Fair Value Measurements

9 Months Ended

Sep. 30, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 3 – Fair Value Measurements

The FASB Codification defines fair value, and establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy under the FASB Codification are: Level 1 – valuations that are based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date; Level 2 – valuations that are based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly; and Level 3 – valuations that require inputs that are both significant to the fair value measurement and unobservable.

Cash and cash equivalents, which primarily include money market mutual funds were $12.7 million and $30.0 million as of September 30, 2022 and December 31, 2021, respectively. Marketable securities, which primarily include U.S. Treasuries and corporate bonds, were $18.3 million and zero as of September 30, 2022 and December 31, 2021, respectively. As of September 30, 2022, our assets that are measured at fair value on a recurring basis included the following (in thousands):

	Fair Value Measurement at September 30, 2022 Using:
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Total
	(Level 1)		(Level 2)		(Level 3)
Assets
Money market funds (included in    cash and cash equivalents)	$	11,051	$	—	$	—	$	11,051
Marketable securities		18,315		—		—		18,315
Note receivable		-		—		2,570		2,570
Total assets	$	29,366	$	—	$	2,570	$	31,936
Liabilities
Contingent acquisition payment	$	—	$	—	$	919	$	919
Total liabilities	$	—	$	—	$	919	$	919

Our investments in marketable securities are classified as available-for-sale and are carried at fair value, with the unrealized gains and losses, net of tax, reported as a component of accumulated other comprehensive loss in stockholders' equity

The investment in the note receivable was negotiated on an arm’s length basis and the total carrying value of the investment of $2.6 million is representative of the fair value of the investment as of September 30, 2022 due to there being no changes in the underlying assumptions of the note receivable. The fair value of our contingent acquisition payment was determined using a Monte Carlo simulation and there was no change in fair value from the initial recording date (acquisition date) to September 30, 2022 or December 31, 2021 due to no change in forecasted revenue and a di minimis impact from the present value factor.

Marketable securities by security type consisted of the following (in thousands):

	September 30, 2022:
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury notes and bonds	$	14,534	$	5	$	(128	)	$	14,411
Corporate bonds		3,951		—		(47	)		3,904
	$	18,485	$	5	$	(175	)	$	18,315

Changes in Note receivable consisted of the following (in thousands):

	Nine Months Ended
	September 30, 2022
	Amortized Cost
Balance as of December 31, 2021	$	—
Investment in Note Receivable		2,500
Accrued Interest		70
Balance as of September 31, 2022	$	2,570

As of December 31, 2021, our assets that are measured at fair value on a recurring basis included the following (in thousands):

	Fair Value Measurement at December 31, 2021 Using:
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)
Assets
Money market funds (included in    cash and cash equivalents)	$	28,952	$	—	$	—
Liabilities
Contingent acquisition payment	$	—	$	—	$	919

The fair value of our contingent acquisition payment was determined using a Monte Carlo simulation and there was no change in fair value from the initial recording date (acquisition date) to December 31, 2021 due to the proximity of the acquisition to year-end.