Fair Value Measurements

6 Months Ended

Jun. 30, 2023

The following tables summarize the estimated value of cash equivalents and restricted cash (in thousands):


	June 30, 2023
	Adjusted Cost		Unrealized Gain		Unrealized Loss		Estimated Fair Value		Cash and cash equivalents		Restricted cash		Short-term investments
Cash	$	4,559	$	—	$	—	$	4,559	$	4,559	$	—	$	—
Level 1:
Money market funds	35,529		—		—		35,529		32,193		3,336		—
Subtotal	35,529		—		—		35,529		32,193		3,336		—
Level 2:
U.S. Treasury securities	6,482		—		—		6,482		—		—		6,482
U.S. agency securities	13,907		1		(1)		13,907		—		—		13,907
Commercial Paper	2,494		—		—		2,494		—		—		2,494
Corporate debt securities	—		—		—		—		—		—		—
Subtotal	22,883		1		(1)		22,883		—		—		22,883
Total	$	62,971	$	1	$	(1)	$	62,971	$	36,752	$	3,336	$	22,883


	December 31, 2022
	Adjusted Cost		Unrealized Gain		Unrealized Loss		Estimated Fair Value		Cash and cash equivalents		Restricted cash		Short-term investments

Level 1:
Money market funds	$	45,412	$	—	$	—	$	45,412	$	42,046	$	3,366	$	—
Subtotal	45,412		—		—		45,412		42,046		3,366		—
Level 2:
U.S. Treasury securities	14,866		4		(3)		14,867		—		—		14,867
U.S. agency securities	5,938		—		—		5,938		3,983		—		1,955
Commercial Paper	28,122		—		—		28,122		5,994		—		22,128
Corporate debt securities	7,590		1		(1)		7,590		5,598		—		1,992
Subtotal	56,516		5		(4)		56,517		15,575		—		40,942
Total	$	101,928	$	5	$	(4)	$	101,929	$	57,621	$	3,366	$	40,942

No securities have contractual maturities of longer than one year. There were no transfers between Levels 1, 2, or 3 for any of the periods presented.

The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments (in thousands):


	Contingent Earnout Liability
Fair value as of December 31, 2022	$	(227)

Change in fair value included in other income (expense)	207
Fair value as of June 30, 2023	$	(20)

The fair value of the Contingent Earnout Liability is based on significant unobservable inputs, which represent Level 3 measurements within the fair value hierarchy.

In determining the fair value of the Contingent Earnout Liability, the Company used a Monte Carlo simulation value model using a distribution of potential outcomes. The assumptions utilized in the calculation were based on the achievement of certain stock price milestones, including the current Company common stock price, expected volatility, risk-free rate, expected term and expected dividend yield. Refer to Note 6, Stockholders’ Equity (Deficit), for further details of the Contingent Earnout Liability.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details