XML 30 R18.htm IDEA: XBRL DOCUMENT v3.21.2
Warrants to Purchase Common Stock
 9 Months Ended
Sep. 30, 2021
Equity [Abstract]  
Warrants to Purchase Common Stock Warrants to Purchase Common Stock
In both 2013 and 2014, in connection with prior loan agreements, the Company issued two warrants to the lender to purchase 101,805 and 101,805 shares of Series B redeemable convertible preferred stock, both at an exercise price of $0.295 per share. As of September 30, 2021, both warrants are fully vested and exercisable and expire in 2023. Prior to the IPO, the warrants were classified as a liability in the condensed consolidated balance sheets and were remeasured at each balance sheet date using the Black-Scholes option pricing model, and any changes in fair value were recorded in other income (expense), net in the Company's condensed consolidated statements of operations. Immediately prior to the completion of the IPO in June 2021, these outstanding redeemable convertible preferred stock warrants were converted to Class B common stock warrants and the fair value of the liability as of that date was reclassified into the Company’s Class B common stock and additional paid-in capital. In July 2021, both warrants were exercised and a total of 203,610 shares of Class B common stock were issued.
In 2015 and 2016, in connection with prior loan agreements, the Company issued two warrants to the lender to purchase 231,348 and 621,066 shares of common stock, both at an exercise price of $0.053 per share. As of December 31, 2020, 231,348 and 438,180 warrants were fully vested and exercisable, and classified as equity instruments. Immediately prior to the completion of the IPO, those warrants were converted to an equivalent number of shares of Class B common stock warrants. In June 2021, both warrants were exercised and a total of 668,412 shares of Class B common stock were issued.
In September 2020, the Company issued a warrant to a Customer to purchase up to 750,000 shares of the Company’s common stock over a period of five years, ending in September 2025, at an exercise price of $0.01 per share, for a total fair value of $5.7 million. The warrant becomes exercisable when the vesting conditions are met. The warrant vesting is contingent on certain performance conditions, which include the Customer reaching certain annual transaction count thresholds over the five-year contract term. This warrant is classified as an equity instrument and expires in September 2025. It is treated as consideration payable to a Customer and recorded as a reduction to net revenue based on the probability of vesting conditions being met and the grant date fair value of the warrant. As of September 30, 2021, 25,900 warrants were vested and the Company recorded $0.1 million and $0.2 million as a reduction to net revenue during the three and nine months then ended, respectively.
The fair value of the warrant was estimated using the Black-Scholes option pricing model and the following assumptions as of the date of the grant:
Dividend yield0.0%
Expected volatility50.0%
Contract term (in years)5.0
Risk-free interest rate0.3%
In March 2021, the Company issued warrants to two Customers to purchase up to 1,100,000 and 50,000 shares of the Company’s common stock, respectively, over a period of four years, ending in April 2025, at an exercise price of $0.01 per share. The aggregate grant date fair value of these warrants was $26.4 million. The warrants’ vesting is contingent on certain performance conditions, which include issuing a specified percentage of new cards on the Company’s Platform over a three-year measurement period. The warrants are treated as consideration payable to a Customer and the grant date fair value of the warrants will be recorded as a reduction to net revenue based on the probability of vesting conditions being met. As of September 30, 2021, 183,334 warrants had vested and the Company recorded $2.0 million and $3.0 million as a reduction to net revenue during the three and nine months ended September 30, 2021, respectively.
The fair value of the warrants was estimated using the Black-Scholes option pricing model and the following weighted average assumptions:
Dividend yield0.0%
Expected volatility50.0%
Contract term (in years)4.0
Risk-free interest rate0.6%