Other Assets

12 Months Ended

Dec. 31, 2023

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Other Assets

Other Assets

Investments in Convertible Debt

In January 2021, the Company purchased two convertible debt securities (the “January 2021 Notes”) for a total aggregate investment of $500 with maturity dates of January 1, 2023 and annual interest rates of 6%. In February 2022, the Company purchased an additional convertible debt security (the “February 2022 Note”) in the amount of $2,000 with a maturity date of February 25, 2024, and annual interest rate of 6%. Interest accrues on each note and becomes payable upon conversion of each convertible note, or will be paid in connection with the repayment in full of the principal amount of such convertible notes. During 2022, the Company performed a periodic evaluation of the investee and determined that it was unlikely that one of the January 2021 Notes would be repaid due to degrading financial results. The Company determined that the carrying value of the note exceeded its fair value and recorded a decrease in the fair value of the note of $250 during the year ended December 31, 2022.

In March 2023, the Company purchased a convertible debt security (the “March 2023 Note”) for a total aggregate investment of $326. The March 2023 Note receives interest at an annual rate of 9% and matures on March 31, 2025. During 2023, the Company performed a periodic review of the operations of the investee and determined that the carrying value of the Note exceeded its fair value due to degrading progress in operations. Accordingly, the Company recorded a decrease in the fair value of the March 2023 Note of $326 for the year ended December 31, 2023.

These convertible debt securities are classified as available-for-sale securities. On December 1, 2023, the Company converted the remaining January 2021 Note and the February 2022 Note in connection with the acquisition of Datos Inc. (See Note 9). As of December 31, 2023, the Company does not have any convertible debt securities recorded on the consolidated balance sheet. As of December 31, 2022, these Notes were included in prepaid expenses and other current assets in the accompanying consolidated balance sheets based on the maturity dates. The Company accounts for these investments, along with the embedded derivatives associated with their conversion features, by utilizing the fair value option within ASC 825, Financial Instruments (“ASC 825”), and accounting for the entire hybrid instrument at fair value through other income (expense). The Company recorded an increase in the fair value of convertible notes of $3,552 and $1,152 for the years ended December 31, 2023 and 2022, respectively.

With respect to its investments in these convertible debt securities prior to conversion, the Company held a variable interest in the issuer of these securities, which was a variable interest entity. After evaluation of the relationship between the Company and this variable interest entity, the Company determined not to consolidate this variable interest entity’s results of operations for the years ended December 31, 2022, and 2021. Significant judgments included the determination that this variable interest entity lacked sufficient equity at risk to finance its activities without additional subordinated support, and that the Company was not the primary beneficiary of the variable interest entity given the Company’s variable interests did not constitute a controlling financial interest. Upon conversion of the convertible debt securities, and in connection with the Company’s acquisition of Datos Inc. (See Note 9), the Company consolidated the Datos Inc. financial statements into the Company’s consolidated financial statements starting on the acquisition date of December 1, 2023.