Fair Value Measurements

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The following table sets forth the fair value of our financial assets and liabilities by level within the fair value hierarchy:

	December 31, 2019
	Level 1		Level 2		Level 3		Fair Value
	(in thousands)
Assets
Cash equivalents:
Money market funds	$	130,640	$	—	$	—	$	130,640
Short-term investment:
Certificates of deposit	150,000		—		—		150,000
Total assets at fair value	$	280,640	$	—	$	—	$	280,640
Liabilities
Other current liabilities—contingent consideration	$	—	$	—	$	3,004	$	3,004
Other noncurrent liabilities—contingent consideration	—		—		2,411		2,411
Total liabilities at fair value	$	—	$	—	$	5,415	$	5,415

	December 31, 2018
	Level 1		Level 2		Level 3		Fair Value
	(in thousands)
Assets
Cash equivalents:
Money market funds	$	96,681	$	—	$	—	$	96,681
Total assets at fair value	$	96,681	$	—	$	—	$	96,681
Liabilities
Other current liabilities—contingent consideration	$	—	$	—	$	1,316	$	1,316
Other noncurrent liabilities—contingent consideration	—		—		3,688		3,688
Total liabilities at fair value	$	—	$	—	$	5,004	$	5,004

Cash, Cash Equivalents and Short-term Investments

Our valuation techniques used to measure the fair value of money market funds are derived from quoted prices in active markets for identical assets or liabilities. Short-term investments, which consist of certificates of deposit with a maturity of twelve months or less, are classified as Level 2 financial assets as such are valued using quoted market price and other observable inputs in active markets for identical securities.

Cash, cash equivalents and short-term investments were as follows (in thousands):

	December 31, 2019
	Adjusted Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
Cash	$	111,098	$	—	$	—	$	111,098
Money market funds	130,640		—		—		130,640
Total cash, and cash equivalents	$	241,738	$	—	$	—	$	241,738
Certificates of deposit	$	150,000	$	—	$	—	$	150,000
Total short-term investments	$	150,000	$	—	$	—	$	150,000
Total cash, cash equivalents and short-term investments	$	391,738	$	—	$	—	$	391,738

	December 31, 2018
	Adjusted Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
Cash	$	12,247	$	—	$	—	$	12,247
Money market funds	96,681		—		—		96,681
Total cash and cash equivalents	$	108,928	$	—	$	—	$	108,928

Contingent Consideration Liability

In connection with the Retrofit Acquisition in April 2018, we recorded a contingent consideration liability, which is payable subject to the achievement of certain targets for 2018, 2019, and 2020. In connection with the myStrength Acquisition in February 2019, we recorded a contingent liability, which is payable subject to the achievement of certain targets for 2019. The fair values of these contingent consideration liabilities were estimated with a Monte Carlo simulation model using Level 3 inputs, including projected qualified members, revenue volatility, and other market variables to assess the probability of us achieving the targets, and any subsequent changes in fair value are recorded in the consolidated statements of operations until settlement. See Note 4 for further discussion.

The following table sets forth the changes in our Level 3 financial liabilities during the periods presented:

	Year Ended December 31,
	2019			2018
	(in thousands)
Beginning balance	$	5,004		$	—
Contingent consideration recorded upon acquisition (Note 4)	3,300			6,204
Change in fair value of contingent consideration liabilities (Note 4)	843			(1,200		)
Payment related to Retrofit contingent consideration (Note 4)	(1,316		)	—
Payment related to myStrength contingent consideration (Note 4)	(2,416		)	—
Ending balance	$	5,415		$	5,004