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Software Development Costs (Notes)

12 Months Ended

Dec. 31, 2022

Research and Development [Abstract]

Research, Development, and Computer Software Disclosure [Text Block]

SOFTWARE DEVELOPMENT COSTS

Software development costs consists of the following:

			December 31, 2022						December 31, 2021
Software development costs			$	4,509,805					$	3,036,810
Less accumulated amortization			(2,735,772)						(2,017,210)
Software development costs, net			$	1,774,033					$	1,019,600

The Company developed its web-based influencer marketing platform, IZEAx, to enable influencer marketing and content creation campaigns on a greater scale. The Company continued to add new features to IZEAx, BrandGraph, and Shake in 2021. In 2022, the Company developed two new web-based influencer marketing platforms, Flex and Marketplace. These new platforms will replace IZEAx and Shake. IZEAx will be sunset in March of 2023 and Shake was sunset in Q4 of 2022. The Company capitalized software development costs of $1,472,995 and $0 during the twelve months ended December 31, 2022, and 2021, respectively. As a result, the Company has capitalized a total of $4,509,805 in direct materials, consulting, payroll, and benefit costs to its internal-use software development costs in the consolidated balance sheet as of December 31, 2022.

The Company amortizes its software development costs, commencing upon initial release of the software or additional features, on a straight-line basis over the estimated useful life of five years, which is consistent with the amount of time its legacy platforms were in service, or its actual useful life, if shorter. The Company recorded amortization expense associated with its capitalized software development cost of $0.7 million and $0.5 million during the twelve months ended December 31, 2022, and 2021, respectively.

As of December 31, 2022, future estimated amortization expense related to software development costs is set forth in the following schedule:

			Software Development Amortization Expense
2023			$	591,957
2024			318,305
2025			303,109
2026			297,361
2027			263,301
Total			$	1,774,033

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- References

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- Definition

The entire disclosure for research, development, and computer software activities, including contracts and arrangements to be performed for others and with federal government. Includes costs incurred (1) in a planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service, a new process or technique, or in bringing about a significant improvement to an existing product or process; or (2) to translate research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or the entity's use, during the reporting period charged to research and development projects, including the costs of developing computer software up to the point in time of achieving technological feasibility and in-process research and development acquired in a business combination consummated during the period.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 985
-SubTopic 730
-URI http://asc.fasb.org/subtopic&trid=2197926

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