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Fair Value Measurements | 3 Months Ended | 12 Months Ended
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Mar. 31, 2025 | Dec. 31, 2024
Fair Value Measurements [Abstract] |  |
FAIR VALUE MEASUREMENTS | 14 - FAIR VALUE MEASUREMENTS Recurring Fair Value Measurements Warrant liability The Company’s initial value of the warrant liability was based on a valuation model utilizing management judgment and pricing inputs from observable and unobservable markets with less volume and transaction frequency than active markets and classified as level 3. The subsequent measurement of the Private Warrants is classified as Level 2 because these warrants are economically equivalent to the Public Warrants, based on the terms of the Private Warrant agreement, and as such their value is principally derived by the value of the Public Warrants. Significant deviations from these estimates and inputs could result in a material change in fair value. During the three months ended March 31, 2025, there were no transfers amongst level 1, 2, and 3 values during the period. The conversion feature of the Convertible Promissory Notes is measured at fair value using a Monte Carlo model that fair values the conversion option. The following table presents fair value information as of March 31, 2025 and December 31, 2024, of the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.
March 31, 2025 |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Private warrant liability |  | $ | 420,497 |  |  |  |  |  |  | $ | 420,497 |  |  |  |  |
Convertible note option liability |  |  | 1,000 |  |  |  |  |  |  |  |  |  |  |  | 1,000 |
Earn-out share liability |  |  | 5,030,000 |  |  |  |  |  |  |  |  |  |  |  | 5,030,000 |
Total |  | $ | 5,451,497 |  |  | $ |  |  |  | $ | 420,497 |  |  | $ | 5,031,000 |
December 31, 2024 |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Money Market Funds |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Private warrant liability |  |  | 840,995 |  |  |  | - |  |  |  | 840,995 |  |  |  | - |
Convertible note option liability |  |  | 60,000 |  |  |  | - |  |  |  | - |  |  |  | 60,000 |
Earn-out Share Liability |  |  | 15,560,000 |  |  |  | - |  |  |  | - |  |  |  | 15,560,000 |
Total |  | $ | 16,460,995 |  |  | $ | - |  |  | $ | 840,995 |  |  | $ | 15,620,000 |
Convertible Note Option Liability The Company established the initial fair value for the convertible note option liability as of September 13, 2024, which was the date the Convertible Note was executed. As of March 31, 2025, the fair value was remeasured using an option pricing model. The option pricing model was used to value the convertible note option liability for the initial periods and subsequent measurement periods. The convertible note option liability was classified within Level 3 of the fair value hierarchy due to the use of unobservable inputs. The key inputs into the option pricing model for the convertible note option liability were as follows:
|  | March 31, 2025 |  |  | December 31, 2024 |
Stock Price |  | $ | 1.49 |  |  | $ | 3.81 |
Expected term (years) |  |  | 0.95 |  |  |  | 1.2 |
Volatility |  |  | 80.0 | % |  |  | 75.0 | %
Risk-Free Rate |  |  | 4.05 | % |  |  | 4.18 | %
Interest rate |  |  | 6.41 | % |  |  | 6.49 | %
|  | Three months ended March 31, 2025 |
Balance, beginning of period |  | $ | 60,000 |
Change in fair value |  |  | (59,000 | )
Balance, end of period |  | $ | 1,000 |
Earn-out Share Liability Following the closing of the Business Combination, holders of certain capital stock of Private Veea immediately prior to the closing have the contingent right to receive up to 4.5 million additional shares of Common Stock if certain trading-price based milestones of the Common Stock are achieved or a change of control transaction occurs during the ten-year period following the Closing. The Company’s obligation to issue the earn out shares is recorded as a contingent liability (the “Earn-out Share Liability”) in the Company’s financial statements. The initial value of the contingent Earn-out Share Liability of $53.6 million was recorded as a transaction cost within operating expenses. The fair value of the Earn-out Share Liability was estimated using a Monte Carlo simulation utilizing assumptions related to the contractual term of the instruments, estimated volatility, the price of the Common Stock, and current interest rates. The following table presents the changes in fair value of the earn-out liability:
|  | Three months ended March 31, 2025 |
Balance, beginning of period |  | $ | 15,560,000 |
Change in fair value |  |  | (10,530,000 | )
Balance, end of period |  | $ | 5,030,000 |
The key inputs for the Earn-out Share Liability were as follows:
|  | March 31, 2025 |  |  | December 31, 2024 |
Stock Price |  | $ | 1.49 |  |  | $ | 6.5 |
Expected term (years) |  |  | 9.5 |  |  |  | 10 |
Volatility |  |  | 75 | % |  |  | 75.0 | %
Risk-Free Rate |  |  | 4.2 | % |  |  | 3.81 | %
| 14 - FAIR VALUE MEASUREMENTS Recurring Fair Value Measurements The Company’s initial value of the warrant liability was based on a valuation model utilizing management judgment and pricing inputs from observable and unobservable markets with less volume and transaction frequency than active markets and classified as level 3. The subsequent measurement of the Private Warrants is classified as Level 2 because these warrants are economically equivalent to the Public Warrants, based on the terms of the Private Warrant agreement, and as such their value is principally derived by the value of the Public Warrants. Significant deviations from these estimates and inputs could result in a material change in fair value. For the year ended December 31, 2024, there were no transfers amongst level 1, 2, and 3 values during the period. The conversion feature of the September 2024 Notes is measured at fair value using a Monte Carlo model that fair values the conversion option. The following table presents fair value information as of December 31, 2024 and 2023 of the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.
December 31, 2024 |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money Market Funds |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Private warrant liability |  |  | 840,995 |  |  |  | - |  |  |  | 840,955 |  |  |  | - |
Convertible note option liability |  |  | 60,000 |  |  |  | - |  |  |  | - |  |  |  | 60,000 |
Earn-out Share Liability |  |  | 15,560,000 |  |  |  | - |  |  |  | - |  |  |  | 15,560,000 |
Total |  | $ | 16,460,995 |  |  | $ | - |  |  | $ | 840,995 |  |  | $ | 15,620,000 |
December 31, 2023 |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Money Market Funds |  | $ | 120,000 |  |  | $ | 120,000 |  |  | $ | - |  |  | $ | - |
Convertible Note Option Liability The Company established the initial fair value for the Convertible Note Option Liability as of September 13, 2024, which was the date of the Financing Closing . On December 31, 2024, the fair value was remeasured using an option pricing model. The option pricing model was used to value the Convertible Note Option liability for the initial period and subsequent measurement periods. The Convertible Note Option liability was classified within Level 3 of the fair value hierarchy at the initial measurement date and as of and December 31, 2024, due to the use of unobservable inputs. The key inputs into the option pricing model for the Convertible Note Option liability were as follows at September 13, 2024 initial value and at December 31, 2024:
|  | December 31, 2024 |  |  | September 13, 2023 |
Stock Price |  | $ | 3.81 |  |  | $ | 12.00 |
Expected term (years) |  |  | 1.2 |  |  |  | 1.5 |
Volatility |  |  | 75.0 | % |  |  | 70.0 | %
Risk-Free Rate |  |  | 4.18 | % |  |  | 3.79 | %
Interest rate |  |  | 6.49 | % |  |  | 7.33 | %
|  | Year ended December 31, 2024 |
Balance at January 1, 2024 | $ | - |
Initial value, September 13, 2024 |  |  | 900,933 |
Change in fair value |  |  | (607,067 | )
Balance at December 31, 2024 |  | $ | 293,866 |
Earn-out Share Liability Following the closing of the Business Combination, holders of certain capital stock of Private Veea immediately prior to the closing will have the contingent right to receive up to 4.5 million additional shares of the Company’s common stock if certain trading-price based milestones of the Company’s common stock are achieved or a change of control transaction occurs during the ten-year period following the Closing. The Company’s obligation to issue the earnout shares is recorded as a contingent liability (the “Earn-Out Share Liability”) in the Company’s financial statements. The initial value of the contingent earnout share liability of $53.6 million is recorded as a transaction cost within operating expenses for the year ended December 31, 2024. The fair value of the Earn-out Share Liabilities was estimated using Monte Carlo simulation utilizing assumptions related to the contractual term of the instruments, estimated volatility, the price of our common stock, and the risk-free rate. A significant driver of the value of the Earn-out Share Liability at the close of the Business Combination was our closing stock price on September 13, 2024, which was $12.00. The following table presents the changes in fair value of the earnout liabilities:
|  | Year ended December 31, 2024 |
Liability at January 1, 2024 |  | $ | - |
Initial value, September 13, 2024 |  |  | 53,600,000 |
Change in fair value |  |  | (38,040,000 | )
Balance as of December 31, 2024 |  | $ | 15,560,000 |
The key inputs for the Earn-out Share Liability were as follows at September 13, 2024 initial value, and at December 31, 2024:
|  | December 31, 2024 |  |  | September 13, 2024 |
Stock Price |  | $ | 6.50 |  |  | $ | 12.00 |
Expected term (years) |  |  | 10 |  |  |  | 10 |
Volatility |  |  | 75.0 | % |  |  | 70.0 | %
Risk-Free Rate |  |  | 3.81 | % |  |  | 3.66 | %

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- 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 Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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