10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36814

Entellus Medical, Inc.

(Exact name of registrant as specified in its charter)

Delaware	20-4627978
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

3600 Holly Lane North, Suite 40

Plymouth, Minnesota 55447

(Address of principal executive offices) (Zip Code)

(763) 463-1595

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	x  (Do not check if a smaller reporting company)	Smaller reporting company	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o    No  x

On October 30, 2015, there were 18,788,325 shares of the Registrant’s common stock, $0.001 par value per share, issued and outstanding.

ENTELLUS MEDICAL, INC.

TABLE OF CONTENTS

		Page
	PART I. FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements	3
	Condensed Consolidated Balance Sheets as of September 30, 2015 (unaudited) and December 31, 2014	3
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months ended September 30, 2015 and 2014 (unaudited)	4
	Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2015 and 2014 (unaudited)	5
	Condensed Consolidated Notes to Financial Statements (unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	23
Item 4.	Controls and Procedures	23
	PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information	25
Item 6.	Exhibits	26
SIGNATURES		27

As used in this report, the terms “we,” “us,” “our,” “Entellus Medical,” “Entellus” and the “Company” mean Entellus Medical, Inc., unless the context indicates another meaning.

2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

ENTELLUS MEDICAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

	September 30,			December 31,
	2015			2014
	(unaudited)			(1)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	8,705		$	3,484
Short-term investments		65,225			—
Accrued interest income		192			—
Accounts receivable, net		10,169			8,746
Inventories		3,277			2,439
Prepaid expenses and other current assets		1,498			883
Total current assets		89,066			15,552
PROPERTY AND EQUIPMENT, NET		3,655			1,730
Debt issuance costs, net		192			237
Other non-current assets		34			1,717
Total assets	$	92,947		$	19,236
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’    EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable	$	3,418		$	2,414
Current portion of long-term debt		4,102			—
Convertible preferred stock warrant liability		—			291
Accrued expenses		7,463			5,084
Total current liabilities		14,983			7,789
LONG-TERM LIABILITIES
Long-term debt, less current portion		15,898			20,000
Other non-current liabilities		484			247
Total liabilities		31,365			28,036
COMMITMENTS AND CONTINGENCIES (See Note M)
CONVERTIBLE PREFERRED STOCK, issuable in series, $0.001 par value;
Authorized shares: none at September 30, 2015 and 44,567  at December 31, 2014
Issued and outstanding shares: none at September 30, 2015 and 44,317 at    December 31, 2014		—			91,554
STOCKHOLDERS' EQUITY (DEFICIT) (see Note I)
Preferred stock, $0.001 par value per share:
Authorized shares: 10,000 at September 30, 2015 and none at December 31, 2014
Issued and outstanding shares: none		—			—
Common stock, $0.001 par value per share:
Authorized shares: 200,000 at September 30, 2015 and 62,276 at December 31, 2014; Issued and outstanding shares: 18,767 and 1,887 at September 30, 2015 and
December 31, 2014, respectively		19			2
Additional paid-in capital		178,596			3,402
Accumulated other comprehensive gain		12			—
Accumulated deficit		(117,045	)		(103,758	)
Total stockholders' equity (deficit)		61,582			(100,354	)
Total liabilities and stockholders' equity (deficit)	$	92,947		$	19,236

(1) Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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ENTELLUS MEDICAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited)

(in thousands, except per share data)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Revenue	$	14,804		$	11,691		$	43,497		$	34,364
Cost of goods sold		3,431			2,501			9,728			7,515
Gross profit		11,373			9,190			33,769			26,849
Operating expenses
Selling and marketing		12,308			8,391			32,010			24,276
Research and development		1,392			972			4,000			3,135
General and administrative		3,230			1,386			9,120			3,767
Total operating expenses		16,930			10,749			45,130			31,178
Loss from operations		(5,557	)		(1,559	)		(11,361	)		(4,329	)
Other income (expense)
Interest income		47			—			118			5
Interest expense		(561	)		(474	)		(2,042	)		(1,418	)
Other non-operating (expense) income		—			—			(2	)		1
Total other expense, net		(514	)		(474	)		(1,926	)		(1,412	)
Net loss	$	(6,071	)	$	(2,033	)	$	(13,287	)	$	(5,741	)
Other comprehensive loss
Unrealized gain on short term investments, net of tax		23			—			21			—
Foreign currency translation loss, net of tax		(8	)		—			(9	)		—
Comprehensive loss	$	(6,056	)	$	(2,033	)	$	(13,275	)	$	(5,741	)
Net loss per share, basic and diluted	$	(0.32	)	$	(1.36	)	$	(0.80	)	$	(3.94	)
Weighted average common shares used to compute net loss per    share, basic and diluted		18,738			1,500			16,688			1,456

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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ENTELLUS MEDICAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)

	Nine Months Ended
	September 30,
	2015			2014
Cash flows from operating activities:
Net loss	$	(13,287	)	$	(5,741	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		686			451
Amortization of debt issuance costs		45			44
Amortization of premium on investments		297			—
Accretion of final payment fee on long-term debt		230			161
Deferred rent		4			(15	)
Gain on disposal of equipment		—			(1	)
Stock-based compensation		1,776			159
Changes in fair value of convertible preferred stock warrants		357			151
Changes in operating assets and liabilities:
Accrued interest income		(192	)		—
Accounts receivables, net		(1,432	)		(1,374	)
Inventories		(838	)		(907	)
Prepaid expenses and other current assets		(616	)		192
Other non-current assets		1,684			(558	)
Accounts payable		1,003			1,192
Accrued expenses		2,381			(13	)
Net cash used in operating activities		(7,902	)		(6,259	)
Cash flows from investing activities:
Purchase of property and equipment		(2,611	)		(630	)
Proceeds from sale of property and equipment		—			1
Purchase of investments		(111,051	)		—
Proceeds from maturities of short-term investments		45,551			—
Net cash used in investing activities		(68,111	)		(629	)
Cash flows from financing activities:
Proceeds from stock options exercised		282			207
Proceeds from initial public offering, net of issuance costs		80,953			—
Repurchase of common stock		(1	)		—
Net cash provided by financing activities		81,234			207
Net increase (decrease) in cash and cash equivalents		5,221			(6,681	)
Cash and cash equivalents - beginning of period		3,484			7,709
Cash and cash equivalents - end of period	$	8,705		$	1,028
Supplemental cash flow information:
Cash paid for interest	$	1,394		$	973

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5

ENTELLUS MEDICAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except per share data)

NOTE A. ORGANIZATION

Nature of Business

Entellus Medical, Inc. (the “Company”) was incorporated in Delaware and its facilities are located in Plymouth, Minnesota. The Company is focused on the design, development and commercialization of products for the minimally invasive treatment of patients suffering from chronic sinusitis. The Company’s XprESS family of products is used by ear, nose and throat (“ENT”) physicians to treat patients with chronic sinusitis by opening narrowed or obstructed sinus drainage pathways using balloon sinus dilation performed in the physician office or the operating room. The Company currently sells product through its sales force in the United States and United Kingdom and to a limited number of additional countries through international distributors. The Company operates in one segment.

NOTE B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Preparation

The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”).

The interim financial data as of September 30, 2015, is unaudited and is not necessarily indicative of the results for a full year. In the opinion of the Company’s management, the interim data includes only normal and recurring adjustments necessary for a fair statement of the Company’s financial results for the three and nine months ended September 30, 2015 and 2014. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements.

The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 that has been filed with the SEC.

Initial Public Offering

In February 2015, the Company completed its initial public offering (“IPO”) by issuing 5,294 shares of common stock, at an offering price of $17.00 per share, for net proceeds of approximately $80,953 after deducting underwriting discounts, commissions and offering expenses payable by the Company. In connection with the IPO, the Company’s outstanding shares of convertible preferred stock were automatically converted into an aggregate of 11,404 shares of common stock, and the Company’s outstanding warrants to purchase shares of convertible preferred stock were automatically converted into warrants to purchase up to an aggregate of 38 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock warrant liability of $648 to additional paid-in-capital.

1-for-4 Reverse Stock Split

In connection with the IPO, the Company’s board of directors and stockholders approved a reverse stock split of the Company’s common stock on a 1-for-4 basis. The reverse stock split became effective on January 12, 2015. The par value of the common stock was not adjusted as a result of the reverse stock split. Adjustments corresponding to the reverse stock split were made to the ratio at which the convertible preferred stock converted into common stock immediately prior to the closing of the IPO. Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split and adjustment of the preferred stock’s conversion ratios.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates.

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Significant Accounting Policies

Other than the policies described below, there have been no changes in the Company’s significant accounting policies for the three and nine months ended September 30, 2015, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

Cash and Cash Equivalents

Cash equivalents are stated at fair value and include short-term, highly liquid investments with remaining maturities of 90 days or less at the date of purchase. Cash equivalents consist of money market funds recorded at fair value and corporate debt securities recorded at amortized costs. Investments in marketable securities of $2,590 were classified as cash equivalents as of September 30, 2015.

Short-term Investments

Short-term investments represent holdings of marketable securities in accordance with the Company’s investment policy and cash management strategy. Short-term investments are classified as available-for-sale and mature within 12 months from the balance sheet date. Investments with maturity dates greater than one year from the balance sheet date are classified as long-term investments. At the time that the maturity dates of these investments become one year or less, the securities are reclassified to short-term investments. The Company’s investments are recorded at fair value, with any unrealized gains and losses reported as a component of stockholders’ equity (deficit) until realized or until a determination is made that an other-than-temporary decline in market value has occurred. The cost of investments sold is determined based on the specific identification method and any realized gains or losses on the sale of investments are reflected as a component of interest income or expense. These investments are deemed Level 2 assets under the fair value hierarchy as their fair value is determined under a market approach using valuation models that utilize observable inputs, including maturity date, issue date, settlements date, and current interest rates.

Deferred Offering Costs

Deferred offering costs were capitalized and consisted primarily of legal, accounting and other direct fees and costs related to the IPO. The deferred offering costs included in other non-current assets at December 31, 2014 were offset against the IPO proceeds upon the closing of the IPO in February 2015. There were no deferred offering costs capitalized as of September 30, 2015.

Convertible Preferred Stock Warrant Liability

The Company issued warrants to purchase shares of convertible preferred stock in connection with the Company’s entry into its original credit facility in October 2012. The warrants are recorded at fair value using the Black Scholes model. The fair value of these warrants is remeasured at each financial reporting period with any changes in fair value being recognized as a component of other income (expense) in the statements of operations and comprehensive loss. In connection with completion of the IPO, in January 2015, the Company performed the final remeasurement of the warrant liability. There were no costs and costs of $357 for the three and nine months ended September 30, 2015, respectively, recorded as interest expense from the final remeasurement.

Upon the closing of the IPO, warrants to purchase shares of convertible preferred stock automatically converted into warrants to purchase shares of common stock. The Company reclassified the warrant liability to additional paid-in capital, as the warrants met the definition of an equity instrument.

Principles of Consolidation

The consolidated financial statements include the accounts of Entellus Medical, Inc., and its wholly owned subsidiary. All significant intercompany transactions and accounts have been eliminated.

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board, (“FASB”) issued Accounting Standards Update, (“ASU”) No. 2014-09, Revenue from Contracts with Customers. This standard will eliminate the transaction and industry specific revenue recognition guidance under current U.S. GAAP and replace it with a principles based approach for determining revenue recognition. In August 2015, the FASB issued ASU 2015-14 which defers the adoption of ASU 2014-09 to interim periods beginning after December 31, 2018 for companies under the Jumpstart Our Business Startups Act. The Company is in the process of evaluating the impact of the adoption of this standard.

7

In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. ASU 2015-02 is effective for the annual period beginning after December 15, 2015, and for annual and interim periods thereafter. Early application is permitted. The adoption of ASU 2015-02 is not expected to have a material impact on the Company’s financial position or results of operations.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance, which changes the presentation of debt issuance costs in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. ASU 2015-03 is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. The Company does not believe that adoption of ASU 2015-03 will have a significant impact on the Company’s consolidated financial statements.

In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory, which requires inventory not measured using either the last in, first out or the retail inventory method to be measured at the lower of cost and net realizable value.  Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation.  The new standard will be effective January 1, 2017 and will be applied prospectively.  Early adoption is permitted.  The Company is in the process of evaluating the impact of the adoption of this standard.

NOTE C. COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS

Inventories

	September 30,		December 31,
	2015		2014
Finished goods	$	1,360	$	859
Work in process		430		318
Raw materials		1,487		1,262
Total	$	3,277	$	2,439

Property and Equipment

	September 30,			December 31,
	2015			2014
Furniture and office equipment	$	520		$	401
Computer hardware and software		2,033			837
Laboratory equipment		2,511			1,427
Tooling and molds		1,237			1,237
Leasehold improvements		574			494
	$	6,875		$	4,396
Less accumulated depreciation and amortization		(3,447	)		(2,768	)
Property and equipment in progress		227			102
Total	$	3,655		$	1,730

Depreciation and amortization expense was $272 and $157 during the three months ended September 30, 2015 and 2014, respectively, and $686 and $451 during the nine months ended September 30, 2015 and 2014, respectively.

Other Non-Current Assets

	September 30,		December 31,
	2015		2014
Security deposit on operating lease	$	34	$	19
Deferred offering costs		—		1,698
Total	$	34	$	1,717

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Accrued Expenses

	September 30,		December 31,
	2015		2014
Compensation and commissions payable	$	4,915	$	3,001
Royalty payable		1,527		1,537
Other accrued expenses		1,021		546
Total	$	7,463	$	5,084

NOTE D. LIQUIDITY AND BUSINESS RISKS

As of September 30, 2015, the Company had cash, cash equivalents and short-term investments of $73,930 and an accumulated deficit of $117,045. In February 2015, the Company completed its IPO by issuing 5,294 shares of common stock at an offering price of $17.00 per share, for net proceeds of approximately $80,953, after deducting underwriting discounts and commissions and offering expenses. Prior to the IPO, the Company financed its operations with a combination of revenue, private placements of convertible preferred securities and amounts borrowed under its credit facility. Following the IPO, the Company expects that its cash and cash equivalents, short-term investments, revenue and available debt financing arrangements will be sufficient to fund its operations through at least the next twelve months.

NOTE E. SHORT-TERM INVESTMENTS

The Company determines the appropriate classification of its investments at the time of purchase and revaluates such determinations at each balance sheet date. Marketable securities are classified as held-to-maturity when the Company has the positive intent and ability to hold the securities to maturity.    

Marketable securities for which the Company does not have the intent or ability to hold to maturity are classified as available-for-sale. Marketable securities classified as available-for-sale are carried at fair market value, with the unrealized gains and losses included in the determination of comprehensive income and reported in stockholders’ equity.

The following is a summary of the available-for-sale investments by type of instrument, which are included in short-term investments in the Condensed Consolidated Balance Sheet as of September 30, 2015. As of December 31, 2014, there were no short or long-term investments.

			Unrealized		Unrealized
			Gain in		Losses in
			Accumulated		Accumulated
			Other		Other
	Amortized		Comprehensive		Comprehensive			Estimated
September 30, 2015	Cost		Income		Income			Fair Value
Short-Term
Commercial paper	$	26,726	$	27	$	—		$	26,753
Corporate bonds		21,127		—		(3	)		21,124
Foreign assets		17,351		—		(3	)		17,348
Total available-for-sale securities	$	65,204	$	27	$	(6	)	$	65,225

Based on an evaluation of securities that have been in a loss position, the Company did not recognize any other-than-temporary impairment charges during the three and nine months ended September 30, 2015. The Company considered various factors which included a credit and liquidity assessment of the underlying securities and the Company’s intent and ability to hold the underlying securities until the estimated date of recovery of its amortized cost.

9

Contractual maturities of available-for-sale securities at September 30, 2015, are as follows:

Mature in one year or less	$	65,225
Mature in 1-5 years		—
Total	$	65,225

NOTE F. FAIR VALUE MEASUREMENTS

As of September 30, 2015 and as of December 31, 2014, the carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued expenses approximated their estimated fair values because of the short term nature of these financial instruments.

Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three categories:

· Level 1: Quoted market prices in active markets for identical assets or liabilities.

· Level 2: Includes other than level 1 inputs that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs for which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the asset or liabilities.

· Level 3: Unobservable inputs that are supported by little or no market activities, which would require the Company to develop its own assumptions.

Short-term Investments

The following is a summary of available-for-sale investments by type of instrument measured at fair value on a recurring basis at September 30, 2015. As of December 31, 2014, there were no available-for-sale investments.

	September 30, 2015
	Level 1		Level 2		Level 3		Total
Commercial paper	$	—	$	26,753	$	—	$	26,753
Corporate bonds		—		21,124		—		21,124
Foreign assets		—		17,348		—		17,348
Total	$	—	$	65,225	$	—	$	65,225

There were no transfers in or out of Level 1, Level 2 or Level 3 fair value measurement during the three and nine months ended September 30, 2015.

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Convertible Preferred Stock Warranty Liability

The following table sets forth a summary of the changes in the estimated fair value of the Company’s convertible preferred stock warrants, which represents financial instruments that were categorized as Level 3, according to the three-level fair value hierarchy.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015			2014
Beginning of the period	$	—	$	309	$	291		$	211
Issued		—		—		—			—
Exercised		—		—		—			—
Expired		—		—		—			—
Reclassified to equity (1)		—		—		(648	)		—
Change in fair value		—		53		357			151
End of the period	$	—	$	362	$	—		$	362

(1) In connection with the closing of the IPO in February 2015, warrants to purchase shares of convertible preferred stock were converted to warrants to purchase shares of common stock, resulting in the reclassification of the related convertible preferred stock warrant liability to additional paid-in-capital.

The fair market value of the convertible preferred stock prior to the IPO was determined using the option pricing method and the probability weighted expected return method. The fair value of the convertible preferred stock warrant liability was determined using the Black-Scholes option pricing model with the following assumptions:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015	2014			2015			2014
Expected life in years	N/A		8.0			7.5			8.0
Risk-free interest rate	N/A		2.2	%		1.6	%		2.2	%
Expected dividend yield	N/A		0.0	%		0.0	%		0.0	%
Expected volatility	N/A		50	%		56	%		50	%

NOTE G. DEBT

On May 19, 2015, the Company entered into an amendment to the Company’s amended and restated loan and security agreement (the “credit facility”) with Oxford Finance LLC (the “lender”) changing the Company’s obligations related to foreign subsidiaries.

Under the credit facility, the Company can borrow up to a total of $25,000 in three tranches at a fixed rate of 9.40%. The first tranche of $15,000, including the refinance of $7,500 previously outstanding, was borrowed in December 2013. In connection with the funding of the first tranche, the Company paid a prorated final payment fee on the original credit facility of $143. The second tranche of up to $5,000 was available through December 31, 2014, of which $5,000 was borrowed during the three months ended December 31, 2014. The third tranche of up to $5,000 is available at any time through December 31, 2015, subject to the achievement by the Company of certain revenue milestones. As of September 30, 2015, the Company achieved the specified revenue milestones for the third tranche. The credit facility matures and all amounts borrowed thereunder are due on December 1, 2018. As a result of the $5,000 borrowed in 2014, all amounts borrowed under the credit facility are interest only through January 2016 (24 months), after which the Company will make monthly payments of principal and interest. The interest-only period may be extended to 36 months based on funding and revenue milestones provided for in the credit facility.

In addition to the principal and interest payments, under the credit facility the Company is required to pay a final payment fee of 7.15% on all amounts outstanding, which is being accrued over the credit facility term and shall be due at the earlier of maturity or prepayment. If the Company repays the amounts borrowed under the loan prior to maturity, the Company will also be required to pay a prepayment fee equal to 1.75% if the prepayment occurs prior to or on the first anniversary of the funding date with respect to a given borrowed amount or 0.75% if the prepayment occurs after the first anniversary of the funding date, in each case on all amounts borrowed other than the $5,000 borrowed during the three months ended December 31, 2014.

As of September 30, 2015 and December 31, 2014, the Company has borrowed and had outstanding $20,000 of debt under the credit facility.

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As of September 30, 2015 and as of December 31, 2014, the carrying amounts of debt approximates fair market value due to the fixed term nature of the credit facility. The fair value of the Company’s debt is considered a Level 3 measurement.

NOTE H. CONVERTIBLE PREFERRED STOCK

In connection with the IPO in February 2015, the 44,317 shares of convertible preferred stock were converted into 11,404 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock of $91,554 to common stock and additional paid-in-capital.

A summary of the Company’s convertible preferred stock is as follows (presented in actual amounts):

	September 30, 2015						December 31, 2014
			Number of						Number of		Number of
	Number of		shares				Number of		shares		shares
	Shares		issued and		Carrying		Shares		issued and		converted		Carrying
	authorized		outstanding		value		authorized		outstanding		common Stock		value
Series A		—		—		—		2,440,000		2,440,000		610,000	$	2,963,745
Series B		—		—		—		4,986,188		4,986,188		1,246,547		8,988,134
Series C		—		—		—		3,717,329		3,717,329		1,254,375		14,937,389
Series D		—		—		—		15,310,943		15,310,943		3,827,736		29,822,047
Series E		—		—		—		18,112,611		17,862,611		4,465,653		34,842,241
Total		—		—		—		44,567,071		44,317,071		11,404,311	$	91,553,556

NOTE I. STOCKHOLDERS’ EQUITY (DEFICIT)

Preferred Stock

In connection with the IPO, the Company amended and restated its certificate of incorporation. The amended and restated certificate of incorporation authorizes 10,000 shares of preferred stock. As of September 30, 2015, no preferred stock had been issued.

Common Stock

In May 2014, the Company amended its certificate of incorporation to increase the authorized number of shares of common stock available for issuance from 57,000 to 57,565 shares of $0.001 par value common stock. In December 2014, the Company further amended its certificate of incorporation to increase the authorized number of common stock shares available for issuance to 62,276. In connection with the IPO, the Company amended and restated its certificate of incorporation. The amended and restated certificate of incorporation authorizes 200,000 shares of common stock.

The common stockholders are generally entitled to one vote for each share held on all matters submitted to a vote of the stockholders and do not have any cumulative voting rights. The Company’s common stockholders are entitled to receive proportionally any dividends declared by the Company’s Board of Directors, subject to any preferential dividend rights of outstanding preferred stock.

In the event of the Company’s liquidation or dissolution, the common stockholders are entitled to share ratably in all assets remaining after payment of all debts and other liabilities, subject to any preferential rights of any outstanding preferred stock. The common stockholders have no preemptive, subscription, redemption or conversion rights.

2015 Incentive Award Plan

In December 2014, the Company’s Board of Directors adopted, and in January 2015 the Company’s stockholders approved, the Company’s Incentive Award Plan (the “2015 Plan”). The 2015 Plan became effective in connection with the IPO, at which time the Company ceased making awards under the 2006 Plan. Under the 2015 Plan, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units and certain other awards to individuals who are employees, officers, directors or consultants of the Company. A total of 1,346 shares of common stock were initially reserved for issuance under the 2015 Plan. In addition, the number of shares available for issuance under the 2015 Plan will be annually increased by an amount equal to the lesser of (A) 875 shares, (B) 4% of the outstanding shares of the Company’s common stock as of the last day of our immediately preceding fiscal year or (C) an amount determined by the Company’s Board of Directors.

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A summary of the Company’s stock option activity and related information is as follows:

	Nine Months Ended
	September 30,
	2015
						Weighted
						average	Aggregate
				Weighted		remaining	intrinsic
				average		contractual	value
	Options			exercise price		term	($000)
Outstanding, beginning of period		2,098		$	7.38	8.8 years	$	8,385
Granted		351			25.70
Exercised		(182	)		1.55
Cancelled		—			—
Forfeited		(36	)		11.13
Outstanding, end of period		2,231		$	10.67	8.5 years	$	26,357
Exercisable		605		$	4.31	6.8 years	$	10,730

The aggregate pre-tax intrinsic value of options exercised was $2,745 and $1,368 for the nine months ended September 30, 2015 and 2014, respectively. The aggregate pre-tax intrinsic value was calculated as the difference between the exercise prices of the underlying options and the estimated fair value of the common stock on the date of exercise or September 30, 2015. The total cash received upon the exercise of options was $282 and $207 during the nine months ended September 30, 2015 and 2014, respectively.

NOTE J. STOCK-BASED COMPENSATION EXPENSE

Stock-based compensation expense is reflected in the Condensed Consolidated Statement of Operations and Comprehensive Loss for the three and nine months ended September 30, 2015 and 2014, as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015		2014
Cost of goods sold	$	18	$	3	$	40	$	8
Selling and marketing		203		38		428		78
Research and development		71		10		171		35
General and administrative		408		13		1,137		38
Total	$	700	$	64	$	1,776	$	159

The amount of unearned stock-based compensation currently estimated to be expensed through the year 2019 related to unvested employee stock-based payment awards as of September 30, 2015, is approximately $10,466. The weighted average period over which the unearned stock-based compensation is expected to be recognized as of September 30, 2015, is approximately 3.3 years. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that the Company grants additional share-based payments.

The Company estimates the fair value of stock-based compensation on the date of grant using the Black-Scholes option-pricing model. The Black-Scholes model determines the fair value of stock-based payment awards based on the fair market value of the Company’s common stock on the date of grant and is affected by assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the fair market value of the Company’s common stock, volatility over the expected term of the awards and actual and projected employee stock option exercise behaviors. The Company has opted to use the “simplified method” for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option. Due to the Company’s limited operating history and a lack of company-specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility data was computed using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the share-based payments. The Company will continue to analyze the historical stock price volatility and expected term assumptions as more historical data for the Company’s common stock becomes available. The risk-free rate assumption is based on the U.S. Treasury instruments with maturities similar to the expected term of the Company’s stock options. The expected dividend assumption is based on the Company’s history of not paying dividends and its expectation that it will not declare dividends for the foreseeable future.

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As stock-based compensation expense recognized in the financial statements is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from estimates. Forfeitures are estimated based on estimated future employee turnover and historical experience.

The fair value of the options granted to employees or directors during the nine months ended September 30, 2015 and 2014, was estimated as of the grant date using the Black-Scholes model assuming the weighted average assumptions listed in the following table:

	Nine Months Ended
	September 30,
	2015			2014
Expected life in years		6.0			6.0
Risk-free interest rate		1.7	%		1.9	%
Expected dividend yield		0	%		0	%
Expected volatility		70	%		64	%
Weighted average fair value	$	25.70		$	2.08

NOTE K. INCOME TAXES

We did not record a federal or state income tax benefit for our losses for the three and nine months ended September 30, 2015 and 2014 due to our conclusion that full valuation allowance is required against our deferred tax assets.

NOTE L. EARNINGS PER SHARE

Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive potential shares of common stock outstanding during the period. Because the Company has reported a net loss for all periods presented, diluted net loss per share is the same as basic net loss per share for those periods as all potentially dilutive shares consisting of convertible preferred stock, stock options and warrants were antidilutive in those periods.

The following table sets forth the computation of the Company’s net loss per share:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Net Loss	$	(6,071	)	$	(2,033	)	$	(13,287	)	$	(5,741	)
Weighted average common stock outstanding		18,738			1,500			16,688			1,456
Net loss per share, basic and diluted	$	(0.32	)	$	(1.36	)	$	(0.80	)	$	(3.94	)

The following potentially dilutive securities outstanding have been excluded from the computations of diluted earnings per share because such securities have an antidilutive impact due to losses reported:

	September 30,
	2015		2014
Convertible preferred stock outstanding		—		11,404
Convertible preferred stock warrants		—		38
Common stock warrants		38		—
Common stock options		2,231		1,169
Total		2,269		12,611

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NOTE M. COMMITMENTS AND CONTINGENCIES

Operating Leases

As of September 30, 2015, the Company has two leased facilities under operating lease agreements. The Company entered into a 41-month lease in February 2012, effective April 1, 2012, for its corporate headquarters. The Company entered into a 50-month lease on June 30, 2014, effective July 1, 2014, for additional distribution space in a second facility. On February 26, 2015, the Company exercised its right to extend the lease term of its manufacturing and corporate facility for an additional three years through August 2018. On June 30, 2015, the Company entered into amendments to each lease agreement, among other things, to expand the space occupied by the Company at the property at which the Company’s corporate headquarters are located, and to extend the term of each lease agreement through June 2021, with an option to extend for an additional term through June 2024. Rental payments on operating leases are charged to expense on a straight-line basis over the period of the lease. The lease agreement requires the Company to pay executory costs such as real estate taxes, insurance and repairs, and includes renewal and escalation clauses.

Approximate minimum annual future obligations which include monthly contractual lease payments under operating leases with initial terms in excess of one year are as follows:

2015 (remaining)	$	52
2016		351
2017		366
2018		373
2019		381
2020		389
2021		197
Total	$	2,109

Total lease expense was approximately $83 and $83 for the three months ended September 30, 2015 and 2014, respectively and $257 and $221 for the nine months ended September 30, 2015 and 2014, respectively.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with our financial statements and accompanying notes included in this Quarterly Report on Form 10-Q and the financial statements and accompanying notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014. In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Some of the numbers included herein have been rounded for the convenience of presentation. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those discussed under “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q.

Overview

We are a medical technology company focused on the design, development and commercialization of products for the minimally invasive treatment of patients who are suffering from chronic sinusitis. Our XprESS family of products is used by ear, nose and throat, or ENT, physicians to open narrowed or obstructed sinus drainage pathways using balloon sinus dilation to treat patients with symptomatic inflammation of the nasal sinuses. When used as a stand-alone therapy in the doctor’s office, our balloon sinus dilation products are the only devices clinically proven in a sufficiently powered prospective, multicenter, randomized, controlled trial to be as effective as functional endoscopic sinus surgery, or FESS. Patients treated with our products in this trial in the ENT physician office also experienced faster recovery, less bleeding at discharge, less use of prescription pain medication and fewer post-procedure debridements than patients receiving FESS.

Minimally invasive balloon sinus dilation devices have enabled a shift towards office-based treatment of chronic sinusitis patients who are candidates for sinus surgery in the operating room. We believe this shift has been facilitated by our technology and clinical data, as well as procedure economics that are favorable to the healthcare system, patient and provider. Our XprESS family of products is used to treat patients with inflammation of the frontal, ethmoid, sphenoid and maxillary sinuses and is specifically designed for ease-of-use in the ENT physician office setting. Our XprESS family of products includes our XprESS Pro device, our XprESS LoProfile device and our XprESS Ultra device. We derive substantially all of our revenue from our XprESS family of products. Our XprESS family of products represented 93% of our revenue for the three months ended September 30, 2015 and 95% for the nine months ended September 30, 2015. Our XprESS family of products represented 95% of our revenue for the three and nine months ended September 30, 2014. Our research and development efforts are focused on enhancing our XprESS family of products and broadening their indications for use. We are also the exclusive distributor of XeroGel. In August 2015, we also entered into an agreement with Fiagon NA Corporation that, subject to certain limited exceptions for third parties that currently distribute Fiagon products, grants us exclusive distribution rights for Fiagon Image Guidance Systems, or Fiagon IGS, in physician offices and ambulatory surgery centers, or ASCs, in the United States and certain other U.S. territories.

Our direct sales force engages in sales efforts and promotional activities focused on ENT physicians. As of September 30, 2015, we employed a total of 126 full-time persons in our direct sales organization, representing an increase of 24 from the 102 persons we employed full-time as of September 30, 2014. We have expanded our sales force to include a total of 81 full quota-carrying representatives as of September 30, 2015, an expansion of 29% from our 63 full quota-carrying representatives as of September 30, 2014. For the third quarter of 2015, our full quota-carrying representatives sold at an annualized rate of approximately $700,000. We expect to continue to expand our sales force and staffing to further penetrate the sinusitis market. In addition, we invest substantial resources to educate ENT physicians and patients on the proven clinical advantages of stand-alone balloon sinus dilation.

We have a diverse customer base of ENT physicians, hospitals and ASCs, with no single customer accounting for more than 5% of our revenue during the three or nine months ended September 30, 2015. Our customers are reimbursed by governmental and private health insurers for procedures using our products pursuant to reimbursement codes specific to the setting of the procedure. We manufacture all of our proprietary products at our 32,351 square foot facility in Plymouth, Minnesota, with components supplied by external suppliers. As of September 30, 2015, our manufacturing organization included 26 people. We expect the capacity of our current facility to be able to meet expected demand through at least the end of 2017. In the second quarter of 2015, we established a United Kingdom subsidiary and started the process of selling our products in certain European countries using a combination of direct sales representatives and a network of independent distributors, with experience in selling products into ENT markets in Europe. Throughout the third quarter we increased our presence outside the United States as we added distributors.

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For the three months ended September 30, 2015 we generated revenue of $14.8 million and had a net loss of $6.1 million compared to revenue of $11.7 million and a net loss of $2.0 million for the three months ended September 30, 2014. For the nine months ended September 30, 2015 we generated revenue of $43.5 million and had a net loss of $13.3 million compared to revenue of $34.4 million and a net loss of $5.7 million for the nine months ended September 30, 2014. We expect to continue to incur losses until at least 2017 as we expend resources to expand our organization to support planned sales growth and expansion while also continuing to invest in the development of next generation products and new products for the ENT market. As of September 30, 2015, we had an accumulated deficit of $117.0 million. Our primary sources of capital to date have been from sales of our products, private placements of our convertible preferred securities, amounts borrowed under our credit facility and completion of our initial public offering, or IPO. We operate in one segment.

In February 2015, we completed our IPO by issuing 5,294,117 shares of common stock at an offering price of $17.00 per share, for net proceeds to us of approximately $81.0 million after deducting underwriting discounts and commissions and offering expenses.

Components of Our Results of Operation

Revenue

We derive substantially all of our revenue from the sale of our XprESS family of products to ENT physicians, hospitals and ASCs. We derive additional revenue from the sale of XeroGel and Fiagon IGS, products for which we are a distributor. Recent revenue growth has been driven by, and we expect our revenue to continue to increase in the future as a result of, increased physician awareness of the clinical efficacy of stand-alone balloon sinus dilation and our products and increasing insurance coverage for balloon sinus dilation procedures. Any reversal in these recent trends, however, could have a negative impact on our future revenue. In addition, we have expanded our sales and marketing infrastructure to help us drive and support revenue growth and intend to continue this expansion. Our revenue has fluctuated, and we expect our revenue to continue to fluctuate, from quarter to quarter due to a variety of factors.

When used as a stand-alone balloon sinus dilation procedure in the physician office setting, our products are paid for as part of the practice expense component of the physician’s fee. When used in an operating room in an ASC or hospital, our products are typically utilized as tools used during FESS and are paid for as part of the FESS procedure.

Seasonality

Our business may be affected by seasonality. In the first quarter, our results can be impacted by adverse weather and by resetting of annual patient healthcare insurance plan deductibles, both of which may cause patients to delay elective procedures in which our products are used. In the second quarter, demand may be increased by the seasonal nature of allergies and the resultant onset of sinus-related symptoms. In the third quarter, the number of balloon sinus dilation and FESS procedures nationwide is historically lower than other quarters throughout the year, which we believe is attributable to the summer vacations of ENT physicians and their patients. In the fourth quarter, demand may be increased by the onset of the cold and flu season and related symptoms, as well as the desire of patients to spend the remaining balances in their flexible-spending accounts or because of lower out-of-pocket costs to patients who have met their annual deductibles under their health insurance plans.

Cost of Goods Sold and Gross Margin

Cost of goods sold for products we manufacture consists primarily of manufacturing overhead costs, material costs and direct labor. A significant portion of our cost of goods sold consists of manufacturing overhead costs. These overhead costs include the cost of quality assurance, material procurement, inventory control, facilities, equipment and operations supervision and management. We expect overhead costs as a percentage of revenue to continue to decrease as our production volume increases. Cost of goods sold for products we manufacture also includes depreciation expense for production equipment, amortization of leasehold improvements, shipping costs and royalty expense related to our licensing agreement with Acclarent, Inc. that is payable in connection with sales of substantially all of our manufactured products. For those products we sell as a distributor, our cost of goods sold consists primarily of transfer price. We expect cost of goods sold to increase in absolute dollars primarily as, and to the extent, our revenue grows.

We calculate gross margin as gross profit divided by revenue. Our gross margin has been and will continue to be affected by a variety of factors, primarily product sales mix and prices, new products, the impact of distributor relationships, production volumes, manufacturing costs and product yields, and to a lesser extent the implementation of cost-reduction strategies. As a result of product mix and distributor relationships our gross margin may decrease over time.

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Selling and Marketing Expenses

Selling and marketing expenses consist primarily of compensation for personnel, including base salaries and variable compensation associated with sales results, spending related to marketing, reimbursement and customer service functions, and stock-based compensation. Other selling and marketing expenses include training, travel expenses, promotional activities, conferences, trade shows and consulting services. We expect selling and marketing expenses to continue to increase in absolute dollars as we expand our commercial infrastructure to both drive and support our planned growth in revenue.

Research and Development Expenses

Research and development, or R&D, expenses consist primarily of engineering, product development, clinical studies to develop and support our products, regulatory expenses, consulting services, materials, depreciation and other costs associated with products and technologies in development and next generation versions of current devices. These expenses include employee and non-employee compensation, including stock-based compensation, supplies, materials, quality assurance expenses allocated to R&D programs, consulting, related travel expenses and facilities expenses, in each case related to R&D programs. Clinical expenses include clinical trial management and monitoring, payments to clinical investigators, data management and travel expenses and the cost of manufacturing products for clinical trials. We expect R&D expenses to increase modestly, as increases in expenses related to developing, enhancing and commercializing new products and technologies will be only partially offset by the timing and extent of expenses relating to clinical studies. We expect R&D expenses as a percentage of revenue to vary over time depending on the level and timing of initiating new product development efforts as well as our clinical development activities.

General and Administrative Expenses

General and administrative expenses consist primarily of compensation for personnel, including base salaries and bonus compensation, spending related to finance, information technology, human resource functions and stock-based compensation. Other general and administrative expenses include consulting expenses, travel expenses, credit card processing fees, professional services fees, audit fees, insurance costs and general corporate expenses, including allocated facilities-related expenses. We expect general and administrative expenses to continue to increase in absolute dollars as we expand our commercial infrastructure to both drive and support our planned growth in revenue. We also expect to incur additional legal, accounting, insurance and other professional service fees associated with being a public company, which may increase further when we are no longer able to rely on the “emerging growth company” exemption we are afforded under the Jumpstart Our Business Startups Act of 2012, or JOBS Act.

Other Expense, Net

Other expense, net consists of interest expense payable under our credit facility and fair value adjustments related to our convertible preferred stock warrants, which, prior to our IPO, were accounted for as a liability and marked-to-market at each reporting period. In connection with our IPO, the warrants converted to warrants to purchase shares of our common stock. Other expense, net also includes interest income associated with our short-term investments.

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2014-09, Revenue from Contracts with Customers. This standard will eliminate the transaction and industry specific revenue recognition guidance under current U.S. generally accepted accounting principles, or U.S. GAAP, and replace it with a principles based approach for determining revenue recognition. In August 2015, the FASB issued ASU 2015-14 which defers the adoption of ASU 2014-09 to interim periods beginning after December 31, 2018 for companies under the JOBS Act. We are in the process of evaluating the impact of the adoption of this standard.

In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. ASU 2015-02 is effective for the annual period beginning after December 15, 2015, and for annual and interim periods thereafter. Early application is permitted. The adoption of ASU 2015-02 is not expected to have a material impact on our financial position or results of operations.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance, which changes the presentation of debt issuance costs in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. ASU 2015-03 is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. We do not believe that adoption of ASU 2015-03 will have a significant impact on our consolidated financial statements.

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In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory, which requires inventory not measured using either the last in, first out or the retail inventory method to be measured at the lower of cost and net realizable value.  Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation.  The new standard will be effective January 1, 2017 and will be applied prospectively.  Early adoption is permitted.  We are in the process of evaluating the impact of the adoption of this standard.

Results of Operations

	Three Months Ended												Nine Months Ended
	September 30,												September 30,
(in thousands)	2015			2014			$ Change			% Change			2015			2014			$ Change			% Change
Revenue	$	14,804		$	11,691		$	3,113			27	%	$	43,497		$	34,364		$	9,133			27	%
Cost of goods sold		3,431			2,501			930			37	%		9,728			7,515			2,213			29	%
Gross profit		11,373			9,190			2,183			24	%		33,769			26,849			6,920			26	%
Gross margin		77	%		79	%		—			—			78	%		78	%		—			—
Operating expenses
Selling and marketing		12,308			8,391			3,917			47	%		32,010			24,276			7,734			32	%
Research and development		1,392			972			420			43	%		4,000			3,135			865			28	%
General and administrative		3,230			1,386			1,844			133	%		9,120			3,767			5,353			142	%
Total operating expenses		16,930			10,749			6,181			58	%		45,130			31,178			13,952			45	%
Loss from operations		(5,557	)		(1,559	)		(3,998	)		256	%		(11,361	)		(4,329	)		(7,032	)		162	%
Other expense, net		(514	)		(474	)		(40	)		8	%		(1,926	)		(1,412	)		(514	)		36	%
Net loss	$	(6,071	)	$	(2,033	)	$	(4,038	)		199	%	$	(13,287	)	$	(5,741	)	$	(7,546	)		131	%

Comparison of the Three and Nine months ended September 30, 2015 and 2014

Revenue

Revenue increased $3.1 million, or 27%, to $14.8 million during the three months ended September 30, 2015, compared to $11.7 million during the three months ended September 30, 2014. The growth in revenue was primarily attributable to an increase in sales of our XprESS family of products through broader account penetration and increased sales of new products.

Revenue increased $9.1 million, or 27%, to $43.5 million during the nine months ended September 30, 2015, compared to $34.4 million during the nine months ended September 30, 2014. The growth in revenue was primarily attributable to an increase in sales of our XprESS family of products through broader account penetration and increased sales of new products.

Cost of Goods Sold and Gross Margin

Cost of goods sold increased $0.9 million, or 37%, to $3.4 million during the three months ended September 30, 2015, compared to $2.5 million during the three months ended September 30, 2014. Cost of goods sold increased $2.2 million, or 29%, to $9.7 million during the nine months ended September 30, 2015, compared to $7.5 million during the nine months ended September 30, 2015. The increase in cost of goods sold for both periods was primarily attributable to the growth in sales of our XprESS family of products and to a lesser extent increased sales of new products.

Gross margin for the three months ended September 30, 2015 decreased compared to gross margin for the three months ended September 30, 2014 due to changes in product mix as we added new product lines. Gross margin for the nine months ended September 30, 2015 remained relatively consistent compared to gross margin for the nine months ended September 30, 2014. Although unit sales increased, the gross margin remained flat due to increased overhead costs and to a lesser extent changes in product mix.

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Selling and Marketing Expenses

Selling and marketing expenses increased $3.9 million, or 47%, to $12.3 million during the three months ended September 30, 2015, compared to $8.4 million during the three months ended September 30, 2014. The increase was primarily attributable to a $2.5 million increase in salaries, benefits, stock-based compensation, travel expenses and other employee-related expenses as a result of increased headcount in our sales and marketing organizations. In addition, advertising and promotional expenses increased $1.2 million.

Selling and marketing expenses increased $7.7 million, or 32%, to $32.0 million during the nine months ended September 30, 2015, compared to $24.3 million during the nine months ended September 30, 2014. The increase was primarily attributable to a $5.1 million increase in salaries, benefits, stock-based compensation, travel expenses and other employee-related expenses as a result of increased headcount in our sales and marketing organizations. In addition, consulting expenses increased $0.5 million and advertising and promotional expenses increased $1.8 million.

Research and Development Expenses

R&D expenses increased $0.4 million, or 43%, to $1.4 million during the three months ended September 30, 2015, compared to $1.0 million during the three months ended September 30, 2014. The increase in R&D expenses was primarily due to an increase of $0.2 million in compensation and other employee-related expenses.

R&D expenses increased $0.9 million, or 28%, to $4.0 million during the nine months ended September 30, 2015, compared to $3.1 million during the nine months ended September 30, 2014. The increase in R&D expenses was primarily due to increases of $0.5 million in compensation and other employee-related expenses and of $0.2 million in clinical trial expenses.

General and Administrative Expenses

General and administrative expenses increased $1.8 million, or 133%, to $3.2 million during the three months ended September 30, 2015, compared to $1.4 million during the three months ended September 30, 2014. The increase was primarily due to an increase of $0.7 million in salaries, stock-based compensation, benefits and other employee-related expenses. In addition, external consultant fees increased $0.7 million, and insurance and legal fees increased $0.3 million. Credit card processing fees, facility expenses and other general and administrative expenses accounted for the remaining increase.

General and administrative expenses increased $5.3 million, or 142%, to $9.1 million during the nine months ended September 30, 2015, compared to $3.8 million during the nine months ended September 30, 2014. The increase was primarily due to an increase of $2.4 million in salaries, stock-based compensation, benefits and other employee-related expenses. In addition, external consultant fees increased $1.6 million and insurance, legal and audit fees increased $0.8 million. Credit card processing fees, facility expenses and other general and administrative expenses accounted for the remaining increase.

Other Expense, Net

Other expense, net, reflected an expense of $0.5 million for each of the three months ended September 30, 2015 and 2014. The expense for 2015 and 2014 was primarily attributable to interest expense related to our credit facility.

Other expense, net, reflected an expense of $1.9 million during the nine months ended September 30, 2015, compared to an expense of $1.4 million during the nine months ended September 30, 2014. The increase in expense was primarily attributable to a $0.3 million increase associated with the revaluation of our then-outstanding convertible preferred stock warrants and a $0.3 million increase in interest expense related to our credit facility, partially offset by a $0.1 million increase in interest income related to our available for sale securities.

We performed the final revaluation of the preferred stock warrant liability in January 2015 in connection with the completion of the IPO.

20

Liquidity and Capital Resources

Overview

As of September 30, 2015, we had cash, cash equivalents and short-term investments of $73.9 million and an accumulated deficit of $117.0 million, compared to cash and cash equivalents of $3.5 million and an accumulated deficit of $103.8 million as of December 31, 2014. In February 2015, we completed our IPO by issuing 5,294,117 shares of common stock at an offering price of $17.00 per share, for net proceeds to us of approximately $81.0 million after deducting underwriting discounts and commissions and offering expenses payable by us. Our primary sources of capital prior to our IPO were from sales of our products, private placements of our convertible preferred securities and amounts borrowed under our credit facility.

We believe that our existing cash and cash equivalents, availability under our credit facility and revenue will be sufficient to meet our capital requirements and fund our operations through at least the end of 2017. However, we have based these estimates on assumptions that may prove to be incorrect, and we could spend our available financial resources much faster than we currently expect. If these sources are insufficient to satisfy our liquidity requirements, we may seek to sell additional equity or debt securities, or enter into a new credit facility. If we raise additional funds by issuing equity securities, our stockholders would experience dilution. Debt financing, if available, may involve covenants restricting our operations or our ability to incur additional debt. Any debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders. Additional financing may not be available at all, or in amounts or on terms unacceptable to us. If we are unable to obtain additional financing, we may be required to delay the development, commercialization and marketing of our products.

Cash Flows  

	Nine Months Ended
	September 30,
(in thousands)	2015			2014
Net cash (used in) provided by:
Operating activities	$	(7,902	)	$	(6,259	)
Investing activities		(68,111	)		(629	)
Financing activities		81,234			207
Net increase (decrease) in cash and cash equivalents	$	5,221		$	(6,681	)

Cash Used in Operating Activities

During the nine months ended September 30, 2015, net cash used in operating activities was $7.9 million, consisting primarily of a net loss of $13.3 million, offset by a decrease in net operating assets of $2.0 million and by non-cash charges of $3.4 million. The decrease in net operating assets was primarily due to decreases in deferred offering costs due to completion of our IPO and an increase in accrued expenses and accounts payable due to the growth in our sales organization, offset by increases in accounts receivable, inventories and other current assets. Non-cash charges consisted primarily of stock-based compensation, depreciation, the change in fair value of convertible preferred stock warrants, amortization of premium on investments and the accretion of the final payment fee on our credit facility.

During the nine months ended September 30, 2014, net cash used in operating activities was $6.3 million, consisting primarily of a net loss of $5.7 million and an increase in net operating assets of $1.5 million, partially offset by non-cash charges of $0.9 million. The increase in net operating assets was primarily due to increases in accounts receivable and inventory, partially offset by an increase in accounts payable. Non-cash charges consisted primarily of depreciation, the accretion of the final payment fee on our credit facility, stock-based compensation and the change in the fair value of convertible preferred warrants.

Net Cash Used in Investing Activities

During the nine months ended September 30, 2015, net cash used in investing activities was $68.1 million consisting of purchases of short-term investments, available-for-sale of $111.1 million and property and equipment of $2.6 million, partially offset by proceeds from short-term investment maturities of $45.6 million.

During the nine months ended September 30, 2014, net cash used in investing activities was $0.6 million, consisting of the purchase of property and equipment.

21

Net Cash Provided by Financing Activities

During the nine months ended September 30, 2015, net cash provided by financing activities was $81.2 million, consisting of net proceeds from the IPO of approximately $81.0 million and the remaining amount was primarily from proceeds from the exercise of stock options.

During the nine months ended September 30, 2014, net cash provided by financing activities consisted primarily of proceeds from the exercise of stock options.

Credit Facility

In December 2013, we entered into an amended and restated credit facility with Oxford Finance LLC. On March 30, 2015, we entered into an amendment to the credit facility, changing our obligation to deliver consolidated financial statements from monthly to quarterly, so long as we are required to make periodic filings with the Securities and Exchange Commission, or SEC. On May 19, 2015, we entered into an amendment to the credit facility changing our obligations related to foreign subsidiaries. We refer to the amended and restated credit facility, as amended, as the credit facility. Under the credit facility, we can borrow up to a total of $25.0 million in three tranches at a fixed rate of 9.40%. The first tranche of $15.0 million was borrowed in December 2013, a portion of which was used to refinance the $7.5 million then-outstanding under the previous credit facility. The second tranche of up to $5.0 million was available through December 31, 2014, of which all was borrowed. The third tranche of up to $5.0 million is available at any time through December 31, 2015, subject to certain trailing six-month revenue milestones. As of September 30, 2015, we achieved the specified revenue milestones for the third tranche. The credit facility matures and all amounts borrowed thereunder are due on December 1, 2018. As a result of the $5.0 million borrowed during the three months ended December 31, 2014, all amounts borrowed under the credit facility are interest-only through January 2016 (24 months), after which we will make monthly payments of principal and interest. The interest-only period may be extended to 36 months based on funding and revenue milestones provided for in the credit facility.

In addition to the principal and interest payments under the credit facility, we are required to pay a final payment fee of 7.15% on all amounts outstanding, which is being accrued over the credit facility term and will be due at the earlier of maturity or prepayment. If we repay the amounts borrowed under the loan prior to maturity, we will also be required to pay a prepayment fee equal to 1.75% if the prepayment occurs prior to or on the first anniversary of the funding date with respect to a given borrowed amount or 0.75% if the prepayment occurs after the first anniversary of the funding date, in each case on all amounts borrowed other than the $5.0 million borrowed during the three months ended December 31, 2014. We may make principal payments during any interest only periods to reduce, but not repay in full, the outstanding principal balance of the loan without incurring any prepayment penalties. In this case, however, we would still be required to pay the final payment fee.

Our obligations under the credit facility are secured by a first priority security interest in substantially all of our assets, other than our intellectual property. There are no financial covenants contained in the credit facility and we are in compliance with the affirmative and restrictive covenants as of September 30, 2015. We have agreed not to pledge or otherwise encumber our intellectual property assets, except for permitted liens, as such terms are defined in the credit facility and except as otherwise provided for in the credit facility.

As of September 30, 2015, we have borrowed and have outstanding $20.0 million of debt under the credit facility.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions for the reported amounts of assets, liabilities, revenue, expenses and related disclosures. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions and any such differences may be material.

Other than the changes described in Note B of the Condensed Consolidated Financial Statements, there have been no changes in our significant accounting policies for the three and nine months ended September 30, 2015 as compared to the significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

Off-Balance Sheet Arrangements

We do not maintain any off-balance sheet partnerships, arrangements or other relationships with unconsolidated entities or others, often referred to as structured finance or special-purpose entities that are established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

22

Contractual Obligations

The following table sets out, as of September 30, 2015, our contractual obligations due by period.

	Payments Due by Period
	Less Than		1-3		3-5		More Than
	1 Year		Years		Years		5 Years		Total
(in thousands)
Debt obligations (1)	$	4,102	$	13,961	$	3,367	$	—	$	21,430
Operating lease obligations (2)		313		735		766		295		2,109
Total	$	4,415	$	14,696	$	4,133	$	295	$	23,539

(1) The total amount outstanding under the credit facility was $20.0 million at September 30, 2015.  Assumes a 36-month amortization period for repayment of the debt.  The total debt amount is inclusive of the final payment fee of 7.15% due with the final payment. As of September 30, 2015, we have accrued $0.5 million in ‘Other non-current liabilities’ in the Condensed Consolidated Balance Sheets.

(2) We currently lease our headquarters and manufacturing facilities in Plymouth, Minnesota under leases that expire in June 2021.  We have entered into an agreement to lease approximately 19,700 square feet in additional space beginning in February 2016.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

Interest rate fluctuations have not had a material impact on our results of operations. Our cash and cash equivalents include cash in readily available checking and money market accounts. Because our cash equivalents are primarily short-term in duration, we believe that our exposure to interest rate risk is not significant and a 100 basis point movement in market interest rates would not have a significant impact on the total value of our cash and cash equivalents. Additionally, the interest rate on our credit facility is fixed and not subject to changes in market interest rates.

Inflation

Inflationary factors, such as increases in our cost of goods sold and selling and operating expenses, may adversely affect our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, a high rate of inflation in the future may have an adverse effect on our ability to maintain and increase our gross margin and selling and marketing and operating expenses as a percentage of our revenue if the selling prices of our products do not increase as much or more than these increased costs.

Credit Risk

As of September 30, 2015, our cash and cash equivalents were maintained with two financial institutions in the United States, and our current deposits are likely in excess of insured limits. We have reviewed the financial statements of these institutions and believe they have sufficient assets and liquidity to conduct their operations in the ordinary course of business with little or no credit risk to us.

Our accounts receivable primarily relate to revenue from the sale of our XprESS family of products to hospitals, ASCs and physician offices. For the three and nine months ended September 30, 2015, no single customer represented more than 5% of our revenue.

Foreign Currency Risk

Our business is conducted primarily in U.S. dollars and foreign transactions have been minimal. Any transactions that may be conducted in foreign currencies are not expected to have a material effect on our results of operations, financial position or cash flows.

Item 4. Controls and Procedures

Limitations on Effectiveness of Controls and Procedures

In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

23

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer and chief financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act). Based on that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of September 30, 2015.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) identified in connection with the evaluation of our internal control performed during the fiscal quarter ended September 30, 2015, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

24

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

Under Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC on March 19, 2015, we identified important factors that could affect our financial performance and could cause our actual results for future periods to differ materially from our anticipated results or other expectations, including those expressed in any forward-looking statements made in this Quarterly Report on Form 10-Q. There has been no material change in our risk factors subsequent to the filing of our Annual Report. However, the risks described in our Annual Report are not the only risks we face. Additional risks and uncertainties that we currently deem to be immaterial or not currently known to us, as well as other risks reported from time to time in our reports to the SEC, also could cause our actual results to differ materially from our anticipated results or other expectations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Securities

During the quarterly period ended September 30, 2015, we did not sell any securities that were not registered under the Securities Act of 1933, as amended.

Use of Proceeds

On January 28, 2015, the SEC declared effective our Registration Statement on Form S-1 (File No. 333-201237), as amended, filed in connection with our IPO. Pursuant to the Registration Statement, as well as the Registration Statement on Form S-1 (File No. 333-201741) filed on January 28, 2015 to register additional securities, we issued and sold an aggregate of 5,294,117 shares of our common stock at a price to the public of $17.00 per share (including 690,537 shares sold pursuant to an option granted to the underwriters). There has been no material change in the expected use of the net proceeds from our IPO as described in our final prospectus, dated January 28, 2015, filed with the SEC pursuant to Rule 424(b).

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

We expect to hold our 2016 annual meeting of stockholders, our first annual meeting as a public company, in June 2016. Stockholders interested in submitting a proposal for consideration at our 2016 annual meeting must do so by sending such proposal to our corporate secretary at Entellus Medical, Inc., 3600 Holly Lane North, Suite 40, Plymouth, Minnesota, 55447 Attention: Corporate Secretary.

Under the SEC’s proxy rules, we have set the deadline for submission of proposals to be included in our proxy materials for the 2016 annual meeting as January 29, 2016, which we believe is a reasonable time before we will begin to print and send our proxy materials for the 2016 annual meeting. Accordingly, in order for a stockholder proposal to be considered for inclusion in our proxy materials for the 2016 annual meeting, any such stockholder proposal must be received by our Corporate Secretary on or before January 29, 2016, and comply with the procedures and requirements set forth in Rule 14a-8 under the Exchange Act, as well as the applicable requirements of our Amended and Restated Bylaws. Any stockholder proposal received after January 29, 2016 will be considered untimely, and will not be included in our proxy materials.

In addition, stockholders interested in submitting a proposal outside of Rule 14a-8 must properly submit such a proposal in accordance with our Amended and Restated Bylaws not earlier than the one hundred twentieth (120th) day prior to the 2016 annual meeting and not later than the ninetieth (90th) day prior to the 2016 annual meeting or, if later, the tenth (10th) day following the day on which public disclosure of the date of the 2016 annual meeting is first made. Proposals submitted outside of these dates will be considered untimely and not properly brought before the annual meeting.

25

Item 6. Exhibits

A list of exhibits is set forth on the Exhibit Index immediately following the signature page of this Quarterly Report on Form 10-Q, and is incorporated herein by reference.

26

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		ENTELLUS MEDICAL, INC.
Date: November 6, 2015	by:	/s/    Robert S. White
		Robert S. White
		President and Chief Executive Officer
		(Principal Executive Officer)
Date: November 6, 2015	by:	/s/    Thomas E. Griffin
		Thomas E. Griffin
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

27

Exhibit Index

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit	Filing Date	Filed Herewith
3.1	Amended and Restated Certificate of Incorporation of Entellus Medical, Inc.	8-K	001-36814	3.1	02/03/15
3.2	Amended and Restated Bylaws of Entellus Medical, Inc.	8-K	001-36814	3.2	02/03/15
10.1	Fiagon NA Distributor Agreement, effective 10 August 2015, by and between Fiagon NA Corporation and Entellus Medical, Inc.	8-K	001-36814	10.1	08/14/15	†
31.1	Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer					*
31.2	Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer					*
32.1	Section 1350 Certification of Chief Executive Officer					**
32.2	Section 1350 Certification of Chief Financial Officer					**
101.INS	XBRL Instance Document					**
101.SCH	XBRL Taxonomy Extension Schema Document					**
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document					**
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document					**
101.LAB	XBRL Taxonomy Extension Label Linkbase Document					**
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document					**

*        Filed herewith

** Furnished herewith

†        Portions of this exhibit (indicated by asterisks) have been omitted pursuant to a request for confidential treatment pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

28

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Robert S. White, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Entellus Medical, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) [omitted];

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 6, 2015	/s/ Robert S. White
	Robert S. White President and Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Thomas E. Griffin, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Entellus Medical, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) [omitted];

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 6, 2015	/s/ Thomas E. Griffin
	Thomas E. Griffin Chief Financial Officer (Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Robert S. White, President and Chief Executive Officer of Entellus Medical, Inc. (the “Company”), hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1) The Quarterly Report on Form 10-Q of the Company for the period ended September 30, 2015 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 6, 2015	/s/ Robert S. White
	Robert S. White President and Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Thomas E. Griffin, Chief Financial Officer of Entellus Medical, Inc. (the “Company”), hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1) The Quarterly Report on Form 10-Q of the Company for the period ended September 30, 2015 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 6, 2015	/s/ Thomas E. Griffin
	Thomas E. Griffin Chief Financial Officer (Principal Financial and Accounting Officer)

XML

Fair Value Measurements - Additional Information (Detail) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2015	Dec. 31, 2014
Fair Value Disclosures [Abstract]
Available-for-sale investments	$ 65,225,000	$ 65,225,000	$ 0
Transfer of assets between level 1, level 2 or level 3	$ 0	$ 0

XML

Commitments and Contingencies - Additional Information (Detail) $ in Thousands			1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 26, 2015	Jun. 30, 2014	Feb. 29, 2012	Sep. 30, 2015 USD ($) Facilities	Sep. 30, 2014 USD ($)	Sep. 30, 2015 USD ($) Facilities	Sep. 30, 2014 USD ($)
Commitments And Contingencies Disclosure [Abstract]
Number of leased facilities under operating lease agreement				2		2
Operating leased facility, period		50 months	41 months
Operating leased facility, effective date		Jul. 01, 2014	Apr. 01, 2012
Operating leased facility, additional period	3 years
Operating leased facility, amendment description						On June 30, 2015, the Company entered into amendments to each lease agreement, among other things, to expand the space occupied by the Company at the property at which the Company’s corporate headquarters are located, and to extend the term of each lease agreement through June 2021, with an option to extend for an additional term through June 2024.
Total lease expense | $				$ 83	$ 83	$ 257	$ 221

XML

Stock Based Compensation Expense - Summary of Stock-Based Compensation Expense in Condensed Statement of Operations and Comprehensive Loss (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense			$ 1,776	$ 159
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 700	$ 64	1,776	159
Employee Stock Option [Member] | Cost of Goods Sold [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	18	3	40	8
Employee Stock Option [Member] | Selling and Marketing [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	203	38	428	78
Employee Stock Option [Member] | Research and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	71	10	171	35
Employee Stock Option [Member] | General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 408	$ 13	$ 1,137	$ 38

XML

Commitment and Contingencies - Summary of Annual Future Minimum Lease Payments (Detail) $ in Thousands	Sep. 30, 2015 USD ($)
Commitments And Contingencies Disclosure [Abstract]
2015 (remaining)	$ 52
2016	351
2017	366
2018	373
2019	381
2020	389
2021	197
Total minimum payment required	$ 2,109

XML

Stockholders' Equity (Deficit) - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	9 Months Ended
	Jan. 31, 2015	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014		May. 31, 2014	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Preferred stock, shares authorized		10,000,000		0	[1]
Preferred stock, shares Issued		0		0	[1]
Common stock, shares authorized		200,000,000		62,276,000	[1]		57,000,000
Common stock, par value		$ 0.001		$ 0.001	[1]
2015 Incentive Award Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance	1,346,000
Annual percentage increase in shares available for grant	4.00%
Annual increase in shares available for grant	875,000
Total cash received upon the exercise of options		$ 282	$ 207
Aggregate pre-tax intrinsic value of options exercised		$ 2,745	$ 1,368
After Amendment [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, shares authorized				62,276,000		57,565,000

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

XML

Composition of Certain Financial Statement Items - Schedule of Other Non-Current Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Assets Noncurrent [Abstract]
Security deposit on operating lease	$ 34	$ 19
Deferred offering costs		1,698
Other non-current assets, Total	$ 34	$ 1,717	[1]

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Stock Based Compensation Expense (Tables)

9 Months Ended

Sep. 30, 2015

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Stock-based Compensation Expense in Condensed Statement of Operations and Comprehensive Loss

Stock-based compensation expense is reflected in the Condensed Consolidated Statement of Operations and Comprehensive Loss for the three and nine months ended September 30, 2015 and 2014, as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015		2014
Cost of goods sold	$	18	$	3	$	40	$	8
Selling and marketing		203		38		428		78
Research and development		71		10		171		35
General and administrative		408		13		1,137		38
Total	$	700	$	64	$	1,776	$	159

Summary of Weighted Average Assumptions Used in Black-Scholes Model in Estimating Fair Value of Option Granted

The fair value of the options granted to employees or directors during the nine months ended September 30, 2015 and 2014, was estimated as of the grant date using the Black-Scholes model assuming the weighted average assumptions listed in the following table:

	Nine Months Ended
	September 30,
	2015			2014
Expected life in years		6.0			6.0
Risk-free interest rate		1.7	%		1.9	%
Expected dividend yield		0	%		0	%
Expected volatility		70	%		64	%
Weighted average fair value	$	25.70		$	2.08

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Stock Based Compensation Expense - Summary of Weighted Average Assumptions Used in Black-Scholes Model in Estimating Fair Value of Option Granted (Detail) - Employee Stock Option [Member] - $ / shares	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected life in years	6 years	6 years
Risk-free interest rate	1.70%	1.90%
Expected dividend yield	0.00%	0.00%
Expected volatility	70.00%	64.00%
Weighted average fair value	$ 25.70	$ 2.08

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Fair Value Measurements - Summary of Fair Value of Convertible Preferred Stock Warrant Liability (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Abstract]
Expected life in years	0 years	8 years	7 years 6 months	8 years
Risk-free interest rate		2.20%	1.60%	2.20%
Expected dividend yield		0.00%	0.00%	0.00%
Expected volatility		50.00%	56.00%	50.00%

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Short-term Investments - Summary of Investments by Type of Instrument (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 65,204,000
Unrealized Gain in Accumulated Other Comprehensive Income	27,000
Unrealized Losses in Accumulated Other Comprehensive Income	(6,000)
Estimated Fair Value	65,225,000	$ 0
Short-term Investments [Member] | Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	26,726,000
Unrealized Gain in Accumulated Other Comprehensive Income	27,000
Estimated Fair Value	26,753,000
Short-term Investments [Member] | Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	21,127,000
Unrealized Losses in Accumulated Other Comprehensive Income	(3,000)
Estimated Fair Value	21,124,000
Short-term Investments [Member] | Foreign Assets [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	17,351,000
Unrealized Losses in Accumulated Other Comprehensive Income	(3,000)
Estimated Fair Value	$ 17,348,000

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Earnings Per Share - Schedule of Net Loss Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Earnings Per Share [Abstract]
Net loss	$ (6,071)	$ (2,033)	$ (13,287)	$ (5,741)
Weighted average common stock outstanding	18,738	1,500	16,688	1,456
Net loss per share, basic and diluted	$ (0.32)	$ (1.36)	$ (0.80)	$ (3.94)

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Stockholders' Equity (Deficit) - Summary of Stock Option Activity and Related Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Options outstanding, Beginning balance	2,098
Options Granted	351
Options Exercised	(182)
Options Forfeited	(36)
Options outstanding, Ending balance	2,231	2,098
Options Exercisable, Ending balance	605
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Weighted Average Exercise Price, Beginning balance	$ 7.38
Weighted Average Exercise Price, Granted	25.70
Weighted Average Exercise Price, Exercised	1.55
Weighted Average Exercise Price, Forfeited	11.13
Weighted Average Exercise Price, Ending balance	10.67	$ 7.38
Weighted Average Exercise Price, Exercisable	$ 4.31
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Weighted Average Remaining Contractual Term, Beginning balance	8 years 6 months	8 years 9 months 18 days
Weighted Average Remaining Contractual Term, Exercisable, Ending balance	6 years 9 months 18 days
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Intrinsic Value [Roll Forward]
Aggregate Intrinsic Value, Beginning balance	$ 8,385
Aggregate Intrinsic Value, Ending balance	26,357	$ 8,385
Aggregate Intrinsic Value Exercisable	$ 10,730

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Liquidity and Business Risks

9 Months Ended

Sep. 30, 2015

Equity [Abstract]

Liquidity and Business Risks

NOTE D. LIQUIDITY AND BUSINESS RISKS

As of September 30, 2015, the Company had cash, cash equivalents and short-term investments of $73,930 and an accumulated deficit of $117,045. In February 2015, the Company completed its IPO by issuing 5,294 shares of common stock at an offering price of $17.00 per share, for net proceeds of approximately $80,953, after deducting underwriting discounts and commissions and offering expenses. Prior to the IPO, the Company financed its operations with a combination of revenue, private placements of convertible preferred securities and amounts borrowed under its credit facility. Following the IPO, the Company expects that its cash and cash equivalents, short-term investments, revenue and available debt financing arrangements will be sufficient to fund its operations through at least the next twelve months.

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Debt - Additional Information (Detail) - Credit Facility [Member]		1 Months Ended	9 Months Ended
	May. 19, 2015 USD ($) Tranches	Dec. 31, 2013 USD ($)	Sep. 30, 2015 USD ($)	Dec. 31, 2014 USD ($)
Debt Instrument [Line Items]
Line of credit facility, amount outstanding			$ 20,000,000	$ 20,000,000
Maximum borrowing capacity				5,000,000
Fixed interest floor rate	9.40%
Number of tranches | Tranches	3
Maturity date of debt instrument			Dec. 01, 2018
Credit facility interest payment period			24 months
Credit facility interest payment expected extension period			36 months
Credit facility final payment fee			7.15%
First Tranche [Member]
Debt Instrument [Line Items]
Line of credit facility, amount outstanding		$ 15,000,000
Payment fee		143,000
Second Tranche [Member]
Debt Instrument [Line Items]
Line of credit facility, amount outstanding				5,000,000
Third Tranche [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 5,000,000
Prior to First Anniversary
Debt Instrument [Line Items]
Credit facility prepayment fee			1.75%
After First Anniversary
Debt Instrument [Line Items]
Credit facility prepayment fee			0.75%
Scenario, Previously Reported [Member] | First Tranche [Member]
Debt Instrument [Line Items]
Line of credit facility, amount outstanding		$ 7,500,000
Maximum [Member]
Debt Instrument [Line Items]
Line of credit facility, amount outstanding	$ 25,000,000
Maximum [Member] | Second Tranche [Member]
Debt Instrument [Line Items]
Line of credit facility, amount outstanding				$ 5,000,000

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Summary of Significant Accounting Policies - Additional Information (Detail)		1 Months Ended	3 Months Ended	9 Months Ended		12 Months Ended
	Jan. 12, 2015	Feb. 28, 2015 USD ($) $ / shares shares	Sep. 30, 2015 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2014 USD ($)	Dec. 31, 2014 shares
Accounting Policies [Line Items]
Number of common stock converted from preferred stock | shares						11,404,311
Reverse stock split conversion ratio	0.25
Changes in fair value of convertible preferred stock warrants				$ 357,000	$ 151,000
Interest Expense [Member]
Accounting Policies [Line Items]
Changes in fair value of convertible preferred stock warrants			$ 0	357,000
Other Non-current Assets [Member]
Accounting Policies [Line Items]
Deferred offering costs capitalized			0	0
Cash Equivalents [Member]
Accounting Policies [Line Items]
Investment in marketable securities			$ 2,590,000	$ 2,590,000
Initial Public Offering [Member]
Accounting Policies [Line Items]
Common stock, shares issued | shares		5,294,000
Common stock offering price per share | $ / shares		$ 17.00
Proceeds from issuance of common stock, net of issuance costs		$ 80,953,000
Number of common stock converted from preferred stock | shares		11,404,000
Shares purchasable upon conversion of preferred stock | shares		38,000
Preferred stock warrant liability reclassified		$ 648,000

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Organization - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2015 Segment
Organization And Nature Of Business Textual [Abstract]
Number of operating segment	1

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Convertible Preferred Stock - Additional Information (Detail) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended	12 Months Ended
	Feb. 28, 2015	Sep. 30, 2015	Dec. 31, 2014
Temporary Equity [Line Items]
Preferred stock, conversion basis		In connection with the IPO in February 2015, the 44,317 shares of convertible preferred stock were converted into 11,404 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock of $91,554 to common stock and additional paid-in-capital.
Number of preferred stock converted to common stock	44,317,000
Number of common stock converted from preferred stock			11,404,311
Convertible preferred stock	$ 91,554
Initial Public Offering [Member]
Temporary Equity [Line Items]
Number of common stock converted from preferred stock	11,404,000

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Composition of Certain Financial Statement Items - Schedule of Inventories (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Inventory Disclosure [Abstract]
Finished goods	$ 1,360	$ 859
Work in process	430	318
Raw materials	1,487	1,262
Total	$ 3,277	$ 2,439	[1]

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Composition of Certain Financial Statement Items - Schedule of Property and Equipment (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Property, Plant and Equipment [Line Items]
Property plant and equipment, Gross	$ 6,875	$ 4,396
Less accumulated depreciation and amortization	(3,447)	(2,768)
Property and equipment in progress	227	102
Total	3,655	1,730	[1]
Furniture and Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Property plant and equipment, Gross	520	401
Computer Hardware and Software [Member]
Property, Plant and Equipment [Line Items]
Property plant and equipment, Gross	2,033	837
Laboratory Equipment [Member]
Property, Plant and Equipment [Line Items]
Property plant and equipment, Gross	2,511	1,427
Tooling and Molds [Member]
Property, Plant and Equipment [Line Items]
Property plant and equipment, Gross	1,237	1,237
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property plant and equipment, Gross	$ 574	$ 494

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Composition of Certain Financial Statement Items

9 Months Ended

Sep. 30, 2015

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Composition of Certain Financial Statement Items

NOTE C. COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS

Inventories

	September 30,		December 31,
	2015		2014
Finished goods	$	1,360	$	859
Work in process		430		318
Raw materials		1,487		1,262
Total	$	3,277	$	2,439

Property and Equipment

	September 30,			December 31,
	2015			2014
Furniture and office equipment	$	520		$	401
Computer hardware and software		2,033			837
Laboratory equipment		2,511			1,427
Tooling and molds		1,237			1,237
Leasehold improvements		574			494
	$	6,875		$	4,396
Less accumulated depreciation and amortization		(3,447	)		(2,768	)
Property and equipment in progress		227			102
Total	$	3,655		$	1,730

Depreciation and amortization expense was $272 and $157 during the three months ended September 30, 2015 and 2014, respectively, and $686 and $451 during the nine months ended September 30, 2015 and 2014, respectively.

Other Non-Current Assets

	September 30,		December 31,
	2015		2014
Security deposit on operating lease	$	34	$	19
Deferred offering costs		—		1,698
Total	$	34	$	1,717

Accrued Expenses

	September 30,		December 31,
	2015		2014
Compensation and commissions payable	$	4,915	$	3,001
Royalty payable		1,527		1,537
Other accrued expenses		1,021		546
Total	$	7,463	$	5,084

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Composition of Certain Financial Statement Items - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Property Plant And Equipment [Abstract]
Depreciation and amortization	$ 272	$ 157	$ 686	$ 451

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Fair Value Measurements - Summary of Available for Sale Investments at Fair Value on Recurring Basis (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	$ 65,225,000	$ 0
Fair Value, Measurements, Recurring [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	65,225,000
Fair Value, Measurements, Recurring [Member] | Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	26,753,000
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	21,124,000
Fair Value, Measurements, Recurring [Member] | Foreign Assets [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	$ 17,348,000
Fair Value, Measurements, Recurring [Member] | Level 1 [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Foreign Assets [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 2 [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	$ 65,225,000
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	26,753,000
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	21,124,000
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | Foreign Assets [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments	$ 17,348,000
Fair Value, Measurements, Recurring [Member] | Level 3 [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | Commercial Paper [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | Foreign Assets [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale investments

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Earnings Per Share - Schedule of Antidilutive Securities Outstanding Excluded from Computation of Earnings Per Share (Detail) - shares shares in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive potential common shares excluded from computation of diluted earning per share	2,269	12,611
Convertible Preferred Stock Outstanding [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive potential common shares excluded from computation of diluted earning per share		11,404
Convertible Preferred Stock Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive potential common shares excluded from computation of diluted earning per share		38
Common Stock Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive potential common shares excluded from computation of diluted earning per share	38
Common Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive potential common shares excluded from computation of diluted earning per share	2,231	1,169

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Condensed Consolidated Balance Sheets - USD ($)		Sep. 30, 2015	Dec. 31, 2014
CURRENT ASSETS
Cash and cash equivalents		$ 8,705,000	$ 3,484,000	[1]
Short-term investments		65,225,000	0
Accrued interest income		192,000
Accounts receivable, net		10,169,000	8,746,000	[1]
Inventories		3,277,000	2,439,000	[1]
Prepaid expenses and other current assets		1,498,000	883,000	[1]
Total current assets		89,066,000	15,552,000	[1]
PROPERTY AND EQUIPMENT, NET		3,655,000	1,730,000	[1]
Debt issuance costs, net		192,000	237,000	[1]
Other non-current assets		34,000	1,717,000	[1]
Total assets		92,947,000	19,236,000	[1]
CURRENT LIABILITIES
Accounts payable		3,418,000	2,414,000	[1]
Current portion of long-term debt		4,102,000
Convertible preferred stock warrant liability	[1]		291,000
Accrued expenses		7,463,000	5,084,000	[1]
Total current liabilities		14,983,000	7,789,000	[1]
LONG-TERM LIABILITIES
Long-term debt, less current portion		15,898,000	20,000,000	[1]
Other non-current liabilities		484,000	247,000	[1]
Total liabilities		$ 31,365,000	$ 28,036,000	[1]
COMMITMENTS AND CONTINGENCIES (See Note M)				[1]
CONVERTIBLE PREFERRED STOCK, issuable in series, $0.001 par value; Authorized shares: none at September 30, 2015 and 44,567 at December 31, 2014 Issued and outstanding shares: none at September 30, 2015 and 44,317 at December 31, 2014	[1]		$ 91,553,556
STOCKHOLDERS' EQUITY (DEFICIT) (see Note I)
Preferred stock, $0.001 par value per share: Authorized shares: 10,000 at September 30, 2015 and none at December 31, 2014 Issued and outstanding shares: none				[1]
Common stock, $0.001 par value per share: Authorized shares: 200,000 at September 30, 2015 and 62,276 at December 31, 2014 Issued and outstanding shares: 18,767 and 1,887 at September 30, 2015 and December 31, 2014, respectively		$ 19,000	$ 2,000	[1]
Additional paid-in capital		178,596,000	3,402,000	[1]
Accumulated other comprehensive gain		12,000
Accumulated deficit		(117,045,000)	(103,758,000)	[1]
Total stockholders' equity (deficit)		61,582,000	(100,354,000)	[1]
Total liabilities and stockholders' equity (deficit)		$ 92,947,000	$ 19,236,000	[1]

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Convertible Preferred Stock - Summary of Convertible Preferred Stock (Detail) - USD ($)		12 Months Ended
		Dec. 31, 2014		Sep. 30, 2015
Temporary Equity [Line Items]
Number of shares authorized		44,567,071	[1]	0
Number of shares issued		44,317,071	[1]	0
Number of shares outstanding		44,317,071	[1]	0
Number of shares converted to common Stock		11,404,311
Carrying Value	[1]	$ 91,553,556
Series A [Member]
Temporary Equity [Line Items]
Number of shares authorized		2,440,000
Number of shares issued		2,440,000
Number of shares outstanding		2,440,000
Number of shares converted to common Stock		610,000
Carrying Value		$ 2,963,745
Series B [Member]
Temporary Equity [Line Items]
Number of shares authorized		4,986,188
Number of shares issued		4,986,188
Number of shares outstanding		4,986,188
Number of shares converted to common Stock		1,246,547
Carrying Value		$ 8,988,134
Series C [Member]
Temporary Equity [Line Items]
Number of shares authorized		3,717,329
Number of shares issued		3,717,329
Number of shares outstanding		3,717,329
Number of shares converted to common Stock		1,254,375
Carrying Value		$ 14,937,389
Series D [Member]
Temporary Equity [Line Items]
Number of shares authorized		15,310,943
Number of shares issued		15,310,943
Number of shares outstanding		15,310,943
Number of shares converted to common Stock		3,827,736
Carrying Value		$ 29,822,047
Series E [Member]
Temporary Equity [Line Items]
Number of shares authorized		18,112,611
Number of shares issued		17,862,611
Number of shares outstanding		17,862,611
Number of shares converted to common Stock		4,465,653
Carrying Value		$ 34,842,241

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Organization

9 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

Organization

NOTE A. ORGANIZATION

Nature of Business

Entellus Medical, Inc. (the “Company”) was incorporated in Delaware and its facilities are located in Plymouth, Minnesota. The Company is focused on the design, development and commercialization of products for the minimally invasive treatment of patients suffering from chronic sinusitis. The Company’s XprESS family of products is used by ear, nose and throat (“ENT”) physicians to treat patients with chronic sinusitis by opening narrowed or obstructed sinus drainage pathways using balloon sinus dilation performed in the physician office or the operating room. The Company currently sells product through its sales force in the United States and United Kingdom and to a limited number of additional countries through international distributors. The Company operates in one segment.

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Liquidity and Business Risks - Additional Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	1 Months Ended
	Feb. 28, 2015	Sep. 30, 2015	Dec. 31, 2014	[1]
Subsidiary, Sale of Stock [Line Items]
Cash, cash equivalents and short-term investments		$ 73,930
Accumulated deficit		$ 117,045	$ 103,758
Initial Public Offering [Member]
Subsidiary, Sale of Stock [Line Items]
Common stock, shares issued	5,294
Common stock offering price per share	$ 17.00
Proceeds from issuance of common stock, net of issuance costs	$ 80,953

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2015

Fair Value Disclosures [Abstract]

Summary of Available for Sale Investments at Fair Value on Recurring Basis

The following is a summary of available-for-sale investments by type of instrument measured at fair value on a recurring basis at September 30, 2015. As of December 31, 2014, there were no available-for-sale investments.

	September 30, 2015
	Level 1		Level 2		Level 3		Total
Commercial paper	$	—	$	26,753	$	—	$	26,753
Corporate bonds		—		21,124		—		21,124
Foreign assets		—		17,348		—		17,348
Total	$	—	$	65,225	$	—	$	65,225

Summary of Changes in Estimated Fair Value of Company's Convertible Preferred Stock Warrants

The following table sets forth a summary of the changes in the estimated fair value of the Company’s convertible preferred stock warrants, which represents financial instruments that were categorized as Level 3, according to the three-level fair value hierarchy.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015			2014
Beginning of the period	$	—	$	309	$	291		$	211
Issued		—		—		—			—
Exercised		—		—		—			—
Expired		—		—		—			—
Reclassified to equity (1)		—		—		(648	)		—
Change in fair value		—		53		357			151
End of the period	$	—	$	362	$	—		$	362

(1) In connection with the closing of the IPO in February 2015, warrants to purchase shares of convertible preferred stock were converted to warrants to purchase shares of common stock, resulting in the reclassification of the related convertible preferred stock warrant liability to additional paid-in-capital.

Summary of Fair Value of Convertible Preferred Stock Warrant Liability

The fair market value of the convertible preferred stock prior to the IPO was determined using the option pricing method and the probability weighted expected return method. The fair value of the convertible preferred stock warrant liability was determined using the Black-Scholes option pricing model with the following assumptions:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015	2014			2015			2014
Expected life in years	N/A		8.0			7.5			8.0
Risk-free interest rate	N/A		2.2	%		1.6	%		2.2	%
Expected dividend yield	N/A		0.0	%		0.0	%		0.0	%
Expected volatility	N/A		50	%		56	%		50	%

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Short-term Investments - Additional Information (Detail) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2015	Dec. 31, 2014
Investments Debt And Equity Securities [Abstract]
Short-term investments	$ 65,225,000	$ 65,225,000	$ 0
Long-term investments			$ 0
Other-than-temporary impairment charges	$ 0	$ 0

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Stockholders' Equity (Deficit) (Tables)

9 Months Ended

Sep. 30, 2015

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Stock Option Activity and Related Information

A summary of the Company’s stock option activity and related information is as follows:

	Nine Months Ended
	September 30,
	2015
						Weighted
						average	Aggregate
				Weighted		remaining	intrinsic
				average		contractual	value
	Options			exercise price		term	($000)
Outstanding, beginning of period		2,098		$	7.38	8.8 years	$	8,385
Granted		351			25.70
Exercised		(182	)		1.55
Cancelled		—			—
Forfeited		(36	)		11.13
Outstanding, end of period		2,231		$	10.67	8.5 years	$	26,357
Exercisable		605		$	4.31	6.8 years	$	10,730

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTE B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Preparation

The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”).

The interim financial data as of September 30, 2015, is unaudited and is not necessarily indicative of the results for a full year. In the opinion of the Company’s management, the interim data includes only normal and recurring adjustments necessary for a fair statement of the Company’s financial results for the three and nine months ended September 30, 2015 and 2014. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements.

The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 that has been filed with the SEC.

Initial Public Offering

In February 2015, the Company completed its initial public offering (“IPO”) by issuing 5,294 shares of common stock, at an offering price of $17.00 per share, for net proceeds of approximately $80,953 after deducting underwriting discounts, commissions and offering expenses payable by the Company. In connection with the IPO, the Company’s outstanding shares of convertible preferred stock were automatically converted into an aggregate of 11,404 shares of common stock, and the Company’s outstanding warrants to purchase shares of convertible preferred stock were automatically converted into warrants to purchase up to an aggregate of 38 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock warrant liability of $648 to additional paid-in-capital.

1-for-4 Reverse Stock Split

In connection with the IPO, the Company’s board of directors and stockholders approved a reverse stock split of the Company’s common stock on a 1-for-4 basis. The reverse stock split became effective on January 12, 2015. The par value of the common stock was not adjusted as a result of the reverse stock split. Adjustments corresponding to the reverse stock split were made to the ratio at which the convertible preferred stock converted into common stock immediately prior to the closing of the IPO. Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split and adjustment of the preferred stock’s conversion ratios.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates.

Significant Accounting Policies

Other than the policies described below, there have been no changes in the Company’s significant accounting policies for the three and nine months ended September 30, 2015, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

Cash and Cash Equivalents

Cash equivalents are stated at fair value and include short-term, highly liquid investments with remaining maturities of 90 days or less at the date of purchase. Cash equivalents consist of money market funds recorded at fair value and corporate debt securities recorded at amortized costs. Investments in marketable securities of $2,590 were classified as cash equivalents as of September 30, 2015.

Short-term Investments

Short-term investments represent holdings of marketable securities in accordance with the Company’s investment policy and cash management strategy. Short-term investments are classified as available-for-sale and mature within 12 months from the balance sheet date. Investments with maturity dates greater than one year from the balance sheet date are classified as long-term investments. At the time that the maturity dates of these investments become one year or less, the securities are reclassified to short-term investments. The Company’s investments are recorded at fair value, with any unrealized gains and losses reported as a component of stockholders’ equity (deficit) until realized or until a determination is made that an other-than-temporary decline in market value has occurred. The cost of investments sold is determined based on the specific identification method and any realized gains or losses on the sale of investments are reflected as a component of interest income or expense. These investments are deemed Level 2 assets under the fair value hierarchy as their fair value is determined under a market approach using valuation models that utilize observable inputs, including maturity date, issue date, settlements date, and current interest rates.

Deferred Offering Costs

Deferred offering costs were capitalized and consisted primarily of legal, accounting and other direct fees and costs related to the IPO. The deferred offering costs included in other non-current assets at December 31, 2014 were offset against the IPO proceeds upon the closing of the IPO in February 2015. There were no deferred offering costs capitalized as of September 30, 2015.

Convertible Preferred Stock Warrant Liability

The Company issued warrants to purchase shares of convertible preferred stock in connection with the Company’s entry into its original credit facility in October 2012. The warrants are recorded at fair value using the Black Scholes model. The fair value of these warrants is remeasured at each financial reporting period with any changes in fair value being recognized as a component of other income (expense) in the statements of operations and comprehensive loss. In connection with completion of the IPO, in January 2015, the Company performed the final remeasurement of the warrant liability. There were no costs and costs of $357 for the three and nine months ended September 30, 2015, respectively, recorded as interest expense from the final remeasurement.

Upon the closing of the IPO, warrants to purchase shares of convertible preferred stock automatically converted into warrants to purchase shares of common stock. The Company reclassified the warrant liability to additional paid-in capital, as the warrants met the definition of an equity instrument.

Principles of Consolidation

The consolidated financial statements include the accounts of Entellus Medical, Inc., and its wholly owned subsidiary. All significant intercompany transactions and accounts have been eliminated.

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board, (“FASB”) issued Accounting Standards Update, (“ASU”) No. 2014-09, Revenue from Contracts with Customers. This standard will eliminate the transaction and industry specific revenue recognition guidance under current U.S. GAAP and replace it with a principles based approach for determining revenue recognition. In August 2015, the FASB issued ASU 2015-14 which defers the adoption of ASU 2014-09 to interim periods beginning after December 31, 2018 for companies under the Jumpstart Our Business Startups Act. The Company is in the process of evaluating the impact of the adoption of this standard.

In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. ASU 2015-02 is effective for the annual period beginning after December 15, 2015, and for annual and interim periods thereafter. Early application is permitted. The adoption of ASU 2015-02 is not expected to have a material impact on the Company’s financial position or results of operations.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance, which changes the presentation of debt issuance costs in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. ASU 2015-03 is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. The Company does not believe that adoption of ASU 2015-03 will have a significant impact on the Company’s consolidated financial statements.

In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory, which requires inventory not measured using either the last in, first out or the retail inventory method to be measured at the lower of cost and net realizable value.  Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation.  The new standard will be effective January 1, 2017 and will be applied prospectively.  Early adoption is permitted.  The Company is in the process of evaluating the impact of the adoption of this standard.

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Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2015	Dec. 31, 2014	[1]
Statement Of Financial Position [Abstract]
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, shares authorized	0	44,567,071
Convertible preferred stock, shares issued	0	44,317,071
Convertible preferred stock, shares outstanding	0	44,317,071
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	0
Preferred stock, shares Issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	200,000,000	62,276,000
Common stock, shares issued	18,767,000	1,887,000
Common stock, shares outstanding	18,767,000	1,887,000

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Earnings Per Share

9 Months Ended

Sep. 30, 2015

Earnings Per Share [Abstract]

Earnings Per Share

NOTE L. EARNINGS PER SHARE

Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive potential shares of common stock outstanding during the period. Because the Company has reported a net loss for all periods presented, diluted net loss per share is the same as basic net loss per share for those periods as all potentially dilutive shares consisting of convertible preferred stock, stock options and warrants were antidilutive in those periods.

The following table sets forth the computation of the Company’s net loss per share:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Net Loss	$	(6,071	)	$	(2,033	)	$	(13,287	)	$	(5,741	)
Weighted average common stock outstanding		18,738			1,500			16,688			1,456
Net loss per share, basic and diluted	$	(0.32	)	$	(1.36	)	$	(0.80	)	$	(3.94	)

The following potentially dilutive securities outstanding have been excluded from the computations of diluted earnings per share because such securities have an antidilutive impact due to losses reported:

	September 30,
	2015		2014
Convertible preferred stock outstanding		—		11,404
Convertible preferred stock warrants		—		38
Common stock warrants		38		—
Common stock options		2,231		1,169
Total		2,269		12,611

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Oct. 30, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q3
Trading Symbol	ENTL
Entity Registrant Name	ENTELLUS MEDICAL INC
Entity Central Index Key	0001374128
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		18,788,325

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2015

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE M. COMMITMENTS AND CONTINGENCIES

Operating Leases

As of September 30, 2015, the Company has two leased facilities under operating lease agreements. The Company entered into a 41-month lease in February 2012, effective April 1, 2012, for its corporate headquarters. The Company entered into a 50-month lease on June 30, 2014, effective July 1, 2014, for additional distribution space in a second facility. On February 26, 2015, the Company exercised its right to extend the lease term of its manufacturing and corporate facility for an additional three years through August 2018. On June 30, 2015, the Company entered into amendments to each lease agreement, among other things, to expand the space occupied by the Company at the property at which the Company’s corporate headquarters are located, and to extend the term of each lease agreement through June 2021, with an option to extend for an additional term through June 2024. Rental payments on operating leases are charged to expense on a straight-line basis over the period of the lease. The lease agreement requires the Company to pay executory costs such as real estate taxes, insurance and repairs, and includes renewal and escalation clauses.

Approximate minimum annual future obligations which include monthly contractual lease payments under operating leases with initial terms in excess of one year are as follows:

2015 (remaining)	$	52
2016		351
2017		366
2018		373
2019		381
2020		389
2021		197
Total	$	2,109

Total lease expense was approximately $83 and $83 for the three months ended September 30, 2015 and 2014, respectively and $257 and $221 for the nine months ended September 30, 2015 and 2014, respectively.

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Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income Statement [Abstract]
Revenue	$ 14,804	$ 11,691	$ 43,497	$ 34,364
Cost of goods sold	3,431	2,501	9,728	7,515
Gross profit	11,373	9,190	33,769	26,849
Operating expenses
Selling and marketing	12,308	8,391	32,010	24,276
Research and development	1,392	972	4,000	3,135
General and administrative	3,230	1,386	9,120	3,767
Total operating expenses	16,930	10,749	45,130	31,178
Loss from operations	(5,557)	(1,559)	(11,361)	(4,329)
Other income (expense)
Interest income	47		118	5
Interest expense	(561)	(474)	(2,042)	(1,418)
Other non-operating (expense) income			(2)	1
Total other expense, net	(514)	(474)	(1,926)	(1,412)
Net loss	(6,071)	(2,033)	(13,287)	(5,741)
Other comprehensive loss
Unrealized gain on short term investments, net of tax	23		21
Foreign currency translation loss, net of tax	(8)		(9)
Comprehensive loss	$ (6,056)	$ (2,033)	$ (13,275)	$ (5,741)
Net loss per share, basic and diluted	$ (0.32)	$ (1.36)	$ (0.80)	$ (3.94)
Weighted average common shares used to compute net loss per share, basic and diluted	18,738	1,500	16,688	1,456

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Debt

9 Months Ended

Sep. 30, 2015

Debt Disclosure [Abstract]

Debt

NOTE G. DEBT

On May 19, 2015, the Company entered into an amendment to the Company’s amended and restated loan and security agreement (the “credit facility”) with Oxford Finance LLC (the “lender”) changing the Company’s obligations related to foreign subsidiaries.

Under the credit facility, the Company can borrow up to a total of $25,000 in three tranches at a fixed rate of 9.40%. The first tranche of $15,000, including the refinance of $7,500 previously outstanding, was borrowed in December 2013. In connection with the funding of the first tranche, the Company paid a prorated final payment fee on the original credit facility of $143. The second tranche of up to $5,000 was available through December 31, 2014, of which $5,000 was borrowed during the three months ended December 31, 2014. The third tranche of up to $5,000 is available at any time through December 31, 2015, subject to the achievement by the Company of certain revenue milestones. As of September 30, 2015, the Company achieved the specified revenue milestones for the third tranche. The credit facility matures and all amounts borrowed thereunder are due on December 1, 2018. As a result of the $5,000 borrowed in 2014, all amounts borrowed under the credit facility are interest only through January 2016 (24 months), after which the Company will make monthly payments of principal and interest. The interest-only period may be extended to 36 months based on funding and revenue milestones provided for in the credit facility.

In addition to the principal and interest payments, under the credit facility the Company is required to pay a final payment fee of 7.15% on all amounts outstanding, which is being accrued over the credit facility term and shall be due at the earlier of maturity or prepayment. If the Company repays the amounts borrowed under the loan prior to maturity, the Company will also be required to pay a prepayment fee equal to 1.75% if the prepayment occurs prior to or on the first anniversary of the funding date with respect to a given borrowed amount or 0.75% if the prepayment occurs after the first anniversary of the funding date, in each case on all amounts borrowed other than the $5,000 borrowed during the three months ended December 31, 2014.

As of September 30, 2015 and December 31, 2014, the Company has borrowed and had outstanding $20,000 of debt under the credit facility.

As of September 30, 2015 and as of December 31, 2014, the carrying amounts of debt approximates fair market value due to the fixed term nature of the credit facility. The fair value of the Company’s debt is considered a Level 3 measurement.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

NOTE F. FAIR VALUE MEASUREMENTS

As of September 30, 2015 and as of December 31, 2014, the carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued expenses approximated their estimated fair values because of the short term nature of these financial instruments.

Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three categories:

· Level 1: Quoted market prices in active markets for identical assets or liabilities.

· Level 2: Includes other than level 1 inputs that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs for which all significant inputs are observable or can be corroborated by observable market data for substantially the full term of the asset or liabilities.

· Level 3: Unobservable inputs that are supported by little or no market activities, which would require the Company to develop its own assumptions.

Short-term Investments

The following is a summary of available-for-sale investments by type of instrument measured at fair value on a recurring basis at September 30, 2015. As of December 31, 2014, there were no available-for-sale investments.

	September 30, 2015
	Level 1		Level 2		Level 3		Total
Commercial paper	$	—	$	26,753	$	—	$	26,753
Corporate bonds		—		21,124		—		21,124
Foreign assets		—		17,348		—		17,348
Total	$	—	$	65,225	$	—	$	65,225

There were no transfers in or out of Level 1, Level 2 or Level 3 fair value measurement during the three and nine months ended September 30, 2015.

Convertible Preferred Stock Warranty Liability

The following table sets forth a summary of the changes in the estimated fair value of the Company’s convertible preferred stock warrants, which represents financial instruments that were categorized as Level 3, according to the three-level fair value hierarchy.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015			2014
Beginning of the period	$	—	$	309	$	291		$	211
Issued		—		—		—			—
Exercised		—		—		—			—
Expired		—		—		—			—
Reclassified to equity (1)		—		—		(648	)		—
Change in fair value		—		53		357			151
End of the period	$	—	$	362	$	—		$	362

(1) In connection with the closing of the IPO in February 2015, warrants to purchase shares of convertible preferred stock were converted to warrants to purchase shares of common stock, resulting in the reclassification of the related convertible preferred stock warrant liability to additional paid-in-capital.

The fair market value of the convertible preferred stock prior to the IPO was determined using the option pricing method and the probability weighted expected return method. The fair value of the convertible preferred stock warrant liability was determined using the Black-Scholes option pricing model with the following assumptions:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015	2014			2015			2014
Expected life in years	N/A		8.0			7.5			8.0
Risk-free interest rate	N/A		2.2	%		1.6	%		2.2	%
Expected dividend yield	N/A		0.0	%		0.0	%		0.0	%
Expected volatility	N/A		50	%		56	%		50	%

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Convertible Preferred Stock (Tables)

9 Months Ended

Sep. 30, 2015

Equity [Abstract]

Summary of Convertible Preferred Stock

A summary of the Company’s convertible preferred stock is as follows (presented in actual amounts):

	September 30, 2015						December 31, 2014
			Number of						Number of		Number of
	Number of		shares				Number of		shares		shares
	Shares		issued and		Carrying		Shares		issued and		converted		Carrying
	authorized		outstanding		value		authorized		outstanding		common Stock		value
Series A		—		—		—		2,440,000		2,440,000		610,000	$	2,963,745
Series B		—		—		—		4,986,188		4,986,188		1,246,547		8,988,134
Series C		—		—		—		3,717,329		3,717,329		1,254,375		14,937,389
Series D		—		—		—		15,310,943		15,310,943		3,827,736		29,822,047
Series E		—		—		—		18,112,611		17,862,611		4,465,653		34,842,241
Total		—		—		—		44,567,071		44,317,071		11,404,311	$	91,553,556

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

Basis of Preparation

Basis of Preparation

The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”).

The interim financial data as of September 30, 2015, is unaudited and is not necessarily indicative of the results for a full year. In the opinion of the Company’s management, the interim data includes only normal and recurring adjustments necessary for a fair statement of the Company’s financial results for the three and nine months ended September 30, 2015 and 2014. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements.

The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 that has been filed with the SEC.

Initial Public Offering

Initial Public Offering

In February 2015, the Company completed its initial public offering (“IPO”) by issuing 5,294 shares of common stock, at an offering price of $17.00 per share, for net proceeds of approximately $80,953 after deducting underwriting discounts, commissions and offering expenses payable by the Company. In connection with the IPO, the Company’s outstanding shares of convertible preferred stock were automatically converted into an aggregate of 11,404 shares of common stock, and the Company’s outstanding warrants to purchase shares of convertible preferred stock were automatically converted into warrants to purchase up to an aggregate of 38 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock warrant liability of $648 to additional paid-in-capital.

Reverse Stock Split

1-for-4 Reverse Stock Split

In connection with the IPO, the Company’s board of directors and stockholders approved a reverse stock split of the Company’s common stock on a 1-for-4 basis. The reverse stock split became effective on January 12, 2015. The par value of the common stock was not adjusted as a result of the reverse stock split. Adjustments corresponding to the reverse stock split were made to the ratio at which the convertible preferred stock converted into common stock immediately prior to the closing of the IPO. Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split and adjustment of the preferred stock’s conversion ratios.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash equivalents are stated at fair value and include short-term, highly liquid investments with remaining maturities of 90 days or less at the date of purchase. Cash equivalents consist of money market funds recorded at fair value and corporate debt securities recorded at amortized costs. Investments in marketable securities of $2,590 were classified as cash equivalents as of September 30, 2015.

Short-term Investments

Short-term Investments

Short-term investments represent holdings of marketable securities in accordance with the Company’s investment policy and cash management strategy. Short-term investments are classified as available-for-sale and mature within 12 months from the balance sheet date. Investments with maturity dates greater than one year from the balance sheet date are classified as long-term investments. At the time that the maturity dates of these investments become one year or less, the securities are reclassified to short-term investments. The Company’s investments are recorded at fair value, with any unrealized gains and losses reported as a component of stockholders’ equity (deficit) until realized or until a determination is made that an other-than-temporary decline in market value has occurred. The cost of investments sold is determined based on the specific identification method and any realized gains or losses on the sale of investments are reflected as a component of interest income or expense. These investments are deemed Level 2 assets under the fair value hierarchy as their fair value is determined under a market approach using valuation models that utilize observable inputs, including maturity date, issue date, settlements date, and current interest rates.

Deferred Offering Costs

Deferred Offering Costs

Deferred offering costs were capitalized and consisted primarily of legal, accounting and other direct fees and costs related to the IPO. The deferred offering costs included in other non-current assets at December 31, 2014 were offset against the IPO proceeds upon the closing of the IPO in February 2015. There were no deferred offering costs capitalized as of September 30, 2015.

Convertible Preferred Stock Warrant Liability

Convertible Preferred Stock Warrant Liability

The Company issued warrants to purchase shares of convertible preferred stock in connection with the Company’s entry into its original credit facility in October 2012. The warrants are recorded at fair value using the Black Scholes model. The fair value of these warrants is remeasured at each financial reporting period with any changes in fair value being recognized as a component of other income (expense) in the statements of operations and comprehensive loss. In connection with completion of the IPO, in January 2015, the Company performed the final remeasurement of the warrant liability. There were no costs and costs of $357 for the three and nine months ended September 30, 2015, respectively, recorded as interest expense from the final remeasurement.

Upon the closing of the IPO, warrants to purchase shares of convertible preferred stock automatically converted into warrants to purchase shares of common stock. The Company reclassified the warrant liability to additional paid-in capital, as the warrants met the definition of an equity instrument.

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of Entellus Medical, Inc., and its wholly owned subsidiary. All significant intercompany transactions and accounts have been eliminated.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board, (“FASB”) issued Accounting Standards Update, (“ASU”) No. 2014-09, Revenue from Contracts with Customers. This standard will eliminate the transaction and industry specific revenue recognition guidance under current U.S. GAAP and replace it with a principles based approach for determining revenue recognition. In August 2015, the FASB issued ASU 2015-14 which defers the adoption of ASU 2014-09 to interim periods beginning after December 31, 2018 for companies under the Jumpstart Our Business Startups Act. The Company is in the process of evaluating the impact of the adoption of this standard.

In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. ASU 2015-02 is effective for the annual period beginning after December 15, 2015, and for annual and interim periods thereafter. Early application is permitted. The adoption of ASU 2015-02 is not expected to have a material impact on the Company’s financial position or results of operations.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance, which changes the presentation of debt issuance costs in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. ASU 2015-03 is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. The Company does not believe that adoption of ASU 2015-03 will have a significant impact on the Company’s consolidated financial statements.

In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory, which requires inventory not measured using either the last in, first out or the retail inventory method to be measured at the lower of cost and net realizable value.  Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation.  The new standard will be effective January 1, 2017 and will be applied prospectively.  Early adoption is permitted.  The Company is in the process of evaluating the impact of the adoption of this standard.

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Stock Based Compensation Expense

9 Months Ended

Sep. 30, 2015

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock Based Compensation Expense

NOTE J. STOCK-BASED COMPENSATION EXPENSE

Stock-based compensation expense is reflected in the Condensed Consolidated Statement of Operations and Comprehensive Loss for the three and nine months ended September 30, 2015 and 2014, as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015		2014
Cost of goods sold	$	18	$	3	$	40	$	8
Selling and marketing		203		38		428		78
Research and development		71		10		171		35
General and administrative		408		13		1,137		38
Total	$	700	$	64	$	1,776	$	159

The amount of unearned stock-based compensation currently estimated to be expensed through the year 2019 related to unvested employee stock-based payment awards as of September 30, 2015, is approximately $10,466. The weighted average period over which the unearned stock-based compensation is expected to be recognized as of September 30, 2015, is approximately 3.3 years. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that the Company grants additional share-based payments.

The Company estimates the fair value of stock-based compensation on the date of grant using the Black-Scholes option-pricing model. The Black-Scholes model determines the fair value of stock-based payment awards based on the fair market value of the Company’s common stock on the date of grant and is affected by assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the fair market value of the Company’s common stock, volatility over the expected term of the awards and actual and projected employee stock option exercise behaviors. The Company has opted to use the “simplified method” for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option. Due to the Company’s limited operating history and a lack of company-specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility data was computed using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the share-based payments. The Company will continue to analyze the historical stock price volatility and expected term assumptions as more historical data for the Company’s common stock becomes available. The risk-free rate assumption is based on the U.S. Treasury instruments with maturities similar to the expected term of the Company’s stock options. The expected dividend assumption is based on the Company’s history of not paying dividends and its expectation that it will not declare dividends for the foreseeable future.

As stock-based compensation expense recognized in the financial statements is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from estimates. Forfeitures are estimated based on estimated future employee turnover and historical experience.

The fair value of the options granted to employees or directors during the nine months ended September 30, 2015 and 2014, was estimated as of the grant date using the Black-Scholes model assuming the weighted average assumptions listed in the following table:

	Nine Months Ended
	September 30,
	2015			2014
Expected life in years		6.0			6.0
Risk-free interest rate		1.7	%		1.9	%
Expected dividend yield		0	%		0	%
Expected volatility		70	%		64	%
Weighted average fair value	$	25.70		$	2.08

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Convertible Preferred Stock

9 Months Ended

Sep. 30, 2015

Temporary Equity Disclosure [Abstract]

Convertible Preferred Stock

NOTE H. CONVERTIBLE PREFERRED STOCK

In connection with the IPO in February 2015, the 44,317 shares of convertible preferred stock were converted into 11,404 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock of $91,554 to common stock and additional paid-in-capital.

A summary of the Company’s convertible preferred stock is as follows (presented in actual amounts):

	September 30, 2015						December 31, 2014
			Number of						Number of		Number of
	Number of		shares				Number of		shares		shares
	Shares		issued and		Carrying		Shares		issued and		converted		Carrying
	authorized		outstanding		value		authorized		outstanding		common Stock		value
Series A		—		—		—		2,440,000		2,440,000		610,000	$	2,963,745
Series B		—		—		—		4,986,188		4,986,188		1,246,547		8,988,134
Series C		—		—		—		3,717,329		3,717,329		1,254,375		14,937,389
Series D		—		—		—		15,310,943		15,310,943		3,827,736		29,822,047
Series E		—		—		—		18,112,611		17,862,611		4,465,653		34,842,241
Total		—		—		—		44,567,071		44,317,071		11,404,311	$	91,553,556

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Stockholders' Equity (Deficit)

9 Months Ended

Sep. 30, 2015

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stockholders' Equity (Deficit)

NOTE I. STOCKHOLDERS’ EQUITY (DEFICIT)

Preferred Stock

In connection with the IPO, the Company amended and restated its certificate of incorporation. The amended and restated certificate of incorporation authorizes 10,000 shares of preferred stock. As of September 30, 2015, no preferred stock had been issued.

Common Stock

In May 2014, the Company amended its certificate of incorporation to increase the authorized number of shares of common stock available for issuance from 57,000 to 57,565 shares of $0.001 par value common stock. In December 2014, the Company further amended its certificate of incorporation to increase the authorized number of common stock shares available for issuance to 62,276. In connection with the IPO, the Company amended and restated its certificate of incorporation. The amended and restated certificate of incorporation authorizes 200,000 shares of common stock.

The common stockholders are generally entitled to one vote for each share held on all matters submitted to a vote of the stockholders and do not have any cumulative voting rights. The Company’s common stockholders are entitled to receive proportionally any dividends declared by the Company’s Board of Directors, subject to any preferential dividend rights of outstanding preferred stock.

In the event of the Company’s liquidation or dissolution, the common stockholders are entitled to share ratably in all assets remaining after payment of all debts and other liabilities, subject to any preferential rights of any outstanding preferred stock. The common stockholders have no preemptive, subscription, redemption or conversion rights.

2015 Incentive Award Plan

In December 2014, the Company’s Board of Directors adopted, and in January 2015 the Company’s stockholders approved, the Company’s Incentive Award Plan (the “2015 Plan”). The 2015 Plan became effective in connection with the IPO, at which time the Company ceased making awards under the 2006 Plan. Under the 2015 Plan, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units and certain other awards to individuals who are employees, officers, directors or consultants of the Company. A total of 1,346 shares of common stock were initially reserved for issuance under the 2015 Plan. In addition, the number of shares available for issuance under the 2015 Plan will be annually increased by an amount equal to the lesser of (A) 875 shares, (B) 4% of the outstanding shares of the Company’s common stock as of the last day of our immediately preceding fiscal year or (C) an amount determined by the Company’s Board of Directors.

A summary of the Company’s stock option activity and related information is as follows:

	Nine Months Ended
	September 30,
	2015
						Weighted
						average	Aggregate
				Weighted		remaining	intrinsic
				average		contractual	value
	Options			exercise price		term	($000)
Outstanding, beginning of period		2,098		$	7.38	8.8 years	$	8,385
Granted		351			25.70
Exercised		(182	)		1.55
Cancelled		—			—
Forfeited		(36	)		11.13
Outstanding, end of period		2,231		$	10.67	8.5 years	$	26,357
Exercisable		605		$	4.31	6.8 years	$	10,730

The aggregate pre-tax intrinsic value of options exercised was $2,745 and $1,368 for the nine months ended September 30, 2015 and 2014, respectively. The aggregate pre-tax intrinsic value was calculated as the difference between the exercise prices of the underlying options and the estimated fair value of the common stock on the date of exercise or September 30, 2015. The total cash received upon the exercise of options was $282 and $207 during the nine months ended September 30, 2015 and 2014, respectively.

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Income Taxes

9 Months Ended

Sep. 30, 2015

Income Tax Disclosure [Abstract]

Income Taxes

NOTE K. INCOME TAXES

We did not record a federal or state income tax benefit for our losses for the three and nine months ended September 30, 2015 and 2014 due to our conclusion that full valuation allowance is required against our deferred tax assets.

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Composition of Certain Financial Statement Items - Schedule of Accrued Expenses (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Payables And Accruals [Abstract]
Compensation and commissions payable	$ 4,915	$ 3,001
Royalty payable	1,527	1,537
Other accrued expenses	1,021	546
Accrued expenses, Total	$ 7,463	$ 5,084	[1]

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income Tax Disclosure [Abstract]
Federal income tax benefit	$ 0	$ 0	$ 0	$ 0
State income tax benefit	$ 0	$ 0	$ 0	$ 0

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Short-Term Investments (Tables)

9 Months Ended

Sep. 30, 2015

Investments Debt And Equity Securities [Abstract]

Summary of Investments by Type of Instrument

The following is a summary of the available-for-sale investments by type of instrument, which are included in short-term investments in the Condensed Consolidated Balance Sheet as of September 30, 2015. As of December 31, 2014, there were no short or long-term investments.

			Unrealized		Unrealized
			Gain in		Losses in
			Accumulated		Accumulated
			Other		Other
	Amortized		Comprehensive		Comprehensive			Estimated
September 30, 2015	Cost		Income		Income			Fair Value
Short-Term
Commercial paper	$	26,726	$	27	$	—		$	26,753
Corporate bonds		21,127		—		(3	)		21,124
Foreign assets		17,351		—		(3	)		17,348
Total available-for-sale securities	$	65,204	$	27	$	(6	)	$	65,225

Summary of Contractual Maturities of Available-for-Sale Securities

Contractual maturities of available-for-sale securities at September 30, 2015, are as follows:

Mature in one year or less	$	65,225
Mature in 1-5 years		—
Total	$	65,225

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Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2015

Earnings Per Share [Abstract]

Schedule of Net Loss Per Share

The following table sets forth the computation of the Company’s net loss per share:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Net Loss	$	(6,071	)	$	(2,033	)	$	(13,287	)	$	(5,741	)
Weighted average common stock outstanding		18,738			1,500			16,688			1,456
Net loss per share, basic and diluted	$	(0.32	)	$	(1.36	)	$	(0.80	)	$	(3.94	)

Schedule of Antidilutive Securities Outstanding Excluded from Computation of Earnings Per Share

The following potentially dilutive securities outstanding have been excluded from the computations of diluted earnings per share because such securities have an antidilutive impact due to losses reported:

	September 30,
	2015		2014
Convertible preferred stock outstanding		—		11,404
Convertible preferred stock warrants		—		38
Common stock warrants		38		—
Common stock options		2,231		1,169
Total		2,269		12,611

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Stock Based Compensation Expense - Additional Information (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2015 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unvested employee stock-based payment award	$ 10,466
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average period for unearned stock-based compensation cost	3 years 3 months 18 days

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Fair Value Measurements - Summary of Changes in Estimated Fair Value of Company's Convertible Preferred Stock Warrants (Detail) - Convertible Preferred Stock Warrants [Member] - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Class of Warrant or Right [Line Items]
Beginning of the period	$ 309	$ 291	$ 211
Reclassified to equity		(648)
Change in fair value	53	$ 357	151
End of the period	$ 362		$ 362

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2015		Sep. 30, 2014
Cash flows from operating activities:
Net loss	$ (13,287)		$ (5,741)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	686		451
Amortization of debt issuance costs	45		44
Amortization of premium on investments	297
Accretion of final payment fee on long-term debt	230		161
Deferred rent	4		(15)
Gain on disposal of equipment			(1)
Stock-based compensation	1,776		159
Changes in fair value of convertible preferred stock warrants	357		151
Changes in operating assets and liabilities:
Accrued interest income	(192)
Accounts receivables, net	(1,432)		(1,374)
Inventories	(838)		(907)
Prepaid expenses and other current assets	(616)		192
Other non-current assets	1,684		(558)
Accounts payable	1,003		1,192
Accrued expenses	2,381		(13)
Net cash used in operating activities	(7,902)		(6,259)
Cash flows from investing activities:
Purchase of property and equipment	(2,611)		(630)
Proceeds from sale of property and equipment			1
Purchase of investments	(111,051)
Proceeds from maturities of short-term investments	45,551
Net cash used in investing activities	(68,111)		(629)
Cash flows from financing activities:
Proceeds from stock options exercised	282		207
Proceeds from initial public offering, net of issuance costs	80,953
Repurchase of common stock	(1)
Net cash provided by financing activities	81,234		207
Net increase (decrease) in cash and cash equivalents	5,221		(6,681)
Cash and cash equivalents - beginning of period	3,484	[1]	7,709
Cash and cash equivalents - end of period	8,705		1,028
Supplemental cash flow information:
Cash paid for interest	$ 1,394		$ 973

[1] Amounts derived from the audited financial statements of Entellus Medical, Inc. included in its Annual Report on Form 10-K for the year ended December 31, 2014.

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Short-Term Investments

9 Months Ended

Sep. 30, 2015

Investments Debt And Equity Securities [Abstract]

Short-Term Investments

NOTE E. SHORT-TERM INVESTMENTS

The Company determines the appropriate classification of its investments at the time of purchase and revaluates such determinations at each balance sheet date. Marketable securities are classified as held-to-maturity when the Company has the positive intent and ability to hold the securities to maturity.    

Marketable securities for which the Company does not have the intent or ability to hold to maturity are classified as available-for-sale. Marketable securities classified as available-for-sale are carried at fair market value, with the unrealized gains and losses included in the determination of comprehensive income and reported in stockholders’ equity.

The following is a summary of the available-for-sale investments by type of instrument, which are included in short-term investments in the Condensed Consolidated Balance Sheet as of September 30, 2015. As of December 31, 2014, there were no short or long-term investments.

			Unrealized		Unrealized
			Gain in		Losses in
			Accumulated		Accumulated
			Other		Other
	Amortized		Comprehensive		Comprehensive			Estimated
September 30, 2015	Cost		Income		Income			Fair Value
Short-Term
Commercial paper	$	26,726	$	27	$	—		$	26,753
Corporate bonds		21,127		—		(3	)		21,124
Foreign assets		17,351		—		(3	)		17,348
Total available-for-sale securities	$	65,204	$	27	$	(6	)	$	65,225

Based on an evaluation of securities that have been in a loss position, the Company did not recognize any other-than-temporary impairment charges during the three and nine months ended September 30, 2015. The Company considered various factors which included a credit and liquidity assessment of the underlying securities and the Company’s intent and ability to hold the underlying securities until the estimated date of recovery of its amortized cost.

Contractual maturities of available-for-sale securities at September 30, 2015, are as follows:

Mature in one year or less	$	65,225
Mature in 1-5 years		—
Total	$	65,225

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Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2015

Commitments And Contingencies Disclosure [Abstract]

Summary of Annual Future Minimum Lease Payments

Approximate minimum annual future obligations which include monthly contractual lease payments under operating leases with initial terms in excess of one year are as follows:

2015 (remaining)	$	52
2016		351
2017		366
2018		373
2019		381
2020		389
2021		197
Total	$	2,109

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Short-term Investments - Summary of Contractual Maturities of Available-for-Sale Securities (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Investments Debt And Equity Securities [Abstract]
Mature in one year or less	$ 65,225,000
Total	$ 65,225,000	$ 0

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Composition of Certain Financial Statement Items (Tables)

9 Months Ended

Sep. 30, 2015

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Schedule of Inventories

Inventories

	September 30,		December 31,
	2015		2014
Finished goods	$	1,360	$	859
Work in process		430		318
Raw materials		1,487		1,262
Total	$	3,277	$	2,439

Schedule of Property and Equipment

Property and Equipment

	September 30,			December 31,
	2015			2014
Furniture and office equipment	$	520		$	401
Computer hardware and software		2,033			837
Laboratory equipment		2,511			1,427
Tooling and molds		1,237			1,237
Leasehold improvements		574			494
	$	6,875		$	4,396
Less accumulated depreciation and amortization		(3,447	)		(2,768	)
Property and equipment in progress		227			102
Total	$	3,655		$	1,730

Schedule of Other Non-Current Assets

Other Non-Current Assets

	September 30,		December 31,
	2015		2014
Security deposit on operating lease	$	34	$	19
Deferred offering costs		—		1,698
Total	$	34	$	1,717

Schedule of Accrued Expenses

Accrued Expenses

	September 30,		December 31,
	2015		2014
Compensation and commissions payable	$	4,915	$	3,001
Royalty payable		1,527		1,537
Other accrued expenses		1,021		546
Total	$	7,463	$	5,084