Strategic investments

6 Months Ended

Jun. 30, 2022

Investments, All Other Investments [Abstract]

Strategic investments

6. Strategic investments

In the fiscal year ended December 31, 2021, the Company made a strategic investment of $10.0 million in cash for preferred shares of privately held online education platform technology company. On February 28, 2022, the Company completed the second tranche purchase of this investment, which resulted in an incremental cash investment of $5.0 million, for a total value of $15.0 million. The estimation of fair value for this investment requires the use of significant unobservable inputs, and as a result, the Company classifies this investment as Level 3 within the fair value hierarchy.

The carrying value of this investment is adjusted based on price changes from observable transactions of identical or similar securities of the same issuer (referred to as the measurement alternative) or for impairment. Any changes in carrying value are recorded within other expense, net in the condensed consolidated statements of operations. As of June 30, 2022, there have been no observable transactions that would cause the Company to adjust the carrying amount of the investment, resulting in no realized or unrealized gains or losses for the three and six months ended June 30, 2022.

The Company evaluates this investment for impairment at each reporting period. This evaluation consists of several potential qualitative and quantitative impairment indicators including, but not limited to, the investee's financial metrics, whether there were any significant adverse changes in the economic environment or general market conditions of the geographies and industries in which the investee operates, and any other publicly available information that may affect the value of the investment. Based on the assessment performed as of June 30, 2022, the Company did not recognize any impairment losses during the three and six months ended June 30, 2022.

The Company did not own any strategic investments during the three and six months ended June 30, 2021.