Stock-based Compensation

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

2021 Equity Incentive Plan

In June 2021, our board of directors adopted our 2021 Equity Incentive Plan, or 2021 Plan. All equity-based awards going forward are granted under the 2021 Plan. An aggregate of 18,946,871 shares of our common stock were reserved for issuance under our 2021 Plan, as well as any future automatic annual increases in the number of shares of common stock reserved for issuance under our 2021 Plan.

Under the terms of the 2021 Plan, both incentive and nonqualified stock options could be granted with exercise prices not less than the fair market value of our common stock on the date of grant. Options granted pursuant to the 2021 Plan will vest at the rate specified in the stock option agreement. Under the 2021 Plan, if an option holder’s service relationship with us or any of our affiliates ceases for any reason other than disability, death, or cause, the option holder may generally exercise any vested options for a period of three months following the cessation of service. If under our 2021 Plan, shares subject to stock option awards expire or terminate without being exercised in full or are paid out in cash rather than in shares, such stock options will not reduce the number of shares available for issuance under our 2021 Plan. Our policy is to issue new common stock upon the exercise of stock options. Shares withheld under a stock option award to satisfy the exercise, strike or purchase price of such award or to satisfy a tax withholding obligation will not reduce the number of shares available for issuance under our 2021 Plan.

Under the 2021 Plan, RSU awards are granted under RSU award agreements approved by the administrator. RSU awards may be granted for any form of legal consideration that may be acceptable to our board of directors and permissible under applicable law. An RSU award may be settled by cash, delivery of stock, a combination of cash and stock as deemed appropriate by the administrator, or in any other form of consideration set forth in the RSU award agreement. Additionally, dividend equivalents may be credited in respect of shares covered by a RSU award. Except as otherwise provided in the applicable award agreement, or other written agreement between us and the recipient, RSU awards that have not vested will be forfeited once the participant’s continuous service ends for any reason.

2021 Employee Stock Purchase Plan

In June 2021, our board of directors adopted our 2021 Employee Stock Purchase Plan, or 2021 ESPP. We authorized the issuance of 3,552,538 shares of common stock under the 2021 ESPP, as well as any future automatic annual increases in the number of shares of common stock reserved for issuance under our 2021 Employee Stock Purchase Plan. Our 2021 ESPP is implemented through a series of offerings under which eligible employees are granted rights to purchase shares of our common stock on specified dates during such offerings at a discounted price per share.

Under the 2021 ESPP, our employees may purchase common stock through payroll deductions at a price equal to 85% of the lower of the fair market value of the stock at the beginning of the offering period or at the end of each applicable purchase period. The 2021 ESPP generally provides for offering periods of six months in duration with purchase periods ending on either May 15 or November 15. Contributions under the 2021 ESPP are limited to a maximum of 15% of an employee’s eligible compensation. Purchases under the 2021 ESPP are settled with common stock from the 2021 ESPP’s previously-authorized and available pool of shares. The stock-based compensation expense incurred in connection with the 2021 ESPP in 2024, 2023 and 2022 was $0.4 million, $0.7 million and $0.7 million, respectively.

2016 Stock Option Plan

Prior to the adoption of the 2021 Plan, we granted stock options under our 2016 Stock Incentive Plan, or 2016 Plan.

Under the terms of the 2016 Plan, both incentive and nonqualified stock options were granted with exercise prices not less than the fair value of the underlying common stock on the date of grant. Options granted pursuant to the 2016 Plan vest over periods of up to five years and expire ten years from the grant date. If a 2016 Plan option expires and is not exercised, such as if an employee does not exercise vested 2016 Plan options within thirty days of termination, then these options would revert back to the 2016 Plan’s option pool.

The exercise price of all options granted was based on the estimated fair market value of our common stock as determined by the board of directors at the date of grant or date of modification.

Stock-based Compensation Expense

We recorded stock-based compensation expense in the following categories in the accompanying consolidated statements of operations and balance sheets (in thousands):


	Year Ended December 31,
	2024		2023		2022
Cost of revenue	$	5,833	$	4,318	$	2,931
Sales and marketing	8,077		6,096		10,144
Technology and development	19,573		18,899		16,574
General and administrative	38,027		36,702		50,820
Total stock-based compensation expense	71,510		66,015		80,469
Amount capitalized to internal-use software	5,967		4,056		2,526
Total stock-based compensation	$	77,477	$	70,071	$	82,995

Stock Options

Stock option activity for the year ended December 31, 2024 is as follows (in thousands, except weighted-average exercise price and remaining contract life):


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2023	20,486	$	10.69	6.9	$	34,571
Granted	—	—
Exercised	(389)	1.11
Cancelled	(2,231)	13.00
Forfeited	(2,672)	11.22
Outstanding at December 31, 2024	15,194	$	10.51	2.6	$	442
Vested and expected to vest at December 31, 2024	15,194	$	10.51	2.6	$	442
Exercisable at December 31, 2024	13,948	$	10.46	2.1	$	442

The aggregate intrinsic values in the table above represents the difference, if any, between the fair value per share of our common stock and the option exercise prices multiplied by the number of options at the respective balance sheet dates. The total intrinsic value of stock options exercised in 2024, 2023 and 2022 was $3.5 million, $2.2 million and $3.9 million, respectively. During the years ended December 31, 2024, 2023, and 2022, the Company recorded stock-based compensation expense related to stock option awards of $5.4 million, $22.0 million, and $40.1 million, respectively. At December 31, 2024, total remaining stock-based compensation expense for unvested stock options was $5.7 million, which is expected to be recognized over a weighted-average period of 1.8 years.

The weighted-average grant-date fair value per share of options granted using the Black-Scholes option pricing model for 2023 and 2022 was $4.40 and $6.61, respectively. We did not grant any stock options in 2024. There was a $3.1 million tax benefit for tax deductions from stock options exercised in 2024. There was no tax benefit for 2023, and a realized tax benefit of $2.6 million for tax deductions from stock options exercised in 2022. All tax effects related to stock-based compensation have been recorded in our provision for income taxes in the accompanying consolidated statements of operations. Vesting of the options granted to the members of our senior leadership team will be accelerated upon a qualifying termination that occurs during the change-in-control period, as defined in the option grant agreement, or immediately prior to the effective time of a change-in-control if the option award is not assumed, continued or substituted by the surviving or acquiring entity (or its parent) in connection with such change-in-control.

The weighted-average assumptions that were used to calculate the grant-date fair value of our stock option grants using the Black-Scholes option pricing model were as follows:


	Year Ended December 31,
	2023	2022
Expected life (years)	5.9	5.6
Risk-free interest rate	3.4%-3.8%	2.6	%
Expected volatility	50.4%-50.7%	48	%
Expected dividend yield	—	—

Restricted Stock Units and Performance Stock Units

A summary of RSUs and performance stock units, or PSUs, activity for the year ended December 31, 2024 is as follows (in thousands, except weighted-average grant-date fair value):


	Number of Units	Weighted- Average Grant- Date Fair Value
Unvested at December 31, 2023	14,007	$	10.83
Granted(1)	28,681	7.70
Cancelled/forfeited	(7,091)	11.35
Vested	(5,875)	11.84
Unvested at December 31, 2024	29,722	$	7.49

(1) Granted shares include RSU awards with a market vesting condition granted in July 2024 and reflected at 200% of target, and RSU awards with market vesting condition granted in November 2024 reflected at 400% of target.

The fair value of vested RSUs in 2024, 2023 and 2022, was $52.1 million, $36.6 million and $18.5 million, respectively. Our RSUs consist of time-based RSUs, RSUs with performance and/or market conditions, and RSUs with market conditions. For the years ended December 31, 2024, 2023 and 2022, total stock-based compensation expense related to RSUs was $71.4 million, $47.3 million and $41.4 million, respectively. At December 31, 2024, total remaining stock-based compensation expense for unvested RSU awards was $193.1 million, which is expected to be recognized over a weighted-average period of 2.2 years. There was no tax benefit for 2024, 2023 and 2022.

During the year ended December 31, 2024, we granted 2.5 million RSUs with performance and market conditions, or PSUs, to members of our senior leadership team. The grant date fair value of the PSUs at 100% of the target was $29.8 million. The weighted-average grant-date fair value per share of the PSUs granted was $12.05. The fair value of these PSUs was estimated using the Monte Carlo simulation model on the dates of the grant based on the assumptions shown in the table below. Vesting of the PSUs is contingent upon the recipients’ continuous employment over the requisite service period and was subject to fulfillment by the Company of a predefined profitability target during the performance period. The number of PSUs subject to vesting was determined at the end of the performance period and could equal zero percent (0%) to two hundred percent (200%) of the target award. If the performance criteria was achieved, one third of the PSUs would vest on the date the compensation committee of the board of directors certifies achievement of the performance criteria, and the remaining awards would vest quarterly thereafter through February 2027. These PSU awards also included a modifier to the total number of shares earned based on the Company’s total shareholder return, or TSR, compared to the TSR of the Nasdaq Composite Index during the performance period. The total number of shares issued pursuant to the PSU award could be increased, decreased, or remain unchanged based on the TSR modifier. The TSR modifier applicable to the PSUs was considered a market condition and therefore is reflected in the respective grant-date fair values of the awards. A Monte Carlo simulation was used to account for this market condition in the grant-date fair value of the awards. Expense related to the PSUs is recognized over the employee’s requisite service period using graded vesting attribution method to the extent it is probable that the performance conditions will be achieved. We recognized $9.2 million in stock-based compensation expense during the year ended December 31, 2024 related to these awards. At December 31, 2024, the remaining stock-based compensation expense for

unvested PSUs is $7.8 million which is expected to be recognized over a weighted-average requisite service period of approximately 1.2 years.

The assumptions that were used to calculate the grant-date fair value of our PSU grants using a Monte Carlo simulation model were as follows:


						Year Ended December 31,
						2024
Expected life (years)						0.4-0.8
Risk-free interest rate						5.2%-5.4%
Expected volatility						47.4%-66.1%
Expected dividend yield						—

In July 2024, we also granted 2.7 million RSUs with a market vesting condition to a member of our senior leadership team. The grant date fair value of these RSUs at 100% of the target was $13.1 million. The weighted-average grant-date fair value per share of the RSUs granted was $4.89. The fair value of the RSUs was estimated on the date of grant using the Monte Carlo simulation model, based on the assumptions shown in the table below. Vesting of this award is contingent upon the recipient’s continuous employment over the requisite service period and is subject to achievement of predetermined stock price targets during a five-year performance period. Achievement of the predetermined stock price targets is measured based on a 45-trading day volume weighted-average closing price of our common stock, subject to a 44-day extension in certain circumstances. The number of RSUs subject to vesting during the performance period may equal zero percent (0%) to two hundred percent (200%) of the target award. Upon the achievement of a stock price target during the performance period, one-half of the eligible RSUs will vest on the date the compensation committee of the board of directors certifies achievement of the stock price target and the other half will vest one year from such date, subject to the recipient’s continued employment through the vesting date. We recognized $4.9 million in stock-based compensation expense during the year ended December 31, 2024 related to these awards. At December 31, 2024, the remaining stock-based compensation expense for unvested RSUs is $21.2 million which is expected to be recognized over a weighted-average requisite service period of approximately 2.4 years.

The assumptions that were used to calculate the grant-date fair value of the RSUs with a market vesting condition using a Monte Carlo simulation model were as follows:


	Year Ended December 31,
	2024
Expected life (years)	5
Risk-free interest rate	4.2	%
Expected volatility	59.4	%
Expected dividend yield	—

In November 2024, we also granted 2.4 million RSUs with a market vesting condition to members of our senior leadership team. The grant date fair value of these RSUs at 100% of the target was $12.6 million. The weighted-average grant-date fair value per share of the RSUs granted was $5.30. The fair value of the RSUs was estimated using the Monte Carlo simulation model on the date of the grant based on the assumptions shown in the table below. Vesting of this award is contingent upon the recipient’s continuous employment over the requisite service period and is subject to achievement of predetermined stock price targets during a three-year performance period, subject to certification by the compensation committee of the board of directors. Achievement of the predetermined stock price targets is measured based on the trailing 30-trading day volume weighted average closing stock price of our common stock subject to a 29-day extension in certain circumstances. The number of RSUs subject to vesting during the performance period may equal zero percent (0%) to four hundred percent (400%) of the target award. If the compensation committee of the board of directors certifies achievement of a stock price target prior to November 15, 2025, the eligible shares will vest in full and become non-forfeitable on November 15, 2025. If the compensation committee of the board of directors certifies achievement of a stock price target on or subsequent to November 15, 2025, 100% of the eligible shares will vest and become non-forfeitable immediately on the date of certification by the compensation committee of the board of directors. We recognized $5.6 million in stock-based compensation expense during the year ended December 31, 2024 related to these awards. At December 31, 2024, the

remaining stock-based compensation expense for unvested RSUs is $44.8 million which is expected to be recognized over a weighted-average requisite service period of approximately 1.1 years.

The assumptions that were used to calculate the grant-date fair value of the RSUs with a market vesting condition using a Monte Carlo simulation model were as follows:


	Year Ended December 31,
	2024
Expected life (years)	3
Risk-free interest rate	4.2	%
Expected volatility	60.9	%
Expected dividend yield	—

During the year ended December 31, 2023, we also granted 1.3 million PSUs to members of our senior leadership team. Vesting of the PSUs was contingent upon the recipient’s continuous employment over the requisite service period and was subject to fulfillment by the Company of predefined performance criteria which were not achieved. Consequently, no stock-based compensation expense related to these PSU awards was recognized during the year ended December 31, 2024.

In November 2022, we granted 211,864 PSUs with a grant date fair value of $2.0 million to certain employees where 25% and 50% of the PSUs vest upon the first and second anniversaries, respectively, from the Revv asset acquisition date should certain headcount thresholds be maintained, and 25% will vest upon the third anniversary from the Revv asset acquisition date. For the years ended December 31, 2024, 2023 and 2022, stock-based compensation expense for these PSUs was $0.7 million, $0.8 million and $0.1 million, respectively, and was recognized on a graded vesting basis. At December 31, 2024, the remaining stock-based compensation expense for unvested PSUs was $0.2 million, which is expected to be recognized over a weighted-average requisite service period of approximately 0.9 years.

Modification of Stock-Based Compensation Awards

In May 2023, the compensation committee of the board of directors approved amendments to the terms of the stock option and RSU awards granted to members of our senior leadership team during the year ended December 31, 2022, whereby the vesting of such stock options and RSUs will be accelerated upon (i) a qualifying termination that occurs during the CIC period or (ii) the individual’s termination as a result of his or her death or disability (as each such term is defined in the employment agreement between the Company and applicable individual). Further, the amendments provide that such stock options, to the extent vested and outstanding on the date of the individual’s qualifying termination or the termination of the individual’s employment in the event of his or her death or disability, as applicable and after giving effect to the vesting acceleration, shall remain outstanding and exercisable until the earlier of: (x) the original expiration date of the stock options, (y) the one-year anniversary of the date of the individual’s termination of employment with the Company, and (z) immediately prior to the effective time of a change in control if such stock option is not assumed, continued or substituted by the surviving or acquiring entity (or its parent) in connection with such change in control. The modification to add the foregoing provisions did not result in an incremental fair value of the impacted awards because the original vesting conditions were expected to be satisfied as of the modification date and the termination of the individual’s employment in the event of change-in-control or as a result of his or her death or disability was not probable as of the date of this filing.