Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 10, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-34522 | |
Entity Registrant Name | ASURE SOFTWARE, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 74-2415696 | |
Entity Address, Address Line One | 405 Colorado Street, Suite 1800 | |
Entity Address, City or Town | Austin | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78701 | |
City Area Code | 512 | |
Local Phone Number | 437-2700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 24,851,198 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Entity Central Index Key | 0000884144 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Common Stock, $0.01 par value | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | ASUR | |
Security Exchange Name | NASDAQ | |
Series A Junior Participating Preferred Share Purchase Rights | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Series A Junior Participating Preferred Share Purchase Rights | |
No Trading Symbol Flag | true |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) shares in Thousands, $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash, cash equivalents, and restricted cash | $ 32,787 | $ 17,010 |
Accounts receivable, net of allowance for doubtful accounts of $1,186 and $3,248 at September 30, 2023 and December 31, 2022, respectively | 15,133 | 12,123 |
Inventory | 93 | 251 |
Prepaid expenses and other current assets | 3,907 | 10,304 |
Total current assets before funds held for clients | 51,920 | 39,688 |
Funds held for clients | 172,503 | 203,588 |
Total current assets | 224,423 | 243,276 |
Property and equipment, net | 13,436 | 11,439 |
Goodwill | 86,011 | 86,011 |
Intangible assets, net | 57,326 | 66,594 |
Operating lease assets, net | 5,265 | 7,065 |
Other assets, net | 8,036 | 5,523 |
Total assets | 394,497 | 419,908 |
Current liabilities: | ||
Current portion of notes payable | 195 | 4,106 |
Accounts payable | 1,696 | 2,194 |
Accrued compensation and benefits | 5,770 | 5,791 |
Operating lease liabilities, current | 1,510 | 1,860 |
Other accrued liabilities | 5,170 | 3,728 |
Contingent purchase consideration | 0 | 2,955 |
Deferred revenue | 3,392 | 8,461 |
Total current liabilities before client fund obligations | 17,733 | 29,095 |
Client fund obligations | 175,056 | 206,088 |
Total current liabilities | 192,789 | 235,183 |
Long-term liabilities: | ||
Deferred revenue | 666 | 788 |
Deferred tax liability | 1,614 | 1,503 |
Notes payable, net of current portion | 2,633 | 30,795 |
Operating lease liabilities, noncurrent | 4,956 | 6,459 |
Other liabilities | 177 | 114 |
Total long-term liabilities | 10,046 | 39,659 |
Total liabilities | 202,835 | 274,842 |
Stockholders’ equity: | ||
Preferred stock, $0.01 par value; 1,500 shares authorized; none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value; 44,000 shares authorized; 25,235 and 20,628 shares issued, 24,851 and 20,244 shares outstanding at September 30, 2023 and December 31, 2022, respectively | 252 | 206 |
Treasury stock at cost, 384 shares at September 30, 2023 and December 31, 2022 | (5,017) | (5,017) |
Additional paid-in capital | 485,981 | 433,586 |
Accumulated deficit | (286,858) | (281,226) |
Accumulated other comprehensive loss | (2,696) | (2,483) |
Total stockholders’ equity | 191,662 | 145,066 |
Total liabilities and stockholders’ equity | $ 394,497 | $ 419,908 |
Common stock, shares authorized | 44,000 | 44,000 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) shares in Thousands, $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 1,186 | $ 3,248 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,500 | 1,500 |
Preferred stock, shares outstanding | 0 | 0 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 44,000 | 44,000 |
Common stock, shares issued | 25,235 | 20,628 |
Common stock, shares outstanding | 24,851 | 20,244 |
Treasury Stock, Common, Shares | 384 | 384 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue: | ||||
Total revenue | $ 29,334 | $ 21,903 | $ 92,818 | $ 66,536 |
Cost of Sales | 8,054 | 8,256 | 25,120 | 25,164 |
Gross profit | 21,280 | 13,647 | 67,698 | 41,372 |
Operating expenses: | ||||
Sales and marketing | 6,597 | 4,752 | 22,312 | 14,238 |
General and administrative | 9,294 | 8,023 | 29,586 | 24,204 |
Research and development | 1,803 | 1,230 | 5,107 | 4,523 |
Amortization of intangible assets | 3,333 | 3,350 | 9,929 | 10,134 |
Total operating expenses | 21,027 | 17,355 | 66,934 | 53,099 |
Income (loss) from operations | 253 | (3,708) | 764 | (11,727) |
Interest expense, net | (782) | (1,122) | (4,321) | (3,006) |
Gain (Loss) on Extinguishment of Debt | (1,517) | 0 | (1,517) | 180 |
Other (expense) income, net | (283) | 399 | (291) | 1,349 |
Loss from operations before income taxes | (2,329) | (4,431) | (5,365) | (13,204) |
Income tax (benefit) expense | (123) | 102 | 267 | 206 |
Net loss | (2,206) | (4,533) | (5,632) | (13,410) |
Other comprehensive loss: | ||||
Unrealized loss on marketable securities | (201) | (1,243) | (213) | (2,802) |
Comprehensive loss | $ (2,407) | $ (5,776) | $ (5,845) | $ (16,212) |
Basic and diluted loss per share | ||||
Basic (in Dollars per share) | $ (0.10) | $ (0.22) | $ (0.27) | $ (0.67) |
Diluted (in Dollars per share) | $ (0.10) | $ (0.22) | $ (0.27) | $ (0.67) |
Weighted average basic and diluted shares | ||||
Basic (in shares) | 22,591 | 20,219 | 21,204 | 20,092 |
Diluted (in shares) | 22,591 | 20,219 | 21,204 | 20,092 |
Recurring | ||||
Revenue: | ||||
Total revenue | $ 23,833 | $ 19,959 | $ 74,749 | $ 61,977 |
Professional services, hardware and other | ||||
Revenue: | ||||
Total revenue | $ 5,501 | $ 1,944 | $ 18,069 | $ 4,559 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Deficit | Other Comprehensive Loss |
Beginning balance (in shares) at Dec. 31, 2021 | 20,028 | |||||
Beginning balance at Dec. 31, 2021 | $ 158,240 | $ 204 | $ (5,017) | $ 429,912 | $ (266,760) | $ (99) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 43 | |||||
Stock issued upon option exercise and vesting of restricted stock units | 1 | $ 1 | ||||
Share based compensation | 729 | 729 | ||||
Net income | (3,017) | (3,017) | ||||
Other comprehensive income | (1,063) | (1,063) | ||||
Ending balance (in shares) at Mar. 31, 2022 | 20,071 | |||||
Ending balance at Mar. 31, 2022 | 154,890 | $ 205 | (5,017) | 430,641 | (269,777) | (1,162) |
Beginning balance (in shares) at Dec. 31, 2021 | 20,028 | |||||
Beginning balance at Dec. 31, 2021 | $ 158,240 | $ 204 | (5,017) | 429,912 | (266,760) | (99) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 0 | |||||
Net income | $ (13,410) | |||||
Ending balance (in shares) at Sep. 30, 2022 | 20,160 | |||||
Ending balance at Sep. 30, 2022 | 144,562 | $ 205 | (5,017) | 432,445 | (280,170) | (2,901) |
Beginning balance (in shares) at Mar. 31, 2022 | 20,071 | |||||
Beginning balance at Mar. 31, 2022 | 154,890 | $ 205 | (5,017) | 430,641 | (269,777) | (1,162) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 33 | |||||
Stock issued upon option exercise and vesting of restricted stock units | 0 | |||||
Stock issued, ESPP (in shares) | 38 | |||||
Stock issued, ESPP | 192 | 192 | ||||
Share based compensation | 814 | 814 | ||||
Net income | (5,860) | (5,860) | ||||
Other comprehensive income | (496) | (496) | ||||
Ending balance (in shares) at Jun. 30, 2022 | 20,142 | |||||
Ending balance at Jun. 30, 2022 | $ 149,540 | $ 205 | (5,017) | 431,647 | (275,637) | (1,658) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 0 | 18 | ||||
Stock issued upon option exercise and vesting of restricted stock units | $ 0 | |||||
Share based compensation | 798 | 798 | ||||
Net income | (4,533) | (4,533) | ||||
Other comprehensive income | (1,243) | (1,243) | ||||
Ending balance (in shares) at Sep. 30, 2022 | 20,160 | |||||
Ending balance at Sep. 30, 2022 | 144,562 | $ 205 | (5,017) | 432,445 | (280,170) | (2,901) |
Beginning balance (in shares) at Dec. 31, 2022 | 20,244 | |||||
Beginning balance at Dec. 31, 2022 | 145,066 | $ 206 | (5,017) | 433,586 | (281,226) | (2,483) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 375 | |||||
Stock issued upon option exercise and vesting of restricted stock units | 1,988 | $ 4 | 1,984 | |||
Share based compensation | 1,337 | 1,337 | ||||
Net income | 339 | 339 | ||||
Other comprehensive income | 481 | 481 | ||||
Ending balance (in shares) at Mar. 31, 2023 | 20,619 | |||||
Ending balance at Mar. 31, 2023 | 149,211 | $ 210 | (5,017) | 436,907 | (280,887) | (2,002) |
Beginning balance (in shares) at Dec. 31, 2022 | 20,244 | |||||
Beginning balance at Dec. 31, 2022 | $ 145,066 | $ 206 | (5,017) | 433,586 | (281,226) | (2,483) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 349 | |||||
Net income | $ (5,632) | |||||
Ending balance (in shares) at Sep. 30, 2023 | 24,851 | |||||
Ending balance at Sep. 30, 2023 | 191,662 | $ 252 | (5,017) | 485,981 | (286,858) | (2,696) |
Beginning balance (in shares) at Mar. 31, 2023 | 20,619 | |||||
Beginning balance at Mar. 31, 2023 | 149,211 | $ 210 | (5,017) | 436,907 | (280,887) | (2,002) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 40 | |||||
Stock issued upon option exercise and vesting of restricted stock units | 42 | 42 | ||||
Stock issued, ESPP (in shares) | 46 | |||||
Stock issued, ESPP | 237 | $ 1 | 236 | |||
Share based compensation | 1,582 | 1,582 | ||||
Net income | (3,765) | (3,765) | ||||
Other comprehensive income | (493) | (493) | ||||
Ending balance (in shares) at Jun. 30, 2023 | 20,705 | |||||
Ending balance at Jun. 30, 2023 | $ 146,814 | $ 211 | (5,017) | 438,767 | (284,652) | (2,495) |
Stock issued upon option exercise and vesting of restricted stock units (in shares) | 66 | 99 | ||||
Stock issued upon option exercise and vesting of restricted stock units | $ 480 | $ 1 | 479 | |||
Stock Issued During Period, Value, New Issues | 45,524 | $ 40 | 45,484 | |||
Stock Issued During Period, Shares, New Issues | 4,047 | |||||
Share based compensation | 1,251 | 1,251 | ||||
Net income | (2,206) | (2,206) | ||||
Other comprehensive income | (201) | (201) | ||||
Ending balance (in shares) at Sep. 30, 2023 | 24,851 | |||||
Ending balance at Sep. 30, 2023 | $ 191,662 | $ 252 | $ (5,017) | $ 485,981 | $ (286,858) | $ (2,696) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net income | $ (5,632) | $ (13,410) |
Adjustments to reconcile loss to net cash provided by operations: | ||
Depreciation and amortization | 14,243 | 14,018 |
Amortization of operating lease assets | 1,129 | 1,268 |
Amortization of debt financing costs and discount | 548 | 531 |
Non-cash interest expense | 1,471 | 0 |
Net accretion of discounts and amortization of premiums on available-for-sale securities | (63) | 279 |
Provision for doubtful accounts | 2,004 | 304 |
Provision for deferred income taxes | 111 | 163 |
Loss (gain) on extinguishment of debt | 1,208 | (180) |
Net realized gains on sales of available-for-sale securities | (1,645) | (808) |
Share-based compensation | 4,170 | 2,341 |
Loss on disposals of long-term assets | 132 | 1 |
Change in fair value of contingent purchase consideration | 175 | (1,350) |
Adjustment to Intangibles | 0 | 23 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (5,014) | (1,816) |
Inventory | 159 | (85) |
Prepaid expenses and other assets | 4,031 | 2,855 |
Operating lease right-of-use assets | 473 | (3,489) |
Accounts payable | (498) | 738 |
Accrued expenses and other long-term obligations | 918 | 2,637 |
Operating lease liabilities | (895) | 2,298 |
Deferred revenue | (5,190) | 639 |
Net cash provided by operating activities | 11,835 | 6,957 |
Cash flows from investing activities: | ||
Acquisition of intangible asset | (697) | (2,289) |
Purchases of property and equipment | (1,365) | (2,188) |
Software capitalization costs | (5,029) | (3,219) |
Purchases of available-for-sale securities | (21,513) | (33,454) |
Proceeds from sales and maturities of available-for-sale securities | 10,428 | 7,159 |
Net cash used in investing activities | (18,176) | (33,991) |
Cash flows from financing activities: | ||
Payments of notes payable | (35,627) | (1,688) |
Debt extinguishment costs | (468) | 0 |
Payments of contingent purchase consideration | 0 | (9) |
Net proceeds from issuance of common stock | 45,986 | 192 |
Capital raise fees | (258) | 0 |
Net change in client fund obligations | (31,033) | (32,527) |
Net cash used in financing activities | (21,400) | (34,032) |
Net decrease in cash, cash equivalents, restricted cash, and restricted cash equivalents | (27,741) | (61,066) |
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period | 164,042 | 198,641 |
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period | 136,301 | 137,575 |
Cash, cash equivalents, and restricted cash | 32,787 | 10,885 |
Restricted cash and cash equivalents held to satisfy client funds obligations | 103,514 | 126,690 |
Total cash, cash equivalents, restricted cash, and restricted cash equivalents | 136,301 | 137,575 |
Supplemental information: | ||
Cash paid for interest | 3,140 | 2,247 |
Cash paid for income taxes | 532 | 246 |
Acquisition of intangible assets | 332 | 0 |
Notes payable issued for acquisitions | 0 | 411 |
Other Significant Noncash Transaction, Value of Consideration Given | $ 2,543 | $ 0 |
THE COMPANY AND BASIS OF PRESEN
THE COMPANY AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies | THE COMPANY AND BASIS OF PRESENTATION Asure Software, Inc. (“Asure”, the “Company”, “we” and “our”), a Delaware corporation, is a provider of cloud-based Human Capital Management (“HCM”) software solutions delivered as Software-as-a-Service (“SaaS”) for small and medium-sized businesses (“SMBs”). We offer human resources (“HR”) tools necessary to build a thriving workforce, provide the resources to stay compliant with dynamic federal, state, and local tax jurisdictions and their respective labor laws, freeing cash flows so SMBs can spend their financial capital on growing their businesses rather than administrative overhead that can impede growth. Our solutions also provide new ways for employers to connect with and to differentiate themselves with their employees in order to enhance their relationships with their talent. Asure’s HCM suite (“Asure HCM”) includes Payroll & Tax solutions, HR compliance and services, Time & Attendance software and data integrations that enable employers and their employees to enhance efficiencies and take advantage of value-added solutions, which we refer to as AsureMarketplace™. AsureMarketplace™ automates interactions between our HCM systems with third-party providers to enhance efficiency, improve accuracy and to extend the range of services offered to employers and their employees. The Company’s approach to HR compliance services incorporates artificial intelligence technology to enhance scalability and efficiency while prioritizing client interactions. We offer our services directly and indirectly through our network of Reseller Partners. We strive to be the most trusted HCM resource to SMBs. We target less densely populated U.S. metropolitan cities where fewer of our competitors have a presence. Our solutions solve three primary challenges that prevent businesses from growing: HR complexity, allocation of human and financial capital, and the ability to build great teams. We have and will continue to invest in research and development to expand our solutions. O ur solutions reduce the administrative burden on employers and increase employee productivity while managing the employment lifecycle. The Asure HCM suite includes five product lines: Asure Payroll & Tax, Asure Tax Management Solutions, Asure Time & Attendance, Asure HR Compliance, and AsureMarketplace™. We develop, market, sell and support our offerings nationwide through our principal office in Austin, Texas and from our processing hubs in California, Florida, New Jersey, New York, Tennessee, and Vermont. We have prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) and accordingly, they do not include all information and footnotes required under U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. In the opinion of management, these interim financial statements contain all adjustments, consisting of normal, recurring adjustments, necessary for a fair presentation of our financial position as of September 30, 2023, comprehensive loss and changes in stockholders’ equity for the three and nine months ended September 30, 2023 and September 30, 2022, and cash flows for the nine months ended September 30, 2023 and September 30, 2022. Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements. These reclassifications had no effect on the consolidated financial position or consolidated results of operations of the Company. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES USE OF ESTIMATES Preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. These estimates are subjective in nature and involve judgments. The more significant estimates made by management include the valuation allowance for the gross deferred tax assets, the determination of the fair value of its long-lived assets, and the fair value of assets acquired and liabilities assumed during acquisitions. We base our estimates on historical experience and on various other assumptions management believes reasonable under the given circumstances. These estimates could be materially different under different conditions and assumptions. CASH, CASH EQUIVALENTS, AND RESTRICTED CASH The Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be cash equivalents. Cash equivalents include investments in an institutional money market fund, which invests in U.S. Treasury bills, notes and bonds, and/or repurchase agreements, backed by such obligations. Carrying value approximates fair value. Restricted cash consists of cash balances which are restricted as to withdrawal or usage. As of December 31, 2022, the Company had a restricted cash balance of $500 related to the collateralization of a letter of credit issued by South State Bank in connection with its money transmission licenses, which was released in the first quarter of 2023. As of September 30, 2023, the Company had no restricted cash. LIQUIDITY In March 2021, we filed a universal shelf registration statement on Form S-3 with the Securities and Exchange Commission (“SEC”) to provide access to additional capital, if needed. Pursuant to the shelf registration statement, we may from time to time offer to sell in one or more offerings shares of our common stock or other securities having an aggregate value of up to $150,000 (which includes 1,480 of unsold securities that were previously registered on other registration statements effective at the time of the filing of our current S-3). The shelf registration statement relating to these securities became effective on April 21, 2021. As of September 30, 2023, there is $104,000 available under the shelf registration statement. On August 21, 2023, we completed an underwritten public offering in which we sold an aggregate of 3,333 newly issued shares of our common stock at a public offering price of $12.00 per share, and realized net proceeds of $37,475, after deducting underwriting discounts and offering expenses of $2,525. Additionally, on August 30, 2023, the Underwriters exercised their option to purchase an additional 500 shares of our common stock, and we realized net proceeds of $5,507, after deducting underwriting discounts and offering expenses of $493. As of September 30, 2023, the Company’s principal sources of liquidity consisted of approximately $32,787 of cash, cash equivalents and restricted cash, together with cash generated from operations of our business over the next twelve months. We cannot assure that we can grow our cash balances or limit our cash consumption and thus maintain sufficient cash balances for our planned operations or future acquisitions; however we believe that we have sufficient liquidity to support our business operations for at least the next twelve months. Future business demands may lead to cash utilization at levels greater than recently experienced or expected. We may need to raise additional capital in the future in order to grow our existing software operations and to seek additional strategic acquisitions in the near future. Currently the Company does not have a credit facility or access to a line of credit. Further, we cannot assure that we will be able to raise additional capital on acceptable terms, or at all. RECENT ACCOUNTING PRONOUNCEMENTS In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326), which establishes a new approach to estimate credit losses on certain financial instruments. The update requires financial assets measured at amortized cost to be presented at the net amount expected to be collected. The amended guidance will also update the impairment model for available-for-sale debt securities, requiring entities to determine whether all or a portion of the unrealized loss on such securities is a credit loss . The standard became effective for interim and annual periods beginning after December 15, 2022. Effective January 1, 2023, the Company adopted the provisions of ASU No. 2016-13 and determined that adoption did not have a material impact on our consolidated financial statements. ACCUMULATED OTHER COMPREHENSIVE LOSS As of September 30, 2023 and December 31, 2022, accumulated other comprehensive loss consisted of net unrealized gains and losses on available-for-sale securities. |
BUSINESS COMBINATIONS AND ASSET
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS | BUSINESS COMBINATIONS AND ASSET ACQUISITIONS 2022 Effective January 1, 2022, the Company acquired customer relationships of a payroll business for a cash payment of $1,970, which included $31 of transaction costs, and the delivery of a promissory note in the amount of $411. The acquired customer relationships are recorded as an intangible asset and are being amortized on a straight-line basis over eight years. In May 2023, the Company paid the remaining balance of $422 on the promissory note, consisting of $411 in principal and $11 in accrued interest. As of September 30, 2023, there are no further amounts due or owing under the subordinated promissory note. 2021 and 2020 In September 2021, the Company acquired certain assets of two payroll businesses, which were used to provide payroll processing services. In connection with these acquisitions there were two outstanding promissory notes payable. In September 2023, the Company paid the remaining balance of $2,312 on one of the promissory notes, consisting of $2,223 in principal and $89 in accrued interest. The second promissory note also includes contingent consideration for which the Company calculated the final value to be $587. The contingent consideration was added as an increase to the principal balance due on the promissory note during the second quarter of 2023. As of September 30, 2023, the second promissory note had an outstanding balance of $4,200 and matures on September 30, 2026. |
INVESTMENTS AND FAIR VALUE MEAS
INVESTMENTS AND FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
INVESTMENTS AND FAIR VALUE MEASUREMENT | INVESTMENTS AND FAIR VALUE MEASUREMENTS Accounting Standards Codification (ASC) 820 “Fair Value Measurement” (ASC 820) defines fair value, establishes a framework for measuring fair value under U.S. GAAP and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 describes a fair value hierarchy based on the following three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last unobservable: Level 1: Quoted prices in active markets for identical assets or liabilities; Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active for identical or similar assets or liabilities; and model-driven valuations whose significant inputs are observable; and Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table presents the fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022, respectively (in thousands): Total Carrying Value Level 1 Level 2 Level 3 September 30, 2023 Assets: Funds held for clients Money market funds $ 4,704 $ 4,704 $ — $ — Available-for-sale securities 68,989 — 68,989 — Total $ 73,693 $ 4,704 $ 68,989 $ — December 31, 2022 Assets: Funds held for clients Money market funds $ 2,829 $ 2,829 $ — $ — Available-for-sale securities 56,556 — 56,556 — Total $ 59,385 $ 2,829 $ 56,556 $ — Liabilities: Contingent purchase consideration (1) $ 2,955 $ — $ — $ 2,955 Total $ 2,955 $ — $ — $ 2,955 (1) See Note 3 — Business Combinations and Asset Acquisitions for further discussion regarding the contingent purchase consideration. Restricted cash equivalents and investments classified as available-for-sale within funds held for clients consisted of the following (in thousands): Amortized Gross Unrealized Gains (1) Gross Unrealized Losses (1) Aggregate September 30, 2023 Restricted cash equivalents $ 4,711 $ — $ (7) $ 4,704 Available-for-sale securities: Certificates of deposit 973 3 (2) 974 Corporate debt securities 65,946 17 (2,341) 63,622 Municipal bonds 4,262 — (325) 3,937 U.S. Government agency securities 500 — (44) 456 Total available-for-sale securities 71,681 20 (2,712) 68,989 Total (2) $ 76,392 $ 20 $ (2,719) $ 73,693 December 31, 2022 Restricted cash equivalents $ 2,829 $ — $ — $ 2,829 Available-for-sale securities: Certificates of deposit 983 4 (2) 985 Corporate debt securities 52,251 1 (2,023) 50,229 Municipal bonds 5,297 — (405) 4,892 U.S. Government agency securities 500 — (50) 450 Total available-for-sale securities 59,031 5 (2,480) 56,556 Total (2) $ 61,860 $ 5 $ (2,480) $ 59,385 (1) Unrealized gains and losses on available-for-sale securities are included as a component of comprehensive loss. As of September 30, 2023 and December 31, 2022, there were 7 and 3 securities, respectively, in an unrealized gain position and there were 159 and 124 securities in an unrealized loss position, respectively. As of September 30, 2023, these unrealized losses were less than $79 individually and $2,719 in the aggregate. As of December 31, 2022, these unrealized losses were less than $96 individually and $2,480 in the aggregate. These securities have not been in a continuous unrealized gain or loss position for more than 12 months. We do not intend to sell these investments and we do not expect to sell these investments before recovery of their amortized cost basis, which may be at maturity. We review our investments to identify and evaluate investments that indicate credit losses. Factors considered in determining whether a loss is a credit loss include the length of time and extent to which fair value has been less than the cost basis, the credit rating of the investment, and our intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. (2) At September 30, 2023 and December 31, 2022, none of these securities were classified as cash and cash equivalents on the accompanying Condensed Consolidated Balance Sheets. Funds held for clients represent assets that the Company has classified as restricted for use solely for the purposes of satisfying the obligations to remit funds relating to the Company’s payroll and payroll tax filing services, which are classified as client funds obligations on our Condensed Consolidated Balance Sheets. Funds held for clients have been invested in the following categories (in thousands): September 30, 2023 December 31, 2022 Restricted cash and cash equivalents held to satisfy client funds obligations $ 103,514 $ 147,032 Restricted short-term marketable securities held to satisfy client funds obligations 9,297 9,174 Restricted long-term marketable securities held to satisfy client funds obligations 59,692 47,382 Total funds held for clients $ 172,503 $ 203,588 Expected maturities of available-for-sale securities as of September 30, 2023 are as follows (in thousands): One year or less $ 9,297 After one year through five years 59,692 Total $ 68,989 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS December 31, 2022 Acquisitions September 30, 2023 Goodwill $ 86,011 $ — $ 86,011 We believe significant synergies are expected to arise from our strategic acquisitions and their assembled work forces. This factor contributed to a purchase price that was in excess of the fair value of the net assets acquired and, as a result, we recorded goodwill for each acquisition. A portion of acquired goodwill will be amortizable for tax purposes. As of September 30, 2023, there has been no impairment of goodwill based on the qualitative assessments performed by the Company. Gross Intangible Assets December 31, 2022 Acquisitions September 30, 2023 Customer relationships $ 116,971 $ — $ 116,971 Developed technology 12,001 — 12,001 Reseller relationships 1,344 1,029 2,373 Trade names 880 — 880 Non-compete agreements 1,032 — 1,032 $ 132,228 $ 1,029 $ 133,257 The gross carrying amount and accumulated amortization of our intangible assets as of September 30, 2023 are as follows (in thousands, except weighted average periods): Weighted Average Gross Accumulated Net September 30, 2023 Customer relationships 8.7 $ 116,971 $ (62,498) $ 54,473 Developed technology 6.9 12,001 (10,651) 1,350 Reseller relationships 6.4 2,373 (985) 1,388 Trade names 4.3 880 (872) 8 Non-compete agreements 5.2 1,032 (925) 107 8.5 $ 133,257 $ (75,931) $ 57,326 December 31, 2022 Customer relationships 8.7 $ 116,971 $ (52,700) $ 64,271 Developed technology 6.6 12,001 (10,283) 1,718 Reseller relationships 6.9 1,344 (889) 455 Trade names 3.0 880 (847) 33 Non-compete agreements 5.2 1,032 (915) 117 8.4 $ 132,228 $ (65,634) $ 66,594 We record amortization expenses using the straight-line method over the estimated useful lives of the intangible assets, as noted above. Amortization expenses recorded in Operating Expenses were $9,929 and $10,134 for the nine months ended September 30, 2023 and 2022, respectively. Amortization expenses recorded in Cost of Sales were $368 and $889 for the nine months ended September 30, 2023 and 2022, respectively. There was no impairment of intangibles during the nine months ended September 30, 2023 based on the qualitative assessment performed by the Company. However, if market, political and other conditions over which we have no control continue to affect the capital markets and our stock price declines, we may experience an impairment of our intangibles in future quarters. The following table summarizes the future estimated amortization expense relating to our intangible assets as of September 30, 2023 (in thousands): 2023 $ 3,389 2024 13,522 2025 12,736 2026 9,621 2027 7,426 2028 5,957 Thereafter 4,675 $ 57,326 |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTES PAYABLE The following table summarizes our outstanding debt as of the dates indicated (in thousands): Maturity Cash Interest Rate September 30, 2023 December 31, 2022 Subordinated Notes Payable – Acquisitions (1) 12/31/2022 – 9/30/2026 2.00% - 3.00% $ 4,200 $ 6,947 Senior Credit Facility 10/1/2025 14.25% — 30,607 Gross Notes Payable $ 4,200 $ 37,554 (1) See Note 3 — Business Combinations and Asset Acquisitions and Subordinated Notes Payable - Acquisitions section below for further discussion regarding the notes payable related to acquisitions. The following table summarizes the debt issuance costs as of the dates indicated (in thousands): Gross Notes Payable Debt Issuance Costs and Debt Discount Net Notes Payable September 30, 2023 Current portion of notes payable $ 420 $ (225) $ 195 Notes payable, net of current portion 3,780 (1,147) 2,633 Total $ 4,200 $ (1,372) $ 2,828 December 31, 2022 Current portion of notes payable $ 4,774 $ (668) $ 4,106 Notes payable, net of current portion 32,780 (1,985) 30,795 Total $ 37,554 $ (2,653) $ 34,901 The following table summarizes the future principal payments related to our outstanding debt as of September 30, 2023 (in thousands): 2023 $ — 2024 420 2025 378 2026 3,402 Total $ 4,200 Subordinated Notes Payable - Acquisitions In January 2023, the Company resolved the outstanding claims for indemnification for which it was withholding payment of the subordinated note payable as security for such claim. As a result of the resolution of those claims, the remaining balance of $232 has been paid to the Seller ($182) and to the claimant ($50) in satisfaction of its claim. As of September 30, 2023, there are no further amounts due or owing under this subordinated promissory note. In April 2023, the Company calculated the final contingent consideration due in connection with the acquisition of a payroll business in September 2021. As a result, the fair value of the contingent consideration of $587 was added as an increase to the principal balance due on the promissory note. As of September 30, 2023, the promissory note had an outstanding balance of $4,200. In May 2023, the Company paid the outstanding balance of a subordinated note payable in connection with the acquisition of customer relationships of a payroll business that took place in 2022. As a result, the Company paid the remaining balance of $422 on the promissory note consisting of $411 in principal and $11 in accrued interest. As of September 30, 2023, there are no further amounts due or owing under the subordinated note payable. In September 2023, the Company paid the outstanding balance of a subordinated note payable in connection with the acquisition of certain assets of a payroll business that took place in 2021. As a result, the Company paid the remaining balance of $2,312 on the promissory note consisting of $2,223 in principal and $89 in accrued interest. As of September 30, 2023, there are no further amounts due or owing under the subordinated note payable. Senior Credit Facility with Structural Capital Investments III, LP On September 10, 2021, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Structural Capital Investments III, LP (“Structural” and together with the other lenders that are or become parties thereto, the “Lenders”), and Ocean II PLO LLC, as administrative and collateral agent for the Lender (“Agent”), under the terms of which the Lenders committed to lend us up to $50,000 in term loan financing to support our growth needs (the “Facility”). Of the amount committed by the Lenders, the Company drew $30,000 in September 2021. The Company also entered into a secured promissory note with the Agent evidencing our obligations under the Facility. On August 7, 2023, the Company entered into an amendment to the Facility, whereby the Final Payment Fee (as defined in the Loan Agreement) was settled for $1,677 (the “Settled Amount”), which was paid on August 7, 2023. The Final Payment Fee was originally equal to 1.0% of the increase in our market capitalization since September 10, 2021, and was due upon payment in full of the obligations under the Senior Credit Facility. The Company also paid the Lenders a fee equal to $250 to be credited against any reimbursable expenses owed to the Lenders in a future refinancing of the Facility if it occurs prior to December 31, 2024. On September 12, 2023, the Company opted to terminate the Loan Agreement and repay the outstanding balance on the secured promissory note (the “Note”). In connection with the termination, the Company paid the Agent for the benefit of the Lenders an aggregate amount of $30,927 (the “Payoff Amount”) in full payment of our outstanding obligations under the Loan Agreement. The Payoff Amount represented $30,617 of outstanding principal and interest on the unpaid principal balance, a 1.0% prepayment fee in the amount of $306 and $5 for the accrued non-utilization fee and lender expenses associated with the extinguishment. As of September 30, 2023, there are no further amounts due or owing under the Facility. |
CONTRACTS WITH CUSTOMERS AND RE
CONTRACTS WITH CUSTOMERS AND REVENUE CONCENTRATION | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
CONTRACTS WITH CUSTOMERS AND REVENUE CONCENTRATION | CONTRACTS WITH CUSTOMERS AND REVENUE CONCENTRATION Receivables Receivables from contracts with customers, net of allowance for doubtful accounts of $1,186, w ere $15,133 at September 30, 2023. Receivables from contracts with customers, net of allowance for doubtful accounts of $3,248, were $12,123 at December 31, 2022. The decrease in the allowance for doubtful accounts balance during the three and nine months ended September 30, 2023 is primarily due to the removal of fully reserved receivable balances. The increase in the receivable balance during the first nine months of 2023 is primarily due to deferred payment terms on many of our Earned Retention Tax Credit commitments. No customer represented more than 10% of our net accounts receivable balance as of September 30, 2023 and December 31, 2022, respectively. Deferred Commissions Deferred commission costs from contracts with customers w ere $9,155 and $6,660 at September 30, 2023 and December 31, 2022 , respectively. The amount of amortization recognized for the three and nine months ended September 30, 2023 was $1,029 and $2,176, respectively, and for the three and nine months ended September 30, 2022 was $412 and $1,192, respectively. Deferred Revenue During the three and nine months ended September 30, 2023, revenue of $924 and $6,650, respectively, an d during the three and nine months ended September 30, 2022, revenue of $156 and $3,362, respectively, was recognized from the deferred revenue balance at the beginning of each period. Transaction Price Allocated to the Remaining Performance Obligations As of September 30, 2023, approximately $18,891 of revenue is expected to be recognized from remaining performance obligations. We expect to recognize revenue on approximately 81% of these remaining performance obligations over the next 12 months, with the balance recognized thereafter. Revenue Co ncentration During the three and nine months ended September 30, 2023 and 2022, there were no customers that individually represented 10% or more of consolidated revenue. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
LEASES | NOTE 8 - LEASES We have entered into office space lease agreements, which qualify as operating leases under ASU No. 2016-02, “Leases (Topic 842)”. Under such leases, the lessors receive annual minimum (base) rent. The leases have original terms (excluding extension options) ranging from one year to eight years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We record base rent expense under the straight-line method over the term of the lease. In the accompanying Condensed Consolidated Statements of Comprehensive Loss, rent expense is included in operating expenses under general and administrative expenses. The components of the rent expense for the three and nine months ended September 30, 2023 and 2022 are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Operating lease cost $ 481 $ 610 $ 1,896 $ 1,759 Sublease income (5) (15) (13) (84) Net rent expense $ 476 $ 595 $ 1,883 $ 1,675 For purposes of calculating the operating lease assets and lease liabilities, extension options are not included in the lease term unless it is reasonably certain we will exercise the option, or the lessor has the sole ability to exercise the option. The weighted average discount rate of our operating leases is 10% and 8% as of September 30, 2023 and December 31, 2022, respectively. The weighted average remaining lease term is five years as of September 30, 2023 and December 31, 2022. Supplemental cash flow information related to operating leases for the nine months ended September 30 are as follows (in thousands): Nine Months Ended September 30, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 1,998 $ 1,561 Non-cash operating activities: Operating lease assets obtained or removed in exchange for new, modified or terminated operating lease liabilities $ (473) $ 2,221 Future minimum commitments over the life of all operating leases, which exclude variable rent payments, are as follows (in thousands): 2023 $ 551 2024 1,883 2025 1,649 2026 1,194 2027 1,001 2028 993 Thereafter 743 Total minimum lease payments 8,014 Less: imputed interest (1,548) Total lease liabilities $ 6,466 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-based Payment Arrangement [Text Block] | NOTE 9 - SHARE-BASED COMPENSATION We have one active equity plan, the 2018 Incentive Award Plan (the “2018 Plan”). The 2018 Plan, approved by our stockholders, replaced our 2009 Equity Incentive Plan, as amended (the “2009 Plan”), however, the terms and conditions of the 2009 Plan will continue to govern any outstanding awards granted thereunder. The number of shares reserved for issuance under the 2018 Plan is 4,350 shares. We have an aggregate of 2,306 options, RSUs and PSUs granted and outstanding pursuant to the 2018 Plan as of September 30, 2023. As of September 30, 2023, the number of shares available for future grant under the 2018 Plan is 1,737. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | NET LOSS PER SHAREWe compute net income or loss per share based on the weighted average number of common shares outstanding for the period. Diluted net income per share reflects the maximum dilution that would have resulted from incremental common shares issuable upon the exercise of stock options or vesting of RSUs and in some cases PSUs. In periods of net income, we compute the adjustment to the denominator of our dilutive net earnings per share calculation to include these stock options, RSUs, and PSUs, as applicable, using the treasury stock method. Regardless of the period resulting in net income or net loss, we exclude the adjustment to the denominator of our dilutive net loss per share calculation to the extent that they are anti-dilutive. The following table sets forth the computation of basic and diluted net loss per common share for the periods presented below (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Basic: Net loss $ (2,206) $ (4,533) $ (5,632) $ (13,410) Weighted-average shares of common stock outstanding 22,591 20,219 21,204 20,092 Basic loss per share $ (0.10) $ (0.22) $ (0.27) $ (0.67) Diluted: Net loss $ (2,206) $ (4,533) $ (5,632) $ (13,410) Weighted-average shares of common stock outstanding 22,591 20,219 21,204 20,092 Diluted loss per share $ (0.10) $ (0.22) $ (0.27) $ (0.67) |
EMPLOYEE RETENTION TAX CREDIT
EMPLOYEE RETENTION TAX CREDIT | 9 Months Ended |
Sep. 30, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
EMPLOYEE RETENTION TAX CREDIT | EMPLOYEE RETENTION TAX CREDITIn March 2020, the Coronavirus Aid, Relief, and Economic Security Act was signed into law, providing numerous tax provisions and other stimulus measures, including the Employee Retention Tax Credit (“ERTC”): a refundable tax credit against certain employment taxes. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021 extended and expanded the availability of the ERTC. We qualified for the ERTC in the first three quarters of 2021. During the quarter ended September 30, 2021, we recorded an aggregate benefit of $10,533 in our Condensed Consolidated Statements of Comprehensive Loss to reflect the ERTC payable to us for the first three quarters in 2021 presented as other current assets within our Condensed Consolidated Balance Sheets. In 2022, the Company received cash of $3,457, reflecting a portion of our ERTC. In January and February 2023, the Company received the remaining balance of $7,076 for the ERTC benefit. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSOn October 1, 2023, the Company acquired certain assets of a Reseller Partner, which were used to provide payroll processing services. The Partner is located in the southeastern United States. The aggregate purchase price that the Company paid for these assets was $8,391, paid as follows: (i) $6,891 in cash of which $6,545 was paid at closing and (ii) the delivery of a promissory note in the amount of $1,500. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policy) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Use of Estimates | USE OF ESTIMATES Preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. These estimates are subjective in nature and involve judgments. The more significant estimates made by management include the valuation allowance for the gross deferred tax assets, the determination of the fair value of its long-lived assets, and the fair value of assets acquired and liabilities assumed during acquisitions. We base our estimates on historical experience and on various other assumptions management believes reasonable under the given circumstances. These estimates could be materially different under different conditions and assumptions. |
Cash, Cash Equivalents, and Restricted Cash | CASH, CASH EQUIVALENTS, AND RESTRICTED CASHThe Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be cash equivalents. Cash equivalents include investments in an institutional money market fund, which invests in U.S. Treasury bills, notes and bonds, and/or repurchase agreements, backed by such obligations. Carrying value approximates fair value. Restricted cash consists of cash balances which are restricted as to withdrawal or usage. |
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326), which establishes a new approach to estimate credit losses on certain financial instruments. The update requires financial assets measured at amortized cost to be presented at the net amount expected to be collected. The amended guidance will also update the impairment model for available-for-sale debt securities, requiring entities to determine whether all or a portion of the unrealized loss on such securities is a credit loss . The standard became effective for interim and annual periods beginning after December 15, 2022. Effective January 1, 2023, the Company adopted the provisions of ASU No. 2016-13 and determined that adoption did not have a material impact on our consolidated financial statements. |
Accumulated Other Comprehensive Loss | ACCUMULATED OTHER COMPREHENSIVE LOSS As of September 30, 2023 and December 31, 2022, accumulated other comprehensive loss consisted of net unrealized gains and losses on available-for-sale securities. |
Fair Value of Financial Instruments, Policy | Accounting Standards Codification (ASC) 820 “Fair Value Measurement” (ASC 820) defines fair value, establishes a framework for measuring fair value under U.S. GAAP and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 describes a fair value hierarchy based on the following three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last unobservable: Level 1: Quoted prices in active markets for identical assets or liabilities; Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active for identical or similar assets or liabilities; and model-driven valuations whose significant inputs are observable; and Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
INVESTMENTS AND FAIR VALUE ME_2
INVESTMENTS AND FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents the fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022, respectively (in thousands): Total Carrying Value Level 1 Level 2 Level 3 September 30, 2023 Assets: Funds held for clients Money market funds $ 4,704 $ 4,704 $ — $ — Available-for-sale securities 68,989 — 68,989 — Total $ 73,693 $ 4,704 $ 68,989 $ — December 31, 2022 Assets: Funds held for clients Money market funds $ 2,829 $ 2,829 $ — $ — Available-for-sale securities 56,556 — 56,556 — Total $ 59,385 $ 2,829 $ 56,556 $ — Liabilities: Contingent purchase consideration (1) $ 2,955 $ — $ — $ 2,955 Total $ 2,955 $ — $ — $ 2,955 (1) See Note 3 — Business Combinations and Asset Acquisitions for further discussion regarding the contingent purchase consideration. |
Debt Securities, Available-for-sale | Restricted cash equivalents and investments classified as available-for-sale within funds held for clients consisted of the following (in thousands): Amortized Gross Unrealized Gains (1) Gross Unrealized Losses (1) Aggregate September 30, 2023 Restricted cash equivalents $ 4,711 $ — $ (7) $ 4,704 Available-for-sale securities: Certificates of deposit 973 3 (2) 974 Corporate debt securities 65,946 17 (2,341) 63,622 Municipal bonds 4,262 — (325) 3,937 U.S. Government agency securities 500 — (44) 456 Total available-for-sale securities 71,681 20 (2,712) 68,989 Total (2) $ 76,392 $ 20 $ (2,719) $ 73,693 December 31, 2022 Restricted cash equivalents $ 2,829 $ — $ — $ 2,829 Available-for-sale securities: Certificates of deposit 983 4 (2) 985 Corporate debt securities 52,251 1 (2,023) 50,229 Municipal bonds 5,297 — (405) 4,892 U.S. Government agency securities 500 — (50) 450 Total available-for-sale securities 59,031 5 (2,480) 56,556 Total (2) $ 61,860 $ 5 $ (2,480) $ 59,385 (1) Unrealized gains and losses on available-for-sale securities are included as a component of comprehensive loss. As of September 30, 2023 and December 31, 2022, there were 7 and 3 securities, respectively, in an unrealized gain position and there were 159 and 124 securities in an unrealized loss position, respectively. As of September 30, 2023, these unrealized losses were less than $79 individually and $2,719 in the aggregate. As of December 31, 2022, these unrealized losses were less than $96 individually and $2,480 in the aggregate. These securities have not been in a continuous unrealized gain or loss position for more than 12 months. We do not intend to sell these investments and we do not expect to sell these investments before recovery of their amortized cost basis, which may be at maturity. We review our investments to identify and evaluate investments that indicate credit losses. Factors considered in determining whether a loss is a credit loss include the length of time and extent to which fair value has been less than the cost basis, the credit rating of the investment, and our intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. (2) At September 30, 2023 and December 31, 2022, none of these securities were classified as cash and cash equivalents on the accompanying Condensed Consolidated Balance Sheets. Funds held for clients have been invested in the following categories (in thousands): September 30, 2023 December 31, 2022 Restricted cash and cash equivalents held to satisfy client funds obligations $ 103,514 $ 147,032 Restricted short-term marketable securities held to satisfy client funds obligations 9,297 9,174 Restricted long-term marketable securities held to satisfy client funds obligations 59,692 47,382 Total funds held for clients $ 172,503 $ 203,588 |
Investments Classified by Contractual Maturity Date | Expected maturities of available-for-sale securities as of September 30, 2023 are as follows (in thousands): One year or less $ 9,297 After one year through five years 59,692 Total $ 68,989 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill [Table Text Block] | December 31, 2022 Acquisitions September 30, 2023 Goodwill $ 86,011 $ — $ 86,011 |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Gross Intangible Assets December 31, 2022 Acquisitions September 30, 2023 Customer relationships $ 116,971 $ — $ 116,971 Developed technology 12,001 — 12,001 Reseller relationships 1,344 1,029 2,373 Trade names 880 — 880 Non-compete agreements 1,032 — 1,032 $ 132,228 $ 1,029 $ 133,257 The gross carrying amount and accumulated amortization of our intangible assets as of September 30, 2023 are as follows (in thousands, except weighted average periods): Weighted Average Gross Accumulated Net September 30, 2023 Customer relationships 8.7 $ 116,971 $ (62,498) $ 54,473 Developed technology 6.9 12,001 (10,651) 1,350 Reseller relationships 6.4 2,373 (985) 1,388 Trade names 4.3 880 (872) 8 Non-compete agreements 5.2 1,032 (925) 107 8.5 $ 133,257 $ (75,931) $ 57,326 December 31, 2022 Customer relationships 8.7 $ 116,971 $ (52,700) $ 64,271 Developed technology 6.6 12,001 (10,283) 1,718 Reseller relationships 6.9 1,344 (889) 455 Trade names 3.0 880 (847) 33 Non-compete agreements 5.2 1,032 (915) 117 8.4 $ 132,228 $ (65,634) $ 66,594 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | The following table summarizes the future estimated amortization expense relating to our intangible assets as of September 30, 2023 (in thousands): 2023 $ 3,389 2024 13,522 2025 12,736 2026 9,621 2027 7,426 2028 5,957 Thereafter 4,675 $ 57,326 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | The following table summarizes our outstanding debt as of the dates indicated (in thousands): Maturity Cash Interest Rate September 30, 2023 December 31, 2022 Subordinated Notes Payable – Acquisitions (1) 12/31/2022 – 9/30/2026 2.00% - 3.00% $ 4,200 $ 6,947 Senior Credit Facility 10/1/2025 14.25% — 30,607 Gross Notes Payable $ 4,200 $ 37,554 (1) See Note 3 — Business Combinations and Asset Acquisitions and Subordinated Notes Payable - Acquisitions section below for further discussion regarding the notes payable related to acquisitions. The following table summarizes the debt issuance costs as of the dates indicated (in thousands): Gross Notes Payable Debt Issuance Costs and Debt Discount Net Notes Payable September 30, 2023 Current portion of notes payable $ 420 $ (225) $ 195 Notes payable, net of current portion 3,780 (1,147) 2,633 Total $ 4,200 $ (1,372) $ 2,828 December 31, 2022 Current portion of notes payable $ 4,774 $ (668) $ 4,106 Notes payable, net of current portion 32,780 (1,985) 30,795 Total $ 37,554 $ (2,653) $ 34,901 |
Schedule of Maturities of Long-term Debt [Table Text Block] | The following table summarizes the future principal payments related to our outstanding debt as of September 30, 2023 (in thousands): 2023 $ — 2024 420 2025 378 2026 3,402 Total $ 4,200 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Lease, Cost | The components of the rent expense for the three and nine months ended September 30, 2023 and 2022 are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Operating lease cost $ 481 $ 610 $ 1,896 $ 1,759 Sublease income (5) (15) (13) (84) Net rent expense $ 476 $ 595 $ 1,883 $ 1,675 Supplemental cash flow information related to operating leases for the nine months ended September 30 are as follows (in thousands): Nine Months Ended September 30, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 1,998 $ 1,561 Non-cash operating activities: Operating lease assets obtained or removed in exchange for new, modified or terminated operating lease liabilities $ (473) $ 2,221 |
Lessee, Operating Lease, Liability, Maturity | Future minimum commitments over the life of all operating leases, which exclude variable rent payments, are as follows (in thousands): 2023 $ 551 2024 1,883 2025 1,649 2026 1,194 2027 1,001 2028 993 Thereafter 743 Total minimum lease payments 8,014 Less: imputed interest (1,548) Total lease liabilities $ 6,466 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net loss per common share for the periods presented below (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Basic: Net loss $ (2,206) $ (4,533) $ (5,632) $ (13,410) Weighted-average shares of common stock outstanding 22,591 20,219 21,204 20,092 Basic loss per share $ (0.10) $ (0.22) $ (0.27) $ (0.67) Diluted: Net loss $ (2,206) $ (4,533) $ (5,632) $ (13,410) Weighted-average shares of common stock outstanding 22,591 20,219 21,204 20,092 Diluted loss per share $ (0.10) $ (0.22) $ (0.27) $ (0.67) |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 30, 2023 | Aug. 21, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Mar. 31, 2021 |
Subsidiary, Sale of Stock [Line Items] | ||||||
Restricted Cash | $ 0 | $ 500 | ||||
Aggregate Value of Common Stock and Other Securities Registered for Sale | 104,000 | $ 150,000 | ||||
Securities Registered For Sale, Number Of Unsold Securities | 1,480,000 | |||||
Payments of Stock Issuance Costs | $ 493 | $ 2,525 | ||||
Cash, cash equivalents, and restricted cash | $ 32,787 | $ 17,010 | $ 10,885 | |||
Public Stock Offering | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued | 3,333,000 | |||||
Sale of Stock, Price Per Share | $ 12 | |||||
Sale of Stock, Consideration Received on Transaction | $ 37,475 | |||||
Over-Allotment Option | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued | 500,000 | |||||
Sale of Stock, Consideration Received on Transaction | $ 5,507 |
BUSINESS COMBINATIONS AND ASS_2
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |||
Jan. 01, 2022 | Sep. 30, 2023 | May 31, 2023 | Jan. 31, 2023 | Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |||||
Initial purchase price | $ 1,970 | ||||
Business Acquisition, Transaction Costs | 31 | ||||
Debt instrument, fair value | $ 411 | ||||
Debt Instrument, Periodic Payment | $ 422 | ||||
Debt Instrument, Periodic Payment, Principal | $ 2,223 | 411 | $ 2,223 | ||
Debt Instrument, Periodic Payment, Interest | 89 | $ 11 | 89 | ||
Repayments of Subordinated Debt | 2,312 | $ 232 | 2,312 | ||
Asset Acquisition, Contingent Consideration, Liability | 587 | 587 | |||
Notes Payable | 4,200 | 4,200 | |||
Business Combination, Contingent Consideration, Liability | $ 2,299 | $ 2,299 |
INVESTMENTS AND FAIR VALUE ME_3
INVESTMENTS AND FAIR VALUE MEASUREMENTS - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Funds held for clients | ||
Total | $ 73,693 | $ 59,385 |
Liabilities: | ||
Contingent purchase consideration | 2,955 | |
Total | 2,955 | |
Money market funds | ||
Funds held for clients | ||
Funds held for clients | 4,704 | 2,829 |
Available-for-sale securities | ||
Funds held for clients | ||
Funds held for clients | 68,989 | 56,556 |
Level 1 | ||
Funds held for clients | ||
Total | 4,704 | 2,829 |
Liabilities: | ||
Contingent purchase consideration | 0 | |
Total | 0 | |
Level 1 | Money market funds | ||
Funds held for clients | ||
Funds held for clients | 4,704 | 2,829 |
Level 1 | Available-for-sale securities | ||
Funds held for clients | ||
Funds held for clients | 0 | 0 |
Level 2 | ||
Funds held for clients | ||
Total | 68,989 | 56,556 |
Liabilities: | ||
Contingent purchase consideration | 0 | |
Total | 0 | |
Level 2 | Money market funds | ||
Funds held for clients | ||
Funds held for clients | 0 | 0 |
Level 2 | Available-for-sale securities | ||
Funds held for clients | ||
Funds held for clients | 68,989 | 56,556 |
Level 3 | ||
Funds held for clients | ||
Total | 0 | 0 |
Liabilities: | ||
Contingent purchase consideration | 2,955 | |
Total | 2,955 | |
Level 3 | Money market funds | ||
Funds held for clients | ||
Funds held for clients | 0 | 0 |
Level 3 | Available-for-sale securities | ||
Funds held for clients | ||
Funds held for clients | $ 0 | $ 0 |
INVESTMENTS AND FAIR VALUE ME_4
INVESTMENTS AND FAIR VALUE MEASUREMENTS - Debt Securities, Available-for-sale (Details) $ in Thousands | Sep. 30, 2023 USD ($) security | Dec. 31, 2022 USD ($) security |
Funds Held for Clients | ||
Funds Held For Clients, Restricted Cash, Amortized Cost | $ 4,711 | $ 2,829 |
Funds Held For Clients, Restricted Cash and Debt Securities, Amortized Cost | 76,392 | 61,860 |
Funds Held For Clients, Restricted Cash, Gross Unrealized Gains | 0 | 0 |
Funds Held For Clients, Restricted Cash and Debt Securities, Gross Unrealized Gains | 20 | 5 |
Funds Held For Clients, Restricted Cash, Gross Unrealized Losses | (7) | 0 |
Gross Unrealized Losses | (2,719) | |
Funds Held For Clients, Restricted Cash and Debt Securities, Gross Unrealized Losses | (2,719) | (2,480) |
Funds Held For Clients, Restricted Cash | 4,704 | 2,829 |
Funds Held For Clients, Restricted Cash and Debt Securities | $ 73,693 | $ 59,385 |
Number of securities in unrealized gain position | security | 7 | 3 |
Number of securities in unrealized loss position | security | 159 | 124 |
Individually | ||
Funds Held for Clients | ||
Gross Unrealized Losses | $ (79) | $ (96) |
Aggregate | ||
Funds Held for Clients | ||
Gross Unrealized Losses | (2,480) | |
Certificates of deposit | ||
Funds Held for Clients | ||
Amortized Cost | 973 | 983 |
Gross Unrealized Gains | 3 | 4 |
Gross Unrealized Losses | (2) | (2) |
Aggregate Estimated Fair Value | 974 | 985 |
Corporate debt securities | ||
Funds Held for Clients | ||
Amortized Cost | 65,946 | 52,251 |
Gross Unrealized Gains | 17 | 1 |
Gross Unrealized Losses | (2,341) | (2,023) |
Aggregate Estimated Fair Value | 63,622 | 50,229 |
Municipal bonds | ||
Funds Held for Clients | ||
Amortized Cost | 4,262 | 5,297 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (325) | (405) |
Aggregate Estimated Fair Value | 3,937 | 4,892 |
U.S. Government agency securities | ||
Funds Held for Clients | ||
Amortized Cost | 500 | 500 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (44) | (50) |
Aggregate Estimated Fair Value | 456 | 450 |
Available-for-sale securities | ||
Funds Held for Clients | ||
Amortized Cost | 71,681 | 59,031 |
Gross Unrealized Gains | 20 | 5 |
Gross Unrealized Losses | (2,712) | (2,480) |
Aggregate Estimated Fair Value | $ 68,989 | $ 56,556 |
INVESTMENTS AND FAIR VALUE ME_5
INVESTMENTS AND FAIR VALUE MEASUREMENTS - Funds Held For Clients (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Fair Value Disclosures [Abstract] | |||
Restricted cash and cash equivalents held to satisfy client funds obligations | $ 103,514 | $ 147,032 | $ 126,690 |
Restricted short-term marketable securities held to satisfy client funds obligations | 9,297 | 9,174 | |
Restricted long-term marketable securities held to satisfy client funds obligations | 59,692 | 47,382 | |
Total funds held for clients | $ 172,503 | $ 203,588 |
INVESTMENTS AND FAIR VALUE ME_6
INVESTMENTS AND FAIR VALUE MEASUREMENTS - Investments Classified by Contractual Maturity Date (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Fair Value Disclosures [Abstract] | |
One year or less | $ 9,297 |
After one year through five years | 59,692 |
Total | $ 68,989 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Schedule of Goodwill Acquisitions (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 86,011 |
Acquisitions | 0 |
Ending Balance | $ 86,011 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Goodwill and Intangible Asset Impairment | $ 0 | |||
Amortization of intangible assets | $ 3,333 | $ 3,350 | 9,929 | $ 10,134 |
Cost, Amortization | $ 368 | $ 889 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Schedule of Intangible Asset Acquisitions (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Finite-Lived Intangible Assets [Roll Forward] | |
Beginning Balance | $ 132,228 |
Acquisitions | 1,029 |
Ending Balance | 133,257 |
Customer relationships | |
Finite-Lived Intangible Assets [Roll Forward] | |
Beginning Balance | 116,971 |
Acquisitions | 0 |
Ending Balance | 116,971 |
Developed technology | |
Finite-Lived Intangible Assets [Roll Forward] | |
Beginning Balance | 12,001 |
Acquisitions | 0 |
Ending Balance | 12,001 |
Reseller relationships | |
Finite-Lived Intangible Assets [Roll Forward] | |
Beginning Balance | 1,344 |
Acquisitions | 1,029 |
Ending Balance | 2,373 |
Trade names | |
Finite-Lived Intangible Assets [Roll Forward] | |
Beginning Balance | 880 |
Acquisitions | 0 |
Ending Balance | 880 |
Non-compete agreements | |
Finite-Lived Intangible Assets [Roll Forward] | |
Beginning Balance | 1,032 |
Acquisitions | 0 |
Ending Balance | $ 1,032 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Summary of Gross Carrying Amount and Accumulated Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in Years) | 8 years 6 months | 8 years 4 months 24 days |
Gross | $ 133,257 | $ 132,228 |
Accumulated Amortization | (75,931) | (65,634) |
Net | $ 57,326 | $ 66,594 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in Years) | 8 years 8 months 12 days | 8 years 8 months 12 days |
Gross | $ 116,971 | $ 116,971 |
Accumulated Amortization | (62,498) | (52,700) |
Net | $ 54,473 | $ 64,271 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in Years) | 6 years 10 months 24 days | 6 years 7 months 6 days |
Gross | $ 12,001 | $ 12,001 |
Accumulated Amortization | (10,651) | (10,283) |
Net | $ 1,350 | $ 1,718 |
Reseller relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in Years) | 6 years 4 months 24 days | 6 years 10 months 24 days |
Gross | $ 2,373 | $ 1,344 |
Accumulated Amortization | (985) | (889) |
Net | $ 1,388 | $ 455 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in Years) | 4 years 3 months 18 days | 3 years |
Gross | $ 880 | $ 880 |
Accumulated Amortization | (872) | (847) |
Net | $ 8 | $ 33 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (in Years) | 5 years 2 months 12 days | 5 years 2 months 12 days |
Gross | $ 1,032 | $ 1,032 |
Accumulated Amortization | (925) | (915) |
Net | $ 107 | $ 117 |
GOODWILL AND OTHER INTANGIBLE_7
GOODWILL AND OTHER INTANGIBLE ASSETS - Schedule of Expected Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 | $ 3,389 | |
2024 | 13,522 | |
2025 | 12,736 | |
2026 | 9,621 | |
2027 | 7,426 | |
2028 | 5,957 | |
Thereafter | 4,675 | |
Intangible Asset, Net | $ 57,326 | $ 66,594 |
NOTES PAYABLE - Narrative (Deta
NOTES PAYABLE - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||
Sep. 12, 2023 | Aug. 07, 2023 | Sep. 30, 2023 | May 31, 2023 | Jan. 31, 2023 | Sep. 30, 2021 | Sep. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2021 | |
NOTES PAYABLE (Details) [Line Items] | ||||||||||
Repayments of Subordinated Debt | $ 2,312 | $ 232 | $ 2,312 | |||||||
Asset Acquisition, Contingent Consideration, Liability | 587 | 587 | $ 587 | |||||||
Notes Payable | 4,200 | 4,200 | 4,200 | |||||||
Debt Instrument, Periodic Payment | $ 422 | |||||||||
Debt Instrument, Periodic Payment, Principal | 2,223 | 411 | 2,223 | |||||||
Debt Instrument, Periodic Payment, Interest | $ 89 | $ 11 | $ 89 | |||||||
Final payment fee | $ 1,677 | |||||||||
Final payment fee, percentage of increase in market capitalization | 1% | |||||||||
Lenders fee | $ 250 | |||||||||
Payment for Debt Extinguishment or Debt Prepayment Cost | $ 468 | $ 0 | ||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 50,000 | |||||||||
debt prepayment penalty, percent | 1% | 1% | 1% | |||||||
Seller | ||||||||||
NOTES PAYABLE (Details) [Line Items] | ||||||||||
Repayments of Subordinated Debt | 182 | |||||||||
Claimant | ||||||||||
NOTES PAYABLE (Details) [Line Items] | ||||||||||
Repayments of Subordinated Debt | $ 50 | |||||||||
Secured Promissory Note | ||||||||||
NOTES PAYABLE (Details) [Line Items] | ||||||||||
Repayments of Debt | $ 30,927 | |||||||||
Debt Instrument, Repaid, Principal | 30,617 | |||||||||
Payment for Debt Extinguishment or Debt Prepayment Cost | 306 | |||||||||
Debt Instrument, Non-Utilization Fee And Lender Expense | $ 5 | |||||||||
StructuralCapital | The Facility | ||||||||||
NOTES PAYABLE (Details) [Line Items] | ||||||||||
Proceeds from Long-Term Lines of Credit | $ 30,000 |
NOTES PAYABLE (Details) - Sched
NOTES PAYABLE (Details) - Schedule of Debt - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Long-term Debt, Gross | $ 4,200 | $ 37,554 |
Current portion of notes payable | 195 | 4,106 |
Notes payable, net of current portion | 2,633 | 30,795 |
Short-term Debt | ||
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Notes Payable | $ 420 | 4,774 |
Notes Payable, Other Payables [Member] | ||
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Debt Instrument, Maturity Date, Description | 12/31/2022 – 9/30/2026 | |
Long-term Debt, Gross | $ 4,200 | 6,947 |
Long-term Debt | ||
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Notes Payable | $ 3,780 | 32,780 |
Consolidated Entities [Domain] | Minimum [Member] | ||
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |
Consolidated Entities [Domain] | Maximum [Member] | ||
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 3% | |
StructuralCapital | Notes Payable, Other Payables [Member] | ||
NOTES PAYABLE (Details) - Schedule of Debt [Line Items] | ||
Debt Instrument, Maturity Date, Description | 10/1/2025 | |
Debt Instrument, Interest Rate, Stated Percentage | 14.25% | |
Long-term Debt, Gross | $ 0 | $ 30,607 |
NOTES PAYABLE (Details) - Sch_2
NOTES PAYABLE (Details) - Schedule of Debt and Debt Issuance Costs - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
Debt Issuance Costs and Debt Discount, current portion | $ (225) | $ (668) |
Notes payable, net of current portion | 195 | 4,106 |
Notes payable, net of current portion | (1,147) | (1,985) |
Notes payable, net of current portion | 2,633 | 30,795 |
Long-term Debt, Gross | 4,200 | 37,554 |
Total Debt Issuance Costs and Debt Discount | (1,372) | (2,653) |
Total notes payable | 2,828 | 34,901 |
NOTES PAYABLE (Details) [Line Items] | ||
Debt Issuance Costs, Gross, Current | $ 225 | $ 668 |
NOTES PAYABLE (Details) - Sch_3
NOTES PAYABLE (Details) - Schedule of Maturities of Long-term Debt - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
Long-Term Debt, Maturity, Remainder of Fiscal Year | $ 0 | |
Long-Term Debt, Maturity, Year One | 420 | |
Long-Term Debt, Maturity, Year Two | 378 | |
Long-Term Debt, Maturity, Year Three | 3,402 | |
Long-term Debt, Gross | $ 4,200 | $ 37,554 |
CONTRACTS WITH CUSTOMERS AND _2
CONTRACTS WITH CUSTOMERS AND REVENUE CONCENTRATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |||||
Contract with Customer, Asset, Allowance for Credit Loss | $ 1,186 | $ 1,186 | $ 3,248 | ||
Accounts receivable, net of allowance for doubtful accounts of $1,186 and $3,248 at September 30, 2023 and December 31, 2022, respectively | 15,133 | 15,133 | 12,123 | ||
Accrued Sales Commission | 9,155 | 9,155 | $ 6,660 | ||
Amortization of Deferred Sales Commissions | 1,029 | $ 412 | 2,176 | $ 1,192 | |
Deferred Revenue, Revenue Recognized | 924 | $ 156 | 6,650 | $ 3,362 | |
Revenue, Remaining Performance Obligation, Amount | $ 18,891 | $ 18,891 | |||
Revenue, Remaining Performance Obligation, Percentage | 81% | 81% |
LEASES (Details)
LEASES (Details) | Sep. 30, 2023 | Dec. 31, 2022 |
LEASES (Details) [Line Items] | ||
Operating Lease, Weighted Average Discount Rate, Percent | 10% | 8% |
Operating Lease, Weighted Average Remaining Lease Term | 5 years | |
Minimum [Member] | ||
LEASES (Details) [Line Items] | ||
Lessee, Operating Lease, Term of Contract | 1 year | |
Maximum [Member] | ||
LEASES (Details) [Line Items] | ||
Lessee, Operating Lease, Term of Contract | 8 years |
LEASES (Details) - Rent Expense
LEASES (Details) - Rent Expense Components - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Operating lease cost | $ 481 | $ 610 | $ 1,896 | $ 1,759 |
Sublease income | (5) | (15) | (13) | (84) |
Net rent expense | $ 476 | $ 595 | $ 1,883 | $ 1,675 |
LEASES (Details) - Lessee, Oper
LEASES (Details) - Lessee, Operating Lease, Disclosure - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash outflows from operating leases | $ 1,998 | $ 1,561 |
Non-cash operating activities: | ||
Operating lease assets obtained in exchange for new operating lease liabilities | $ (473) | $ 2,221 |
Minimum [Member] | ||
LEASES (Details) [Line Items] | ||
Lessee, Operating Lease, Term of Contract | 1 year | |
Maximum [Member] | ||
LEASES (Details) [Line Items] | ||
Lessee, Operating Lease, Term of Contract | 8 years |
LEASES (Details) - Lessee, Op_2
LEASES (Details) - Lessee, Operating Lease, Liability, Maturity $ in Thousands | Sep. 30, 2023 USD ($) |
Leases [Abstract] | |
Lessee, Operating Lease, Liability, to be Paid, Year One | $ 1,883 |
Lessee, Operating Lease, Liability, to be Paid, Year Two | 1,649 |
Lessee, Operating Lease, Liability, to be Paid, Year Three | 1,194 |
Lessee, Operating Lease, Liability, to be Paid, Year Four | 1,001 |
Lessee, Operating Lease, Liability, to be Paid, Year Five | 993 |
Lessee, Operating Lease, Liability, to be Paid, after Year Five | 743 |
Lessee, Operating Lease, Liability, to be Paid, Total | 8,014 |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | (1,548) |
Operating Lease, Liability | 6,466 |
Lessee, Operating Lease, Liability, to be Paid, Remainder of Fiscal Year | $ 551 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (66) | 0 | (349) | 0 |
Share-based compensation | $ 1,251 | $ 799 | $ 4,170 | $ 2,341 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 40 | 22 | 164 | 95 |
2018 Plan | ||||
Share-Based Payment Arrangement [Abstract] | ||||
Shares available for issuance | 4,350 | 4,350 | ||
Options Outstanding | 2,306 | 2,306 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,737 | 1,737 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,737 | 1,737 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 4,350 | 4,350 | ||
Options Outstanding | 2,306 | 2,306 |
NET LOSS PER SHARE (Details) -
NET LOSS PER SHARE (Details) - Components of Earnings Per Share, Basic and Diluted - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||||||||
Net loss | $ (2,206) | $ (3,765) | $ 339 | $ (4,533) | $ (5,860) | $ (3,017) | $ (5,632) | $ (13,410) |
Weighted average shares of common stock outstanding, basic (in shares) | 22,591 | 20,219 | 21,204 | 20,092 | ||||
Basic loss per share (in Dollars per share) | $ (0.10) | $ (0.22) | $ (0.27) | $ (0.67) | ||||
Weighted average shares of common stock outstanding, diluted (in shares) | 22,591 | 20,219 | 21,204 | 20,092 | ||||
Diluted loss per share (in Dollars per share) | $ (0.10) | $ (0.22) | $ (0.27) | $ (0.67) |
EMPLOYEE RETENTION TAX CREDIT -
EMPLOYEE RETENTION TAX CREDIT - Narrative (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Dec. 31, 2022 | Sep. 30, 2021 |
ERC Income | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Other assets | $ 7,076 | $ 3,457 | $ 10,533 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Event - Reseller Partner Acquisition $ in Thousands | Oct. 01, 2023 USD ($) |
Subsequent Event [Line Items] | |
Asset Acquisition, Consideration Transferred | $ 8,391 |
Cash payment | 6,891 |
Payment at closing | 6,545 |
Delivery of promissory note | $ 1,500 |