Revenue

12 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

The Company derives revenue primarily through the delivery of various types of services, including: customer acquisition, managed services and software as a service (“SaaS”). The Company recognizes revenue when the promised goods or services are transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services. The Company has elected the practical expedient to not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which revenue is recognized in the amount to which the Company has the right to invoice for services performed.

The Company has organized its operations into three reportable segments: Brand Direct, Marketplace and Technology Solutions. The Brand Direct reportable segment consists of services delivered against our customer’s brand, while the Marketplace reportable segment includes services delivered directly against the DMS brand. In the Technology Solutions reportable segment, services offered by the Company include software services and digital media services that are managed on behalf of the customer. Corporate and other represents other business activities and includes eliminating entries. Management uses these segments to evaluate the performance of its businesses and to assess its financial results and forecasts.

Disaggregation of Revenue

The following tables presents the disaggregation of revenue by reportable segment and type of service (in thousands):

	Year Ended December 31, 2023
	Brand Direct		Marketplace		Technology Solutions		Intercompany Eliminations		Total
Net revenue:
Customer acquisition	$	200,551	$	149,782	$	—	$	(27,632)	$	322,701
Managed services	3,905		—		2,294		—		6,199
Software services	—		—		6,049		—		6,049
Total Net revenue	$	204,456	$	149,782	$	8,343	$	(27,632)	$	334,949

	Year Ended December 31, 2022
	Brand Direct		Marketplace		Technology Solutions		Intercompany Eliminations		Total
Net revenue:
Customer acquisition	$	198,873	$	216,385	$	—	$	(39,284)	$	375,974
Managed services	5,367		—		4,814		—		10,181
Software services	—		—		4,993		—		4,993
Total Net revenue	$	204,240	$	216,385	$	9,807	$	(39,284)	$	391,148

The Company generated revenue outside the United States through its 2023 ClickDealer acquisition. The following table represents these revenues by region (in thousands):

	Year Ended December 31, 2023
Europe	$	17,376
Other International	10,109

Accounts Receivable, net

Accounts receivable are recorded at the invoiced amount and do not bear interest. The Allowance for credit losses is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on historical write-off experience, delinquency trends and current credit conditions. The Company reviews its Allowance for credit losses monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. All other balances are reviewed on a pooled basis. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure related to its customers.

The activity in the Allowance for credit losses related to accounts receivable is as follows (in thousands):

Balance, January 1, 2022	$	4,930
Additions charged to expense	1,761
Deductions/write-offs	(2,035)
Balance, December 31, 2022	4,656
Additions charged to expense	2,050
Deductions/write-offs	(2,240)
ASU 2016-13 (Topic 326) adjustment	(294)
Balance, December 31, 2023	$	4,172

For the years ended December 31, 2023 and 2022, one advertising customer within the Marketplace segment accounted for approximately 14.1% and 23.2% of our total revenue, respectively.

For the year ended December 31, 2023, bad debt expense was $4.1 million, including the establishment of allowance for credit losses related to contract assets as described below. For the year ended December 31, 2022, bad debt expense was $1.8 million.

Contract balances

Contract Assets

The Company’s contract assets primarily result from the estimated variable consideration for commissions to be received from insurance distributors for performance obligations that have been satisfied. In addition, other contract assets with clients where the performance obligations have been satisfied in advance of the contractual terms with the customer are also recorded as contract assets. The Company recognizes revenue when the performance obligation is met and the contract asset is recorded within the consolidated balance sheets as current assets and long term assets, where applicable. Related to commission revenue, the Company collects the consideration payments in equal installments over the lifetime-value of the underlying insurance policy, beginning collections on or after 90 days after the policy becomes effective, which can be up to several months after the Company’s performance obligation is met. From time to time, the Company may also record bonuses based on certain criteria set forth by the insurance distributor.

Contract assets as of December 31, 2023 are as follows (in thousands):

Contract assets - current, net	$	6,467
Contract assets - non-current, net	1,632
Total Contract assets	$	8,099

There were no contract assets as of December 31, 2022.

The activity in the contract assets is as follows (in thousands):

Balance, January 1, 2023	$	—
Additions recorded as revenue	10,622
Collections	(186)
Changes to Allowance for Credit Losses	(2,337)
Balance, December 31, 2023	$	8,099

Contract Liabilities

The Company’s contract liabilities result from payments received from clients in advance of revenue recognition as they precede the Company’s satisfaction of the associated performance obligation. If a customer pays consideration before the Company’s performance obligations are satisfied, such amounts are classified as deferred revenue and recorded within Accrued expenses and other current liabilities on the consolidated balance sheets. As of December 31, 2023 and 2022, the balance of deferred revenue was $1.0 million and $1.0 million, respectively. We expect the majority of the deferred revenue balance at December 31, 2023 to be recognized as revenue during the following quarter.

When there is a delay between the completion of our performance obligations and when a customer is invoiced, revenue is recognized and recorded as unbilled revenue (i.e. contract assets) within Accounts receivable, net on the consolidated balance sheets.