Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2018

Schedule of the assets and liabilities measured at fair value on a recurring basis

Assets and Liabilities Measured at Fair Value on a Recurring Basis



	June 30, 2018								December 31, 2017
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Money market funds(1)	$	49,233	$	—	$	—	$	49,233	$	53,853	$	—	$	—	$	53,853
Total assets	$	49,233	$	—	$	—	$	49,233	$	53,853	$	—	$	—	$	53,853
Liabilities:
Contingent consideration on acquisition liability(2)	$	—	$	—	$	1,443	$	1,443	$	—	$	—	$	—	$	—
Total liabilities	$	—	$	—	$	1,443	$	1,443	$	—	$	—	$	—	$	—

(1)

Money market funds are included within cash and cash equivalents in the Company’s consolidated balance sheets. As short-term, highly liquid investments readily convertible to known amounts of cash, the Company’s money market funds have carrying values that approximates its fair value. Amounts above do not include $15,717 and $22,467 of operating cash balances as of June 30, 2018 and December 31, 2017, respectively.

(2)

On June 8, 2018, the Company acquired all of the outstanding shares of SlimCut. In connection with the acquisition, the former stockholders of SlimCut are eligible to receive future cash payments contingent on the operating performance of SlimCut in reaching certain financial milestones. In estimating the fair value of the contingent consideration on the date of acquisition, the Company used a Monte-Carlo valuation model based on future expectations on reaching financial milestones, other management assumptions (including operating results, business plans, anticipated future cash flows, and marketplace data), and the weighted-probabilities of possible payments. These assumptions were based on significant inputs not observed in the market and, therefore, represent a Level 3 measurement. Subsequent to the date of acquisition, the Company re-measured the estimated fair value of the contingent consideration as of June 30, 2018 with no material change in the estimated fair value of the contingent consideration. Any changes in the unobservable inputs could significantly impact the estimated fair value of the contingent consideration.

Schedule of reconciliation of liabilities measured on recurring basis using unobservable inputs

Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)



	2018

Beginning Balance at January 1, 2018	$	—
Contingent consideration (SlimCut Acquisition)	1,443
Mark-to-market(1)	—
Balance as of June 30, 2018	$	1,443

(1)

As of June 30, 2018, there is no mark-to-market expense incurred based on the Company’s re-measurement of the estimated fair value of the contingent consideration relating to the acquisition of SlimCut. Amounts recorded as mark-to-market expense relating to Level 3 instruments are recorded in operating expense. Refer to the table above regarding assumptions used for Level 3 instruments, and note 4 for further discussion of contingent consideration payments owed in connection with the Company’s acquisition of SlimCut.