstanding (in shares) | 982,272 | |||
Issuance Price Per Share | $ 9.18 | |||
Carrying value | $ 9,003,134 | |||
Liquidation Preference | $ 9,003,124 | |||
Series C-3 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 1,607,161 | |||
Issued (in shares) | 559,764 | |||
Outstanding (in shares) | 559,764 | |||
Issuance Price Per Share | $ 11.46 | |||
Carrying value | $ 7,066,283 | |||
Liquidation Preference | $ 6,412,106 | |||
Series D-1 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 8,894,451 | |||
Issued (in shares) | 8,894,451 | |||
Outstanding (in shares) | 8,894,451 | |||
Issuance Price Per Share | $ 11.51 | |||
Carrying value | $ 97,926,084 | |||
Liquidation Preference | $ 102,340,201 | |||
Series D-2 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 2,094,931 | |||
Issued (in shares) | 2,094,931 | |||
Outstanding (in shares) | 2,094,931 | |||
Issuance Price Per Share | $ 10.37 | |||
Carrying value | $ 21,694,134 | |||
Liquidation Preference | $ 21,694,112 | |||
Series E-1 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 4,020,556 | |||
Issued (in shares) | 4,020,556 | |||
Outstanding (in shares) | 4,020,556 | |||
Issuance Price Per Share | $ 7.47 | |||
Carrying value | $ 33,707,750 | |||
Liquidation Preference | $ 30,000,000 | |||
Series E-2 | ||||
Class of Stock [Line Items] | ||||
Shares authorized (in shares) | 1,694,223 | |||
Issued (in shares) | 1,694,223 | |||
Outstanding (in shares) | 1,694,223 | |||
Issuance Price Per Share | $ 4.86 | |||
Carrying value | $ 8,217,388 | |||
Liquidation Preference | $ 8,217,284 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2021USD ($)executive_officershares | Dec. 31, 2021USD ($)executive_officerplan$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options granted, weighted average grant date fair value (in dollars per share) | $ / shares | $ 3.59 | $ 1.44 | $ 1.49 | |
Options, unrecognized compensation expense | $ | $ 3,994,756 | $ 3,994,756 | $ 3,490,761 | $ 6,321,143 |
Unrecognized expense expected period for recognition | 1 year 1 month 2 days | 1 year 3 months 10 days | 1 year 4 months 20 days | |
Options exercised, intrinsic value | $ | $ 4,054,823 | $ 109,880 | $ 277,155 | |
Options vested, fair value | $ | $ 1,414,334 | 2,558,269 | 1,581,077 | |
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 4 years | |||
Award expiration period | 10 years | |||
Stock-based compensation expense | $ | $ 2,492,533 | $ 1,956,009 | $ 2,286,349 | |
Incremental expense | $ | $ 356,937 | |||
Stock options | First anniversary | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 25.00% | |||
Stock options | 36 Months following first anniversary | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 36 months | |||
Award vesting percentage | 75.00% | |||
Restricted stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Non-option awards granted (in shares) | shares | 0 | 0 | 0 | |
Restricted stock units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Restricted stock units (RSUs) | Executive Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of executive officers granted awards | executive_officer | 2 | 2 | ||
Awards vested ( in shares) | shares | 0 | |||
Time-Based RSUs | Executive Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Stock-based compensation expense | $ | $ 119,941 | |||
Unrecognized expense expected period for recognition | 2 years 11 months 8 days | |||
Non-option awards granted (in shares) | shares | 510,000 | |||
Non-option awards, unrecognized compensation expense | $ | 5,964,359 | $ 5,964,359 | ||
Price-Target RSUs | Executive Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ | $ 1,035,944 | |||
Unrecognized expense expected period for recognition | 10 months 24 days | |||
Non-option awards granted (in shares) | shares | 770,000 | |||
Non-option awards, unrecognized compensation expense | $ | $ 4,732,496 | $ 4,732,496 | ||
ESPP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of common stock reserved for future issuance (in shares) | shares | 2,004,969 | 2,004,969 | ||
Increase in shares available for issuance as a percentage | 1.00% | |||
Number of shares issued for option exercises and restricted stock purchase agreements (in shares) | shares | 0 | |||
2013 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of equity incentive plans | plan | 1 | |||
Number of shares issued for option exercises and restricted stock purchase agreements (in shares) | shares | 1,280,000 | |||
2021 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of common stock reserved for future issuance (in shares) | shares | 10,024,848 | 10,024,848 | ||
Increase in shares available for issuance as a percentage | 5.00% | |||
Number of shares available for grant (in shares) | shares | 8,744,848 | 8,744,848 |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of Stock Options Activity (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Shares | ||||
Beginning balance (in shares) | 6,207,149 | 7,607,366 | 4,331,494 | |
Granted (in shares) | 1,307,713 | 1,172,294 | 4,342,214 | |
Exercised (in shares) | (351,462) | (52,435) | (105,867) | |
Forfeited (in shares) | (1,330,881) | (2,520,076) | (960,475) | |
Ending balance (in shares) | 5,832,519 | 6,207,149 | 7,607,366 | 4,331,494 |
Vested and expected to vest as of December 31, 2021 (in shares) | 5,832,519 | |||
Exercisable as of December 31, 2021 (in shares) | 3,872,121 | |||
Weighted Average Exercise Price | ||||
Beginning balance (in dollars per share) | $ 3.13 | $ 2.94 | $ 2.43 | |
Granted (in dollars per share) | 4.93 | 3.16 | 3.37 | |
Exercised (in dollars per share) | 2.14 | 1.07 | 1.23 | |
Ending balance (in dollars per share) | 3.30 | $ 3.13 | $ 2.94 | $ 2.43 |
Vested and expected to vest as of December 31, 2021 (in dollars per share) | 3.30 | |||
Exercisable as of December 31, 2021 (in dollars per share) | $ 1.35 | |||
Weighted Average Remaining Contractual Life | ||||
Options outstanding, weighted average remaining contractual life | 5 years 7 months 13 days | 7 years 3 months 18 days | 8 years 2 months 1 day | 7 years 7 months 2 days |
Options vested and expected to vest, outstanding, weighted average remaining contractual life | 5 years 7 months 13 days | |||
Options exercisable, weighted average remaining contractual life | 4 years 7 months 17 days |
STOCK-BASED COMPENSATION - Sc_2
STOCK-BASED COMPENSATION - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividend yield | 0.00% | ||
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 58.00% | 51.80% | 47.40% |
Expected term (in years) | 4 years 4 months 28 days | 5 years 11 months 26 days | 5 years 10 months 24 days |
Risk-free interest rate | 0.80% | 0.30% | 1.80% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Level 1 | |||
Assets: | |||
Assets – cash & cash equivalents | $ 105,027,484 | $ 30,043,046 | $ 12,889,931 |
Assets – restricted cash | 2,767,471 | ||
Total assets | 107,794,955 | 30,043,046 | 12,889,931 |
Liabilities: | |||
Forward purchase option derivative | 0 | ||
Earnout liability | 0 | ||
Total liabilities | 15,395,625 | 0 | 0 |
Level 1 | Public Warrants | |||
Liabilities: | |||
Warrant liabilities | 15,395,625 | ||
Level 1 | Private Warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | ||
Level 1 | Common stock warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | 0 | |
Level 1 | Preferred stock warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | 0 | |
Level 2 | |||
Assets: | |||
Assets – cash & cash equivalents | 0 | 0 | 0 |
Assets – restricted cash | 0 | ||
Total assets | 0 | 0 | 0 |
Liabilities: | |||
Forward purchase option derivative | 0 | ||
Earnout liability | 0 | ||
Total liabilities | 6,649,125 | 0 | 0 |
Level 2 | Public Warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | ||
Level 2 | Private Warrants | |||
Liabilities: | |||
Warrant liabilities | 6,649,125 | ||
Level 2 | Common stock warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | 0 | |
Level 2 | Preferred stock warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | 0 | |
Level 3 | |||
Assets: | |||
Assets – cash & cash equivalents | 0 | 0 | 0 |
Assets – restricted cash | 0 | ||
Total assets | 0 | 0 | 0 |
Liabilities: | |||
Forward purchase option derivative | 4,202,562 | ||
Earnout liability | 27,133,563 | ||
Total liabilities | 0 | 2,122,399 | 1,238,825 |
Level 3 | Public Warrants | |||
Liabilities: | |||
Warrant liabilities | 0 | ||
Level 3 | Private Warrants | |||
Liabilities: | |||
Warrant liabilities | $ 0 | ||
Level 3 | Common stock warrants | |||
Liabilities: | |||
Warrant liabilities | 49,863 | 59,624 | |
Level 3 | Preferred stock warrants | |||
Liabilities: | |||
Warrant liabilities | $ 2,072,536 | $ 1,179,201 |
FAIR VALUE MEASUREMENTS - Sch_2
FAIR VALUE MEASUREMENTS - Schedule of Changes in Level 3 Financial Liabilities (Details) | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Forward purchase option derivative | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balances | $ 0 |
Additions | 14,700,778 |
Changes in fair value | (10,498,216) |
Reclassified to equity | 0 |
Ending balances | 4,202,562 |
Earnout liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balances | 0 |
Additions | 21,606,062 |
Changes in fair value | 5,527,501 |
Reclassified to equity | 0 |
Ending balances | 27,133,563 |
Common stock warrants | Warrant liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balances | 49,863 |
Additions | 0 |
Changes in fair value | 231,149 |
Reclassified to equity | (281,012) |
Ending balances | 0 |
Preferred stock warrants | Warrant liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balances | 2,072,536 |
Additions | 0 |
Changes in fair value | (1,766,370) |
Reclassified to equity | (306,166) |
Ending balances | $ 0 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value Disclosures [Abstract] | ||
Warrants to purchase preferred shares | $ 0 | $ 2,072,536 |
NET LOSS PER SHARE - Schedule o
NET LOSS PER SHARE - Schedule of Computation of Basic and Diluted Income (Loss) Per share (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | |||
Net loss | $ (69,222,605) | $ (34,436,576) | $ (65,402,000) |
Less: accretion adjustment | (2,039,144) | 1,090,294 | 1,155,122 |
Net loss attributable to common shareholders, basic | (67,183,461) | (35,526,870) | (66,557,122) |
Net loss attributable to common shareholders, diluted | $ (67,183,461) | $ (35,526,870) | $ (66,557,122) |
Denominator: | |||
Weighted - average shares - basic (in shares) | 13,063,482 | 9,348,633 | 9,261,222 |
Weighted - average shares - diluted (in shares) | 13,063,482 | 9,348,633 | 9,261,222 |
Net loss per common share - basic (in dollars per share) | $ (5.14) | $ (3.80) | $ (7.19) |
Net loss per common share - diluted (in dollars per share) | $ (5.14) | $ (3.80) | $ (7.19) |
NET LOSS PER SHARE - Schedule_2
NET LOSS PER SHARE - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 08, 2021 | |
Convertible Debt | PIPE Convertible Notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Conversion price (in dollars per share) | $ 12 | |||
Series preferred stock, outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 40,255,926 | 34,541,150 | |
Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 per share | Common stock warrants, outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 35,717 | 35,717 | |
Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 per share | Preferred stock warrants, outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 1,188,848 | 1,188,848 | |
Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 per share | Private warrants, outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 12,937,500 | 0 | 0 | |
Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 per share | Public warrants, outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 5,587,500 | 0 | 0 | |
Common stock options, outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 5,832,519 | 6,207,149 | 7,607,366 | |
Restricted stock units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 1,280,000 | 0 | 0 | |
Convertible Debt Securities | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 7,291,667 | 0 | 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | Feb. 12, 2021USD ($) | Dec. 08, 2021USD ($) | Dec. 31, 2021director | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 09, 2021 |
Related Party Transaction [Line Items] | ||||||
Exchange ratio | 0.9498 | 0.9498 | ||||
Advisory Services | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transactions with related party | $ 300,000 | |||||
Affiliated Entity | Implementation Services for AEON | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from performance obligations | $ 7,300,000 | |||||
Affiliated Entity | Implementation Services for AEON Malaysia | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from performance obligations | 4,500,000 | |||||
Affiliated Entity | Maintenance Services for AEON Malaysia | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from transactions with related party, per month | $ 20,000 | |||||
Series C-1 | ||||||
Related Party Transaction [Line Items] | ||||||
Number of directors to be selected by holders of stock series | director | 1 | |||||
Series C-1 | Majority Shareholder | Inventory | ||||||
Related Party Transaction [Line Items] | ||||||
Purchases from related party | $ 11,752,870 | $ 12,880,934 | 13,879,944 | |||
Series C-1 | Majority Shareholder | Rebates and Incentives | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from related parties | 214,258 | 908,867 | 1,674,169 | |||
Series D-1 | ||||||
Related Party Transaction [Line Items] | ||||||
Number of directors to be selected by holders of stock series | director | 2 | |||||
Series D-1 | Shareholder | Inventory | ||||||
Related Party Transaction [Line Items] | ||||||
Purchases from related party | 1,930,888 | 3,878,138 | 2,267,312 | |||
Series D-1 | Shareholder | Rebates and Incentives | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from related parties | $ 2,276,366 | 25,937 | 230,848 | |||
Series D-1 | Shareholder | Dunnage | ||||||
Related Party Transaction [Line Items] | ||||||
Purchases from related party | $ 2,729,376 | $ 2,747,384 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Segment Reporting Information [Line Items] | ||||
Total net revenue | $ 177,266,677 | $ 187,173,834 | $ 173,992,897 | |
Operating income (loss) | (49,042,810) | (28,686,762) | (65,693,323) | |
Grocery net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 98,925,157 | |||
Home & Household net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 53,352,950 | |||
Other net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 4,711,003 | |||
Software & Services net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 20,277,567 | |||
Retail | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 156,989,110 | 187,173,834 | 173,992,897 | |
Operating income (loss) | (64,863,125) | (26,244,100) | (63,082,583) | |
Retail | Grocery net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 98,925,157 | |||
Retail | Home & Household net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 53,352,950 | |||
Retail | Other net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 4,711,003 | |||
Retail | Software & Services net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 0 | |||
Retail | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 173,692,897 | |||
Software & Services | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | [1] | 20,277,567 | 0 | 0 |
Operating income (loss) | 15,820,315 | $ (2,442,662) | (2,610,740) | |
Software & Services | Grocery net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 0 | |||
Software & Services | Home & Household net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 0 | |||
Software & Services | Other net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 0 | |||
Software & Services | Software & Services net revenue | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | $ 20,277,567 | |||
Software & Services | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | $ 300,000 | |||
[1] | For information related to related party transactions, see Note 17 |