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Stock Incentive Plans | 6 Months Ended
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Jun. 30, 2022
Share-Based Payment Arrangement [Abstract] |
Stock Incentive Plans | Stock Incentive Plans The Company has granted share-based awards to employees, non-employee directors, and other service providers of the Company under the Amended and Restated 2011 Equity Incentive Plan (2011 Plan) and the 2021 Stock Option and Incentive Plan (2021 Plan), collectively, the Plans. The 2011 Plan was terminated in June 2021 in connection with the IPO but continues to govern the terms of outstanding awards that were granted prior to the IPO. Additionally, the Company offers an employee stock purchase plan (ESPP), which allows employees to purchase shares of common stock at 85% of the fair value of the Company’s Class A common stock on the first or last day of the offering period, whichever is lower. The offering periods are six months long and start in May and November of each year. The following table presents the share-based compensation expense recognized in the periods presented:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Restricted stock units | $ | 15,078 |  |  | $ | 30,068 |  |  | $ | 30,423 |  |  | $ | 30,068 |
Stock options | 6,160 |  |  | 8,272 |  |  | 13,818 |  |  | 13,777 |
CEO Long-Term Performance Award | 13,267 |  |  | 11,363 |  |  | 26,388 |  |  | 11,363 |
Employee Stock Purchase Plan | 643 |  |  | 78 |  |  | 1,524 |  |  | 78 |
Secondary sales of common stock | — |  |  | 5,755 |  |  | — |  |  | 11,642 |
Total | $ | 35,148 |  |  | $ | 55,536 |  |  | $ | 72,153 |  |  | $ | 66,928 |
Restricted Stock Units Commencing in 2020, the Company began granting restricted stock units, or RSUs, to employees. RSUs granted prior to April 1, 2021 vest upon the satisfaction of both a service condition and a liquidity condition which was deemed satisfied in connection with the Company’s IPO. The service condition for these awards is satisfied over four years. On June 8, 2021, the Company completed its IPO and the liquidity condition for these awards was satisfied and the Company recognized $23.1 million of share-based compensation expense associated with RSUs that had service-vested as of the IPO completion date. RSUs granted on or after April 1, 2021, vest upon the satisfaction of a service condition. The service condition for these awards is satisfied over four years. A summary of the Company's RSU activity under the Plans was as follows:
| Number of Restricted Stock Units |  | Weighted-average grant date fair value per share |  |
Balance as of December 31, 2021 | 9,001,949 |  | $ | 18.30 |  |  |
Granted | 17,387,744 |  | 10.48 |  |  |
Vested | (2,029,261) |  | 14.77 |  |  |
Canceled and forfeited | (3,889,475) |  |  | 14.88 |  |  |
Balance as of June 30, 2022 | 20,470,957 |  | $ | 11.11 |  |  |
As of June 30, 2022, unrecognized compensation costs related to unvested RSUs was $229.9 million. These costs are expected to be recognized over a period of 3.3 years. Stock Options Under the 2011 Plan and the 2021 Plan, the exercise price of a stock option shall not be less than the fair market value per share of the Company’s common stock on the date of grant (and not less than 110% of the fair market value per share of common stock for grants to stockholders owning more than 10% of the total combined voting power of all classes of stock of the Company, or a 10% Stockholder). Options are exercisable over periods not to exceed ten years from the date of grant (five years for incentive stock options granted to 10% Stockholders). A summary of the Company's stock option activity under both stock incentive plans was as follows:
| Number of Options |  | Weighted-Average Exercise Price per Share |  | Weighted-Average Remaining Contractual Life |  | Aggregate Intrinsic Value(1)
Balance as of December 31, 2021(2) | 44,185,488 |  |  | $ | 13.31 |  |  | 8.46 years |  | $ | 279,242 |
Granted | 3,013,518 |  |  | 10.39 |  |  |  |  |
Exercised | (2,918,489) |  |  | 1.19 |  |  |  |  |
Canceled and forfeited | (2,755,876) |  |  | 6.27 |  |  |  |  |
Balance as of June 30, 2022(2) | 41,524,641 |  | $ | 14.41 |  |  | 7.87 years |  | $ | 79,475 |
Vested as of June 30, 2022 | 10,381,579 |  | $ | 4.12 |  |  | 5.29 years |  | $ | 59,976 |
(1) Intrinsic value is calculated based on the difference between the exercise price of in-the-money-stock options and the fair value of the common stock as of the respective balance sheet dates. (2) The 2011 Plan allows for early exercise of stock options and these balances include all exercisable stock options regardless of vesting status. As of June 30, 2022, aggregate unrecognized compensation costs related to unvested outstanding stock options, excluding the CEO Long-Term Performance Award, was $76.5 million. These costs are expected to be recognized over a period of 2.5 years. The fair value of stock options granted was estimated using the Black-Scholes option pricing model and the following weighted average assumptions:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Dividend yield | 0.0% |  | 0.0% |  | 0.0% |  | 0.0%
Expected volatility | 61.90% |  | 54.72% |  | 59.37% |  | 54.15%
Expected term (in years) | 6.08 |  | 6.84 |  | 6.08 |  | 6.73
Risk-free interest rate | 2.81% |  | 1.32% |  | 2.18% |  | 1.22%
Subsequent to the completion of the IPO, the fair value of the Company’s common stock is determined by the closing price, on the date of grant, of its Class A common stock, which is traded on the Nasdaq Global Select Market. CEO Long-Term Performance Award In April and May 2021, the Company’s board of directors granted the Company’s Chief Executive Officer equity incentive awards in the form of performance-based stock options covering 19,740,923 and 47,267 shares of our Class B common stock with an exercise price of $21.49 and $23.40 per share, respectively, or collectively, the CEO Long-Term Performance Award. The CEO Long-Term Performance Award vests upon the satisfaction of a service condition and the achievement of certain stock price hurdles over a seven-year performance period following the expiration of the lock-up period associated with the IPO. The stock price hurdle will be achieved if the average closing price of a share of our Class A common stock during any 90 consecutive trading day period during the performance period equals or exceeds the Company stock price hurdle set forth in the table below. The CEO Long-Term Performance Award is divided into seven equal tranches which vest upon the achievement of the following Company stock price hurdles:
Tranche |  | Company Stock Price Hurdle |  | Number of Options Eligible to Vest
1 |  | $67.50 |  | 2,826,884
2 |  | $78.98 |  | 2,826,884
3 |  | $92.40 |  | 2,826,884
4 |  | $108.11 |  | 2,826,884
5 |  | $126.49 |  | 2,826,884
6 |  | $147.99 |  | 2,826,884
7 |  | $173.15 |  | 2,826,884
Total |  |  |  | 19,788,188
The grant date fair value of the CEO Long-Term Performance Award was estimated using a Monte Carlo simulation model that incorporated multiple stock price paths and probabilities that the Company stock price hurdles are met. The weighted-average grant date fair value of the seven tranches of the CEO Long-Term Performance Award was estimated to be $10.53 per option share. As of June 30, 2022, the aggregate unrecognized compensation cost of the CEO Long-Term Performance Award was $143.8 million, which is expected to be recognized over the remaining derived service period of 3.6 years. Secondary Sales of Common Stock Prior to the completion of the IPO, certain economic interest holders acquired outstanding common stock from current or former employees for a purchase price greater than the Company's estimated fair value at the time of the transactions. During the three and six months ended June 30, 2022, the Company did not record any share-based compensation expense related to secondary sales of common stock. During the three and six months ended June 30, 2021, the Company recorded share-based compensation expense for the difference between the price paid and the estimated fair value on the date of the transaction of $5.8 million and 11.6 million, respectively.

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