Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 10, 2023 | Jun. 30, 2022 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-40276 | ||
Entity Registrant Name | Semrush Holdings, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 84-4053265 | ||
Entity Address, Address Line One | 800 Boylston Street, Suite 2475 | ||
Entity Address, City or Town | Boston | ||
Entity Address, State or Province | MA | ||
Entity Address, Postal Zip Code | 02199 | ||
City Area Code | (800) | ||
Local Phone Number | 851-9959 | ||
Title of 12(b) Security | Class A Common Stock, $0.00001 par value per share | ||
Trading Symbol | SEMR | ||
Security Exchange Name | NYSE | ||
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 | $ 380.9 | ||
Documents Incorporated by Reference | Portions of the registrant's definitive Proxy Statement for the 2023 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant's fiscal year ended December 31, 2022. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001831840 | ||
Class A Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 118,056,519 | ||
Class B Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 23,657,057 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | Boston, Massachusetts |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 79,765 | $ 269,665 |
Short-term investments | 157,774 | 0 |
Accounts receivable | 3,559 | 2,190 |
Deferred contract costs, current portion | 6,974 | 6,338 |
Prepaid expenses and other current assets | 9,307 | 5,345 |
Total current assets | 257,379 | 283,538 |
Property and equipment, net | 8,076 | 8,270 |
Operating lease right-of-use assets | 12,009 | 0 |
Intangible assets, net | 10,286 | 2,925 |
Goodwill | 6,529 | 1,991 |
Deferred contract costs, net of current portion | 2,082 | 2,254 |
Other long-term assets | 2,329 | 1,096 |
Total assets | 298,690 | 300,074 |
Current liabilities | ||
Accounts payable | 15,495 | 9,942 |
Accrued expenses | 17,847 | 19,479 |
Deferred revenue | 49,354 | 40,232 |
Current portion of operating lease liabilities | 3,694 | 0 |
Other current liabilities | 2,311 | 1,896 |
Total current liabilities | 88,701 | 71,549 |
Deferred revenue, net of current portion | 122 | 237 |
Deferred tax liability | 11 | 268 |
Operating lease liabilities, net of current portion | 8,929 | 0 |
Other long-term liabilities | 1,023 | 2,478 |
Total liabilities | 98,786 | 74,532 |
Commitments and contingencies (Note 13) | ||
Stockholders’ equity | ||
Undesignated preferred stock, $0.00001 par value — 100,000 shares authorized, and no shares issued or outstanding as of December 31, 2022 or 2021 | 0 | 0 |
Additional paid-in capital | 274,057 | 264,871 |
Accumulated other comprehensive deficit | (1,206) | (230) |
Accumulated deficit | (72,948) | (39,100) |
Total stockholders’ equity | 199,904 | 225,542 |
Total liabilities and stockholders’ equity | 298,690 | 300,074 |
Class A Common Stock | ||
Stockholders’ equity | ||
Common stock | 0 | 0 |
Class B Common Stock | ||
Stockholders’ equity | ||
Common stock | $ 1 | $ 1 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, issued (in shares) | 43,743,000 | 31,842,000 |
Common stock, outstanding (in shares) | 43,743,000 | 31,842,000 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 160,000,000 | 160,000,000 |
Common stock, issued (in shares) | 97,897,000 | 108,975,000 |
Common stock, outstanding (in shares) | 97,844,000 | 108,870,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||
Revenue | $ 254,316 | $ 188,001 | $ 124,875 |
Cost of revenue | 48,553 | 41,934 | 29,930 |
Gross profit | 205,763 | 146,067 | 94,945 |
Operating expenses | |||
Sales and marketing | 126,889 | 81,122 | 54,518 |
Research and development | 41,204 | 24,322 | 17,528 |
General and administrative | 62,779 | 43,116 | 29,044 |
Exit costs | 11,264 | 0 | 0 |
Total operating expenses | 242,136 | 148,560 | 101,090 |
Loss from operations | (36,373) | (2,493) | (6,145) |
Other income (expense), net | 3,456 | (522) | (290) |
Loss before income taxes | (32,917) | (3,015) | (6,435) |
Provision for income taxes | 931 | 270 | 577 |
Net loss | $ (33,848) | $ (3,285) | $ (7,012) |
Net loss per share attributable to common stockholders—basic and diluted: | |||
Basic (in dollars per share) | $ (0.24) | $ (0.03) | $ (0.07) |
Diluted (in dollars per share) | $ (0.24) | $ (0.03) | $ (0.07) |
Weighted-average number of shares of common stock used in computing net loss per share attributable to common stockholders—basic and diluted: | |||
Basic (in shares) | 141,160 | 126,586 | 94,803 |
Diluted (in shares) | 141,160 | 126,586 | 94,803 |
Other comprehensive loss | |||
Foreign currency translation adjustments | $ (851) | $ (230) | $ 0 |
Unrealized loss on investments | (125) | 0 | 0 |
Comprehensive loss | $ (34,824) | $ (3,515) | $ (7,012) |
CONSOLIDATED STATEMENTS OF REDE
CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Underwriters' Option | Follow-on Public Offering | Common Stock | Additional Paid-in Capital | Additional Paid-in Capital Underwriters' Option | Additional Paid-in Capital Follow-on Public Offering | Accumulated Other Comprehensive Loss | Accumulated Deficit | Series A | Series A-1 | Series B Preferred Stock | Class A Common Stock | Class A Common Stock Common Stock | Class A Common Stock Common Stock Underwriters' Option | Class A Common Stock Common Stock Follow-on Public Offering | Class B Common Stock | Class B Common Stock Common Stock |
Beginning balance (in shares) at Dec. 31, 2019 | 3,379,400 | 1,837,600 | ||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ 7,789 | $ 10,270 | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 3,379,400 | 1,837,600 | ||||||||||||||||
Ending balance at Dec. 31, 2020 | $ 7,789 | $ 10,270 | ||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 4,681,400 | |||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 94,592,700 | 0 | 0 | |||||||||||||||
Beginning balance at Dec. 31, 2019 | $ (1,159) | $ 0 | $ 3,644 | $ 0 | $ (28,803) | $ 24,000 | $ 0 | $ 0 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Issuance of common stock upon exercise of stock options (in shares) | 457,341 | |||||||||||||||||
Issuance of common stock upon exercise of stock options | 252 | 252 | ||||||||||||||||
Stock-based compensation expense | 1,079 | 1,079 | ||||||||||||||||
Cumulative translation adjustment | 0 | |||||||||||||||||
Unrealized loss on investments | 0 | |||||||||||||||||
Net loss | (7,012) | (7,012) | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 4,681,400 | |||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 95,050,041 | 0 | 0 | |||||||||||||||
Ending balance at Dec. 31, 2020 | (6,840) | $ 0 | 4,975 | 0 | (35,815) | $ 24,000 | $ 0 | $ 0 | ||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||||||
Conversion of preferred stock (in shares) | (3,379,400) | (1,837,600) | ||||||||||||||||
Conversion of preferred stock | $ (7,789) | $ (10,270) | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 0 | 0 | ||||||||||||||||
Ending balance at Dec. 31, 2021 | $ 0 | $ 0 | ||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Issuance of common stock upon exercise of stock options (in shares) | 1,194,918 | |||||||||||||||||
Issuance of common stock upon exercise of stock options | 1,327 | 1,327 | ||||||||||||||||
Conversion of stock (in shares) | 29,695,200 | (4,681,400) | 17,121,795 | (17,121,795) | ||||||||||||||
Conversion of preferred stock | 18,058 | 42,058 | $ (24,000) | |||||||||||||||
Issuance of Class A Common Stock (in shares) | 10,000,000 | 719,266 | 4,000,000 | |||||||||||||||
Issuance of Class A Common Stock | 126,622 | $ 9,245 | $ 77,903 | 126,622 | $ 9,245 | $ 77,903 | ||||||||||||
Reclassification of Common Stock to Class B Common Stock in connection with the initial public offering (in shares) | (124,745,241) | 124,745,241 | ||||||||||||||||
Reclassification of Common Stock to Class B Common Stock in connection with the initial public offering | 0 | (1) | $ 1 | |||||||||||||||
Vesting of Common Stock (in shares) | 51,762 | |||||||||||||||||
Stock-based compensation expense | 2,742 | 2,742 | ||||||||||||||||
Cumulative translation adjustment | (230) | (230) | ||||||||||||||||
Unrealized loss on investments | 0 | |||||||||||||||||
Net loss | $ (3,285) | (3,285) | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 0 | 0 | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 0 | 31,842,000 | 31,841,061 | 108,870,000 | 108,870,126 | |||||||||||||
Ending balance at Dec. 31, 2021 | $ 225,542 | $ 0 | 264,871 | (230) | (39,100) | $ 0 | $ 0 | $ 1 | ||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 0 | 0 | ||||||||||||||||
Ending balance at Dec. 31, 2022 | $ 0 | $ 0 | ||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Issuance of common stock upon exercise of stock options (in shares) | 681,860 | 681,860 | ||||||||||||||||
Issuance of common stock upon exercise of stock options | $ 981 | 981 | ||||||||||||||||
Conversion of stock (in shares) | 11,078,315 | (11,078,315) | ||||||||||||||||
Vesting of Common Stock (in shares) | 77,182 | 51,759 | ||||||||||||||||
Issuance of shares in connection with Employee Stock Purchase Plan (in shares) | 64,756 | |||||||||||||||||
Issuance of shares in connection with Employee Stock Purchase Plan | 758 | 758 | ||||||||||||||||
Stock-based compensation expense | 7,447 | 7,447 | ||||||||||||||||
Cumulative translation adjustment | (851) | (851) | ||||||||||||||||
Unrealized loss on investments | (125) | (125) | ||||||||||||||||
Net loss | $ (33,848) | (33,848) | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 0 | 0 | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 0 | 43,743,000 | 43,743,174 | 97,844,000 | 97,843,570 | |||||||||||||
Ending balance at Dec. 31, 2022 | $ 199,904 | $ 0 | $ 274,057 | $ (1,206) | $ (72,948) | $ 0 | $ 0 | $ 1 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Activities | |||
Net loss | $ (33,848) | $ (3,285) | $ (7,012) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Depreciation and amortization expense | 6,650 | 3,535 | 1,484 |
Intangible asset impairment expense | 642 | 0 | 0 |
Amortization of deferred contract costs | 8,988 | 6,489 | 4,623 |
Non-cash lease expense | 4,520 | 0 | 0 |
Loss on disposal of subsidiaries | 1,738 | 0 | 0 |
Stock-based compensation expense | 7,393 | 2,742 | 1,079 |
Non-cash interest expense | 242 | 211 | 0 |
Changes in fair value of convertible debt securities | (1,152) | 0 | 0 |
Deferred taxes | (253) | 59 | (90) |
Changes in operating assets and liabilities: | |||
Accounts receivable | (3,317) | (791) | 738 |
Deferred contract costs | (9,452) | (9,362) | (6,637) |
Prepaid expenses and other current assets | (2,446) | (2,784) | (70) |
Accounts payable | 6,793 | 1,527 | 1,825 |
Accrued expenses | (848) | 11,613 | 2,501 |
Other current liabilities | (394) | 0 | 0 |
Deferred revenue | 9,133 | 13,807 | 6,914 |
Other long-term liabilities | 94 | 0 | 497 |
Change in operating lease liability | (4,107) | 0 | 0 |
Net cash (used in) provided by operating activities | (9,624) | 23,761 | 5,852 |
Investing Activities | |||
Purchases of property and equipment | (4,234) | (2,380) | (2,367) |
Purchases of short-term investments | (157,899) | 0 | 0 |
Purchases of convertible debt securities | (2,000) | (500) | 0 |
Capitalization of internal-use software development costs | (1,706) | (1,403) | (1,032) |
Cash paid for acquisition of businesses, net of cash acquired | (13,993) | (350) | (2,685) |
Net cash used in investing activities | (179,832) | (4,633) | (6,084) |
Financing Activities | |||
Proceeds from exercise of stock options | 981 | 1,327 | 252 |
Proceeds from issuance of shares in connection with Employee Stock Purchase Plan | 758 | 0 | 0 |
Payment of finance leases | (2,084) | (1,373) | 0 |
Payment of deferred offering costs | 0 | 0 | (1,924) |
Net proceeds from completing public offerings | 0 | 215,370 | 0 |
Net cash (used in) provided by financing activities | (345) | 215,324 | (1,672) |
Effect of exchange rate changes on cash and cash equivalents | (275) | (230) | 0 |
(Decrease) increase in cash, cash equivalents and restricted cash | (190,076) | 234,222 | (1,904) |
Cash, cash equivalents and restricted cash, beginning of year | 269,841 | 35,619 | 37,523 |
Cash, cash equivalents and restricted cash, end of year | 79,765 | 269,841 | 35,619 |
Supplemental cash flow disclosures | |||
Cash paid for interest | 229 | 321 | 0 |
Cash paid for income taxes | 603 | 248 | 583 |
Deferred offering costs incurred and not paid | 0 | 0 | 243 |
Credit facility costs incurred and not paid | 0 | 0 | 303 |
Accrued purchase consideration | 0 | 0 | 497 |
Acquisition of fixed assets under finance leases | 1,050 | 5,750 | 0 |
Unrealized loss on short-term investments | 125 | 0 | 0 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 5,567 | 0 | 0 |
Reduction of right-of-use assets and lease liabilities due to lease modifications | 1,278 | 0 | 0 |
Reclassification of deferred rent liability to right-of-use assets upon adoption of ASC 842 | 213 | 0 | 0 |
Right-of-use assets and lease liabilities recorded upon adoption of ASC 842 | $ 12,579 | $ 0 | $ 0 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Description of Business Semrush Holdings, Inc. (“Semrush Holdings”) and its subsidiaries (together the “Company”, or “Semrush”) provide an online visibility management software-as-a-service (“SaaS”) platform. The Company’s platform enables its subscribers to improve their online visibility and drive traffic, including on their websites and social media pages, and distribute highly relevant content to their customers on a targeted basis across various channels to drive high-quality traffic and measure the effectiveness of their digital marketing campaigns. The Company is headquartered in Boston, Massachusetts, and has wholly owned subsidiaries in Armenia, Canada, Cyprus, the Czech Republic, Germany, the Netherlands, Poland, Spain, Serbia, and the United States. The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development that could affect future operations and financial performance. These risks include, but are not limited to, rapid technological change, competitive pressure from substitute products or larger companies, protection of proprietary technology, management of international activities, the need to obtain additional financing to support growth, and dependence on third parties and key individuals. Effects of the Russian Military Action in Ukraine Economic, civil, military, and political uncertainty exists and may increase in many of the regions where the Company operates and derives its revenue. Several countries in which the Company operates are experiencing and may continue to experience military action and civil and political unrest as a result of such action. The Company has significant development operations in the emerging market economies of Eastern Europe and more than half of the Company’s full-time employees were historically located in Russia. In late February 2022, Russian military forces launched significant military action against Ukraine, and sustained conflict and disruption in the region has been ongoing and is likely to continue. The impact to Ukraine and Russia, as well as actions taken by other countries, including new and stricter sanctions by Canada, the United Kingdom, the European Union, the U.S. and other countries and organizations against officials, individuals, regions, and industries in Russia, Ukraine and Belarus, and each country’s potential response to such sanctions, tensions, and military actions could have a material adverse effect on the Company’s operations. Any such material adverse effect from the conflict, enhanced sanctions activity, and subsequent responses may disrupt the Company’s relationships with its vendors, disrupt its delivery of services, cause the Company to shift all or portions of its work occurring in the region to other countries, and may restrict the Company’s ability to engage in certain projects in the region. During the second quarter of 2022, the Company began a large-scale relocation effort of its Russia-based workforce to other jurisdictions. The Company’s exit from Russia was substantially completed by December 31, 2022. See Note 7 for additional information on the costs associated with such relocation efforts. Sale of the Company’s Russian Subsidiaries On August 3, 2022, the Company completed the sale of its two Russian subsidiaries, Semrush RU Ltd. and Semrush SM Ltd., in connection with the winding down of its operations in Russia. The Company received an insignificant amount of consideration in connection with the sale of these two subsidiaries. See Note 7 for further detail on the sale of the Company’s Russian subsidiaries. Effects of COVID-19 The Company considered the potential effects of the COVID-19 pandemic on the Company. In March 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic, and numerous new strains of COVID-19 have subsequently spread throughout the world. COVID-19 has continued to impact market and economic conditions globally. In an attempt to limit the spread of the virus, various governmental restrictions have been implemented, including restrictions with respect to business activities and travel restrictions, and “shelter–at–home” orders, that have had and may continue to have an adverse impact on the Company’s business and operations. In light of the evolving nature of COVID-19 and the uncertainty it has produced around the world, it is not possible to predict the COVID-19 pandemic’s cumulative and ultimate impact on the Company’s future business operations, results of operations, financial position, liquidity, and cash flows. The extent of the impact of the pandemic on the Company’s business and financial results will depend largely on future developments, including the duration of the spread of the outbreak both globally and within the U.S., the impact on capital, foreign currencies exchange and financial markets, and governmental or regulatory orders that impact the Company’s business, all of which are highly uncertain and cannot be predicted. As of December 31, 2022, the Company has experienced long lead times for hardware affected by a semiconductor shortage attributed to the COVID-19 pandemic which may affect its ability to timely furnish the infrastructure within its data centers. The Company will continue to actively monitor the current international and domestic impacts of and responses to COVID-19 and its related risks. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The accompanying consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the consolidated financial statements. The Company believes that a significant accounting policy is one that is both important to the portrayal of the Company’s financial condition and results, and requires management’s most difficult, subjective, or complex judgments, often as the result of the need to make estimates about the effect of matters that are inherently uncertain. Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates relied upon in preparing these consolidated financial statements include, but are not limited to, revenue recognition, expected future cash flows used to evaluate the recoverability of long-lived assets, contingent liabilities, expensing and capitalization of research and development costs for internal-use software, the average period of benefit associated with costs capitalized to obtain revenue contracts, the determination of the fair value of stock-based awards issued, stock-based compensation expense, the determination of the estimated fair value of the convertible notes held by the Company, the valuations of the intangible assets acquired through acquisitions, the estimation of the Company’s incremental borrowing rate, and the recoverability of the Company’s net deferred tax assets and related valuation allowance. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results may differ from management’s estimates if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. Subsequent Events Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. See Note 17. Revenue Recognition The Company primarily derives revenue from subscription revenues via the Semrush online visibility management platform and the Prowly public relations platform, which are comprised of subscription fees from customers accessing the Company’s SaaS services and related customer support. For the years ended December 31, 2022, 2021, and 2020, subscription revenue accounted for nearly all of the Company’s revenue. Revenue related to other revenue was not material for the years ended December 31, 2022, 2021 and 2020. The Company offers subscriptions to its platform primarily on a monthly or annual basis. The Company sells its products and services primarily through a self-service model and also directly through its sales force. The Company’s subscription arrangements provide customers the right to access the Company’s hosted software applications. Customers do not have the right to take possession of the Company’s software during the hosting arrangement. Subscriptions are generally non-cancellable during the contractual subscription term; however, subscription contracts contain a right to a refund if requested within seven days of purchase. The Company recognizes revenue in accordance with ASC 606. Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration it expects to receive in exchange for those products or services. To achieve the core principle of ASC 606, the Company performs the following steps: 1) Identify the contract(s) with a customer; 2) Identify the performance obligations in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) the Company satisfies a performance obligation. The Company recognizes subscription and support revenue ratably over the term of the contract, beginning on the date the customer is provided access to the Company’s service. These subscriptions are generally stand-ready obligations as the customer has access to the service throughout the term of the subscription, and the Company’s performance obligations are satisfied with the customer over time. The Company considers the SaaS services and related support services to have the same pattern of transfer to the customer. As such, they are accounted for as a single performance obligation. Amounts that have been invoiced are recorded in accounts receivable and in deferred revenue or revenue, depending on whether the revenue recognition criteria have been met. The Company primarily invoices and collects payments from customers for its services in advance on a monthly or annual basis. Deferred revenue represents amounts billed for which revenue has not yet been recognized. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current deferred revenue, and the remaining portion is recorded as long-term deferred revenue. Deferred revenue increased by $9,007 and $13,809 during the years ended December 31, 2022 and 2021, respectively. During the years ended December 31, 2022, 2021, and 2020, $40,232, $26,537, and $19,218 of revenue was recognized that was included in deferred revenue at the beginning of each respective period. The Company has elected to exclude amounts charged to customers for sales tax from the transaction price. Accordingly, revenue is presented net of any sales tax collected from customers. Transaction Price Allocated to Future Performance Obligations ASC 606 requires that the Company disclose the aggregate amount of the transaction price that is allocated to performance obligations that have not yet been satisfied as of the balance sheet dates reported. For contracts with an original expected duration greater than one year, the aggregate amount of the transaction price allocated to the performance obligations that were unsatisfied as of December 31, 2022 was $654, which the Company expects to recognize over the next 12 months. For contracts with an original expected duration of one year or less, the Company has applied the practical expedient available under ASC 606 to not disclose the amount of transaction price allocated to unsatisfied performance obligations as of December 31, 2022. For performance obligations not satisfied as of December 31, 2022, and to which this expedient applies, the nature of the performance obligations is consistent with performance obligations satisfied as of December 31, 2022. The remaining durations are less than one year. Costs to Obtain a Contract The incremental direct costs of obtaining a contract, which primarily consist of sales commissions paid for new subscription contracts, are deferred and recorded as deferred contract costs in the consolidated balance sheet and are amortized over a period of approximately 24 months on a systematic basis, consistent with the pattern of transfer of the goods or services to which the asset relates. The 24-month period represents the estimated benefit period of the customer relationship and has been determined by taking into consideration the type of product sold, the commitment term of the customer contract, the nature of the Company’s technology development life-cycle, and an estimated customer relationship period based on historical experience and future expectations. Deferred contract costs that will be recorded as expense during the succeeding 12-month period are recorded as current deferred contract costs, and the remaining portion is recorded as deferred contract costs, net of current portion. Amortization of deferred contract costs is included in sales and marketing expense in the accompanying consolidated statements of operations and comprehensive loss. Cost of Revenue Cost of revenue primarily consists of expenses related to supporting and hosting the Company’s SaaS platforms, acquiring data and providing support to the Company’s customers. These costs include salaries, benefits, incentive compensation and stock-based compensation expense related to the management of the Company’s data centers, the customer support team, and data acquisition costs. In addition to these expenses, the Company incurs third-party service provider costs, such as data center and networking expenses, allocated overhead costs, and depreciation and amortization expense associated with the Company’s property and equipment and capitalized internal-use software development costs. Cash, Cash Equivalents and Investments The Company considers all highly liquid instruments purchased with an original maturity date of 90 days or less from the date of purchase to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks and amounts held in interest-bearing money market funds. Cash equivalents are carried at cost, which approximates their fair market value. Investments not classified as cash equivalents are presented as either short-term or long-term investments based on both their stated maturities as well as the time period the Company intends to hold such securities. The Company determines the appropriate classification of investments at the time of purchase and reevaluates such designation at each balance sheet date. The Company adjusts the cost of investments for amortization of premiums and accretion of discounts to maturity. The Company includes such amortization and accretion in interest income in the consolidated statements of operations. When the Company holds debt investments classified as available-for-sale pursuant to ASC 320, Investments — Debt Securities (“ASC 320”), it records available-for-sale securities at fair value, with unrealized gains and losses included in accumulated other comprehensive loss in stockholders’ equity. The Company includes interest and dividends on securities classified as available-for-sale in interest income in the consolidated statements of operations and comprehensive loss. Realized gains and losses are recorded in the consolidated statements of operations and comprehensive loss based on the specific-identification method. There were no material realized gains or losses on investments for the years ended December 31, 2022, 2021, or 2020. The Company did not hold any debt investments as of December 31, 2021. The Company reviews investments for other-than-temporary impairment whenever the fair value of an investment is less than its amortized cost and evidence indicates that an investment’s carrying amount is not recoverable within a reasonable period of time. Other-than-temporary impairments of investments are recognized in the consolidated statements of operations if the Company has experienced a credit loss, has the intent to sell the investments, or if it is more likely than not that the Company will be required to sell the investment before recovery of the amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to the end of the period. As of December 31, 2022, the aggregate fair value of investments held by the Company in an unrealized loss position for less than twelve months was $137,816. For the year ended December 31, 2022, the Company determined that no other-than-temporary impairments were required to be recognized in the consolidated statements of operations. The Company did not hold any debt investments prior to fiscal year 2022. The following is a summary of cash, cash equivalents and investments as of December 31, 2022: Amortized Gross Gross Estimated December 31, 2022: Cash and cash equivalents $ 79,765 $ — $ — $ 79,765 Investments: U.S. treasury securities due in one year or less 153,604 5 (108) 153,501 Corporate Securities due in one year or less 4,295 — (22) 4,273 Total investments 157,899 5 (130) 157,774 Total cash, cash equivalents and investments $ 237,664 $ 5 $ (130) $ 237,539 Restricted Cash As of December 31, 2021, restricted cash was $176 and related to cash held at a separate financial institution in an interest-bearing cash account as collateral for a letter of credit related to the contractual provisions for one of the Company’s building leases. During 2022, this cash was returned to the Company and a corresponding reduction was made to the Company’s line of credit. See Note 9 for detail on this credit facility. Restricted cash is included in “other long-term assets” in the accompanying consolidated balance sheets as of December 31, 2021 based on the maturity date of the letter of credit. The following table is a reconciliation of cash, cash equivalents and restricted cash included in the accompanying consolidated balance sheets that sum to the total cash, cash equivalents and restricted cash included in the accompanying consolidated statements of cash flows. As of December 31, 2022 2021 Cash and cash equivalents $ 79,765 $ 269,665 Restricted cash included in “other long-term assets” — 176 $ 79,765 $ 269,841 Concentrations of Credit Risk and Significant Customers The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, and accounts receivables. The Company maintains its cash and cash equivalents with multiple financial institutions that management believes to be of high-credit quality. At times, the deposits with these financial institutions may exceed federally insured limits. Credit risk with respect to accounts receivable is dispersed due to the large number of customers of the Company. The Company routinely assesses the creditworthiness of its customers and generally does not require its customers to provide collateral or other security to support accounts receivable. Credit losses historically have not been significant and the Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company’s accounts receivable. As of December 31, 2022 and 2021, no individual customer represented more than 10% of the Company’s accounts receivable. During the years ended December 31, 2022, 2021, and 2020, no individual customer represented more than 10% of the Company’s revenue. Allowance for doubtful accounts The Company reduces gross trade accounts receivable by an allowance for doubtful accounts based upon the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable and based upon historical loss patterns, the number of days that billings are past due, and an evaluation of the potential risk of loss associated with specific accounts. Provisions for the allowance for doubtful accounts are recorded in general and administrative expense. As of December 31, 2022 and 2021, the Company did not record an allowance for doubtful accounts. Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the related asset. The estimated useful lives of the Company’s property and equipment are as follows: Estimated Useful Life (In Years) Computer equipment 2 to 5 Furniture and office equipment 5 to 7 Leasehold improvements 2 to 4 Expenditures for maintenance and repairs are charged to expense as incurred, whereas major betterments are capitalized as additions to property and equipment. Capitalized Software Development Costs Costs incurred to develop software applications used in the Company’s SaaS platform consist of certain direct costs of materials and services incurred in developing or obtaining internal-use computer software, and payroll and payroll-related costs for employees who are directly associated with, and who devote time to, the project. These costs generally consist of internal labor during configuration, coding, and testing activities. Research and development costs incurred during the preliminary project stage or costs incurred for data conversion activities, training, maintenance, and general and administrative or overhead costs are expensed as incurred. Once a project has reached the application development stage, internal and external costs, if direct and incremental, are capitalized until the project is substantially complete and ready for its intended use. Qualified costs incurred during the post-implementation stage of the Company’s software applications relating to upgrades and enhancements are capitalized to the extent it is probable that they will result in added functionality, while costs incurred for maintenance of, and minor upgrades and enhancements to, internal-use software are expensed as incurred. Capitalized software development costs are amortized on a straight-line basis over their estimated useful life of three years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. During the years ended December 31, 2022, 2021, and 2020, the Company capitalized $1,760, $1,403, and $1,032, respectively, of software development costs, which are classified as intangible assets on the accompanying consolidated balance sheets. The Company recorded amortization expense associated with its capitalized software development costs of $570, $482, and $305 for the years ended December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022 and 2021, the net book value of capitalized software development costs was $1,962 and $1,959, respectively. Business Combinations In accordance with ASC 805, Business Combinations (“ASC 805”) , the Company recognizes the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. Determining these fair values requires management to make significant estimates and assumptions, especially with respect to intangible assets. The Company recognizes identifiable assets acquired and liabilities assumed at their acquisition date fair value. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair value of the assets acquired and the liabilities assumed and represents the expected future economic benefits arising from other assets acquired that are not individually identified and separately recognized. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, its estimates are inherently uncertain and subject to refinement. Assumptions may be incomplete or inaccurate, and unanticipated events or circumstances may occur, which may affect the accuracy or validity of such assumptions, estimates, or actual results. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill to the extent that it identifies adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date. The Company generally determines the fair value of the contingent consideration using the Monte Carlo simulation model. Each reporting period thereafter, these obligations are revalued and increases or decreases in their fair value are recorded as an adjustment to operating expenses within the consolidated statements of operations and comprehensive loss. Changes in the fair value of the contingent consideration can result from changes in assumed discount periods and rates, and from changes pertaining to the achievement of the defined milestones. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, future business and economic conditions, as well as changes in any of the assumptions described above, can materially impact the amount of contingent consideration expense the Company records in any given period. Goodwill and acquired intangible assets Goodwill is not amortized, but is evaluated for impairment annually, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company has determined that there is a single reporting unit for the purpose of conducting this goodwill impairment assessment and the fair value of its reporting unit has been determined based on the Company’s enterprise value. As part of the annual goodwill impairment test, the Company has the option to perform a qualitative assessment to determine whether further impairment testing is necessary. Examples of events and circumstances that might indicate that the reporting unit’s fair value is less than its carrying amount include macro-economic conditions such as deterioration in the entity’s operating environment or industry or market considerations; entity-specific events such as increasing costs, declining financial performance, or loss of key personnel; or other events such as a sustained decrease in the stock price on either an absolute basis or relative to peers. If, as a result of its qualitative assessment, it is more likely than not (i.e., greater than 50% chance) that the fair value of the Company’s reporting unit is less than its carrying amount, the quantitative impairment test will be required. Otherwise, no further testing will be required. The Company completed its qualitative assessment and concluded that as of October 1, 2022, it is not more likely than not that the fair value of the Company’s reporting unit is less than its carrying amount. Intangible assets acquired in a business combination are recorded at their estimated fair values at the date of acquisition. The Company amortizes acquired definite-lived intangible assets over their estimated useful lives based on the pattern of consumption of the economic benefits or, if that pattern cannot be readily determined, on a straight-line basis. The Company evaluates the recoverability of intangible assets periodically by taking into account events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired. The Company considered potential impairment indicators of acquired intangible assets and noted no indicators of impairment as of December 31, 2022. Impairment of Long-Lived Assets Long-lived assets consist of property and equipment, intangible assets, and capitalized software development costs. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset group for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset group are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset group over its fair value, determined based on discounted cash flows. For the year ended December 31, 2022, the Company recorded $642 of impairment expense related to its capitalized software development costs. Impairment expense related to capitalized software development costs is included in “research and development” in the accompanying consolidated statement of operations for the year ended December 31, 2022. For the year ended December 31, 2021, the Company did not identify any indicators of impairment of its long-lived assets. For the year ended December 31, 2020, the Company recorded an immaterial amount of impairment expense relating to capitalized software development costs. Disclosure of Fair Value of Financial Instruments The Company’s financial instruments include cash, cash equivalents, investments, accounts receivable, accounts payable, and accrued expenses. The company’s investments are classified as available-for-sale and reported at fair value in accordance with the market approach utilizing quoted prices that were directly or indirectly observable. The carrying amount of the remainder of the Company’s financial instruments approximated their fair values as of December 31, 2022 and 2021, due to the short-term nature of these instruments. The Company has evaluated the estimated fair value of financial instruments using available market information. The use of different market assumptions and/or estimation methodologies could have a significant effect on the estimated fair value amounts. See below for further discussion. Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a three-level valuation hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. This guidance further identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1 inputs—Unadjusted observable quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs—Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions of that market. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company evaluates assets and liabilities subject to fair value measurements on a recurring and nonrecurring basis to determine the appropriate level to classify them for each reporting period. The following table summarizes financial assets and liabilities measured and recorded at fair value on a recurring basis in the accompanying consolidated balance sheets as of December 31, 2022, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: December 31, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) Significant Other Observable Inputs (Level 2 Inputs) Significant Unobservable Inputs Total Assets: Money market funds $ 36,222 $ — $ — $ 36,222 U.S. treasury securities — 153,501 — 153,501 Corporate securities — 4,273 — 4,273 Convertible debt securities (See Note 5) — — 3,652 3,652 Total assets $ 36,222 $ 157,774 $ 3,652 $ 197,648 Liabilities: Contingent consideration $ — $ — $ 227 $ 227 Total liabilities $ — $ — $ 227 $ 227 Cash equivalents include money market funds with original maturities of 90 days or less from the date of purchase. The fair value measurement of these assets is based on quoted market prices in active markets for identical assets and, therefore, these assets are recorded at fair value on a recurring basis and classified as Level 1 in the fair value hierarchy. The Company’s investments primarily consist of short-term U.S. treasury securities and corporate securities. The fair value measurement of these assets is based on significant other observable inputs and, therefore, these assets are recorded at fair value on a recurring basis and classified as Level 2 in the fair value hierarchy. As of December 31, 2021, the Company did not have any assets or liabilities measured at fair value on a recurring basis using significant other observable inputs (Level 2). The Company held cash equivalents in money market funds that totaled $21,366 and were classified as Level 1 in the fair value hierarchy. As of December 31, 2022 and 2021, the Company measured its investments in convertible debt securities (see Note 5) and its contingent consideration associated with the acquisition of Prowly.com sp. Z o.o (“Prowly”) on a recurring basis using significant unobservable inputs (Level 3). Convertible Debt Securities The Company records its convertible debt securities at fair value on the purchase date. The Company determines the fair value of these investments using the Black-Scholes Merton model. Each reporting period thereafter, these investments are revalued and increases or decreases in their fair values are recorded as adjustments to other income, net within the consolidated statements of operations and comprehensive loss to reflect the gains and losses. Changes in the fair value of these investments can result from changes in the estimated enterprise value of the issuers, the likelihoods and methods of such conversions, and other market factors. Significant judgm |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases Lease Portfolio Overview The Company’s operating lease obligations consist of various leases for office space in areas that include, among others, Austin, Texas; Boston, Massachusetts; Dallas, Texas; Trevose, Pennsylvania; Barcelona, Spain; Limassol, Cyprus; and Prague, Czech Republic. On October 13, 2022, the Company entered into an operating lease in Austin, Texas at 720 Brazos Street for the lease of 5,396 square feet of office space. The commencement date was November 1, 2022, and the lease has a non-cancellable term through December, 2027, with two five year Company extension options. The lease provided for a tenant improvement allowance, and for annual rent increases through the term of the lease. On June 30, 2022, the Company entered into an operating lease in Barcelona, Spain at Carrer de Tanger 98 for the lease of 19,763 square feet of office space with a commencement date of July 1, 2022. The lease has a Company option to terminate the lease after three years, with six months prior notice, otherwise the lease term concludes in June, 2027. The lease provided for annual rent increases through the term of the lease. On May 2, 2022, the Company entered into an operating lease in Dallas, Texas at 3838 Oak Lawn Avenue for the lease of 4,365 square feet of office space. The commencement date was May 1, 2022, and the lease has a non-cancellable term through August, 2025. The lease provided for tenant improvement allowance, and for annual rent increases through the term of the lease. On April 28, 2022, the Company entered into an operating lease in Trevose, Pennsylvania at 3800 Horizon Boulevard for the lease of 10,450 square feet of office space. The commencement date was October 14, 2022, and the lease has a non-cancellable term through June, 2027, with a five year Company extension option. The lease provided for a turn-key fit-out, an additional upgrade allowance, and for annual rent increases through the term of the lease. On June 23, 2021, the Company amended its operating lease, which was originally entered into on October 24, 2018, to expand its lease to a total of 16,467 square feet of office space in Boston, Massachusetts at 800 Boylston Street. The lease amendment provided for a turn-key fit-out and for annual rent increases through the term of the lease. The commencement date of the amended lease was January 1, 2022, and extended the non-cancellable lease term to March 2027. The lease provides for a Company option to extend the lease term for an additional period of five years. On July 9, 2020, the Company entered into an operating lease in Limassol, Cyprus at Grosvenor Tower for the lease of 8,890 square feet of office space, with the commencement date of August 1, 2020, and lease term through July 2023. The lease provides for a Company option to terminate the lease at any point after two years, with two months prior notice. The lease provides for a Company option with Landlord consent to renew the lease for an additional three-year term. The lease provided for a turn-key fit-out and no annual rent increases permitted. On May 28, 2020, the Company amended its operating lease in Prague, Czech Republic at Kavci Hory Office Park, which was originally entered into on December 14, 2016, to extend the term through July 2025. The amendment provided for a Company option to terminate the lease as of July 31, 2022, with 12 months prior notice. The Company did not exercise the termination option. Prior to the adoption of ASC 842, the Company categorized leases at their inception as either operating or capital leases. On certain lease arrangements, the Company may have received rent holidays or other incentives. The Company recognized lease costs on a straight‑line basis once it achieved control of the space, without regard to deferred payment terms, such as rent holidays, that deferred the commencement date of required payments or escalating payment amounts. The Company recorded the difference between required lease payments and rent expense as deferred rent. Additionally, incentives received were treated as a reduction of costs over the term of the agreement, as they were considered an inseparable part of the lease agreement. Subsequent to the adoption of ASC 842, the Company categorizes leases at commencement as either operating or finance leases. The Company has operating leases for data centers and facilities and finance leases for certain equipment. The leases have remaining lease terms of less than a year to 6 years, some of which include options to extend the leases for up to 10 years. The Company recognizes lease expense for operating leases on a straight-line basis over the lease term. Variable costs, which are based on actual usage, are not included in the measurement of ROUAs and lease liabilities but are expensed when the event determining the amount of variable consideration to be paid occurs. Amortization expense of the ROUA for finance leases is recognized on a straight-line basis over the lease term and interest expense for finance leases is recognized based on the effective interest method using an incremental borrowing rate. Adoption of ASC 842 resulted in the recording of $12,366 in ROUAs and $12,579 in lease liabilities as of January 1, 2022. Incremental borrowing rates as of January 1, 2022, the date the new standard was adopted, were used to calculate the present value of the Company’s lease portfolio as of that date. The Company determines its incremental borrowing rate for each lease based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. There was no impact on retained earnings or other components of equity from the adoption. The Company elected to apply ASC 842 at the beginning of the period of adoption through a cumulative adjustment in accordance with ASC 842-10-65-1(c)(2). The Company elected the three practical expedients as a package and applied them consistently to all leases, which allowed it to forgo reassessing whether any expired or existing contract contain leases, the classification for any expired or existing leases, and the initial direct costs for existing leases. The Company also made an accounting policy election to not recognize a lease liability or right-of-use asset on its consolidated balance sheet for leases with an initial term of twelve months or less, and instead recognizes such lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term. The components of lease expense were as follows: Year Ended December 31, 2022 Operating lease cost $ 3,936 Short-term lease cost 1,128 Variable lease cost 7,340 Total lease cost $ 12,404 Year Ended December 31, 2022 Amortization of lease assets $ 2,106 Interest on lease liabilities 115 Total finance lease cost $ 2,221 Weighted-average remaining lease term and discount rate were as follows: As of December 31, 2022 Weighted-average remaining lease term (in years) Operating leases 3.9 Finance leases 1.6 Weighted-average discount rate Operating leases 5.08 % Finance leases 3.69 % Future minimum amounts payable as of December 31, 2022 were as follows: Year Ending December 31, Operating Leases Finance 2023 $ 4,033 $ 2,393 2024 3,004 865 2025 2,578 194 2026 2,617 — 2027 1,167 — Thereafter 154 — Total lease payments 13,553 3,452 Less: imputed interest (930) (134) Total lease liabilities $ 12,623 $ 3,318 As of December 31, 2022 the Company had no additional operating or finance leases that have not yet commenced. Rent expense related to the Company’s office facilities was $5,064, $3,817, and $4,334 for the years ended December 31, 2022, 2021, and 2020, respectively. As previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and under the previous lease accounting standard, future minimum payments for operating leases and capital leases as of December 31, 2021 were as follows: Year Ending December 31, Operating Leases Capital 2022 $ 4,051 $ 2,195 2023 2,734 2,346 2024 1,738 679 2025 1,341 151 2026 and thereafter 1,597 — Total future lease payments 11,461 5,371 Less: imputed interest — (416) Total $ 11,461 $ 4,955 |
Leases | Leases Lease Portfolio Overview The Company’s operating lease obligations consist of various leases for office space in areas that include, among others, Austin, Texas; Boston, Massachusetts; Dallas, Texas; Trevose, Pennsylvania; Barcelona, Spain; Limassol, Cyprus; and Prague, Czech Republic. On October 13, 2022, the Company entered into an operating lease in Austin, Texas at 720 Brazos Street for the lease of 5,396 square feet of office space. The commencement date was November 1, 2022, and the lease has a non-cancellable term through December, 2027, with two five year Company extension options. The lease provided for a tenant improvement allowance, and for annual rent increases through the term of the lease. On June 30, 2022, the Company entered into an operating lease in Barcelona, Spain at Carrer de Tanger 98 for the lease of 19,763 square feet of office space with a commencement date of July 1, 2022. The lease has a Company option to terminate the lease after three years, with six months prior notice, otherwise the lease term concludes in June, 2027. The lease provided for annual rent increases through the term of the lease. On May 2, 2022, the Company entered into an operating lease in Dallas, Texas at 3838 Oak Lawn Avenue for the lease of 4,365 square feet of office space. The commencement date was May 1, 2022, and the lease has a non-cancellable term through August, 2025. The lease provided for tenant improvement allowance, and for annual rent increases through the term of the lease. On April 28, 2022, the Company entered into an operating lease in Trevose, Pennsylvania at 3800 Horizon Boulevard for the lease of 10,450 square feet of office space. The commencement date was October 14, 2022, and the lease has a non-cancellable term through June, 2027, with a five year Company extension option. The lease provided for a turn-key fit-out, an additional upgrade allowance, and for annual rent increases through the term of the lease. On June 23, 2021, the Company amended its operating lease, which was originally entered into on October 24, 2018, to expand its lease to a total of 16,467 square feet of office space in Boston, Massachusetts at 800 Boylston Street. The lease amendment provided for a turn-key fit-out and for annual rent increases through the term of the lease. The commencement date of the amended lease was January 1, 2022, and extended the non-cancellable lease term to March 2027. The lease provides for a Company option to extend the lease term for an additional period of five years. On July 9, 2020, the Company entered into an operating lease in Limassol, Cyprus at Grosvenor Tower for the lease of 8,890 square feet of office space, with the commencement date of August 1, 2020, and lease term through July 2023. The lease provides for a Company option to terminate the lease at any point after two years, with two months prior notice. The lease provides for a Company option with Landlord consent to renew the lease for an additional three-year term. The lease provided for a turn-key fit-out and no annual rent increases permitted. On May 28, 2020, the Company amended its operating lease in Prague, Czech Republic at Kavci Hory Office Park, which was originally entered into on December 14, 2016, to extend the term through July 2025. The amendment provided for a Company option to terminate the lease as of July 31, 2022, with 12 months prior notice. The Company did not exercise the termination option. Prior to the adoption of ASC 842, the Company categorized leases at their inception as either operating or capital leases. On certain lease arrangements, the Company may have received rent holidays or other incentives. The Company recognized lease costs on a straight‑line basis once it achieved control of the space, without regard to deferred payment terms, such as rent holidays, that deferred the commencement date of required payments or escalating payment amounts. The Company recorded the difference between required lease payments and rent expense as deferred rent. Additionally, incentives received were treated as a reduction of costs over the term of the agreement, as they were considered an inseparable part of the lease agreement. Subsequent to the adoption of ASC 842, the Company categorizes leases at commencement as either operating or finance leases. The Company has operating leases for data centers and facilities and finance leases for certain equipment. The leases have remaining lease terms of less than a year to 6 years, some of which include options to extend the leases for up to 10 years. The Company recognizes lease expense for operating leases on a straight-line basis over the lease term. Variable costs, which are based on actual usage, are not included in the measurement of ROUAs and lease liabilities but are expensed when the event determining the amount of variable consideration to be paid occurs. Amortization expense of the ROUA for finance leases is recognized on a straight-line basis over the lease term and interest expense for finance leases is recognized based on the effective interest method using an incremental borrowing rate. Adoption of ASC 842 resulted in the recording of $12,366 in ROUAs and $12,579 in lease liabilities as of January 1, 2022. Incremental borrowing rates as of January 1, 2022, the date the new standard was adopted, were used to calculate the present value of the Company’s lease portfolio as of that date. The Company determines its incremental borrowing rate for each lease based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. There was no impact on retained earnings or other components of equity from the adoption. The Company elected to apply ASC 842 at the beginning of the period of adoption through a cumulative adjustment in accordance with ASC 842-10-65-1(c)(2). The Company elected the three practical expedients as a package and applied them consistently to all leases, which allowed it to forgo reassessing whether any expired or existing contract contain leases, the classification for any expired or existing leases, and the initial direct costs for existing leases. The Company also made an accounting policy election to not recognize a lease liability or right-of-use asset on its consolidated balance sheet for leases with an initial term of twelve months or less, and instead recognizes such lease payments in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term. The components of lease expense were as follows: Year Ended December 31, 2022 Operating lease cost $ 3,936 Short-term lease cost 1,128 Variable lease cost 7,340 Total lease cost $ 12,404 Year Ended December 31, 2022 Amortization of lease assets $ 2,106 Interest on lease liabilities 115 Total finance lease cost $ 2,221 Weighted-average remaining lease term and discount rate were as follows: As of December 31, 2022 Weighted-average remaining lease term (in years) Operating leases 3.9 Finance leases 1.6 Weighted-average discount rate Operating leases 5.08 % Finance leases 3.69 % Future minimum amounts payable as of December 31, 2022 were as follows: Year Ending December 31, Operating Leases Finance 2023 $ 4,033 $ 2,393 2024 3,004 865 2025 2,578 194 2026 2,617 — 2027 1,167 — Thereafter 154 — Total lease payments 13,553 3,452 Less: imputed interest (930) (134) Total lease liabilities $ 12,623 $ 3,318 As of December 31, 2022 the Company had no additional operating or finance leases that have not yet commenced. Rent expense related to the Company’s office facilities was $5,064, $3,817, and $4,334 for the years ended December 31, 2022, 2021, and 2020, respectively. As previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and under the previous lease accounting standard, future minimum payments for operating leases and capital leases as of December 31, 2021 were as follows: Year Ending December 31, Operating Leases Capital 2022 $ 4,051 $ 2,195 2023 2,734 2,346 2024 1,738 679 2025 1,341 151 2026 and thereafter 1,597 — Total future lease payments 11,461 5,371 Less: imputed interest — (416) Total $ 11,461 $ 4,955 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment consists of the following: As of December 31, 2022 2021 Computer equipment (1) $ 11,133 $ 10,045 Furniture and office equipment 1,738 948 Leasehold improvements 786 1,737 Total property and equipment 13,657 12,730 Less: accumulated depreciation and amortization (5,581) (4,460) Property and equipment, net $ 8,076 $ 8,270 (1) Includes property and equipment acquired under finance leases (subsequent to the adoption of ASC 842) and capital leases (prior to the adoption of ASC 842) of $3,272 and $5,748, respectively. Depreciation and amortization expense related to property and equipment was $4,200, $2,826, and $1,013 for the years ended December 31, 2022, 2021, and 2020, respectively. Depreciation and amortization expense for the years ended December 31, 2022, 2021, and 2020 included $2,030, $1,465, and $0 related to property and equipment acquired under finance and capital leases. |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | Other Assets Investments in Convertible Debt In January 2021, the Company purchased two convertible debt securities (the “January 2021 Notes”) for a total aggregate investment of $500 with maturity dates of January 1, 2023 and annual interest rates of 6%. In February 2022, the Company purchased an additional convertible debt security (the “February 2022 Note”) in the amount of $2,000 with a maturity date of February 25, 2024, and annual interest rate of 6%. Interest accrues on each note and becomes payable upon conversion of each convertible note, or will be paid in connection with the repayment in full of the principal amount of such convertible notes. These convertible note investments are classified as available-for-sale securities. The January 2021 Notes and February 2022 Note are included in prepaid expenses and other current assets and other assets, respectively, in the accompanying consolidated balance sheets based on the maturity dates. The Company accounts for these investments, along with the embedded derivatives associated with their conversion features, by utilizing the fair value option within ASC 825, Financial Instruments (“ASC 825”), and accounting for the entire hybrid instrument at fair value through other income (expense). The Company recorded an increase in the fair value of the convertible notes of $1,152 for the year ended December 31, 2022. Changes in the fair value of the convertible notes were not material for the year ended December 31, 2021. With respect to its investments in these convertible debt securities, the Company has a variable interest in the issuer of these securities, which is a variable interest entity. After evaluation of the relationship between the Company and this variable interest entity, the Company determined not to consolidate this variable interest entity’s results of operations for the years ended December 31, 2022 and 2021. Significant judgments included the determination that this variable interest entity lacked sufficient equity at risk to finance its activities without additional subordinated support, and that the Company was not the primary beneficiary of the variable interest entity given the Company’s variable interests do not constitute a controlling financial interest. |
Acquisitions, Acquired Intangib
Acquisitions, Acquired Intangible Assets, and Goodwill | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions, Acquired Intangible Assets, and Goodwill | Acquisitions, Acquired Intangible Assets, and Goodwill Acquisitions Backlinko On January 13, 2022, the Company completed an asset purchase agreement with Backlinko, LLC (“Backlinko”), acquiring certain of Backlinko’s assets for cash consideration of $4,000. The purpose of this asset acquisition was to acquire valuable content and to access an existing revenue stream in Backlinko’s SEO courses. The Company accounted for this transaction as an asset acquisition and allocated the cost of the asset acquisition to the individual assets acquired. The Company allocated $3,915 to the acquired intangible assets and the remaining cost of the acquisition was allocated to the other assets acquired, which were not material. The identifiable intangible assets consisted of trade names and intellectual property, which the Company amortizes over the assets’ useful lives using a straight-line amortization method. The Company assigned useful lives to the acquired trade name and content of five years and four years, respectively. Kompyte On March 14, 2022, the Company executed a purchase agreement with Intellikom, Inc., which does business under the name Kompyte (“Kompyte”) to acquire 100% of Kompyte’s assets for cash consideration of $10,000. The purpose of the acquisition of Kompyte was to acquire Kompyte’s assets, including its competitive intelligence automation platform. Aggregate acquisition-related costs associated with this business combination were not material for the year ended December 31, 2022, and were included in general and administrative expenses in the consolidated statement of operations and comprehensive loss. The results of operations of Kompyte have been included in the Company’s consolidated financial statements from the date of acquisition. The Company has accounted for this transaction as a business combination under the acquisition method. The total purchase price was allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values. The Company recorded the excess of the purchase price over those fair values as goodwill that is not deductible for tax purposes. The following table presents the purchase price allocation recorded in the Company’s consolidated balance sheet as of the acquisition date, which was final as of June 30, 2022: Purchase Price Assets acquired Allocation Fair value of tangible assets: Other assets $ 328 Goodwill 4,928 Identifiable intangible assets 5,500 Total assets acquired $ 10,756 Liabilities assumed Current and non-current liabilities $ 756 Total liabilities assumed $ 756 Net assets acquired $ 10,000 The Company allocated $5,500 of the purchase price to identifiable intangible assets consisting of developed technology, trade names, and customer relationships, which it amortizes over the assets’ useful lives using a straight-line amortization method. The Company assigned useful lives to acquired developed technology, trade names, and customer relationships of six years, six years, and three years, respectively. This business combination did not have a material impact on the Company’s consolidated financial statements. Therefore, actual results of operations subsequent to the acquisition date and pro forma results of operations have not been presented. Intangible Assets Intangible assets consist of intangible assets resulting from the Company’s acquisitions and its capitalized internal-use software development costs. Intangible assets consist of the following: As of December 31, 2022 Weighted Average Remaining Gross Net Useful Life Carrying Accumulated Carrying (years) Amount Amortization Amount Developed technology 4.8 $ 4,007 $ (765) $ 3,242 Trade name 4.6 3,810 (656) 3,154 Content 3.1 1,958 (471) 1,487 Customer relationships 2.3 600 (159) 441 Capitalized internal-use software 2.6 3,415 (1,453) 1,962 Total as of December 31, 2022 $ 13,790 $ (3,504) $ 10,286 As of December 31, 2021 Weighted Average Remaining Gross Net Useful Life Carrying Accumulated Carrying (years) Amount Amortization Amount Developed technology 4.7 $ 1,194 $ (266) $ 928 Trade name 1.7 68 (30) 38 Capitalized internal-use software 2.5 2,964 (1,005) 1,959 Total as of December 31, 2021 $ 4,226 $ (1,301) $ 2,925 During the years ended December 31, 2022, 2021, and 2020, the Company capitalized $1,760, $1,403, and $1,032, respectively, of internal-use software development costs which are classified as intangible assets on the accompanying consolidated balance sheets, and recorded associated amortization expense of $570, $482, and $305. Amortization expense for acquired intangible assets was $1,880, $227, and $69 for the years ended December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022, future amortization expense is expected to be as follows: Fiscal Year Ended December 31, Amount 2023 $ 2,486 2024 2,265 2025 2,104 2026 1,721 2027 and thereafter 1,710 Total $ 10,286 Goodwill The changes in the carrying value of goodwill during the year ended December 31, 2022 were as follows: Amount Balance as of January 1, 2022 $ 1,991 Kompyte acquisition 4,928 Foreign currency translation adjustment (390) Balance as of December 31, 2022 $ 6,529 |
Exit Costs
Exit Costs | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Exit Costs | Exit Costs On February 24, 2022, Russian forces launched significant military action against Ukraine. As a result of this conflict and the sanctions imposed by the European Union, United Kingdom, United States and Canada, among others, the Company began to exit its operations in Russia during March 2022. As of August 10, 2022, the Company no longer had operating subsidiaries in Russia, and as of December 31, 2022, the Company had relocated substantially all of its employees outside of Russia. All costs associated with its exit activities from Russia are included in the consolidated statements of operations in its income from continuing operations under the line item, Exit costs . Exit costs in connection with the winding down of operations in Russia include employee severance and fringe benefit costs, the loss on the sales of the Company’s Russian subsidiaries, and other associated relocation costs. For employee severance and fringe benefit costs, the Company incurred costs of $1,244 during the year ended December 31, 2022. The Company does not expect to incur additional employee severance and fringe benefit costs related to the winding down of its operations in Russia that would be significant to its results of operations. For other associated relocation costs, the Company incurred $8,282 in the year ended December 31, 2022. The Company expects to incur an additional $1,318 in other associated costs, of which the majority is expected to be incurred during the quarter ended March 31, 2023. During the year ended December 31, 2022, the Company completed its sale of its two Russia-based subsidiaries. The Company recorded a loss on the sale of its Russian subsidiaries of approximately $1,738, primarily consisting of the disposal of fixed assets, which was included in exit costs in the consolidated statement of operations. |
Accrued expenses
Accrued expenses | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Accrued expenses | Accrued expenses Accrued expenses consists of the following: As of December 31, 2022 2021 Employee compensation $ 5,083 $ 10,580 Income taxes payable 1,090 2,375 Other taxes payable 10,101 3,264 Vacation reserves 1,372 1,988 Other 201 1,272 Total accrued expenses $ 17,847 $ 19,479 |
Revolving Credit Facility
Revolving Credit Facility | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Revolving Credit Facility | Revolving Credit Facility Senior Secured Revolving Credit Facility On January 12, 2021, the Company executed a credit agreement with JPMorgan Chase Bank, N.A., in the form of a revolving credit facility, that consists of a $45.0 million revolving credit facility and a letter of credit sub-facility with an aggregate limit equal to the lesser of $5.0 million and the aggregate unused amount of the revolving commitments then in effect. The availability of the credit facility is subject to the borrowing base based on an advance rate of 400% multiplied by annualized retention applied to monthly recurring revenue. The credit facility has a maturity of three years and will mature on January 12, 2024. Borrowings under the credit facility bear interest at the Company’s option at (i) LIBOR, subject to a 0.50% floor, plus a margin, or (ii) the alternate base rate, subject to a 3.25% floor (or 1.50% prior to positive consolidated adjusted earnings before interest, taxes, depreciation, and amortization (“adjusted EBITDA”) for the twelve months most recently ended), plus a margin. For LIBOR borrowings, the applicable rate margin is 2.75% (or 3.50% prior to positive consolidated adjusted EBITDA as of the twelve months most recently ended). For base rate borrowings, the applicable margin is 0.00% (or 2.50% prior to positive consolidated adjusted EBITDA as of the twelve months most recently ended). The Company is also required to pay a 0.25% per annum fee on undrawn amounts under the Company’s revolving credit facility, payable quarterly in arrears. As of December 31, 2022, the Company had not drawn on this revolving credit facility, however the Company reduced its available balance on this revolving credit facility by $176 to replace its letter of credit and associated restricted cash in conformance with the contractual provisions with one of its office leases. For the years ended December 31, 2022 and 2021, the Company incurred $118 and $110 in interest expense, respectively, related to this credit facility. In connection with entering into the credit facility, the Company incurred issuance costs totaling $630, which are being amortized on a straight-line basis to interest expense through the maturity date of the facility. During the years ended December 31, 2022 and December 31, 2021, the Company recorded interest expense of $211 and $211, respectively, related to the amortization of the deferred issuance costs. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Loss before income taxes consists of the following: Year Ended December 31, 2022 2021 2020 United States $ (31,061) $ (6,021) $ (8,772) Foreign (1,856) 3,006 2,337 Loss before income taxes $ (32,917) $ (3,015) $ (6,435) The provision for income taxes in the accompanying consolidated financial statements is comprised of the following: Year Ended December 31, 2022 2021 2020 Current taxes: Federal $ 156 $ — $ — Foreign 868 123 640 State 160 88 27 Total current taxes 1,184 211 667 Deferred taxes: Federal 11 — — Foreign (264) 59 (90) State — — — Total deferred taxes (253) 59 (90) Provision for income taxes $ 931 $ 270 $ 577 The reconciliation of the United States statutory tax rate to the Company’s effective tax rate included in the accompanying consolidated statements of operations is as follows: Year Ended December 31, 2022 2021 2020 Expected benefit from income taxes 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 2.4 6.2 3.7 Foreign income tax rate differential (4.1) 16.0 2.5 Impact of disposition of Russian subsidiaries 6.1 — — Non-deductible expenses — (12.7) (10.7) Net impact of GILTI — (38.9) (3.1) Deferred statutory rate changes (2.9) (1.7) (1.1) Stock compensation (1.4) 93.8 — Foreign research and development incentive 1.7 24.1 — Tax attribute expiration (2.8) — — Change in valuation allowance (21.0) (110.1) (21.3) Other, net (1.8) (6.6) — Effective tax rate (2.8) % (8.9) % (9.0) % The Company’s effective tax rate differs from the statutory rate each year primarily due to the valuation allowance maintained against the Company’s net deferred tax assets and the impact of the jurisdictional mix of earnings. Interpretive guidance on the accounting for GILTI states that an entity can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. The Company has made the accounting policy election to recognize GILTI as a period expense. Deferred tax assets and liabilities reflect the net tax effects of net operating loss carryovers and the temporary differences between the assets and liabilities carrying value for financial reporting and the amounts used for income tax purposes. The Company’s significant deferred tax assets (liabilities) components are as follows: As of December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 10,018 $ 12,847 Capitalized research and development expenditures 9,487 — Accruals and reserves 1,670 2,419 Stock based compensation 959 262 Intangibles 520 298 Depreciation 100 — Capital loss carryforwards 1,915 — Finance lease 3,795 1,045 Other deferred tax asset carryforward 162 252 Gross deferred tax assets 28,626 17,123 Valuation allowance (21,698) (14,623) Total deferred tax assets 6,928 2,500 Deferred tax liabilities: Depreciation (650) (1,285) Intangibles (172) (262) Deferred commissions (2,178) (1,196) Operating lease right-of-use assets (3,662) — Other (277) (25) Total deferred tax liabilities (6,939) (2,768) Net deferred tax (liabilities) assets $ (11) $ (268) The Company’s valuation allowance increased by $7,075, primarily as a result of the operating loss incurred during the year ended December 31, 2022. In assessing the ability to realize the Company’s net deferred tax assets, management considers various factors including taxable income in carryback years, future reversals of existing taxable temporary differences, tax planning strategies, and future taxable income projections to determine whether it is more likely than not that some portion or all of the net deferred tax assets will not be realized. Based on the negative evidence, including the worldwide cumulative losses that the Company has incurred, the Company has determined that the uncertainty regarding realizing its deferred tax assets is sufficient to warrant the need for a full valuation allowance against its worldwide net deferred tax assets. As of December 31, 2022, the Company had U.S. federal net operating loss carryforwards of $28,611 generated in the tax years beginning after December 31, 2017 that do not expire. As of December 31, 2022, the Company had U.S. capital loss carryforwards of $8,034 that expire in 2027. As of December 31, 2022, the Company had U.S. state net operating loss carryforwards of $15,702, substantially all of which expire at various dates through 2041. As of December 31, 2022, the Company had Cyprus net operating loss carryforwards of $22,837 that expire at various dates through 2024. As of December 31, 2022, the Company had net operating loss carryforwards of $1,189 from other foreign locations that expire at various dates through 2042. Under Section 382 of the U.S. Internal Revenue Code, if a corporation undergoes an ownership change, the corporation’s ability to use its pre-change net operating loss carryforwards to offset its post-change income and taxes may be limited. In general, an ownership change occurs if there is a 50 percent cumulative change in ownership of the Company over a rolling three-year period. Similar rules may apply under U.S. state tax laws. The Company has not conducted an assessment to determine whether there may have been a Section 382 ownership change from inception through December 31, 2022, however it does not believe it has experienced a restrictive ownership change. At December 31, 2022, 2021, and 2020, the Company had no recorded liabilities for uncertain tax positions. In addition, at December 31, 2022, 2021, and 2020, the Company had no accrued interest or penalties related to uncertain tax positions. The Company’s accounting policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. The Company files income tax returns in the U.S. federal tax jurisdiction, various state, and various foreign jurisdictions. The Company is currently open to examination under the statute of limitations by the Internal Revenue Service and material state jurisdictions for the tax years ended 2019 through 2022. Since the Company is in a U.S. loss carryforward position, carryforward tax attributes generated in prior years may still be adjusted upon future examination if they have or will be used in a future period. Additionally, certain non-U.S. jurisdictions are no longer subject for income tax examinations by authorities for tax years before 2016. The Company has not provided U.S. deferred income taxes or foreign withholding taxes on unremitted earnings of foreign subsidiaries of approximately $3,057 as such amounts are considered to be indefinitely reinvested in these jurisdictions. The accumulated earnings in the foreign subsidiaries are primarily utilized to fund working capital requirements as its subsidiaries continue to expand their operations and to fund future foreign acquisitions. The amount of any unrecognized deferred tax liability related to undistributed foreign earnings is immaterial. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock and Stockholders’ Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Redeemable Convertible Preferred Stock and Stockholders’ Equity | Redeemable Convertible Preferred Stock and Stockholders’ Equity Public Offerings On March 29, 2021, the Company closed its initial public offering (the “IPO”) in which it sold 10,000,000 shares of its Class A common stock at a price to the public of $14.00 per share. The Company received $126,600 in net proceeds after deducting approximately $13,400 for underwriting discounts, commissions and offering expenses. Immediately prior to the completion of the IPO, all shares of common stock then outstanding were reclassified as Class B common stock, and all shares of redeemable convertible preferred stock and convertible preferred stock then outstanding were converted into shares of common stock on a one-to-one basis and then reclassified into Class B common stock. On April 20, 2021, the underwriters of the Company’s IPO partially exercised their option to purchase additional shares of Class A common stock. In connection with the closing of the partial exercise on April 23, 2021, the underwriters purchased 719,266 shares of the Company’s Class A common stock for net proceeds to the Company of $9,200 after deducting approximately $800 for underwriting discounts, commissions and offering expenses. On November 23, 2021, the Company closed a follow-on offering (the “Follow-On Offering”) in which it sold 4,000,000 shares of its Class A common stock at a price to the public of $20.50 per share. The Company received $77,900 in net proceeds after deducting approximately $4,100 for underwriting discounts, commissions and offering expenses. Selling stockholders sold an aggregate of 1,000,000 shares of Class A common stock in the Follow-On Offering. Prior to the IPO, the authorized capital stock of the Company included 9,898,400 shares of preferred stock, of which 3,379,400 shares were designated as Series A Redeemable Convertible Preferred Stock, 1,837,600 shares were designated as Series A-1 Redeemable Convertible Preferred Stock and 4,681,400 shares were designated as Series B Convertible Preferred Stock (collectively the “Preferred Stock”). Immediately prior to the closing of the IPO, the outstanding shares of Preferred Stock were converted on a three-for-one basis into 29,695,200 shares of common stock. The holders of the Company’s Preferred Stock had certain voting, dividend, and redemption rights, as well as liquidation preferences and conversion privileges. All rights, preferences, and privileges associated with the preferred stock were terminated at the time of the Company’s IPO in conjunction with the conversion of all outstanding shares of Preferred Stock into shares of common stock. As of December 31, 2022, the total number of shares of all classes of stock which the Company shall have authority to issue was (i) 1,000,000,000 shares of Class A common stock, par value $0.00001 per share, and (ii) 160,000,000 shares of Class B common stock, par value $0.00001 per share, and (iii) 100,000,000 undesignated shares of Preferred Stock, par value $0.00001 per share. Each share of Class A common stock entitles the holder to one vote for each share on all matters submitted to a vote of the Company's stockholders at all meetings of stockholders and written actions in lieu of meetings. Each share of Class B common stock entitles the holder to ten votes for each share on all matters submitted to a vote of the Company's stockholders at all meetings of stockholders and written actions in lieu of meetings. Holders of Class A common stock and Class B common stock are entitled to receive dividends, when and if declared by the board of directors (the “Board”). Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Automatic conversion shall occur upon the occurrence of (i) a Transfer, as defined in the amended and restated certificate of incorporation, of such share of Class B common stock, (ii) the affirmative vote of at least two-thirds of the outstanding shares of Class B common stock, voting as a single class, or (iii) on or after the earlier to occur of (a) the seven Stock Split On March 15, 2021, the Board approved a 3-for-1 stock-split of the Company’s common stock. The stock split was approved by the stockholders on March 15, 2021 and became effective on March 15, 2021. Upon the effectiveness of the stock split, (i) every one share of common stock outstanding was increased to three shares of common stock, (ii) the number of shares of common stock into which each outstanding option to purchase common stock is exercisable was proportionally increased on a 3-for-1 basis, and (iii) the exercise price of each outstanding option to purchase common stock was proportionately decreased on a 3-for-1 basis. Additionally, shares of common stock reserved for issuance upon the conversion of the Company’s Preferred Stock were proportionately increased on a 3-for-1 basis and the respective conversion prices of the Preferred Stock were proportionately reduced. All share and per share data shown in the accompanying consolidated financial statements and related notes have been retroactively revised to reflect the stock split. Common Stock Reserved for Future Issuance As of December 31, 2022, the Company had reserved the following shares of common stock for future issuance pursuant to the 2021 Stock Option and Incentive Plan (the “2021 Plan”): Shares of common stock authorized for issuance 13,503,001 Options outstanding (2,041,634) Restricted stock units issued and outstanding (1,346,925) Performance stock units issued and outstanding (1,377,216) Shares of common stock reserved for future issuance (1) 8,737,226 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation In 2019, the Board of Directors adopted the Semrush Holdings, Inc. 2019 Stock Option and Grant Plan (the “2019 Plan”), which provides for the grant of qualified incentive stock options and nonqualified stock options or other awards , including restricted stock unit awards, to the Company’s employees, officers, directors, advisors, and outside consultants for the purchase of up to 8,682,600 shares of the Company’s common stock. In July 2020, the 2019 Plan was amended to provide for the grant of qualified incentive stock options and nonqualified stock options or other awards to the Company’s employees, officers, directors, advisors, and outside consultants for the purchase of up to 10,163,772 shares of the Company’s common stock. Stock options generally vest over a 4 ‑year period and expire 10 years from the date of grant. Certain options provide for accelerated vesting if there is a change in control (as defined in the 2019 Plan). The Semrush Holdings, Inc. 2021 Stock Option and Incentive Plan was adopted by the Board on March 3, 2021 and approved by stockholders on March 15, 2021 and became effective immediately prior to the effectiveness of the Company’s registration statement in connection with its IPO. The 2021 Plan replaced the 2019 Plan as the Board determined not to make additional awards under the 2019 Plan following the pricing of the Company’s IPO. The 2021 Plan allows the compensation committee of the Board to make equity-based and cash-based incentive awards to the Company’s officers, employees, directors and other key persons (including consultants). The Company initially reserved 13,503,001 shares of Class A common stock for the issuance of awards under the 2021 Plan. The 2021 Plan provides that the number of shares reserved and available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2022, by the lesser of 5% of the outstanding number of shares of Class A and Class B common stock on the immediately preceding December 31, or such lesser number of shares as determined by the compensation committee. This number is subject to adjustment in the event of a stock split, stock dividend or other change in the Company’s capitalization. The Company accounts for stock-based compensation in accordance with the provisions of ASC 718 Compensation - Stock Compensation , which requires the recognition of expense related to the fair value of stock-based compensation awards in the statements of operations. For stock option awards issued under the Company’s stock-based compensation plans to employees and members of the Board for their services on the Board, the fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model as discussed further below. For restricted stock units (“RSUs”) granted subject to service-based vesting conditions, the fair value is determined based on the closing price of the Company’s Class A common stock, as reported on the New York Stock Exchange. RSUs granted subject to service-based vesting conditions generally vest over a four-year requisite service period. For all other service-based awards, the Company recognizes compensation expense on a straight-line basis over the requisite service period of the award with actual forfeitures recognized as they occur. Given the absence of an active market for the Company’s common stock prior to the completion of the IPO , the Board, the members of which the Company believes have extensive business, finance, and venture capital experience, were required to estimate the fair value of the Company’s common stock at the time of each grant of a stock-based award. The Company and the Board utilized various valuation methodologies in accordance with the framework of the American Institute of Certified Public Accountants’ Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of its common stock. Each valuation methodology include s estimates and assumptions that require the Company’s judgment. These estimates and assumptions include a number of objective and subjective factors, in determining the value of the Company’s common stock at each grant date, including the following factors: (1) prices paid for the Company’s Preferred Stock, which the Company had sold to outside investors in arm’s-length transactions, and the rights, preferences, and privileges of the Company’s Preferred Stock and common stock; (2) valuations performed by an independent valuation specialist; (3) the Company’s stage of development and revenue growth; (4) the fact that the grants of stock-based awards involved illiquid securities in a private company; and (5) the likelihood of achieving a liquidity event for the common stock underlying the stock-based awards, such as an IPO or sale of the Company, given prevailing market conditions. The Company believes this methodology to be reasonable based upon the Company’s internal peer company analyses, and further supported by several arm’s-length transactions involving the Company’s Preferred Stock. Prior to the Company’s common stock being actively traded, the determination of fair value involved assumptions, judgments, and estimates. If different assumptions were made, stock-based compensation expense, consolidated net income (loss) and consolidated net income (loss) per share could have been significantly different. Following the closing of the Company’s IPO, fair value is determined based on the closing price of the Company’s Class A common stock, as reported on the New York Stock Exchange on the date of grant. The fair value of each option award was estimated on the date of grant using the Black-Scholes option-pricing model. As there was no public market for its common stock prior to March 25, 2021, which was the first day of trading, and as the trading history of the Company’s common stock was limited through December 31, 2022, the Company determined the expected volatility for options granted based on an analysis of reported data for a peer group of companies that issued options with substantially similar terms. The expected volatility of options granted has been determined using an average of the historical volatility measures of this peer group of companies. The expected life of options granted to employees was calculated using the simplified method, which represents the average of the contractual term of the option and the weighted-average vesting period of the option. The Company uses the simplified method because it does not have sufficient historical option exercise data to provide a reasonable basis upon which to estimate expected term. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected life of the share option. The Company has not paid, nor anticipates paying, cash dividends on its ordinary shares; therefore, the expected dividend yield is assumed to be zero. The weighted-average assumptions utilized to determine the fair value of options granted to employees are presented in the following table: Year Ended December 31, 2022 2021 2020 Expected volatility 53.3 % 52.1 % 51.0 % Weighted-average risk-free interest rate 2.72 % 1.07 % 0.71 % Expected dividend yield — — — Expected life – in years 6 6 6 A summary of the Company’s option activity under 2021 Plan and the 2019 Plan as of December 31, 2022, and changes during the year then ended are as follows: Number of Options Weighted-Average Exercise Price (per share) Weighted-Average Remaining Contractual Term (in years) Outstanding at December 31, 2021 6,329,822 $ 2.32 8.14 Granted 1,841,178 11.99 Exercised (681,860) 1.44 Forfeited (623,875) 4.28 Outstanding at December 31, 2022 6,865,265 4.82 7.68 Options exercisable at December 31, 2022 4,162,946 1.72 7.02 The weighted-average grant-date fair value of options granted during the year s ended December 31, 2022, 2021, and 2020 was $6.36, $8.45, and $2.01 per share , respectively . No tax benefits were realized from options during the year ended December 31, 2022 . The aggregate intrinsic value of options outstanding as of December 31, 2022 and 2021 was $32,721 and $117,734, respectively . The aggregate intrinsic value for options exercised during the year s ended December 31, 2022, 2021, and 2020 was $6,687, $26,151 , and $566, respectively . The aggregate intrinsic value for options exercisable as of December 31, 2022 was $27,919. The aggregate intrinsic value was calculated based on the positive difference, if any, between the estimated fair value of the Company’s common stock on December 31, 2022 and 2021 , respectively, or the date of exercise, as appropriate, and the exercise price of the underlying options. On July 28, 2020, the Company issued 156,852 shares of its restricted common stock (“Restricted Stock Issuance”) to the founders of Prowly for a total fair value of $291 under the 2019 Plan. This Restricted Stock Issuance vests over a three-year service period, applicable to both founders. As of December 31, 2022, 103,521 shares have vested in connection with this Restricted Stock Issuance. During the years ended December 31, 2022 and 2021, the Company granted to employees RSU awards for 1,181,782 and 239,936 shares of Class A common stock under the 2021 Plan, respectively. During the years ended December 31, 2022 and 2021 the Company recorded stock-based compensation expense related to the RSU grants of $3,295 and $440. The Company did not grant RSU awards during the year ended December 31, 2020. A summary of RSU activity under the Company’s 2021 Plan for the year ended December 31, 2022 is as follows: Number of Shares Weighted-Average Grant Date Fair Value Aggregate Fair Value Unvested balance at January 1, 2022 239,936 $ 17.21 $ 4,129 Granted 1,181,782 11.70 13,827 Vested (77,182) 16.01 1,236 Forfeited (74,793) 13.25 991 Unvested balance as of December 31, 2022 1,269,743 $ 11.97 $ 15,194 During the year ended December 31, 2022, the Company granted to employees performance stock units (“PSU”) awards for 1,395,596 shares of Class A common stock under the 2021 Plan. The Company did not grant PSU awards during the year ended December 31, 2021. The Company records stock-based compensation expense related to the PSU grants when it is probable that the underlying performance conditions will be recognized. During the year ended December 31, 2022, the Company granted two sets of PSU grants; executives and acquisition-related. The acquisition-related PSUs contained a market component. These awards were deemed probable of partial achievement by the Company during the year ended December 31, 2022. The executive grants were not probable of achievement as of December 31, 2022. During the year ended December 31, 2022, $148 of expense has been recognized in connection with a portion of the acquisition-related PSU awards, however, the remaining acquisition-related PSU awards were not probable of achievement as of December 31, 2022. For PSU grants that have only service and performance conditions, the Company measures these awards at the fair value of its class A common stock on the grant dates. For PSU grants that incorporate a market condition, only the market condition is reflected in the estimated fair value on the grant dates. The Company determined the fair value of the PSU awards using a binomial valuation method. A summary of PSU activity under the Company’s 2021 Plan for the year ended December 31, 2022 is as follows: Number of Shares Weighted-Average Grant Date Fair Value Aggregate Fair Value Unvested balance at January 1, 2022 — $ — $ — Granted 1,395,596 11.18 15,603 Vested — — — Forfeited (111,976) 11.05 1,237 Unvested balance at December 31, 2022 1,283,620 $ 11.22 $ 14,402 Compensation expense is based on the estimated value of the awards on the grant date, and is recognized over the period from the grant date through the expected vest dates of each vesting condition. The compensation expense attributable to the acquisition-based PSU awards was estimated based on a Monte Carlo simulation model, which applied the following key assumptions: For the Year Ended December 31, 2022 Risk-free interest rate 2.07 % Volatility 70.00 % Dividend Yield — % Term (years) 4.13 The Company has recorded stock-based compensation expense of $7,393, $2,742, and $1,079 during the years ended December 31, 2022, 2021, and 2020, respectively. The following table shows stock-based compensation expense by where the stock-based compensation expense is recorded by line item in the Company’s consolidated statement of operations: For the Year Ended December 31, 2022 2021 2020 Cost of revenue $ 74 $ 37 $ 18 Sales and marketing 2,235 405 166 Research and development 1,123 348 113 General and administrative 3,961 1,952 782 Total stock-based compensation $ 7,393 $ 2,742 $ 1,079 As of December 31, 2022, there was $741 of unrecognized compensation cost related to unvested common stock option arrangements granted under the 2019 Plan, which is expected to be recognized over a weighted-average period of 1.34 years and $9,561 of unrecognized compensation cost related to unvested common stock option arrangements granted under the 2021 Plan, which is expected to be recognized over 3.27 years. As of December 31, 2022, there was $12,897 of unrecognized compensation cost related to unvested RSUs granted under the 2021 Plan, which is expected to be recognized over a weighted-average period of 3.14 years. As of December 31, 2022, the amount of unrecognized compensation cost related to unvested PSUs was not material. 2021 Employee Stock Purchase Plan The Semrush Holdings, Inc. 2021 Employee Stock Purchase Plan (the “ESPP”) was adopted by the Board on March 3, 2021 and approved by stockholders on March 15, 2021 and became effective immediately prior to the effectiveness of the Company’s registration statement in connection with its IPO. The ESPP initially reserves and authorizes the issuance of up to a total of 3,000,667 shares of Class A common stock to participating employees. The ESPP provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2022 and each January 1 thereafter through January 1, 2031, by the least of (i) 1% of the outstanding number of shares of Class A and Class B common stock on the immediately preceding December 31; (ii) 3,000,667 shares or (iii) such lesser number of shares of Class A common stock as determined by the ESPP administrator. The number of shares reserved under the ESPP is subject to adjustment in the event of a stock split, stock dividend or other change in the Company’s capitalization. The Company will continue to offer, sell and issue shares of common stock under the ESPP from time to time based on various factors and conditions, although the Company is under no obligation to sell any shares under the ESPP. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Data Providers In addition to its leases, the Company also has multi-year commitments with certain data providers expiring at various dates through 2026. As of December 31, 2022, future commitments for data services are as follows: Fiscal year ended December 31, Amount 2023 $ 8,408 2024 10,473 2025 11,288 2026 3,008 Total $ 33,177 Litigation From time to time the Company may become involved in legal proceedings or be subject to claims arising in the ordinary course of its business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on its business, operating results, financial condition or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Indemnification The Company typically enters into indemnification agreements with customers in the ordinary course of business. Pursuant to these agreements, the Company indemnifies and agrees to reimburse the indemnified party for losses suffered or incurred as a result of claims of intellectual property infringement. These indemnification agreements are provisions of the applicable customer agreement. Based on when clients first sign an agreement for the Company’s service, the maximum potential amount of future payments the Company could be required to make under certain of these indemnification agreements is unlimited. Based on historical experience and information known as of December 31, 2022 , the Company has not incurred any costs for the above guarantees and indemnities. In certain circumstances, the Company warrants that its services will perform in all material respects in accordance with its standard published specification documentation in effect at the time of delivery of the services to the customer for the term of the agreement. To date, the Company has not incurred significant expense under its warranties and, as a result, the Company believes the estimated fair value of these agreements is immaterial. |
Components of Other Income (Exp
Components of Other Income (Expense), Net | 12 Months Ended |
Dec. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Components of Other Income (Expense), Net | Components of Other Income (Expense), Net The components of other income ( expense ), net, are as follows: For the Year Ended December 31, 2022 2021 2020 Foreign currency exchange loss (1,302) (4) (672) Other income (expense), net 4,758 (518) 382 Total other income (expense), net $ 3,456 $ (522) $ (290) |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit PlanThe Company maintains a defined contribution savings plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”) covering all U.S. employees who satisfy certain eligibility requirements. The 401(k) Plan allows each participant to defer a percentage of their eligible compensation subject to applicable annual limits pursuant to the limits established by the Internal Revenue Service. The Company may, at the discretion of the Board, make contributions in the form of matching contributions or profit-sharing contributions. For the years ended December 31, 2022, 2021, and 2020, the Company made matching contributions of $938, $547, and $177, respectively, to the 401(k) Plan. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information Disclosure requirements about segments of an enterprise and related information establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in interim financial reports issued to shareholders. Operating segments are defined as components of an enterprise about which separate discrete financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief executive officer view the Company’s operations and manage its business as one operating segment. Geographic Data The Company allocates, for the purpose of geographic data reporting, its revenue based upon the location of the customer. Total revenue by geographic area was as follows: For the Year Ended December 31, 2022 2021 2020 Revenue: United States $ 119,775 $ 85,642 $ 57,231 United Kingdom 25,669 19,625 13,158 Other 108,872 82,734 54,486 Total revenue $ 254,316 $ 188,001 $ 124,875 Property and equipment, net by geographic location consists of the following: As of December 31, 2022 2021 Property and equipment, net: United States $ 6,025 $ 6,409 Russia — 1,406 Spain 832 — Czech Republic 442 408 Other 777 47 Total assets $ 8,076 $ 8,270 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsThe Company has completed an evaluation of all subsequent events after the audited balance sheet date of December 31, 2022 through March 15, 2023, the date this Annual Report on Form 10-K was filed with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the consolidated financial statements as of December 31, 2022, and events which occurred subsequently but were not recognized in the consolidated financial statements. The Company has concluded that no subsequent events have occurred that require disclosure |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates relied upon in preparing these consolidated financial statements include, but are not limited to, revenue recognition, expected future cash flows used to evaluate the recoverability of long-lived assets, contingent liabilities, expensing and capitalization of research and development costs for internal-use software, the average period of benefit associated with costs capitalized to obtain revenue contracts, the determination of the fair value of stock-based awards issued, stock-based compensation expense, the determination of the estimated fair value of the convertible notes held by the Company, the valuations of the intangible assets acquired through acquisitions, the estimation of the Company’s incremental borrowing rate, and the recoverability of the Company’s net deferred tax assets and related valuation allowance. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results may differ from management’s estimates if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. |
Subsequent Events Considerations | Subsequent Events ConsiderationsThe Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. |
Revenue Recognition | Revenue Recognition The Company primarily derives revenue from subscription revenues via the Semrush online visibility management platform and the Prowly public relations platform, which are comprised of subscription fees from customers accessing the Company’s SaaS services and related customer support. For the years ended December 31, 2022, 2021, and 2020, subscription revenue accounted for nearly all of the Company’s revenue. Revenue related to other revenue was not material for the years ended December 31, 2022, 2021 and 2020. The Company offers subscriptions to its platform primarily on a monthly or annual basis. The Company sells its products and services primarily through a self-service model and also directly through its sales force. The Company’s subscription arrangements provide customers the right to access the Company’s hosted software applications. Customers do not have the right to take possession of the Company’s software during the hosting arrangement. Subscriptions are generally non-cancellable during the contractual subscription term; however, subscription contracts contain a right to a refund if requested within seven days of purchase. The Company recognizes revenue in accordance with ASC 606. Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration it expects to receive in exchange for those products or services. To achieve the core principle of ASC 606, the Company performs the following steps: 1) Identify the contract(s) with a customer; 2) Identify the performance obligations in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) the Company satisfies a performance obligation. The Company recognizes subscription and support revenue ratably over the term of the contract, beginning on the date the customer is provided access to the Company’s service. These subscriptions are generally stand-ready obligations as the customer has access to the service throughout the term of the subscription, and the Company’s performance obligations are satisfied with the customer over time. The Company considers the SaaS services and related support services to have the same pattern of transfer to the customer. As such, they are accounted for as a single performance obligation. Amounts that have been invoiced are recorded in accounts receivable and in deferred revenue or revenue, depending on whether the revenue recognition criteria have been met. The Company primarily invoices and collects payments from customers for its services in advance on a monthly or annual basis. Deferred revenue represents amounts billed for which revenue has not yet been recognized. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current deferred revenue, and the remaining portion is recorded as long-term deferred revenue. Deferred revenue increased by $9,007 and $13,809 during the years ended December 31, 2022 and 2021, respectively. During the years ended December 31, 2022, 2021, and 2020, $40,232, $26,537, and $19,218 of revenue was recognized that was included in deferred revenue at the beginning of each respective period. The Company has elected to exclude amounts charged to customers for sales tax from the transaction price. Accordingly, revenue is presented net of any sales tax collected from customers. Transaction Price Allocated to Future Performance Obligations ASC 606 requires that the Company disclose the aggregate amount of the transaction price that is allocated to performance obligations that have not yet been satisfied as of the balance sheet dates reported. For contracts with an original expected duration greater than one year, the aggregate amount of the transaction price allocated to the performance obligations that were unsatisfied as of December 31, 2022 was $654, which the Company expects to recognize over the next 12 months. For contracts with an original expected duration of one year or less, the Company has applied the practical expedient available under ASC 606 to not disclose the amount of transaction price allocated to unsatisfied performance obligations as of December 31, 2022. For performance obligations not satisfied as of December 31, 2022, and to which this expedient applies, the nature of the performance obligations is consistent with performance obligations satisfied as of December 31, 2022. The remaining durations are less than one year. Costs to Obtain a Contract The incremental direct costs of obtaining a contract, which primarily consist of sales commissions paid for new subscription contracts, are deferred and recorded as deferred contract costs in the consolidated balance sheet and are amortized over a period of approximately 24 months on a systematic basis, consistent with the pattern of transfer of the goods or services to which the asset relates. The 24-month period represents the estimated benefit period of the customer relationship and has been determined by taking into consideration the type of product sold, the commitment term of the customer contract, the nature of the Company’s technology development life-cycle, and an estimated customer relationship period based on historical experience and future expectations. Deferred contract costs that will be recorded as expense during the succeeding 12-month period are recorded as current deferred contract costs, and the remaining portion is recorded as deferred contract costs, net of current portion. Amortization of deferred contract costs is included in sales and marketing expense in the accompanying consolidated statements of operations and comprehensive loss. |
Cost of Revenue | Cost of Revenue Cost of revenue primarily consists of expenses related to supporting and hosting the Company’s SaaS platforms, acquiring data and providing support to the Company’s customers. These costs include salaries, benefits, incentive compensation and stock-based compensation expense related to the management of the Company’s data centers, the customer support team, and data acquisition costs. In addition to these expenses, the Company incurs third-party service provider costs, such as data center and networking expenses, allocated overhead costs, and depreciation and amortization expense associated with the Company’s property and equipment and capitalized internal-use software development costs. |
Cash, Cash Equivalents and Investments | Cash, Cash Equivalents and Investments The Company considers all highly liquid instruments purchased with an original maturity date of 90 days or less from the date of purchase to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks and amounts held in interest-bearing money market funds. Cash equivalents are carried at cost, which approximates their fair market value. Investments not classified as cash equivalents are presented as either short-term or long-term investments based on both their stated maturities as well as the time period the Company intends to hold such securities. The Company determines the appropriate classification of investments at the time of purchase and reevaluates such designation at each balance sheet date. The Company adjusts the cost of investments for amortization of premiums and accretion of discounts to maturity. The Company includes such amortization and accretion in interest income in the consolidated statements of operations. When the Company holds debt investments classified as available-for-sale pursuant to ASC 320, Investments — Debt Securities (“ASC 320”), it records available-for-sale securities at fair value, with unrealized gains and losses included in accumulated other comprehensive loss in stockholders’ equity. The Company includes interest and dividends on securities classified as available-for-sale in interest income in the consolidated statements of operations and comprehensive loss. Realized gains and losses are recorded in the consolidated statements of operations and comprehensive loss based on the specific-identification method. There were no material realized gains or losses on investments for the years ended December 31, 2022, 2021, or 2020. The Company did not hold any debt investments as of December 31, 2021. |
Restricted Cash | Restricted Cash As of December 31, 2021, restricted cash was $176 and related to cash held at a separate financial institution in an interest-bearing cash account as collateral for a letter of credit related to the contractual provisions for one of the Company’s building leases. During 2022, this cash was returned to the Company and a corresponding reduction was made to the Company’s line of credit. See Note 9 for detail on this credit facility. Restricted cash is included in “other long-term assets” in the accompanying consolidated balance sheets as of December 31, 2021 based on the maturity date of the letter of credit. |
Concentrations of Credit Risk and Significant Customers | Concentrations of Credit Risk and Significant Customers The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, and accounts receivables. The Company maintains its cash and cash equivalents with multiple financial institutions that management believes to be of high-credit quality. At times, the deposits with these financial institutions may exceed federally insured limits. |
Allowance for doubtful accounts | Allowance for doubtful accountsThe Company reduces gross trade accounts receivable by an allowance for doubtful accounts based upon the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable and based upon historical loss patterns, the number of days that billings are past due, and an evaluation of the potential risk of loss associated with specific accounts. Provisions for the allowance for doubtful accounts are recorded in general and administrative expense. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the related asset. The estimated useful lives of the Company’s property and equipment are as follows: Estimated Useful Life (In Years) Computer equipment 2 to 5 Furniture and office equipment 5 to 7 Leasehold improvements 2 to 4 |
Capitalized Software Development Costs | Capitalized Software Development Costs Costs incurred to develop software applications used in the Company’s SaaS platform consist of certain direct costs of materials and services incurred in developing or obtaining internal-use computer software, and payroll and payroll-related costs for employees who are directly associated with, and who devote time to, the project. These costs generally consist of internal labor during configuration, coding, and testing activities. Research and development costs incurred during the preliminary project stage or costs incurred for data conversion activities, training, maintenance, and general and administrative or overhead costs are expensed as incurred. Once a project has reached the application development stage, internal and external costs, if direct and incremental, are capitalized until the project is substantially complete and ready for its intended use. Qualified costs incurred during the post-implementation stage of the Company’s software applications relating to upgrades and enhancements are capitalized to the extent it is probable that they will result in added functionality, while costs incurred for maintenance of, and minor upgrades and enhancements to, internal-use software are expensed as incurred. Capitalized software development costs are amortized on a straight-line basis over their estimated useful life of three years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. |
Business Combinations | Business Combinations In accordance with ASC 805, Business Combinations (“ASC 805”) , the Company recognizes the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. Determining these fair values requires management to make significant estimates and assumptions, especially with respect to intangible assets. The Company recognizes identifiable assets acquired and liabilities assumed at their acquisition date fair value. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair value of the assets acquired and the liabilities assumed and represents the expected future economic benefits arising from other assets acquired that are not individually identified and separately recognized. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, its estimates are inherently uncertain and subject to refinement. Assumptions may be incomplete or inaccurate, and unanticipated events or circumstances may occur, which may affect the accuracy or validity of such assumptions, estimates, or actual results. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill to the extent that it identifies adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date. The Company generally determines the fair value of the contingent consideration using the Monte Carlo simulation model. Each reporting period thereafter, these obligations are revalued and increases or decreases in their fair value are recorded as an adjustment to operating expenses within the consolidated statements of operations and comprehensive loss. Changes in the fair value of the contingent consideration can result from changes in assumed discount periods and rates, and from changes pertaining to the achievement of the defined milestones. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, future business and economic conditions, as well as changes in any of the assumptions described above, can materially impact the amount of contingent consideration expense the Company records in any given period. |
Goodwill and acquired intangible assets | Goodwill and acquired intangible assets Goodwill is not amortized, but is evaluated for impairment annually, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company has determined that there is a single reporting unit for the purpose of conducting this goodwill impairment assessment and the fair value of its reporting unit has been determined based on the Company’s enterprise value. As part of the annual goodwill impairment test, the Company has the option to perform a qualitative assessment to determine whether further impairment testing is necessary. Examples of events and circumstances that might indicate that the reporting unit’s fair value is less than its carrying amount include macro-economic conditions such as deterioration in the entity’s operating environment or industry or market considerations; entity-specific events such as increasing costs, declining financial performance, or loss of key personnel; or other events such as a sustained decrease in the stock price on either an absolute basis or relative to peers. If, as a result of its qualitative assessment, it is more likely than not (i.e., greater than 50% chance) that the fair value of the Company’s reporting unit is less than its carrying amount, the quantitative impairment test will be required. Otherwise, no further testing will be required. The Company completed its |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets consist of property and equipment, intangible assets, and capitalized software development costs. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset group for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset group are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset group over its fair value, determined based on discounted cash flows. For the year ended December 31, 2022, the Company recorded $642 of impairment expense related to its capitalized software development costs. Impairment expense related to capitalized software development costs is included in “research and development” in the accompanying consolidated statement of operations for the year ended December 31, 2022. For the year ended December 31, 2021, the Company did not identify any indicators of impairment of its long-lived assets. For the year ended December 31, 2020, the Company recorded an immaterial amount of impairment expense relating to capitalized software development costs. |
Disclosure of Fair Value of Financial Instruments and Fair Value Measurements | Disclosure of Fair Value of Financial Instruments The Company’s financial instruments include cash, cash equivalents, investments, accounts receivable, accounts payable, and accrued expenses. The company’s investments are classified as available-for-sale and reported at fair value in accordance with the market approach utilizing quoted prices that were directly or indirectly observable. The carrying amount of the remainder of the Company’s financial instruments approximated their fair values as of December 31, 2022 and 2021, due to the short-term nature of these instruments. The Company has evaluated the estimated fair value of financial instruments using available market information. The use of different market assumptions and/or estimation methodologies could have a significant effect on the estimated fair value amounts. See below for further discussion. Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a three-level valuation hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. This guidance further identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1 inputs—Unadjusted observable quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs—Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions of that market. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company evaluates assets and liabilities subject to fair value measurements on a recurring and nonrecurring basis to determine the appropriate level to classify them for each reporting period. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred. Advertising expense, which is included within sales and marketing expense in the consolidated statements of operations and comprehensive loss, was $66,319, $42,677, and $25,467 for the years ended December 31, 2022, 2021, and 2020, respectively. |
Leases | Leases Since the Company is an Emerging Growth Company and have elected to use the extended transition period for complying with any new or revised financial accounting standards, the Company adopted the ASU 2016-02 during the fourth quarter of 2022 and applied the modified retrospective method of adoption with a cumulative transition adjustment at January 1, 2022. Subsequent to the adoption of ASU 2016-02, the Company classifies leases at the lease commencement date. At the commencement date, the Company will recognize a right-of-use asset (“ROUA”) and a lease liability on the balance sheet for all leases with the exception of those with a lease term of 12 months or less. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company has elected to account for lease and non-lease components as a single lease component. Lease liabilities and their corresponding ROUAs are recorded based on the present value of lease payments over the expected lease term. The implicit rate within the Company’s leases is generally not determinable and therefore the Company uses the incremental borrowing rate at the lease commencement date to determine the present value of lease payments. The Company determines its incremental borrowing rate for each lease based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. Certain of the Company’s leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROUA and lease liability when it is reasonably certain the Company will exercise that option. An option to terminate is considered unless it is reasonably certain the Company will not exercise the option. See Note 3 for further information. |
Foreign Currency Translation | Foreign Currency Translation The Company operates in a multi-currency environment having transactions in such currencies as the U.S. dollar, Russian ruble, Czech koruna, euro, and others. The reporting currency of the Company is the U.S. dollar. For all periods up to and including the year ended December 31, 2021, the functional currency of the Company’s foreign subsidiaries was the U.S. dollar, with the exception of Prowly, where the functional currency is the local currency, the zloty. For all other entities, foreign currency transactions were measured initially in the functional currency of the recording entity by use of the exchange rate in effect at that date. As each subsequent balance sheet date, foreign currency denominated assets and liabilities of these international subsidiaries were remeasured into U.S. dollars using the exchange rates in effect at the balance sheet date or historical rates, as appropriate. Any differences resulting from the remeasurement of foreign denominated assets and liabilities of the international subsidiaries to the U.S. dollar functional currency were recorded within other income (expense) in the consolidated statement of operations and comprehensive loss. |
Income Taxes | Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the Company’s consolidated financial statements and tax returns. Deferred tax assets and liabilities are determined based upon the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and for loss and credit carryforwards, using enacted tax rates expected to be in effect in the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that these assets may not be realized. The Company provides reserves for potential payments of tax to various tax authorities related to uncertain tax positions. Amounts recognized are based on a determination of whether a tax benefit taken by the Company is more likely than not to be sustained upon audit. The amount recognized is equal to the largest amount that is more than 50% likely to be sustained. Interest and penalties associated with such |
Net Loss Per Share | Net Loss Per Share In March 2021, the Company amended its certificate of incorporation to create two classes of common stock outstanding: Class A common stock and Class B common stock. As more fully described in Note 11 “Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)”, the rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one (1) vote per share and each share of Class B common stock is entitled to ten (10) votes per share. Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Shares of Class B common stock are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible. See Note 11 “Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)” for additional information regarding the current conversion and transfer terms of the Company’s common stock. The Company allocates undistributed earnings attributable to common stock between the common stock classes on a one-to-one basis when computing net loss per share. As a result, basic and diluted net loss per share of Class A common stock and share of Class B common stock are equivalent. Net loss per share information is determined using the two-class method, which includes the weighted-average number of shares of common stock outstanding during the period and other securities that participate in dividends (a participating security). With respect to shares of Preferred Stock that were issued and outstanding prior to the IPO, the Company considers the shares of Preferred Stock to be participating securities because they include rights to participate in dividends with the common stock. Under the two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share attributable to common stockholders is computed using the more dilutive of (1) the two-class method or (2) the if-converted method. The Company allocates net income first to the holders of the Preferred Stock based on dividend rights under the Company’s certificate of incorporation and then to preferred and common stockholders based on ownership interests. Net losses are not allocated to preferred stockholders as they do not have an obligation to share in the Company’s net losses. Diluted net loss per share gives effect to all potentially dilutive securities. Potential dilutive securities consist of shares of common stock issuable upon the exercise of stock options, shares of common stock issuable upon the conversion of the outstanding shares of Preferred Stock, and shares of common stock issuable upon the vesting of restricted stock awards. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation awards in accordance with the provisions of ASC 718, Compensation—Stock Compensation (“ASC 718”), which requires the recognition of expense related to the fair value of stock-based compensation awards in the statements of operations. For service-based awards, the Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period of the award with actual forfeitures recognized as they occur. |
Comprehensive loss | Comprehensive loss Comprehensive loss is comprised of two components: net loss and other comprehensive loss, which includes other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. Such changes include the cumulative foreign currency translation adjustment and unrealized gains or losses on available-for-sale securities. The tax effect of the cumulative foreign currency translation adjustment and unrealized gains or losses on available-for-sale securities is not significant for the years ended December 31, 2022 and 2021. Comprehensive loss equaled total net loss for the year ended December 31, 2020. |
Contingent Liabilities | Contingent Liabilities The Company has certain contingent liabilities that arise in the ordinary course of business activities. The Company accrues for loss contingencies when losses become probable and are reasonably estimable. If the reasonable estimate of the loss is a range and no amount within the range is a better estimate, the minimum amount of the range is recorded as a liability. The Company does not accrue for contingent losses that, in its judgment, are considered to be reasonably possible, but not probable; however, it discloses the range of such reasonably possible losses. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer (“CEO”). The Company and the CEO view the Company’s operations and manage its business as one operating segment. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In February 2016, the FASB issued ASU 2016-02, Leases (“ASC 842”). ASU 2016-02 requires a lessee to recognize most leases on the balance sheet but recognize expenses on the income statement in a manner similar to current practice. The update states that a lessee will recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying assets for the lease term. Leases will continue to be classified as either financing or operating, with classification affecting the recognition, measurement, and presentation of expenses and cash flows arising from a lease. Since the Company is an Emerging Growth Company and have elected to use the extended transition period for complying with any new or revised financial accounting standards, the Company adopted the ASU 2016-02 during the fourth quarter of 2022 and applied the modified retrospective method of adoption with a cumulative transition adjustment at January 1, 2022. See Note 3 for further detail of the impact to the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses ("ASC 326”): Measurement of Credit Losses on Financial Instruments . ASU 2016-13 requires that credit losses be reported as an allowance using an expected losses model, representing the entity’s current estimate of credit losses expected to be incurred. The accounting guidance currently in effect is based on an incurred loss model. ASU 2016-13 affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for public entities for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. For non-public companies, ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company plans to adopt this guidance in the year ended December 31, 2023. The Company is currently evaluating ASU 2016-13 and the potential impact on its consolidated financial statements and financial statement disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes . The new guidance simplifies the accounting for income taxes by removing several exceptions in the current standard and adding guidance to reduce complexity in certain areas, such as requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. For public companies, the ASU is effective for years beginning after December 15, 2020, and interim periods within those years, with early adoption permitted. For non-public companies, the new standard is effective for years beginning after December 15, 2021, with early adoption permitted. The Company adopted this guidance in the year ended December 31, 2022 and it did not have a material impact on its consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . ASU 2021-08 changes the accounting for contract assets and liabilities acquired in a business combination by requiring an acquiring entity to measure contract assets and liabilities in accordance with ASC 606, Revenue from Contracts with Customers. For public business entities, the amendments in ASU 2021-08 are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The amendments in ASU 2021-08 should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted. The Company adopted this guidance in the year ended December 31, 2022 which resulted in the recognition of $613 deferred revenue associated with the Kompyte acquisition. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Cash, Cash Equivalents and Investments | The following is a summary of cash, cash equivalents and investments as of December 31, 2022: Amortized Gross Gross Estimated December 31, 2022: Cash and cash equivalents $ 79,765 $ — $ — $ 79,765 Investments: U.S. treasury securities due in one year or less 153,604 5 (108) 153,501 Corporate Securities due in one year or less 4,295 — (22) 4,273 Total investments 157,899 5 (130) 157,774 Total cash, cash equivalents and investments $ 237,664 $ 5 $ (130) $ 237,539 |
Schedule of Reconciliation of Cash, Cash Equivalents and Restricted Cash | The following table is a reconciliation of cash, cash equivalents and restricted cash included in the accompanying consolidated balance sheets that sum to the total cash, cash equivalents and restricted cash included in the accompanying consolidated statements of cash flows. As of December 31, 2022 2021 Cash and cash equivalents $ 79,765 $ 269,665 Restricted cash included in “other long-term assets” — 176 $ 79,765 $ 269,841 |
Schedule of Property and Equipment | The estimated useful lives of the Company’s property and equipment are as follows: Estimated Useful Life (In Years) Computer equipment 2 to 5 Furniture and office equipment 5 to 7 Leasehold improvements 2 to 4 Property and equipment consists of the following: As of December 31, 2022 2021 Computer equipment (1) $ 11,133 $ 10,045 Furniture and office equipment 1,738 948 Leasehold improvements 786 1,737 Total property and equipment 13,657 12,730 Less: accumulated depreciation and amortization (5,581) (4,460) Property and equipment, net $ 8,076 $ 8,270 (1) Includes property and equipment acquired under finance leases (subsequent to the adoption of ASC 842) and capital leases (prior to the adoption of ASC 842) of $3,272 and $5,748, respectively. |
Schedule of Key Inputs Used in the Fair Value Calculation of Contingent Consideration Payable | The following table represents the key inputs used in the fair value calculation: As of December 31, 2022 December 31, 2021 Risk free interest rate 4.72 % 0.45 % Projected year of payment 2023 2022 — 2023 Revenue volatility 20.1 % 22.3 % Discount rate 9.72 % 5.87 % |
Schedule of Rollforward of Fair Value Measurements of Contingent Consideration | A rollforward of the fair value measurements of the contingent consideration liability for the years ended December 31, 2022 and 2021, is as follows: Balance as of December 31, 2020 78 Expense recognized related to service period rendered 516 Payments made (170) Balance as of December 31, 2021 424 Expense recognized related to service period rendered $ (20) Payments made (177) Balance as of December 31, 2022 $ 227 |
Schedule of Potentially Dilutive Common Stock Equivalents | The following potentially dilutive common stock equivalents have been excluded from the calculation of diluted weighted-average shares outstanding for the period presented: Year ended December 31, 2022 2021 2020 Stock options outstanding 6,865,265 6,329,822 7,611,258 Shares of Preferred Stock — — 29,695,200 Unvested RSAs, RSUs, and PSUs 1,328,714 345,026 156,852 |
Schedule of Fair Value Measurements, Recurring and Nonrecurring | The following table summarizes financial assets and liabilities measured and recorded at fair value on a recurring basis in the accompanying consolidated balance sheets as of December 31, 2022, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: December 31, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) Significant Other Observable Inputs (Level 2 Inputs) Significant Unobservable Inputs Total Assets: Money market funds $ 36,222 $ — $ — $ 36,222 U.S. treasury securities — 153,501 — 153,501 Corporate securities — 4,273 — 4,273 Convertible debt securities (See Note 5) — — 3,652 3,652 Total assets $ 36,222 $ 157,774 $ 3,652 $ 197,648 Liabilities: Contingent consideration $ — $ — $ 227 $ 227 Total liabilities $ — $ — $ 227 $ 227 |
Schedule of Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | A rollforward of the fair value measurements of the convertible debt securities for the years ended December 31, 2021 and 2022 is as follows: Balance as of December 31, 2020 $ — Investment in convertible debt securities 500 Change in fair value included in other income, net — Balance as of December 31, 2021 500 Additional investment in convertible debt securities 2,000 Change in fair value included in other income, net 1,152 Balance as of December 31, 2022 $ 3,652 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Lease Cost and Weighted-Average Lease Term and Discount Rate | The components of lease expense were as follows: Year Ended December 31, 2022 Operating lease cost $ 3,936 Short-term lease cost 1,128 Variable lease cost 7,340 Total lease cost $ 12,404 Year Ended December 31, 2022 Amortization of lease assets $ 2,106 Interest on lease liabilities 115 Total finance lease cost $ 2,221 Weighted-average remaining lease term and discount rate were as follows: As of December 31, 2022 Weighted-average remaining lease term (in years) Operating leases 3.9 Finance leases 1.6 Weighted-average discount rate Operating leases 5.08 % Finance leases 3.69 % |
Schedule of Future Minimum Amounts Payable of Operating Leases | Future minimum amounts payable as of December 31, 2022 were as follows: Year Ending December 31, Operating Leases Finance 2023 $ 4,033 $ 2,393 2024 3,004 865 2025 2,578 194 2026 2,617 — 2027 1,167 — Thereafter 154 — Total lease payments 13,553 3,452 Less: imputed interest (930) (134) Total lease liabilities $ 12,623 $ 3,318 As previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and under the previous lease accounting standard, future minimum payments for operating leases and capital leases as of December 31, 2021 were as follows: Year Ending December 31, Operating Leases Capital 2022 $ 4,051 $ 2,195 2023 2,734 2,346 2024 1,738 679 2025 1,341 151 2026 and thereafter 1,597 — Total future lease payments 11,461 5,371 Less: imputed interest — (416) Total $ 11,461 $ 4,955 |
Schedule of Future Minimum Amounts Payable of Finance Leases | Future minimum amounts payable as of December 31, 2022 were as follows: Year Ending December 31, Operating Leases Finance 2023 $ 4,033 $ 2,393 2024 3,004 865 2025 2,578 194 2026 2,617 — 2027 1,167 — Thereafter 154 — Total lease payments 13,553 3,452 Less: imputed interest (930) (134) Total lease liabilities $ 12,623 $ 3,318 As previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and under the previous lease accounting standard, future minimum payments for operating leases and capital leases as of December 31, 2021 were as follows: Year Ending December 31, Operating Leases Capital 2022 $ 4,051 $ 2,195 2023 2,734 2,346 2024 1,738 679 2025 1,341 151 2026 and thereafter 1,597 — Total future lease payments 11,461 5,371 Less: imputed interest — (416) Total $ 11,461 $ 4,955 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | The estimated useful lives of the Company’s property and equipment are as follows: Estimated Useful Life (In Years) Computer equipment 2 to 5 Furniture and office equipment 5 to 7 Leasehold improvements 2 to 4 Property and equipment consists of the following: As of December 31, 2022 2021 Computer equipment (1) $ 11,133 $ 10,045 Furniture and office equipment 1,738 948 Leasehold improvements 786 1,737 Total property and equipment 13,657 12,730 Less: accumulated depreciation and amortization (5,581) (4,460) Property and equipment, net $ 8,076 $ 8,270 (1) Includes property and equipment acquired under finance leases (subsequent to the adoption of ASC 842) and capital leases (prior to the adoption of ASC 842) of $3,272 and $5,748, respectively. |
Acquisitions, Acquired Intang_2
Acquisitions, Acquired Intangible Assets, and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Purchase Price Allocation Recorded in the Consolidated Balance Sheet | The following table presents the purchase price allocation recorded in the Company’s consolidated balance sheet as of the acquisition date, which was final as of June 30, 2022: Purchase Price Assets acquired Allocation Fair value of tangible assets: Other assets $ 328 Goodwill 4,928 Identifiable intangible assets 5,500 Total assets acquired $ 10,756 Liabilities assumed Current and non-current liabilities $ 756 Total liabilities assumed $ 756 Net assets acquired $ 10,000 |
Schedule of Intangible Assets | Intangible assets consist of the following: As of December 31, 2022 Weighted Average Remaining Gross Net Useful Life Carrying Accumulated Carrying (years) Amount Amortization Amount Developed technology 4.8 $ 4,007 $ (765) $ 3,242 Trade name 4.6 3,810 (656) 3,154 Content 3.1 1,958 (471) 1,487 Customer relationships 2.3 600 (159) 441 Capitalized internal-use software 2.6 3,415 (1,453) 1,962 Total as of December 31, 2022 $ 13,790 $ (3,504) $ 10,286 As of December 31, 2021 Weighted Average Remaining Gross Net Useful Life Carrying Accumulated Carrying (years) Amount Amortization Amount Developed technology 4.7 $ 1,194 $ (266) $ 928 Trade name 1.7 68 (30) 38 Capitalized internal-use software 2.5 2,964 (1,005) 1,959 Total as of December 31, 2021 $ 4,226 $ (1,301) $ 2,925 |
Schedule of Future Amortization Expense | As of December 31, 2022, future amortization expense is expected to be as follows: Fiscal Year Ended December 31, Amount 2023 $ 2,486 2024 2,265 2025 2,104 2026 1,721 2027 and thereafter 1,710 Total $ 10,286 |
Schedule of Goodwill | The changes in the carrying value of goodwill during the year ended December 31, 2022 were as follows: Amount Balance as of January 1, 2022 $ 1,991 Kompyte acquisition 4,928 Foreign currency translation adjustment (390) Balance as of December 31, 2022 $ 6,529 |
Accrued expenses (Tables)
Accrued expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consists of the following: As of December 31, 2022 2021 Employee compensation $ 5,083 $ 10,580 Income taxes payable 1,090 2,375 Other taxes payable 10,101 3,264 Vacation reserves 1,372 1,988 Other 201 1,272 Total accrued expenses $ 17,847 $ 19,479 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Loss Before Income Taxes | Loss before income taxes consists of the following: Year Ended December 31, 2022 2021 2020 United States $ (31,061) $ (6,021) $ (8,772) Foreign (1,856) 3,006 2,337 Loss before income taxes $ (32,917) $ (3,015) $ (6,435) |
Schedule of Provision for Income Taxes | The provision for income taxes in the accompanying consolidated financial statements is comprised of the following: Year Ended December 31, 2022 2021 2020 Current taxes: Federal $ 156 $ — $ — Foreign 868 123 640 State 160 88 27 Total current taxes 1,184 211 667 Deferred taxes: Federal 11 — — Foreign (264) 59 (90) State — — — Total deferred taxes (253) 59 (90) Provision for income taxes $ 931 $ 270 $ 577 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the United States statutory tax rate to the Company’s effective tax rate included in the accompanying consolidated statements of operations is as follows: Year Ended December 31, 2022 2021 2020 Expected benefit from income taxes 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 2.4 6.2 3.7 Foreign income tax rate differential (4.1) 16.0 2.5 Impact of disposition of Russian subsidiaries 6.1 — — Non-deductible expenses — (12.7) (10.7) Net impact of GILTI — (38.9) (3.1) Deferred statutory rate changes (2.9) (1.7) (1.1) Stock compensation (1.4) 93.8 — Foreign research and development incentive 1.7 24.1 — Tax attribute expiration (2.8) — — Change in valuation allowance (21.0) (110.1) (21.3) Other, net (1.8) (6.6) — Effective tax rate (2.8) % (8.9) % (9.0) % |
Schedule of Deferred Tax Assets and Liabilities | The Company’s significant deferred tax assets (liabilities) components are as follows: As of December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 10,018 $ 12,847 Capitalized research and development expenditures 9,487 — Accruals and reserves 1,670 2,419 Stock based compensation 959 262 Intangibles 520 298 Depreciation 100 — Capital loss carryforwards 1,915 — Finance lease 3,795 1,045 Other deferred tax asset carryforward 162 252 Gross deferred tax assets 28,626 17,123 Valuation allowance (21,698) (14,623) Total deferred tax assets 6,928 2,500 Deferred tax liabilities: Depreciation (650) (1,285) Intangibles (172) (262) Deferred commissions (2,178) (1,196) Operating lease right-of-use assets (3,662) — Other (277) (25) Total deferred tax liabilities (6,939) (2,768) Net deferred tax (liabilities) assets $ (11) $ (268) |
Redeemable Convertible Prefer_2
Redeemable Convertible Preferred Stock and Stockholders’ Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of Key Inputs Used in the Fair Value Calculation of Share Purchase Option | The following table represents the key inputs used in the fair value calculation: As of December 31, 2022 December 31, 2021 Risk free interest rate 4.72 % 0.45 % Projected year of payment 2023 2022 — 2023 Revenue volatility 20.1 % 22.3 % Discount rate 9.72 % 5.87 % |
Schedule of Common Stock Reserved For Future Issuance | As of December 31, 2022, the Company had reserved the following shares of common stock for future issuance pursuant to the 2021 Stock Option and Incentive Plan (the “2021 Plan”): Shares of common stock authorized for issuance 13,503,001 Options outstanding (2,041,634) Restricted stock units issued and outstanding (1,346,925) Performance stock units issued and outstanding (1,377,216) Shares of common stock reserved for future issuance (1) 8,737,226 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Weighted-Average Assumptions to Determine Fair Value | The weighted-average assumptions utilized to determine the fair value of options granted to employees are presented in the following table: Year Ended December 31, 2022 2021 2020 Expected volatility 53.3 % 52.1 % 51.0 % Weighted-average risk-free interest rate 2.72 % 1.07 % 0.71 % Expected dividend yield — — — Expected life – in years 6 6 6 For the Year Ended December 31, 2022 Risk-free interest rate 2.07 % Volatility 70.00 % Dividend Yield — % Term (years) 4.13 |
Summary of Option Activity | A summary of the Company’s option activity under 2021 Plan and the 2019 Plan as of December 31, 2022, and changes during the year then ended are as follows: Number of Options Weighted-Average Exercise Price (per share) Weighted-Average Remaining Contractual Term (in years) Outstanding at December 31, 2021 6,329,822 $ 2.32 8.14 Granted 1,841,178 11.99 Exercised (681,860) 1.44 Forfeited (623,875) 4.28 Outstanding at December 31, 2022 6,865,265 4.82 7.68 Options exercisable at December 31, 2022 4,162,946 1.72 7.02 |
Summary of RSU Activity | A summary of RSU activity under the Company’s 2021 Plan for the year ended December 31, 2022 is as follows: Number of Shares Weighted-Average Grant Date Fair Value Aggregate Fair Value Unvested balance at January 1, 2022 239,936 $ 17.21 $ 4,129 Granted 1,181,782 11.70 13,827 Vested (77,182) 16.01 1,236 Forfeited (74,793) 13.25 991 Unvested balance as of December 31, 2022 1,269,743 $ 11.97 $ 15,194 |
Summary of PSU Activity | A summary of PSU activity under the Company’s 2021 Plan for the year ended December 31, 2022 is as follows: Number of Shares Weighted-Average Grant Date Fair Value Aggregate Fair Value Unvested balance at January 1, 2022 — $ — $ — Granted 1,395,596 11.18 15,603 Vested — — — Forfeited (111,976) 11.05 1,237 Unvested balance at December 31, 2022 1,283,620 $ 11.22 $ 14,402 |
Schedule of Stock-based Compensation Expense | The following table shows stock-based compensation expense by where the stock-based compensation expense is recorded by line item in the Company’s consolidated statement of operations: For the Year Ended December 31, 2022 2021 2020 Cost of revenue $ 74 $ 37 $ 18 Sales and marketing 2,235 405 166 Research and development 1,123 348 113 General and administrative 3,961 1,952 782 Total stock-based compensation $ 7,393 $ 2,742 $ 1,079 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Other Commitments | In addition to its leases, the Company also has multi-year commitments with certain data providers expiring at various dates through 2026. As of December 31, 2022, future commitments for data services are as follows: Fiscal year ended December 31, Amount 2023 $ 8,408 2024 10,473 2025 11,288 2026 3,008 Total $ 33,177 |
Components of Other Income (E_2
Components of Other Income (Expense), Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Schedule of Components of Other Income (Expense), Net | The components of other income ( expense ), net, are as follows: For the Year Ended December 31, 2022 2021 2020 Foreign currency exchange loss (1,302) (4) (672) Other income (expense), net 4,758 (518) 382 Total other income (expense), net $ 3,456 $ (522) $ (290) |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Total Revenue by Geographic Area | Total revenue by geographic area was as follows: For the Year Ended December 31, 2022 2021 2020 Revenue: United States $ 119,775 $ 85,642 $ 57,231 United Kingdom 25,669 19,625 13,158 Other 108,872 82,734 54,486 Total revenue $ 254,316 $ 188,001 $ 124,875 |
Schedule of Property and Equipment, Net by Geographic Location | Property and equipment, net by geographic location consists of the following: As of December 31, 2022 2021 Property and equipment, net: United States $ 6,025 $ 6,409 Russia — 1,406 Spain 832 — Czech Republic 442 408 Other 777 47 Total assets $ 8,076 $ 8,270 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Significant Accounting Policies [Line Items] | |||
Increase in deferred revenue, net | $ 9,007,000 | $ 13,809,000 | |
Revenue recognized that was included in deferred revenue at the beginning of each period | $ 40,232,000 | 26,537,000 | $ 19,218,000 |
Amortization period of deferred contract costs | 24 months | ||
Realized gain or loss on investments | $ 0 | 0 | 0 |
Short-term investments | 157,774,000 | 0 | |
Aggregate fair value of investments in unrealized loss position for less than twelve months | 137,816,000 | ||
Allowance for doubtful accounts | 0 | 0 | |
Capitalized internal-use software asset balance | 10,286,000 | 2,925,000 | |
Capitalized computer software, impairments | 642,000 | ||
Advertising expense | 66,319,000 | 42,677,000 | 25,467,000 |
Foreign currency exchange loss | 1,302,000 | 4,000 | 672,000 |
Liability for uncertain tax positions | $ 0 | 0 | 0 |
Number of operating segments | segment | 1 | ||
Prowly | |||
Significant Accounting Policies [Line Items] | |||
Contingent consideration payable | $ 227,000 | 424,000 | |
Contingent consideration, service period | 3 years | ||
Kompyte | |||
Significant Accounting Policies [Line Items] | |||
Deferred revenue | $ 613,000 | ||
Money market funds | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | |||
Significant Accounting Policies [Line Items] | |||
Money market funds | 21,366,000 | ||
Software Development | |||
Significant Accounting Policies [Line Items] | |||
Capitalized software development costs | 1,760,000 | 1,403,000 | 1,032,000 |
Amortization expense associated with capitalized development costs | 570,000 | 482,000 | $ 305,000 |
Capitalized internal-use software asset balance | 1,962,000 | $ 1,959,000 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |||
Significant Accounting Policies [Line Items] | |||
Aggregate amount of transaction price | $ 654,000 | ||
Remaining performance obligation, expected timing of satisfaction | 12 months |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Cash, Cash Equivalents and Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost, Cash and cash equivalents | $ 79,765 | $ 269,665 |
Amortized Cost, Investments | 157,899 | |
Amortized Cost, Total cash, cash equivalents and investments | 237,664 | |
Gross Unrealized Gains | 5 | |
Gross Unrealized Losses | (130) | |
Estimated Fair Value, Investments | 157,774 | $ 0 |
Estimated Fair Value, Cash and cash equivalents | 79,765 | |
Estimated Fair Value, Total cash, cash equivalents and investments | 237,539 | |
U.S. treasury securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost, Investments | 153,604 | |
Gross Unrealized Gains | 5 | |
Gross Unrealized Losses | (108) | |
Estimated Fair Value, Investments | 153,501 | |
Corporate securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost, Investments | 4,295 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (22) | |
Estimated Fair Value, Investments | $ 4,273 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 79,765 | $ 269,665 | ||
Restricted cash included in “other long-term assets” | 0 | 176 | ||
Cash, cash equivalents and restricted cash | $ 79,765 | $ 269,841 | $ 35,619 | $ 37,523 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Property and Equipment Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Computer equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 2 years |
Computer equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 5 years |
Furniture and office equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 5 years |
Furniture and office equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 7 years |
Leasehold improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 2 years |
Leasehold improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 4 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Assets: | ||
Cash and cash equivalents | $ 79,765 | |
Short-term investments | 157,774 | $ 0 |
U.S. treasury securities | ||
Assets: | ||
Short-term investments | 153,501 | |
Corporate securities | ||
Assets: | ||
Short-term investments | 4,273 | |
Fair Value, Recurring | ||
Assets: | ||
Total assets | 197,648 | |
Liabilities: | ||
Contingent consideration | 227 | |
Total liabilities | 227 | |
Fair Value, Recurring | U.S. treasury securities | ||
Assets: | ||
Short-term investments | 153,501 | |
Fair Value, Recurring | Corporate securities | ||
Assets: | ||
Short-term investments | 4,273 | |
Fair Value, Recurring | Convertible Debt Securities | ||
Assets: | ||
Short-term investments | 3,652 | |
Fair Value, Recurring | Money market funds | ||
Assets: | ||
Cash and cash equivalents | 36,222 | |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | ||
Assets: | ||
Total assets | 36,222 | |
Liabilities: | ||
Contingent consideration | 0 | |
Total liabilities | 0 | |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | U.S. treasury securities | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | Corporate securities | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | Convertible Debt Securities | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | Money market funds | ||
Assets: | ||
Cash and cash equivalents | 36,222 | |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2 Inputs) | ||
Assets: | ||
Total assets | 157,774 | |
Liabilities: | ||
Contingent consideration | 0 | |
Total liabilities | 0 | |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2 Inputs) | U.S. treasury securities | ||
Assets: | ||
Short-term investments | 153,501 | |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2 Inputs) | Corporate securities | ||
Assets: | ||
Short-term investments | 4,273 | |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2 Inputs) | Convertible Debt Securities | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2 Inputs) | Money market funds | ||
Assets: | ||
Cash and cash equivalents | 0 | |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3 Inputs) | ||
Assets: | ||
Total assets | 3,652 | |
Liabilities: | ||
Contingent consideration | 227 | |
Total liabilities | 227 | |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3 Inputs) | U.S. treasury securities | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3 Inputs) | Corporate securities | ||
Assets: | ||
Short-term investments | 0 | |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3 Inputs) | Convertible Debt Securities | ||
Assets: | ||
Short-term investments | 3,652 | |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3 Inputs) | Money market funds | ||
Assets: | ||
Cash and cash equivalents | $ 0 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Rollforward of Fair Value Measurements of Convertible Debt Securities (Details) - Convertible Debt Securities - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 500 | $ 0 |
Investment in convertible debt securities | 2,000 | 500 |
Change in fair value included in other income, net | 1,152 | 0 |
Balance at end of period | $ 3,652 | $ 500 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Fair Value Inputs (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Risk free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent consideration, measurement input | 0.0472 | 0.0045 |
Revenue volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent consideration, measurement input | 0.201 | 0.223 |
Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent consideration, measurement input | 0.0972 | 0.0587 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Fair Value of Contingent Consideration Liability (Details) - Prowly - Contingent Consideration Liability - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value of Contingent Consideration Liability [Roll Forward] | ||
Balance as of December 31, 2021 | $ 424 | $ 78 |
Expense recognized related to service period rendered | (20) | 516 |
Payments made | (177) | (170) |
Balance as of December 31, 2022 | $ 227 | $ 424 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Potentially Dilutive Common Stock Equivalents (Details) - shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stock options outstanding | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive common stock equivalents (in shares) | 6,865,265 | 6,329,822 | 7,611,258 |
Shares of Preferred Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive common stock equivalents (in shares) | 0 | 0 | 29,695,200 |
Unvested RSAs, RSUs, and PSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potentially dilutive common stock equivalents (in shares) | 1,328,714 | 345,026 | 156,852 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Thousands | 12 Months Ended | ||||||||||
Jun. 30, 2022 ft² | Jul. 09, 2020 ft² | May 28, 2020 | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Oct. 13, 2022 ft² extension_option | May 02, 2022 ft² | Apr. 28, 2022 ft² | Jan. 01, 2022 USD ($) | Jun. 23, 2021 ft² | |
Lessee, Lease, Description [Line Items] | |||||||||||
Total lease payments | $ | $ 3,452 | ||||||||||
Operating lease right-of-use assets | $ | 12,009 | $ 0 | $ 12,366 | ||||||||
Lease liability | $ | 12,623 | $ 12,579 | |||||||||
Rent expense | $ | $ 5,064 | $ 3,817 | $ 4,334 | ||||||||
Austin, Texas | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Number of square feet | 5,396 | ||||||||||
Number of extension options | extension_option | 2 | ||||||||||
Operating lease renewal term | 5 years | ||||||||||
Barcelona, Spain | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Number of square feet | 19,763 | ||||||||||
Option to terminate, period | 3 years | ||||||||||
Option to terminate, prior notice period | 6 months | ||||||||||
Dallas, Texas | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Number of square feet | 4,365 | ||||||||||
Trevose, Pennsylvania | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Number of square feet | 10,450 | ||||||||||
Operating lease renewal term | 5 years | ||||||||||
Boston, Massachusetts | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Number of square feet | 16,467 | ||||||||||
Operating lease renewal term | 5 years | ||||||||||
Limassol, Cyprus | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Number of square feet | 8,890 | ||||||||||
Operating lease renewal term | 3 years | ||||||||||
Option to terminate, period | 2 years | ||||||||||
Option to terminate, prior notice period | 2 months | ||||||||||
Prague, Czech Republic | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Option to terminate, prior notice period | 12 months | ||||||||||
Minimum | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Lease arrangement term | 1 year | ||||||||||
Maximum | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Operating lease renewal term | 10 years | ||||||||||
Lease arrangement term | 6 years |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 3,936 |
Short-term lease cost | 1,128 |
Variable lease cost | 7,340 |
Total lease cost | $ 12,404 |
Leases- Finance Lease Cost (Det
Leases- Finance Lease Cost (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Leases [Abstract] | |
Amortization of lease assets | $ 2,106 |
Interest on lease liabilities | 115 |
Total finance lease cost | $ 2,221 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Term and Discount Rate of Leases (Details) | Dec. 31, 2022 |
Weighted-average remaining lease term (in years) | |
Operating leases | 3 years 10 months 24 days |
Finance leases | 1 year 7 months 6 days |
Weighted-average discount rate | |
Operating leases | 5.08% |
Finance leases | 3.69% |
Leases - Future Minimum Amounts
Leases - Future Minimum Amounts Payable (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jan. 01, 2022 |
Operating Leases | ||
2023 | $ 4,033 | |
2024 | 3,004 | |
2025 | 2,578 | |
2026 | 2,617 | |
2027 | 1,167 | |
Thereafter | 154 | |
Total lease payments | 13,553 | |
Less: imputed interest | (930) | |
Total lease liabilities | 12,623 | $ 12,579 |
Finance Leases | ||
2023 | 2,393 | |
2024 | 865 | |
2025 | 194 | |
2026 | 0 | |
2027 | 0 | |
Thereafter | 0 | |
Total lease payments | 3,452 | |
Less: imputed interest | (134) | |
Total lease liabilities | $ 3,318 | |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Other current liabilities, Other long-term liabilities |
Leases - Future Minimum Payment
Leases - Future Minimum Payments for Operating Leases and Capital Leases (Details) $ in Thousands | Dec. 31, 2021 USD ($) |
Operating Leases | |
2022 | $ 4,051 |
2023 | 2,734 |
2024 | 1,738 |
2025 | 1,341 |
2026 and thereafter | 1,597 |
Total future lease payments | 11,461 |
Capital Leases | |
2022 | 2,195 |
2023 | 2,346 |
2024 | 679 |
2025 | 151 |
2026 and thereafter | 0 |
Total future lease payments | 5,371 |
Less: imputed interest | (416) |
Total | $ 4,955 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 13,657 | $ 12,730 |
Less: accumulated depreciation and amortization | (5,581) | (4,460) |
Property and equipment, net | 8,076 | 8,270 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 11,133 | 10,045 |
Finance leased asset | 3,272 | |
Capital leased assets | 5,748 | |
Furniture and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 1,738 | 948 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 786 | $ 1,737 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 4,200 | $ 2,826 | $ 1,013 |
Amortization of assets under finance leases | 2,106 | ||
Data center equipment | |||
Property, Plant and Equipment [Line Items] | |||
Amortization of assets under finance leases | $ 2,030 | ||
Amortization of assets under capital leases | $ 1,465 | $ 0 |
Other Assets (Details)
Other Assets (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2022 USD ($) | Jan. 31, 2021 USD ($) investment | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||
Number of convertible debt securities purchased | investment | 2 | ||||
Purchases of short-term investments | $ 2,000 | $ 500 | $ 2,000 | $ 500 | $ 0 |
Investment interest rate | 6% | 6% | |||
Fair value of the convertible notes gain (loss) | $ 1,152 | $ 0 | $ 0 |
Acquisitions, Acquired Intang_3
Acquisitions, Acquired Intangible Assets, and Goodwill - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Mar. 14, 2022 | Jan. 13, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2022 | |
Business Acquisition [Line Items] | ||||||
Amortization expense | $ 1,880 | $ 227 | $ 69 | |||
Trade name | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 4 years 7 months 6 days | 1 year 8 months 12 days | ||||
Content | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 3 years 1 month 6 days | |||||
Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 4 years 9 months 18 days | 4 years 8 months 12 days | ||||
Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 2 years 3 months 18 days | |||||
Capitalized internal-use software | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 2 years 7 months 6 days | 2 years 6 months | ||||
Backlinko | ||||||
Business Acquisition [Line Items] | ||||||
Cash consideration for acquisition | $ 4,000 | |||||
Identifiable intangible assets | $ 3,915 | |||||
Backlinko | Trade name | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 5 years | |||||
Backlinko | Content | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 4 years | |||||
Kompyte | ||||||
Business Acquisition [Line Items] | ||||||
Outstanding capital acquired (as percent) | 100% | |||||
Cash consideration for acquisition | $ 10,000 | |||||
Identifiable intangible assets | $ 5,500 | $ 5,500 | ||||
Kompyte | Trade name | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 6 years | |||||
Kompyte | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 6 years | |||||
Kompyte | Customer relationships | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average useful life | 3 years |
Acquisitions, Acquired Intang_4
Acquisitions, Acquired Intangible Assets, and Goodwill - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jun. 30, 2022 | Mar. 14, 2022 | Dec. 31, 2021 |
Assets acquired | ||||
Goodwill | $ 6,529 | $ 1,991 | ||
Kompyte | ||||
Assets acquired | ||||
Other assets | $ 328 | |||
Goodwill | 4,928 | |||
Identifiable intangible assets | 5,500 | $ 5,500 | ||
Total assets acquired | 10,756 | |||
Liabilities assumed | ||||
Current and non-current liabilities | 756 | |||
Total liabilities assumed | 756 | |||
Net assets acquired | $ 10,000 |
Acquisitions, Acquired Intang_5
Acquisitions, Acquired Intangible Assets, and Goodwill - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 13,790 | $ 4,226 |
Accumulated amortization | (3,504) | (1,301) |
Net carrying amount | $ 10,286 | $ 2,925 |
Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 4 years 9 months 18 days | 4 years 8 months 12 days |
Gross carrying amount | $ 4,007 | $ 1,194 |
Accumulated amortization | (765) | (266) |
Net carrying amount | $ 3,242 | $ 928 |
Trade name | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 4 years 7 months 6 days | 1 year 8 months 12 days |
Gross carrying amount | $ 3,810 | $ 68 |
Accumulated amortization | (656) | (30) |
Net carrying amount | $ 3,154 | $ 38 |
Content | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 3 years 1 month 6 days | |
Gross carrying amount | $ 1,958 | |
Accumulated amortization | (471) | |
Net carrying amount | $ 1,487 | |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 2 years 3 months 18 days | |
Gross carrying amount | $ 600 | |
Accumulated amortization | (159) | |
Net carrying amount | $ 441 | |
Capitalized internal-use software | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 2 years 7 months 6 days | 2 years 6 months |
Gross carrying amount | $ 3,415 | $ 2,964 |
Accumulated amortization | (1,453) | (1,005) |
Net carrying amount | $ 1,962 | $ 1,959 |
Acquisitions, Acquired Intang_6
Acquisitions, Acquired Intangible Assets, and Goodwill - Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2023 | $ 2,486 | |
2024 | 2,265 | |
2025 | 2,104 | |
2026 | 1,721 | |
2027 and thereafter | 1,710 | |
Net carrying amount | $ 10,286 | $ 2,925 |
Acquisitions, Acquired Intang_7
Acquisitions, Acquired Intangible Assets, and Goodwill - Goodwill (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Goodwill [Roll Forward] | |
Balance as of January 1, 2022 | $ 1,991 |
Kompyte acquisition | 4,928 |
Foreign currency translation adjustment | (390) |
Balance as of December 31, 2022 | $ 6,529 |
Exit Costs (Details)
Exit Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||
Exit costs | $ 11,264 | $ 0 | $ 0 |
Loss on disposal of subsidiaries | 1,738 | $ 0 | $ 0 |
Russia | |||
Restructuring Cost and Reserve [Line Items] | |||
Loss on disposal of subsidiaries | 1,738 | ||
One-time Termination Benefits | |||
Restructuring Cost and Reserve [Line Items] | |||
Exit costs | 1,244 | ||
Employee Relocation | |||
Restructuring Cost and Reserve [Line Items] | |||
Exit costs | 8,282 | ||
Other Restructuring | |||
Restructuring Cost and Reserve [Line Items] | |||
Expected restructuring and related cost | $ 1,318 |
Accrued expenses (Details)
Accrued expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Employee compensation | $ 5,083 | $ 10,580 |
Income taxes payable | 1,090 | 2,375 |
Other taxes payable | 10,101 | 3,264 |
Vacation reserves | 1,372 | 1,988 |
Other | 201 | 1,272 |
Total accrued expenses | $ 17,847 | $ 19,479 |
Revolving Credit Facility (Deta
Revolving Credit Facility (Details) - USD ($) | 12 Months Ended | ||
Jan. 12, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Interest expense | $ 211,000 | $ 211,000 | |
Revolving Credit Facility | JPMorgan Chase Bank, N.A. | |||
Line of Credit Facility [Line Items] | |||
Fee on undrawn amounts (as percent) | 0.25% | ||
Amount drawn | 0 | ||
Line of credit facility, increase (decrease), net | 176,000 | ||
Debt issuance costs | 630,000 | ||
Interest expense | $ 118,000 | $ 110,000 | |
Revolving Credit Facility | JPMorgan Chase Bank, N.A. | LIBOR | |||
Line of Credit Facility [Line Items] | |||
Variable interest rate floor (as percent) | 0.50% | ||
Margin on variable interest rate (as percent) | 2.75% | ||
Margin on variable interest rate, prior to initial public offering or positive adjusted EBITDA (as percent) | 3.50% | ||
Revolving Credit Facility | JPMorgan Chase Bank, N.A. | Base Rate | |||
Line of Credit Facility [Line Items] | |||
Variable interest rate floor (as percent) | 3.25% | ||
Variable interest rate floor, prior to initial public offering or positive adjusted EBITDA (as percent) | 1.50% | ||
Margin on variable interest rate (as percent) | 0% | ||
Margin on variable interest rate, prior to initial public offering or positive adjusted EBITDA (as percent) | 2.50% | ||
Revolving Credit Facility | JP Morgan Chase Credit Agreement | JPMorgan Chase Bank, N.A. | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 45,000,000 | ||
Advance rate (as percent) | 400% | ||
Term | 3 years | ||
Letter of Credit Sub-Facility | JP Morgan Chase Credit Agreement | JPMorgan Chase Bank, N.A. | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 5,000,000 |
Income Taxes - Loss Before Inco
Income Taxes - Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (31,061) | $ (6,021) | $ (8,772) |
Foreign | (1,856) | 3,006 | 2,337 |
Loss before income taxes | $ (32,917) | $ (3,015) | $ (6,435) |
Income Taxes - Provision For In
Income Taxes - Provision For Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current taxes: | |||
Federal | $ 156 | $ 0 | $ 0 |
Foreign | 868 | 123 | 640 |
State | 160 | 88 | 27 |
Total current taxes | 1,184 | 211 | 667 |
Deferred taxes: | |||
Federal | 11 | 0 | 0 |
Foreign | (264) | 59 | (90) |
State | 0 | 0 | 0 |
Total deferred taxes | (253) | 59 | (90) |
Provision for income taxes | $ 931 | $ 270 | $ 577 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Effective Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Expected benefit from income taxes | 21% | 21% | 21% |
State taxes, net of federal benefit | 2.40% | 6.20% | 3.70% |
Foreign income tax rate differential | (4.10%) | 16% | 2.50% |
Impact of disposition of Russian subsidiaries | 6.10% | 0% | 0% |
Non-deductible expenses | 0% | (12.70%) | (10.70%) |
Net impact of GILTI | 0 | (0.389) | (0.031) |
Deferred statutory rate changes | (2.90%) | (1.70%) | (1.10%) |
Stock compensation | (1.40%) | 93.80% | 0% |
Foreign research and development incentive | 1.70% | 24.10% | 0% |
Tax attribute expiration | (2.80%) | 0% | 0% |
Change in valuation allowance | (21.00%) | (110.10%) | (21.30%) |
Other, net | (1.80%) | (6.60%) | 0% |
Effective tax rate | (2.80%) | (8.90%) | (9.00%) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 10,018 | $ 12,847 |
Capitalized research and development expenditures | 9,487 | 0 |
Accruals and reserves | 1,670 | 2,419 |
Stock based compensation | 959 | 262 |
Intangibles | 520 | 298 |
Depreciation | 100 | 0 |
Capital loss carryforwards | 1,915 | 0 |
Finance lease | 3,795 | 1,045 |
Other deferred tax asset carryforward | 162 | 252 |
Gross deferred tax assets | 28,626 | 17,123 |
Valuation allowance | (21,698) | (14,623) |
Total deferred tax assets | 6,928 | 2,500 |
Deferred tax liabilities: | ||
Depreciation | (650) | (1,285) |
Intangibles | (172) | (262) |
Deferred commissions | (2,178) | (1,196) |
Operating lease right-of-use assets | (3,662) | 0 |
Other | (277) | (25) |
Total deferred tax liabilities | (6,939) | (2,768) |
Net deferred tax (liabilities) assets | $ (11) | $ (268) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | |||
Increase in valuation allowance | $ 7,075,000 | ||
Liability for uncertain tax positions | 0 | $ 0 | $ 0 |
Accrued interest and penalties related to uncertain tax positions | 0 | $ 0 | $ 0 |
Unremitted earnings of foreign subsidiaries | 3,057,000 | ||
Deferred tax liability on undistributed foreign earnings | 0 | ||
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 28,611,000 | ||
Federal | Capital Loss Carryforward | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 8,034,000 | ||
State | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 15,702,000 | ||
Foreign | Other Foreign Locations | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 1,189,000 | ||
Foreign | Cyprus | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | $ 22,837,000 |
Redeemable Convertible Prefer_3
Redeemable Convertible Preferred Stock and Stockholders’ Equity - Additional Information (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||
Nov. 23, 2021 USD ($) $ / shares shares | Apr. 23, 2021 USD ($) shares | Mar. 29, 2021 USD ($) $ / shares shares | Mar. 28, 2021 shares | Mar. 15, 2021 | Dec. 31, 2022 USD ($) vote $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) | |
Class of Stock [Line Items] | ||||||||
Payment of deferred offering costs | $ | $ 0 | $ 0 | $ 1,924 | |||||
Redeemable convertible preferred stock, authorized (in shares) | 9,898,400 | |||||||
Stock split, conversion ratio | 3 | 3 | ||||||
Conversion of preferred stock (in shares) | 29,695,200 | |||||||
Preferred stock, authorized (in shares) | 100,000,000 | 100,000,000 | ||||||
Percentage of votes required | 0.6667 | |||||||
Anniversary of effectiveness | 7 years | |||||||
Percentage of outstanding shares (as percent) | 0.10 | |||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||||||
Class A Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 | ||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||||||
Number of votes per share of stock held | vote | 1 | |||||||
Number of shares issued in conversion (in shares) | 1 | |||||||
Class A Common Stock | IPO | ||||||||
Class of Stock [Line Items] | ||||||||
Stock sold (in shares) | 10,000,000 | |||||||
Price per share (in dollars per share) | $ / shares | $ 14 | |||||||
Net proceeds | $ | $ 126,600 | |||||||
Payment of deferred offering costs | $ | $ 13,400 | |||||||
Class A Common Stock | Underwriters' Option | ||||||||
Class of Stock [Line Items] | ||||||||
Stock sold (in shares) | 719,266 | |||||||
Net proceeds | $ | $ 9,200 | |||||||
Payment of deferred offering costs | $ | $ 800 | |||||||
Class A Common Stock | Follow-On Offering | ||||||||
Class of Stock [Line Items] | ||||||||
Stock sold (in shares) | 4,000,000 | |||||||
Price per share (in dollars per share) | $ / shares | $ 20.50 | |||||||
Net proceeds | $ | $ 77,900 | |||||||
Payment of deferred offering costs | $ | $ 4,100 | |||||||
Class A Common Stock | Follow-On Offering | Co-founders, Executive Officers and Officers | ||||||||
Class of Stock [Line Items] | ||||||||
Stock sold (in shares) | 1,000,000 | |||||||
Class B Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, authorized (in shares) | 160,000,000 | 160,000,000 | ||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||||||
Number of votes per share of stock held | vote | 10 | |||||||
Series A | ||||||||
Class of Stock [Line Items] | ||||||||
Redeemable convertible preferred stock, authorized (in shares) | 3,379,400 | |||||||
Series A-1 | ||||||||
Class of Stock [Line Items] | ||||||||
Redeemable convertible preferred stock, authorized (in shares) | 1,837,600 | |||||||
Series B Convertible Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Redeemable convertible preferred stock, authorized (in shares) | 4,681,400 |
Redeemable Convertible Prefer_4
Redeemable Convertible Preferred Stock and Stockholders’ Equity - Common Stock Reserved for Future Issuance (Details) - shares | Dec. 31, 2022 | Mar. 15, 2021 | Jul. 31, 2020 | Dec. 31, 2019 |
2021 Plan | ||||
Class of Stock [Line Items] | ||||
Shares of common stock authorized for issuance | 13,503,001 | 13,503,001 | ||
Total authorized shares of common stock reserved for future issuance (in shares) | 8,737,226 | |||
2021 Plan | Options outstanding | ||||
Class of Stock [Line Items] | ||||
Total authorized shares of common stock reserved for future issuance (in shares) | 2,041,634 | |||
2021 Plan | Restricted stock units issued and outstanding | ||||
Class of Stock [Line Items] | ||||
Total authorized shares of common stock reserved for future issuance (in shares) | 1,346,925 | |||
2021 Plan | Performance stock units issued and outstanding | ||||
Class of Stock [Line Items] | ||||
Total authorized shares of common stock reserved for future issuance (in shares) | 1,377,216 | |||
2019 Plan | ||||
Class of Stock [Line Items] | ||||
Shares of common stock authorized for issuance | 10,163,772 | 8,682,600 | ||
2019 Plan | Options outstanding | ||||
Class of Stock [Line Items] | ||||
Total authorized shares of common stock reserved for future issuance (in shares) | 4,823,631 | |||
2019 Plan | Restricted stock | ||||
Class of Stock [Line Items] | ||||
Total authorized shares of common stock reserved for future issuance (in shares) | 53,331 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||||||
Aug. 31, 2022 | Feb. 28, 2022 | Mar. 15, 2021 | Jul. 28, 2020 | Jul. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expected dividend yield | 0% | 0% | 0% | ||||||
Weighted-average grant date fair value of options granted (in dollars per share) | $ 6.36 | $ 8.45 | $ 2.01 | ||||||
Tax benefit | $ 0 | ||||||||
Aggregate intrinsic value of options outstanding | 32,721,000 | $ 117,734,000 | |||||||
Aggregate intrinsic value of options exercised | 6,687,000 | 26,151,000 | $ 566,000 | ||||||
Aggregate intrinsic value of options exercisable | 27,919,000 | ||||||||
Stock-based compensation | $ 7,393,000 | 2,742,000 | $ 1,079,000 | ||||||
RSU | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Service period | 4 years | ||||||||
Awards granted (in shares) | 1,181,782 | ||||||||
Vested (in shares) | 77,182 | ||||||||
Stock-based compensation | $ 3,295,000 | 440,000 | |||||||
ESPP | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares reserved and authorized (in shares) | 3,000,667 | ||||||||
Percent of outstanding shares | 1% | ||||||||
Stock-based compensation | $ 204,000 | $ 133,000 | |||||||
Issuance of shares in connection with Employee Stock Purchase Plan (in shares) | 25,240 | 39,516 | |||||||
PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Expected dividend yield | 0% | ||||||||
Awards granted (in shares) | 1,395,596 | ||||||||
Vested (in shares) | 0 | ||||||||
2019 Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares reserved and authorized (in shares) | 10,163,772 | 8,682,600 | |||||||
Award vesting period | 4 years | ||||||||
Award expiration period | 10 years | ||||||||
Unrecognized compensation cost, options | $ 741,000 | ||||||||
2019 Plan | Restricted stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Total authorized shares of common stock reserved for future issuance (in shares) | 53,331 | ||||||||
Service period | 3 years | ||||||||
Awards granted (in shares) | 156,852 | ||||||||
Fair value of awards granted | $ 291,000 | ||||||||
Vested (in shares) | 103,521 | ||||||||
2019 Plan | Stock options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Total authorized shares of common stock reserved for future issuance (in shares) | 4,823,631 | ||||||||
Unrecognized compensation cost, period of recognition | 1 year 4 months 2 days | ||||||||
2021 Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares reserved and authorized (in shares) | 13,503,001 | 13,503,001 | |||||||
Total authorized shares of common stock reserved for future issuance (in shares) | 8,737,226 | ||||||||
Percent of outstanding shares | 5% | ||||||||
Unrecognized compensation cost, options | $ 9,561,000 | ||||||||
2021 Plan | RSU | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Total authorized shares of common stock reserved for future issuance (in shares) | 1,346,925 | ||||||||
Awards granted (in shares) | 1,181,782 | 239,936 | 0 | ||||||
Unrecognized compensation cost, period of recognition | 3 years 1 month 20 days | ||||||||
Unrecognized compensation cost | $ 12,897,000 | ||||||||
2021 Plan | Stock options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Total authorized shares of common stock reserved for future issuance (in shares) | 2,041,634 | ||||||||
Unrecognized compensation cost, period of recognition | 3 years 3 months 7 days | ||||||||
2021 Plan | PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Total authorized shares of common stock reserved for future issuance (in shares) | 1,377,216 | ||||||||
Awards granted (in shares) | 1,395,596 | ||||||||
Stock-based compensation | $ 148,000 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
Expected volatility | 53.30% | 52.10% | 51% |
Weighted-average risk-free interest rate | 2.72% | 1.07% | 0.71% |
Expected dividend yield | 0% | 0% | 0% |
Expected life – in years | 6 years | 6 years | 6 years |
Stock-Based Compensation - Opti
Stock-Based Compensation - Options Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Options | ||
Outstanding (in shares) | 6,329,822 | |
Granted (in shares) | 1,841,178 | |
Exercised (in shares) | (681,860) | |
Forfeited (in shares) | (623,875) | |
Outstanding (in shares) | 6,865,265 | 6,329,822 |
Options exercisable (in shares) | 4,162,946 | |
Weighted-Average Exercise Price (per share) | ||
Outstanding (in dollars per share) | $ 2.32 | |
Granted (in dollars per share) | 11.99 | |
Exercised (in dollars per share) | 1.44 | |
Forfeited (in dollars per share) | 4.28 | |
Outstanding (in dollars per share) | 4.82 | $ 2.32 |
Options exercisable (in dollars per share) | $ 1.72 | |
Weighted-Average Remaining Contractual Term (in years) | ||
Outstanding (in years) | 7 years 8 months 4 days | 8 years 1 month 20 days |
Options exercisable (in years) | 7 years 7 days |
Stock-Based Compensation - RSU
Stock-Based Compensation - RSU and PSU Activity (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
RSU | |
Number of Shares | |
Unvested beginning balance (in shares) | shares | 239,936 |
Granted (in shares) | shares | 1,181,782 |
Vested (in shares) | shares | (77,182) |
Forfeited (in shares) | shares | (74,793) |
Unvested ending balance (in shares) | shares | 1,269,743 |
Weighted-Average Grant Date Fair Value | |
Unvested beginning balance (in dollars per share) | $ / shares | $ 17.21 |
Granted (in dollars per share) | $ / shares | 11.70 |
Vested (in dollars per share) | $ / shares | 16.01 |
Forfeited (in dollars per share) | $ / shares | 13.25 |
Unvested ending balance (in dollars per share) | $ / shares | $ 11.97 |
Aggregate Fair Value | |
Unvested balance at January 1, 2022 | $ | $ 4,129 |
Granted | $ | 13,827 |
Vested | $ | 1,236 |
Forfeited | $ | 991 |
Unvested balance as of December 31, 2022 | $ | $ 15,194 |
PSUs | |
Number of Shares | |
Unvested beginning balance (in shares) | shares | 0 |
Granted (in shares) | shares | 1,395,596 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | (111,976) |
Unvested ending balance (in shares) | shares | 1,283,620 |
Weighted-Average Grant Date Fair Value | |
Unvested beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 11.18 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 11.05 |
Unvested ending balance (in dollars per share) | $ / shares | $ 11.22 |
Aggregate Fair Value | |
Unvested balance at January 1, 2022 | $ | $ 0 |
Granted | $ | 15,603 |
Vested | $ | 0 |
Forfeited | $ | 1,237 |
Unvested balance as of December 31, 2022 | $ | $ 14,402 |
Stock-Based Compensation - PSU
Stock-Based Compensation - PSU Awards Fair Value Assumption (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 2.72% | 1.07% | 0.71% |
Volatility | 53.30% | 52.10% | 51% |
Dividend Yield | 0% | 0% | 0% |
Term (years) | 6 years | 6 years | 6 years |
PSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 2.07% | ||
Volatility | 70% | ||
Dividend Yield | 0% | ||
Term (years) | 4 years 1 month 17 days |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | $ 7,393 | $ 2,742 | $ 1,079 |
Cost of revenue | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | 74 | 37 | 18 |
Sales and marketing | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | 2,235 | 405 | 166 |
Research and development | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | 1,123 | 348 | 113 |
General and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | $ 3,961 | $ 1,952 | $ 782 |
Commitments and Contingencies -
Commitments and Contingencies - Other Commitments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2023 | $ 8,408 |
2024 | 10,473 |
2025 | 11,288 |
2026 | 3,008 |
Total | $ 33,177 |
Components of Other Income (E_3
Components of Other Income (Expense), Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other Income and Expenses [Abstract] | |||
Foreign currency exchange loss | $ (1,302) | $ (4) | $ (672) |
Other income (expense), net | 4,758 | (518) | 382 |
Total other income (expense), net | $ 3,456 | $ (522) | $ (290) |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Matching contributions | $ 938 | $ 547 | $ 177 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Segment Reporting [Abstract] | |||
Number of operating segments | segment | 1 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Number of operating segments | segment | 1 | ||
Total revenue | $ 254,316 | $ 188,001 | $ 124,875 |
Property and equipment, net | 8,076 | 8,270 | |
United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | 119,775 | 85,642 | 57,231 |
Property and equipment, net | 6,025 | 6,409 | |
United Kingdom | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | 25,669 | 19,625 | 13,158 |
Other | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | 108,872 | 82,734 | $ 54,486 |
Property and equipment, net | 777 | 47 | |
Russia | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | 0 | 1,406 | |
Spain | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | 832 | 0 | |
Czech Republic | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property and equipment, net | $ 442 | $ 408 |