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Document and Entity Information Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Jan. 31, 2018
Class of Stock [Line Items]
Entity Registrant Name	Bandwidth Inc.
Entity Central Index Key	0001514416
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float	$ 96.2
Common Class A
Class of Stock [Line Items]
Entity Common Stock, Shares Outstanding		4,197,831
Common Class B
Class of Stock [Line Items]
Entity Common Stock, Shares Outstanding		13,441,976

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 37,627	$ 6,788
Accounts receivable, net of allowance for doubtful accounts	21,225	16,838
Prepaid expenses and other current assets	3,767	2,318
Deferred costs	2,633	2,099
Total current assets	65,252	28,043
Property and equipment, net	14,946	11,180
Intangible assets, net	7,643	8,482
Deferred costs, non-current	2,068	1,696
Other long-term assets	1,192	1,011
Goodwill	6,867	6,867
Deferred tax asset	6,526	12,694
Total assets	104,494	69,973
Current liabilities:
Accounts payable	3,025	4,688
Accrued expenses and other current liabilities	15,633	14,649
Current portion of deferred revenue and advanced billings	5,768	4,032
Line of credit, current portion	0	5,000
Current portion of long-term debt and capital lease obligations	92	2,101
Total current liabilities	24,518	30,470
Other liabilities	716	609
Deferred revenue, net of current portion	2,549	1,712
Long-term debt and capital lease obligations, net of current portion	0	37,738
Total liabilities	27,783	70,529
Redeemable convertible preferred stock:
Redeemable convertible preferred stock	0	21,818
Commitments and contingencies
Stockholders’ deficit:
Preferred stock	0	0
Additional paid-in capital	102,465	9,356
Accumulated deficit	(25,771)	(31,742)
Total stockholders’ deficit	76,711	(22,374)
Total liabilities, redeemable convertible preferred stock and stockholders’ deficit	104,494	69,973
Common Class A
Stockholders’ deficit:
Class A and Class B common stock	4	0
Common Class B
Stockholders’ deficit:
Class A and Class B common stock	13	0
Old Common Class A
Stockholders’ deficit:
Class A and Class B common stock	0	12
Old Common Class B
Stockholders’ deficit:
Class A and Class B common stock	$ 0	$ 0

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2017	Nov. 09, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Mar. 24, 2011	Feb. 22, 2011	Jan. 01, 2010
Series A redeemable convertible preferred stock, par value (in usd per share)	$ 0.001		$ 0.001			$ 30.8358	$ 30.8358
Series A redeemable convertible preferred stock, shares authorized (in shares)	1,200,000		1,200,000				1,200,000	5,000,000
Series A redeemable convertible preferred stock, shares issued (in shares)	0		710,000			46,093	663,907
Series A redeemable convertible preferred stock, shares outstanding (in shares)	0		710,000	710,000	710,000
Preferred A stock, par value (in usd per share)	$ 0.001		$ 0.001
Preferred A stock, shares authorized (in shares)	10,000,000		10,000,000
Preferred A stock, shares issued (in shares)	0		0
Preferred A stock, shares outstanding (in shares)	0		0
Common stock, par value (in usd per share)		$ 0.001
Common stock, shares authorized (in shares)		120,000,000
Old Common Class B
Common stock, par value (in usd per share)	$ 0.001		$ 0.001
Common stock, shares authorized (in shares)	0		3,341,275
Common stock, shares issued (in shares)	0		18,590
Common stock, shares outstanding (in shares)	0		18,590
Common Class A
Common stock, par value (in usd per share)	$ 0.001		$ 0.001
Common stock, shares authorized (in shares)	100,000,000	100,000,000	0
Common stock, shares issued (in shares)	4,197,831		0
Common stock, shares outstanding (in shares)	4,197,831		0
Old Common Class A
Common stock, par value (in usd per share)	$ 0.001		$ 0.001
Common stock, shares authorized (in shares)	0		20,000,000
Common stock, shares issued (in shares)	0		11,779,975
Common stock, shares outstanding (in shares)	0		11,779,975
Common Class B
Common stock, par value (in usd per share)	$ 0.001		$ 0.001
Common stock, shares authorized (in shares)	20,000,000	20,000,000	0
Common stock, shares issued (in shares)	13,440,725		0
Common stock, shares outstanding (in shares)	13,440,725		0

Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenue:
CPaaS revenue	$ 131,572	$ 117,078	$ 101,502
Other revenue	31,383	35,057	36,299
Total revenue	162,955	152,135	137,801
Cost of revenue:
CPaaS cost of revenue	75,859	71,218	64,760
Other cost of revenue	13,403	14,000	14,482
Total cost of revenue	89,262	85,218	79,242
Gross profit	73,693	66,917	58,559
Operating expenses:
Research and development	10,789	8,520	7,375
Sales and marketing	11,218	9,294	8,620
General and administrative	37,069	33,859	34,602
Total operating expenses	59,076	51,673	50,597
Operating income	14,617	15,244	7,962
Other expense:
Interest expense, net	(1,728)	(908)	(589)
Total other expense	(1,728)	(908)	(589)
Income from continuing operations before income taxes	12,889	14,336	7,373
Income tax (provision) benefit	(6,918)	11,094	(408)
Income from continuing operations	5,971	25,430	6,965
Loss from discontinued operations, net of income taxes	0	(3,072)	(13,665)
Net (loss) income	5,971	22,358	(6,700)
Total comprehensive (loss) income	5,971	22,358	(6,700)
Less: income allocated to participating securities	644	3,355	931
Income from continuing operations attributable to common stockholders	$ 5,327	$ 22,075	$ 6,034
Income (loss) from continuing operations per share:
Basic (in usd per share)	$ 0.42	$ 1.89	$ 0.52
Diluted (in usd per share)	$ 0.37	$ 1.72	$ 0.48
Less: (loss) income allocated to participating securities	$ 644	$ 2,950	$ (896)
Net (loss) income attributable to common stockholders	$ 5,327	$ 19,408	$ (5,804)
Net (loss) income per share:
Basic (in usd per share)	$ 0.42	$ 1.66	$ (0.50)
Diluted (in usd per share)	$ 0.37	$ 1.51	$ (0.47)
Weighted average number of common shares outstanding:
Basic (in shares)	12,590,221	11,678,568	11,497,727
Diluted (in shares)	14,543,170	12,870,632	12,456,540

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Operating activities
Net (loss) income	$ 5,971	$ 22,358	$ (6,700)
Loss from discontinued operations, net of income taxes	0	3,072	13,665
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Depreciation and amortization	5,712	6,142	7,075
Amortization of debt issuance costs	376	52	49
Stock-based compensation	1,803	1,370	3,493
Deferred taxes	6,168	(11,086)	304
Loss on disposal of property and equipment	91	19	382
Impairment of intangible asset	0	695	0
Changes in operating assets and liabilities:
Accounts receivable	(4,387)	(4,043)	(533)
Prepaid expenses and other assets	(1,622)	(848)	(570)
Deferred costs	(906)	(975)	2,877
Accounts payable	(2,429)	243	1,041
Accrued expenses and other liabilities	1,273	(567)	(2,540)
Deferred revenue and advanced billings	2,573	510	108
Net cash provided by operating activities from continuing operations	14,623	16,942	18,651
Net cash used in operating activities from discontinued operations	0	(11,788)	(22,460)
Net cash (used in) provided by operating activities	14,623	5,154	(3,809)
Investing activities
Purchase of property and equipment	(5,021)	(3,831)	(2,091)
Capitalized software development costs	(2,942)	(2,230)	(3,011)
Net cash used in investing activities from continuing operations	(7,963)	(6,061)	(5,102)
Net cash used in investing activities from discontinued operations	0	(1,311)	(860)
Net cash used in investing activities	(7,963)	(7,372)	(5,962)
Financing activities
Borrowings on line of credit	4,000	56,950	43,500
Repayments on line of credit	(9,000)	(68,950)	(32,500)
Payments on capital leases	(73)	(102)	(155)
Borrowings on term loan	0	40,000	0
Repayments on term loan	(40,000)	0	0
Payment of debt issuance costs	(25)	(554)	(52)
Payment of costs related to the initial public offering	(5,385)	0	0
Proceeds from the initial public offering, net of underwriting discounts	74,400	0	0
Proceeds from issuances of common stock	174	974	129
Proceeds from exercises of warrants	91	150	0
Cash distribution to Republic	0	(30,000)	0
Decrease (increase) in restricted cash	(3)	479	116
Net cash provided by (used in) financing activities from continuing operations	24,179	(1,053)	11,038
Net increase (decrease) in cash and cash equivalents	30,839	(3,271)	1,267
Cash and cash equivalents, beginning of period	6,788	10,059	8,792
Cash and cash equivalents, end of period	37,627	6,788	10,059
Supplemental disclosure of cash flow information
Cash paid during the year for interest	1,535	1,314	1,103
Cash paid for taxes	855	6	73
Supplemental disclosure of noncash financing activities
Non-cash distribution of net liabilities to Spin-Off	0	1,101	0
Acquisition of equipment through capital leases	$ 0	$ 132	$ 32

Consolidated Statements of Changes in Redeemable Preferred Stock and Stockholders' (Deficit) Equity - USD ($) $ in Thousands	Total	Conversion of Series A preferred stock to Old Class A voting common stock	Class A voting common Stock	Class B voting common Stock	Old Class A voting common Stock	Old Class B non-voting common Stock	Common stock Class A voting common Stock	Common stock Class A voting common Stock Conversion of Old Class B non-voting common stock to Class A voting common stock	Common stock Class A voting common Stock Conversion of Class B voting common stock to Class A voting common stock	Common stock Class B voting common Stock	Common stock Class B voting common Stock Conversion of Class B voting common stock to Class A voting common stock	Common stock Old Class A voting common Stock	Common stock Old Class A voting common Stock Conversion of Series A preferred stock to Old Class A voting common stock	Common stock Old Class B non-voting common Stock	Common stock Old Class B non-voting common Stock Conversion of Old Class B non-voting common stock to Class A voting common stock	Additional paid-in capital	Additional paid-in capital Conversion of Series A preferred stock to Old Class A voting common stock	Additional paid-in capital Old Class A voting common Stock	Additional paid-in capital Old Class B non-voting common Stock	Accumulated deficit
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2014	710,000
Series A redeemable convertible preferred stock, beginning balance at Dec. 31, 2014	$ 21,818
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2015	710,000
Series A redeemable convertible preferred stock, ending balance at Dec. 31, 2015	$ 21,818
Common stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2014							0			0		11,455,615		14,060
Beginning balance at Dec. 31, 2014	(16,748)						$ 0			$ 0		$ 12		$ 0		$ 31,060				$ (47,820)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)												69,405		4,530
Issuance of common stock					$ 113	$ 48												$ 113	$ 48
Exercise of warrants to purchase common stock (in shares)												17,138
Stock-based compensation	4,213															4,213
Net (loss) income	(6,700)																			(6,700)
Common stock, shares outstanding, ending balance (in shares) at Dec. 31, 2015							0			0		11,542,158		18,590
Ending balance at Dec. 31, 2015	(19,074)						$ 0			$ 0		$ 12		$ 0		35,434				(54,520)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cumulative effect of change in accounting principle	$ 420																			420
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2016	710,000
Series A redeemable convertible preferred stock, ending balance at Dec. 31, 2016	$ 21,818
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)												218,345
Issuance of common stock	1,111															1,111
Exercise of warrants to purchase common stock (in shares)												19,472
Exercise of warrants to purchase common stock	150															150
Distribution of Republic	(28,899)															(28,899)
Shareholders’ anti-dilutive arrangement	(324)															(324)
Stock-based compensation	1,884															1,884
Net (loss) income	22,358																			22,358
Common stock, shares outstanding, ending balance (in shares) at Dec. 31, 2016			0	0	11,779,975	18,590	0			0		11,779,975		18,590
Ending balance at Dec. 31, 2016	$ (22,374)						$ 0			$ 0		$ 12		$ 0		9,356				(31,742)
Increase (Decrease) in Temporary Equity [Roll Forward]
Conversion of Series A preferred stock to Old Class A voting common stock (in shares)	(710,000)
Conversion of Series A preferred stock to Old Class A voting common stock	$ (21,818)
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2017	0
Series A redeemable convertible preferred stock, ending balance at Dec. 31, 2017	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)							4,000,000					31,510		16,250
Issuance of common stock	74,400				$ 94	$ 109	$ 4									74,396		$ 94	$ 109
Exercise of warrants to purchase common stock (in shares)										17,260
Exercise of warrants to purchase common stock	91															91
Stock-based compensation	1,803															1,803
Purchase of common stock (in shares)										(29)
Purchase of common stock	0
Conversion of stock (in shares)								34,840	162,991	13,586,485	(162,991)	(13,586,485)	1,775,000		(34,840)
Conversion of stock		$ 21,818			$ 0					$ 13		$ (13)	$ 1				$ 21,817
Costs in connection with initial public offering	(5,385)															(5,385)
Termination of Shareholders’ anti-dilutive arrangement	184															184
Net (loss) income	5,971																			5,971
Common stock, shares outstanding, ending balance (in shares) at Dec. 31, 2017			4,197,831	13,440,725	0	0	4,197,831			13,440,725		0		0
Ending balance at Dec. 31, 2017	$ 76,711						$ 4			$ 13		$ 0		$ 0		$ 102,465				$ (25,771)

Organization and Description of Business	12 Months Ended
Organization and Description of Business	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Description of Business	1. Organization and Description of Business Bandwidth Inc. (together with its subsidiaries, “Bandwidth” or the “Company”) was founded in July 2000 and incorporated in Delaware on March 29, 2001. The Company’s headquarters are located in Raleigh, North Carolina. The Company is a cloud-based, software-powered communications platform-as-a-service (“CPaaS”) provider that enables enterprises to create, scale and operate voice or text communications services across any mobile application or connected device. The Company has two operating and reportable segments, CPaaS and Other. CPaaS revenue is derived from usage and monthly services fees charged for usage of Voice, Messaging, 911 and Phone Numbers solutions through the Company’s proprietary CPaaS software application programming interfaces. Other revenue consists of fees charged for services provided such as: SIP trunking, data resale, and a hosted Voice-over Internet Protocol (“VoIP”). The Other segment also includes revenue from traffic generated by other carriers, SMS registration fees and other miscellaneous product lines. Initial Public Offering On November 9, 2017, the Company's Registration Statement on Form S-1 relating to the initial public offering (“IPO”) of its Class A common stock was declared effective by the SEC. Immediately prior to the closing of the IPO, the Company’s certificate of incorporation was amended such that (i) each share of the Company’s then-outstanding Class A voting common stock (“Old Class A common stock”) was reclassified as one share of Class B voting common stock (“Class B common stock”), which has ten votes per share, (ii) each share of the Company’s then-outstanding Class B non-voting common stock (“Old Class B common stock”) was reclassified as one share of Class A voting common stock ("Class A common stock"), which has one vote per share and (iii) options and warrants exercisable into the Company’s Old Class A common stock and Old Class B common stock became exercisable into Class B common stock and Class A common stock, respectively. In addition, immediately prior to pricing of the IPO, all shares of the Company’s then-outstanding Series A redeemable convertible preferred stock were converted into Old Class A common stock, which then converted into Class B common stock. In connection with the Company’s IPO, 4,000,000 shares of the Company's Class A common stock were sold at an initial public offering price of $20.00 per share for proceeds of approximately $74,400, net of underwriting discounts and commissions of $5,600. On November 14, 2017, the outstanding term loan of $38,500 was paid in full with proceeds from the IPO.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company had no components of other comprehensive income (loss) during any of the periods presented, as such, a consolidated statement of comprehensive income (loss) is not presented.

Reclassification

The Company reclassified certain prior year amounts to conform to the current year presentation. These reclassifications had no impact on the previously reported total assets, liabilities, stockholder's deficit or net income.

Principles of Consolidation

The consolidated financial statements include the accounts of Bandwidth Inc. and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the amounts reported in these financial statements and accompanying notes. Although the Company believes that the estimates it uses are reasonable, due to the inherent uncertainty involved in making these estimates, actual results reported in future periods could differ from those estimates. These estimates in the consolidated financial statements include, but are not limited to, allowance for doubtful accounts, recoverability of long lived and intangible assets, customer relationship period, valuation allowances on tax assets, certain accrued expenses, and contingencies.

Revenue Recognition

Revenue consists primarily of the sale of communications services offered through API software solutions to large enterprise, as well as small and medium-sized business, customers and are generally derived from usage and monthly service fees for both the CPaaS and Other segments. Usage revenue includes voice communication (primarily driven by inbound minutes, outbound minutes, toll-free minutes) and messaging communication (driven by the number of messages) that traverse the platform and network. Revenue for these services is recognized in the period the usage occurs. Monthly service fees include the provision and management of phone numbers and emergency services access, which is recognized as the service is provided. In addition, the Company earns Carrier Access Billings ("CABS") revenue by allowing interconnected telecommunication carriers to pass traffic through its network and, as such the Company is the principal in delivering communication services to such carriers. Due to the lack of timeliness of payments and the frequency of carrier disputes, the Company recognizes revenue related to this service only when collectability is probable.

When required as part of providing service, revenues and associated expenses related to nonrefundable, upfront service activation and setup fees are deferred and recognized over the longer of the associated service contract period or estimated customer life.

Revenue recognition commences when all of the following criteria are met (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the fee is fixed or determinable; and (iv) collection is probable. Customers generally enter into arrangements that are typically two to three years in length.

Cost of Revenue

CPaaS cost of revenue consists primarily of fees paid to other network service providers from whom the Company buys services such as minutes of use, phone numbers, messages, porting of customer numbers, and network circuits. Cost of revenue also contains costs related to the support of the network, web services and cloud infrastructure, capacity planning and management, rent for network facilities, software licenses, hardware and software maintenance fees, and network engineering services. Personnel costs (including non-cash stock-based compensation expenses) associated with personnel who are responsible for the delivery of services, operation and maintenance of the communications network, customer support, as well as, third party support agreements, and depreciation are also recorded as cost of revenue.

Other cost of revenue consists of amortization of capital software development costs related to platform applications supporting non-CPaaS services including circuit costs paid to third party providers, internet connectivity expenses, minutes of use, contractors, regulatory fees and surcharges, depreciation, and software and hardware maintenance fees.

Operating Expenses

Research and Development

Research and development expenses consist primarily of personnel costs (including non-cash stock-based compensation expenses), outsourced software development and engineering services and cloud infrastructure fees for staging and development outsourced engineering services.

Sales and Marketing

Sales and marketing expenses consist primarily of personnel costs, including commissions for sales employees and non-cash stock-based compensation expenses. Sales and marketing expenses also include expenditures related to advertising, marketing, brand awareness activities, sales support and professional services fees.

General and Administrative

General and administrative expenses consist primarily of personnel costs for support personnel and executives in accounting, finance, legal, information services, human resources and administrative functions. General and administrative expenses also include costs related to product management and reporting, data services, customer billing and collection functions, and other professional services fees, credit card processing fees, rent associated with the Company’s headquarters in Raleigh, North Carolina, depreciation and amortization.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original or remaining maturity of three months or less at the date of purchase, as well as overnight repurchase investments, to be cash equivalents.

Restricted Cash

The Company classifies any cash and cash equivalents that are currently restricted from use as restricted cash. As of December 31, 2016 and 2017, restricted cash is used to secure letters of credit issued in order to operate the CLEC, for Automated Clearing House availability, customer deposits and for credit card security. As of December 31, 2016 and 2017, restricted cash was $240 and $243, respectively. The Company has classified this asset as a long-term asset in order to match the expected period of restriction and is included in Other long-term assets in the consolidated balance sheets.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are stated at realizable value, net of an allowance for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of its customer accounts. The Company regularly reviews the composition of the accounts receivable aging, historical bad debts, changes in payment patterns, customer creditworthiness and current economic trends. If the financial condition of customers were to deteriorate, resulting in their inability to make required payments, additional provisions for doubtful accounts would be required and would increase bad debt expense. Management has evaluated the collectability of trade accounts receivable and determined that allowances of approximately $22,571 and $32,463 for uncollectible accounts and customer balances that are disputed were required as of December 31, 2016 and 2017, respectively. The allowance for doubtful accounts primarily relates to billings for CABS services where collectability was deemed not probable. Refer to Note 5, "Financial Statement Components," for a rollforward of the components of the allowance for doubtful accounts as of December 31, 2016 and 2017. Refer also to Note 17, "Subsequent Events," for discussion of the settlement agreement that was entered into subsequent to year-end that resolved the ongoing dispute and litigation with MCI Communications Services, Inc. d/b/a Verizon Business and Verizon Select Services, Inc. (collectively, “Verizon”), which is a CABS customer of the Company.

The Company includes unbilled receivables in its accounts receivable balance. Generally, these receivables represent services provided to customers, which will be billed in the next billing cycle. All amounts are considered collectible and billable. As of December 31, 2016 and 2017, unbilled receivables were $7,368 and $8,653, respectively.

Concentration of Credit Risk

Financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents and trade accounts receivable. Cash deposits may be in excess of insured limits. The Company believes that the financial institutions that hold its cash deposits are financially sound and, accordingly, minimal credit risk exists with respect to these balances.

With regard to customers, credit evaluation and account monitoring procedures are used to minimize the risk of loss. The Company believes that no additional credit risk beyond amounts provided for by the allowance for doubtful accounts are inherent in accounts receivable. No individual customer represented more than 10 percent of accounts receivable, net of allowance for doubtful accounts as of December 31, 2016. As of December 31, 2017, one customer represented approximately 13% of the Company's accounts receivable, net of allowance for doubtful accounts.

For the years ended December 31, 2015, 2016 and 2017, no individual customer represented more than 10 percent of the Company’s total revenue.

Property and Equipment, net

Property and equipment, net is stated at cost, less accumulated depreciation and amortization. Depreciation and amortization is calculated on a straight-line basis over the estimated useful lives of those assets as follows:



Computer hardware and software	2 to 5 years
Internal-use software development costs	3 years
Furniture and fixtures	2 to 7 years
Leasehold improvements	Shorter of the estimated lease term or useful life

Maintenance and repairs are charged to expense as incurred.

Deferred Costs

The Company defers certain direct and incremental upfront costs related to the generation of a revenue stream or obtaining a new customer agreement. These costs include installment fees, activation and other telecommunication fees. The Company capitalizes these costs and amortizes them over the longer of the term of the customer contracts or the estimated customer life, which is approximately three years.

Software Development Costs

The Company capitalizes qualifying internal-use software development costs that are incurred during the application development stage. Capitalization of costs begins when two criteria are met: (i) the preliminary project stage is completed and (ii) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. The Company also capitalizes costs related to specific upgrades and enhancements when the expenditures will result in additional functionality and expenses costs incurred for maintenance and minor upgrades and enhancements. Costs related to preliminary project activities and post-implementation operating activities are expensed as incurred.

Capitalized costs of platform and other software applications are included in property and equipment. These costs are amortized over the estimated useful life of the software on a straight-line basis over three years. Management evaluates the useful life of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets.

Debt Issuance Costs

The Company incurred debt issuance costs associated with obtaining and entering into a five-year Credit and Security Agreement in November 2016, which includes a revolving credit facility and a term loan. These costs include non-refundable structuring fees, commitment fees, up-front fees and syndication expenses, which have been deferred and are being amortized based on the effective interest method over the term of the Credit and Security Agreement. The debt issuance costs associated with the revolving credit facility are recorded as a deferred cost in the accompanying consolidated balance sheets. The unamortized debt issuance costs, which are included in prepaid expenses and other current assets in the accompanying consolidated balance sheets, were $200 and $175 as of December 31, 2016 and 2017, respectively. Debt issuance costs associated with the term loan were recognized as an adjustment of the yield of the loan and were reflected as a reduction of the long-term debt balance. As of December 31, 2016 and 2017, unamortized debt issuance costs were $326 and $0, respectively. On November 14, 2017, the term loan was paid in full and $260 of unamortized debt issuance costs were recorded as interest expense.

Goodwill

The Company reviews goodwill and indefinite-lived intangible assets at least annually, as of December 31, for possible impairment. Goodwill and indefinite-lived intangible assets are reviewed for possible impairment at an interim date if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit or indefinite-lived intangible asset below its carrying value. The Company tests goodwill at the reporting unit level and has determined that it has two-reporting units, CPaaS and Other. All Goodwill is allocated to the CPaaS reporting unit. Management may first evaluate qualitative factors to assess if it is more likely than not that the fair value of a reporting unit is less than its carrying amount and to determine if a two-step impairment test is necessary. Management may choose to proceed directly to the two-step evaluation, bypassing the initial qualitative assessment. The first step of the impairment test involves comparing the fair value of the reporting unit to its net book value, including goodwill. If the net book value exceeds its fair value, then the Company would perform the second step of the goodwill impairment test to determine the amount of the impairment loss. The impairment loss would be calculated by comparing the implied fair value of the goodwill to its net book value. In calculating the implied fair value of goodwill, the fair value of the entity would be allocated to all of the other assets and liabilities based on their fair values. The excess of the fair value of the entity over the amount assigned to other assets and liabilities is the implied fair value of goodwill. An impairment loss would be recognized when the carrying amount of goodwill exceeds its implied fair value.

The Company makes assumptions regarding estimated future cash flows, discount rates, long-term growth rates and market values to determine each reporting unit’s and indefinite-lived intangible asset’s estimated fair value. If these estimates or related assumptions change in the future, the Company may be required to record an impairment charge. As of December 31, 2016 and 2017, the Company has recorded goodwill of $6,867. No goodwill impairment charges were recorded for the years ended December 31, 2015, 2016 and 2017.

Impairment of Long-Lived Assets

The Company evaluates long-lived assets, including property and equipment and definite lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by a comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If such evaluation indicates that the carrying amount of the asset or the asset group is not recoverable, any impairment loss would be equal to the amount the carrying value exceeds the fair value.

Advertising Costs

The Company expenses advertising costs as incurred. Advertising costs totaled $329, $197 and $464 for the years ended December 31, 2015, 2016 and 2017, respectively, which are included in sales and marketing expenses in the accompanying consolidated statements of operations.

Commissions

Commissions consist of variable compensation earned by sales personnel and third-party resellers. Sales commissions associated with the acquisition of a new customer contract are recognized as sales and marketing expense at the time the customer has entered into a binding agreement.

Stock-Based Compensation

The Company accounts for stock-based compensation expense related to stock-based awards based on the fair value of the award on the grant date. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period, which is generally four years. The Company uses the Black-Scholes option pricing model, net of estimated forfeitures, to measure the fair value of its stock options.

The Black-Scholes option pricing model requires the use of objective and subjective assumptions, which determine the fair-value of stock-based awards. These assumptions include:

•

Fair value of our common stock. Prior to the Company's IPO, the fair value of the shares of the Company's common stock underlying stock options has historically been established by the board of directors. Numerous objective and subjective factors that were considered included, but were not limited to, the following: i) contemporaneous independent, third-party valuations of the Company's common stock; ii) the rights, preferences and privileges of the Company's redeemable convertible preferred stock relative to those of the Company's common stock; iii) the Company's results of operations, financial position and capital resources; iv) current business conditions and projections; v) the lack of marketability of the Company's common stock; vi) the hiring of key personnel and the experience of the Company's management; vi) the introduction of new products; vii) the risk inherent in the development and expansion of the Company's products; viii) the fact that the option grants involve illiquid securities in a private company; ix) the likelihood of achieving a liquidity event, such as an initial public offering or a sale of the Company, given the prevailing market conditions; x) industry trends and competitive environment; and xi) overall economic indicators, including gross domestic product, employment, inflation and interest rates. After the IPO, the Company uses the market closing price of its Class A common stock as reported on the NASDAQ Global Select Market for the fair value.


•	Expected term. The expected term was estimated using the simplified method allowed under SEC guidance as the Company does not have sufficient historical data to use any other method to estimate the expected term.


•	Expected volatility. The expected volatility is derived from an average of the historical volatilities of the common stock of several entities with characteristics similar to those of the Company, such as the size, and operational and economic similarities to its principle business operations. The Company uses this method because it has limited information on the volatility of its common stock.


•	Risk-free interest rate. The risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the options for each option group as of the grant date.


•	Expected dividends. The expected dividend is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock.

In addition to the assumptions used in the Black-Scholes option pricing model, the Company must also determine a forfeiture rate to calculate the stock-based compensation for awards. Through December 31, 2017, the Company recognized compensation for only the portion of options expected to vest using an estimated forfeiture rate that was derived from historical employee termination behavior. If any of the assumptions used in the Black-Scholes option pricing model change, stock-based compensation for future options may differ materially compared to that associated with previous grants.

Income Taxes

The Company accounts for income taxes under the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement and tax basis of assets and liabilities using enacted tax rates. The Company recognizes the effect of a change in tax rates on deferred tax assets and liabilities in the period that includes the enactment date.

The Company reduces the measurement of a deferred tax asset, if necessary, by a valuation allowance if it is more likely than not that it will not realize some or all the deferred tax asset. Quarterly, the Company reviews the deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing temporary differences and the implementation of prudent and feasible tax planning strategies. The evaluation of the recoverability of deferred tax assets requires judgment in assessing future profitability. Should there be a change in the ability to recover deferred tax assets, the Company’s income tax provision would increase or decrease in the period in which the assessment is changed.

The Company accounts for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon technical merits, it is more likely than not that the position will be sustained upon examination. The tax benefit recognized is measured as the largest amount of benefit determined on a cumulative probability basis that the Company believes is more likely than not to be realized upon ultimate settlement of the position. The Company recognizes potential accrued interest and penalties associated with unrecognized tax positions in income tax expense.

Operating Segments

Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to make operating decisions, allocate resources and in assessing performance. The Company has two operating segments, CPaaS and Other, which are deemed to be reportable segments. The Company’s CODM is its Chief Executive Officer. The CODM evaluates the performance of the Company’s operating segments primarily based on revenue and gross profit. The Company does not analyze discrete segment balance sheet information related to long-term assets, all of which are located in the United States. All other financial information is presented on a consolidated basis.

Earnings (Loss) per Share

Basic earnings (loss) per share attributable to common stockholders is calculated by dividing the net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period.

Diluted net income (loss) per share is calculated by giving effect to all potentially dilutive common stock when determining the weighted-average number of common shares outstanding. For purposes of the diluted net income (loss) per share calculation, options and warrants to purchase common stock and redeemable convertible preferred stock are considered to be potential common stock.

The Company has issued securities other than common stock that participate in dividends (“Participating Securities”), and therefore utilizes the two-class method to calculate net income (loss) per share. These Participating Securities include the Series A redeemable convertible preferred stock. The two-class method requires a portion of net income (loss) to be allocated to the Participating Securities to determine the net income (loss) attributable to common stockholders. Net income (loss) attributable to the common stockholders is equal to the net income (loss) less dividends paid on preferred stock with any remaining earnings allocated in accordance with the bylaws between the outstanding common and redeemable convertible preferred stock as of the end of each period. On November 9, 2017, the Participating Securities were converted into shares of Old Class A common stock, which converted to Class B common stock immediately prior to the IPO.

Emerging Growth Company Status

The Company is an “emerging growth company” as defined in the Jumpstart Our Business Startups Act (“JOBS Act”). The JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company has elected to avail itself of this extended transition period and, as a result, it will not adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies.

Recently Adopted Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The effective date of ASU 2016-09 for private business entities is for fiscal years beginning after December 15, 2017. Early adoption is permitted and the Company adopted the amendments in ASU 2016-09 effective January 1, 2016. This standard simplifies several aspects of the accounting for equity-based payment awards, including the income tax consequences and classification on the statement of cash flows. Certain changes implemented by this standard are required to be applied retrospectively, while other changes are required to be applied prospectively. The Company elected to continue to estimate forfeitures when recording stock-based compensation expense.

All excess tax benefits and tax deficiencies related to the year ended December 31, 2016 were recognized in income tax expense. Prior to the adoption of this standard, this amount would have been recorded as additional paid-in capital. This change could create future volatility in the Company’s effective tax rate depending upon the amount of exercise or vesting activity from stock based awards.

The recognition of previously unrecognized excess tax benefits of $420 was recognized as a cumulative effect adjustment on a modified retrospective basis during the year ended December 31, 2016. The Company recorded a deferred tax asset for previously unrecognized excess tax benefits outstanding as of the January 1, 2016, with an offsetting adjustment to accumulated deficit.

In addition, cash flows related to excess tax benefits will no longer be classified as a financing activity apart from other income tax cash flows. The Company has adopted the change in presentation of excess tax benefits in the statements of cash flows on a prospective basis beginning in 2016.

In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes (Topic 740), which requires that all deferred tax assets and liabilities, including any related valuation allowance, be classified as noncurrent on the balance sheet. ASU 2015-17 was effective for fiscal years beginning after December 15, 2016 for public entities, and early adoption is permitted. The Company elected to early adopt ASU 2015-17 beginning with the year ended December 31, 2015.

In April 2015, the FASB issued ASU 2015-05, Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. This new standard, which provides guidance to customers about whether a cloud computing arrangement includes a software license, was effective January 1, 2016. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The Company adopted this standard on January 1, 2016. The adoption of this standard did not have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, which simplifies the presentation of debt issuance costs by requiring that such costs be presented in the consolidated balance sheets as a direct deduction from the carrying value of the associated debt instrument, consistent with debt discounts. Subsequent to the issuance of ASU 2015-03, the SEC staff announced that the presentation of debt issuance costs associated with line-of-credit arrangements may be presented as an asset. This announcement was codified by the FASB in ASU 2015-15. These ASUs were effective for the year ended December 31, 2016, and the adoption did not have a material impact on the Company’s financial condition, results of operations or cash flows.

In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related disclosures. ASU 2014-15 was effective for the year ended December 31, 2016, and its adoption did not have a material impact on the Company’s financial condition, results of operations or cash flows.

Recent Accounting Pronouncements Not Yet Adopted

In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718), Scope of Modification Accounting, which amends the scope of modification accounting for share-based payment arrangements. The ASU provides guidance on the types of changes to terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718, Compensation-Stock Compensation. ASU 2017-09 is effective for fiscal years and interim periods within those years beginning after December 15, 2017, and early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the accounting for goodwill impairment. The ASU requires impairment charges to be based on the first step in today’s two-step impairment test. ASU 2017-04 is effective for annual and interim impairment tests performed in periods beginning after December 15, 2021, and early adoption is permitted. Management does not expect the adoption of this guidance to have any impact on the Company's financial position, results of operations, or cash flows.

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business, which amends the guidance of FASB Accounting Standards Codification Topic 805, “Business Combinations”, adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. This guidance is effective for annual and interim periods beginning after December 15, 2017, and early adoption is permitted under certain circumstances. The impact from the adoption of this standard is dependent upon future transactions.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments, which clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. ASU 2016-15 is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019, and early adoption is permitted. Entities will have to apply the guidance retrospectively, but if it is impracticable to do so for an issue, the amendments related to that issue would be applied prospectively. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU 2016-02, Leases. The standard will affect all entities that lease assets and will require lessees to recognize a lease liability and a right-of-use asset for all leases (except for short- term leases that have a duration of less than one year) as of the date on which the lessor makes the underlying asset available to the lessee. For lessors, accounting for leases is substantially the same as in prior periods. ASU 2016-02 is effective for fiscal years beginning after December 15, 2019, and interim periods within annual periods beginning after December 15, 2020, and early adoption is permitted. For leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, lessees and lessors must apply a modified retrospective transition approach. While the Company expects the adoption of this standard to result in an increase to the reported assets and liabilities, it has not yet determined the full impact the adoption of this standard will have on its financial statements and related disclosures.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” This new guidance will replace most existing GAAP guidance on this topic. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers: Deferral of the effective date,” which deferred by one year the effective date for the new revenue reporting standard for entities reporting under GAAP. In accordance with the deferral, this guidance will be effective for the Company beginning in the year ended December 31, 2019. This guidance can be applied either retrospectively to each period presented or as a cumulative effect adjustment as of the date of adoption. In December 2016, the FASB issued ASU 2016-20, “Revenue from Contracts with Customers, Technical Corrections and Improvements to Topic 606,” which made 12 additional technical corrections and improvements to the new revenue standard. In March 2016, the FASB issued ASU 2016-08, “Revenue from Contracts with Customers, Principal versus Agent Considerations (Reporting Revenue Gross versus Net)” clarifying the implementation guidance on principal versus agent considerations. Specifically, an entity is required to determine whether the nature of a promise is to provide the specified good or service itself (that is, the entity is a principal) or to arrange for the good or service to be provided to the customer by the other party (that is, the entity is an agent). The determination influences the timing and amount of revenue recognition. In April 2016, the FASB issued ASU 2016-10, “Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing”, clarifying the implementation guidance on identifying performance obligations and licensing. Specifically, the amendments reduce the cost and complexity of identifying promised goods or services and improve the guidance for determining whether promises are separately identifiable. The amendments also provide implementation guidance on accounting for an entity’s promise to grant a license. In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers, Narrow-Scope Improvements and Practical Expedients,” clarifying guidance on assessing collectability, presentation of sales taxes, noncash consideration, completed contracts and contract modifications. The effective date and transition requirements for ASU 2016-20, ASU 2016-08 and ASU 2016-10 are the same as the effective date and transition requirements for ASU 2014-09, which will be effective for the Company beginning January 1, 2019.

The Company is still assessing all potential impacts of the new standard on its consolidated financial statements. Given the comprehensive nature of the standard, the Company has already taken steps to identify the impact on its consolidated financial results. The Company has completed a diagnostic which highlighted potential differences between current accounting policies and the new standard. Additionally, the Company has engaged a third-party service provider to assist in its evaluation of customer contracts to identify the attributes that could result in a different accounting treatment under ASU 2014-09. From an information technology perspective, the Company identified the preliminary business requirements and functionality of a new technology solution and have selected a software provider. The Company has not yet reached a conclusion as to whether the quantitative effect of the adoption of the new standard on its revenue will be material. The Company will continue to monitor and assess the impact of the changes of the new standard and the related interpretations of its application as they become available.

Discontinued Operations

12 Months Ended

Dec. 31, 2017

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

3. Discontinued Operations

On April 20, 2015, the Company created a wholly owned subsidiary, Republic Wireless, Inc. (“Republic”), which was incorporated in Delaware. On November 30, 2016, the Company completed a pro-rata distribution of the common stock of Republic to its stockholders of record as of the close of business (the “Spin-Off”). Each of its stockholders received one share of Republic common stock for each share of Bandwidth common or redeemable convertible preferred stock held as of the close of business on November 30, 2016. Accordingly, the results of operations, financial condition and cash flows of Republic have been presented as discontinued operations for all periods presented in the accompanying consolidated financial statements.

The distribution was recorded at the carrying amount of Republic’s net liabilities of $1,101 as of November 30, 2016, as follows:



Assets
Accounts receivable, net of allowance for doubtful accounts	$	1,199
Inventory	7,305
Prepaid expenses and other current assets	2,540
Total current assets	11,044
Property and equipment, net	1,898
Other long-term assets	196
Total assets	$	13,138



Liabilities
Accounts payable	$	7,126
Accrued expenses	3,662
Deferred revenue	3,310
Total current liabilities	14,098
Other long-term liabilities	141
Total liabilities	$	14,239
Net liabilities of Republic	$	1,101

In addition, the Company distributed $30,000 in cash to Republic in connection with the Spin-Off. Accordingly, the net assets distributed to the stockholders in connection with the Spin-Off was $28,899. Bandwidth has not otherwise provided nor does it intend to provide financial support to Republic.

Given the nature of the Spin-Off transaction, the equity holders of Bandwidth are comprised of substantially the same individuals and entities that are the equity owners of Republic. The Company determined the equity owners of Republic are related parties of Bandwidth. As described in Note 15, the Company has certain involvement with Republic via ongoing services arrangements, with these ongoing services arrangements creating a variable interest in Republic. The Company assessed the relationship with Republic under guidance for variable interest entities, and because investors in Republic have disproportionate voting rights, the Company concluded that Republic is a variable interest entity (“VIE”).

Republic is a provider of Wi-Fi centric mobile services directly to retail consumers. Bandwidth determined it is not the primary beneficiary of Republic, as Bandwidth and its related parties do not individually have power to direct the activities that most significantly impact Republic’s economic performance and power is not shared. Bandwidth’s involvement with Republic involves providing certain support services through the Transition Services Agreement, which does not give it power over key activities. Key activities are directed by the Board of Directors Republic, which require majority approval. Bandwidth does not have direct representation on the Board of Republic and is not able to exert power over its key activities. Bandwidth does not have an implicit variable interest in Republic. Republic is financed primarily through the cash distribution in connection with the Spin-off and its own ongoing operations.

The Company’s maximum exposure to loss relating to this variable interest entity is limited to amounts due under the service agreements between Bandwidth and Republic as described in Notes 12, "Commitments and Contingencies" and 15, "Related Parties".

The Spin-Off represented a strategic shift to Bandwidth’s business. The Company believes that for US Federal income tax purposes, the Spin-Off will qualify as tax-free for Republic, Bandwidth and its stockholders. The Company entered into a tax sharing agreement with Republic that governs rights and obligations after the Spin-Off regarding income taxes and other taxes, including tax liabilities and benefits, attributes, returns and contests.

The table below provides the operating results of the discontinued operations through the date of the Spin-Off for the years ended December 31, 2016:



	Year Ended December 31,
	2015			2016

Revenue	$	91,304		$	83,156
Direct costs of network services and equipment	(78,922		)	(61,582		)
Operating expense	(24,692		)	(25,502		)
Depreciation and interest	(1,355		)	(949		)
Income tax benefit	—			1,805
Loss from discontinued operations	$	(13,665	)	$	(3,072	)

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

4. Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value as of December 31, 2016 and 2017 because of the relatively short duration of these instruments. The carrying value of long-term debt at December 31, 2016 approximates fair value given interest rates are based on market rates. The rates are subject to change monthly, quarterly, semi-annually or annually at the Company’s election.

The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires use of observable inputs when available, and to minimize the use of unobservable inputs when determining fair value. The three tiers are defined as follows:


•	Level 1. Observable inputs based on unadjusted quoted prices in active markets for identical assets or liabilities;


•	Level 2. Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and


•	Level 3. Unobservable inputs for which there is little or no market data, which requires the Company to develop its own assumptions.

The Company evaluated its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. The following table summarizes the assets measured at fair value as of December 31, 2016 and 2017:



	Fair Value Measurements on a Recurring Basis December 31, 2016
	Level 1		Level 2		Level 3		Total
Stockholders’ anti-dilutive arrangement	$	—	$	—	$	184	$	184
Total	$	—	$	—	$	184	$	184



	Fair Value Measurements on a Recurring Basis December 31, 2017
	Level 1		Level 2		Level 3		Total
Money Market Account	$	28,015	$	—	$	—	$	28,015
Total	$	28,015	$	—	$	—	$	28,015

The Company monitors the availability of observable market data to assess the appropriate classification of financial instruments within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques may require the transfer of financial instruments from one fair value level to another. In such instances, the transfer is reported at the beginning of the reporting period. There were no transfers between Levels 1, 2 or 3 during the years ended December 31, 2016 and 2017.

The money market account is included in cash and cash equivalents in the consolidated balance sheets as of December 31, 2016 and 2017.

On February 22, 2011, the Company entered into an anti-dilutive arrangement with the Principal Non-Founder Stockholders (“Principal Stockholders”). Under the terms of the agreement, the Principal Stockholders received the right (“shareholders’ anti-dilutive arrangement”) to purchase a pro-rata number of shares based on their ownership percentage of outstanding shares, when certain option holders exercise his or her stock option. The price at which the Principal Stockholders may purchase their pro-rata shares matches the exercise price of the option exercised. The Principal Stockholders have 90 days from the date of receipt of notice to inform the Company of their intention to purchase stock under the terms of the agreement. On a quarterly basis, the Company adjusts this liability to fair value.

The agreement terminates by one of the following events:


•	closing of a “Qualified Public Offering,” which is defined as one resulting in aggregate net proceeds to the Company equal to or greater than $20 million, or


•	a “true sale” as defined in the Investors’ Rights Agreement.

The shareholders’ anti-dilutive arrangement is included in other liabilities in the consolidated balance sheets as of December 31, 2016, and as a result of the Company's IPO, the agreement terminated on November 9, 2017.

Prior to the termination date, the fair value of the shareholders’ anti-dilutive arrangement was estimated using the Black-Scholes-Merton option pricing model. The significant unobservable inputs used in the fair value measurement of the shareholders’ anti-dilutive arrangement were the fair value of the Company’s stock and the expected term of the options. The expected term was calculated as a weighted average of the estimated time to IPO as of the measurement date and the historical average term of options subject to the agreement which were vested and expired or were exercised. Volatility was based on the historical volatility of certain public entities that are similar to the Company as the Company did not have sufficient historical transactions of its own shares on which to base expected volatility.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Financial Statement Components

12 Months Ended

Dec. 31, 2017

Financial Statement Components [Abstract]

Financial Statement Components

5. Financial Statement Components

Accounts receivable, net of allowance for doubtful accounts consist of the following:



	December 31,
	2016			2017
Trade accounts receivable	$	31,734		$	44,692
Unbilled accounts receivable	7,368			8,653
Allowance for doubtful accounts	(22,571		)	(32,463		)
Other accounts receivable	307			343
Total accounts receivable, net	$	16,838		$	21,225

Components of allowance for doubtful accounts are as follows:



	Year Ended December 31,
Allowance for doubtful accounts:	2016			2017
Balance, beginning of period	$	238		$	255
Charged to bad debt expense	238			176
Deductions(1)	(221		)	(242		)
Balance, end of period	$	255		$	189

________________________

(1) Write off of uncollectible accounts after all collection efforts have been exhausted.



	Year Ended December 31,
Allowance for CABS revenue:	2016			2017
Balance, beginning of period	$	12,317		$	22,316
Billings deemed not probable of collection(1)	10,494			10,024
Deductions(2)	(495		)	(66		)
Balance, end of period	$	22,316		$	32,274

________________________

(1) Represents amounts billed but where collectibility is not probable based on customers collection experience. Amounts were charged to a contra-revenue account. Refer also to Note 17, Subsequent Events," for discussion of the settlement agreement that was entered into subsequent to year-end that resolved the ongoing dispute and litigation with Verizon, which is a CABS customer of the Company and represented the majority of the outstanding CABS receivables and related allowance.

(2) Write off of uncollectible accounts after all collection efforts have been exhausted.



	Year Ended December 31,
CABS revenue:	2015		2016		2017
Billed	$	15,617	$	19,838	$	19,147
Revenue recognized	8,454		9,344		9,123
Billings deemed not probable of collection(1)	$	7,163	$	10,494	$	10,024

________________________

(1) Represents amounts billed but where collectibility is not probable based on customers collection experience. Amounts were charged to a contra-revenue account.

Accrued expenses and other current liabilities consisted of the following:



	December 31,
	2016		2017
Accrued expense	$	6,853	$	6,851
Accrued compensation and benefits	4,373		5,237
Accrued sales, use, and telecom related taxes	2,769		3,030
Other accrued expenses	654		515
Total accrued expenses	$	14,649	$	15,633

Property and Equipment

12 Months Ended

Dec. 31, 2017

Property, Plant and Equipment [Abstract]

Property and Equipment

6. Property and Equipment

Property and equipment, net consisted of the following:



	December 31,
	2016			2017
Furniture and fixtures	$	680		$	863
Computer and office equipment	7,539			7,545
Telecommunications equipment	13,718			19,985
Leasehold improvements	453			453
Software development costs	13,676			15,517
Automobile	10			10
Total cost	36,076			44,373
Less—accumulated depreciation	(24,896		)	(29,427		)
Total property and equipment, net	$	11,180		$	14,946

The Company capitalizes the costs to design software for internal use related to the development of its platform during the application development stage of the projects. The costs are primarily comprised of salaries and benefits of the projects’ engineers and product development teams. Internally developed software is reported at cost less accumulated amortization. Amortization begins once the project is substantially complete and ready for its intended use. The Company amortizes the asset on a straight-line basis over the useful life, which is estimated to be three years. Costs incurred prior to the application development stage, maintenance activities or minor upgrades are expensed in the period incurred. Unamortized software development costs were approximately $4,056 and $3,795 as of December 31, 2016 and 2017, respectively.

Amortization expense related to capitalized software development costs were $2,842, $2,820 and $2,133 for the years ended December 31, 2015, 2016 and 2017, respectively.

The Company recognized an impairment of $71, $91 and $81 during the years ended December 31, 2015, 2016 and 2017, respectively, related to capitalized software development costs that provided no future benefit and therefore were impaired. This expense is reflected within cost of revenue in the accompanying consolidated statements of operations.

The Company capitalized $3,011, $2,230 and $2,942 of software development costs during the years ended December 31, 2015, 2016 and 2017, respectively.

The Company recognized depreciation expense, which includes amortization of capitalized software development costs, as follows:



	Year Ended December 31,
	2015		2016		2017
Cost of revenue	$	5,258	$	4,574	$	4,315
Research and development	21		29		81
Sales and marketing	16		21		27
General and administrative	872		627		450
Total depreciation expense	$	6,167	$	5,251	$	4,873

Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

7. Intangible Assets

Intangible assets consisted of the following as of December 31, 2016:



	Gross Amount		Accumulated Amortization			Net Carrying Value		Amortization Period
								(Years)
Customer relationships	$	10,396	$	(3,032	)	$	7,364	20
Domain name and related trademarks	2,678		(2,324		)	354		3–7
Licenses, amortizable	341		(341		)	—		2
Non-compete agreements	139		(139		)	—		2–5
Developed technology	775		(775		)	—		3
Licenses, indefinite lived	764		—			764		Indefinite
Total intangible assets, net	$	15,093	$	(6,611	)	$	8,482

Intangible assets consisted of the following as of December 31, 2017:



	Gross Amount		Accumulated Amortization			Net Carrying Value		Amortization Period
								(Years)
Customer relationships	$	10,396	$	(3,552	)	$	6,844	20
Domain name and related trademarks	2,678		(2,643		)	35		3–7
Licenses, amortizable	341		(341		)	—		2
Non-compete agreements	139		(139		)	—		2–5
Developed technology	775		(775		)	—		3
Licenses, indefinite lived	764		—			764		Indefinite
Total intangible assets, net	$	15,093	$	(7,450	)	$	7,643

Amortization expense for definite lived intangible assets was $908, $891 and $839 for the years ended December 31, 2015, 2016 and 2017, respectively. The weighted average amortization period for all definite lived intangible assets is 19 years.

Future estimated amortization expense for definite lived intangible assets subsequent to December 31, 2017 is as follows:



	Amount
2018	$	555
2019	520
2020	520
2021	520
2022	520
Thereafter	4,244
	$	6,879

Costs associated with the acquisition and transfer of the CLEC perpetual licenses from other entities have been capitalized and have an indefinite life. The Company evaluates these indefinite lived intangible assets on an annual basis to assess if any impairment exists. The Company performed its annual assessment on December 31, 2016 and 2017 and concluded no impairment exists.

During the year ended December 31, 2016, the Company re-evaluated its marketing and branding usage of the trade name assets acquired in the Dash acquisition as part of its annual evaluation of its intangible assets, and concluded there was no further benefit from the use of the trade name. The Company impaired the asset and recognized a loss of $695, which is reflected within general and administrative expenses in the accompanying consolidated statements of operations and comprehensive income for the year ended December 31, 2016.

Debt

12 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Debt

8. Debt

In September 2008, the Company entered into a Loan and Security Agreement which included a revolving line of credit with a bank. Substantially all assets of the Company were pledged as a Security to the Loan and Security Agreement. This agreement was amended several times to increase the Company’s borrowing limit and extend the maturity date. On December 14, 2015, the Loan and Security Agreement was amended to increase the Company’s borrowing limit to $25,000 and to extend the maturity through December 14, 2017.

On February 24, 2016, the Loan and Security Agreement was amended to add the ability to include an outstanding letter of credit as an advance on the revolving line of credit. On March 28, 2016 the Loan and Security Agreement was further amended to update certain covenants for 2016 performance metrics. On December 1, 2016, the Company paid the Loan and Security Agreement in full.

On November 4, 2016, the Company entered into a Credit and Security Agreement with a syndication of four banks. The agreement includes a $40,000 term loan, and a $25,000 revolving loan, which includes a swing line of up to $1,000 and limits letters of credit commitments to a maximum of $2,500. Substantially all assets of the Company are pledged as security to the Credit and Security Agreement. The term of the Credit and Security Agreement is five years and matures on November 3, 2021. The interest rate used for the debt is based, at the Company’s election, on either the Federal Funds Effective Rate or LIBOR plus a stated margin, as defined in the Credit and Security Agreement. Once the Company repays any portion of the term loan, it cannot be re-borrowed. The Company is entitled to borrow and repay and borrow under the revolving loan at any time during the term of the Credit and Security Agreement. This agreement requires the Company to meet a certain leverage ratio and minimum debt service coverage ratio each quarter on a trailing 12-month basis.

On November 14, 2017, the term loan was paid in full with proceeds from the IPO. As of December 31, 2016 and 2017, the Company had $40,000 and $0, respectively, outstanding on the term loan and $5,000 and $0, respectively, on the revolving loan and was in compliance with all financial and non-financial covenants for all periods presented. The available borrowing capacity under the Credit and Security Agreement revolving loan was $25,000 as of December 31, 2017.

Capital Leases

The Company leases various equipment under leases accounted for as capital leases with expiration dates ranging from March 2016 through October 2018. As of December 31, 2016, cost and accumulated depreciation of the assets under capital leases recorded by the Company were $1,951 and $1,807, respectively. As of December 31, 2017, cost and accumulated depreciation of the assets under capital leases recorded by the Company were $1,951 and $1,855, respectively.

Remaining payments due on the Company’s capital lease obligations as of December 31, 2017, are as follows:



	Amount
2018	$	92
Less amount representing interest	—
	92
Less current maturities	92
	$	—

Segment and Geographic Information

12 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Segment and Geographic Information

9. Segment and Geographic Information

The Company has two reportable segments, CPaaS and Other. Segments are primarily evaluated based on revenue and gross profit. The Company does not allocate operating expenses, interest expense or income tax expense to its segments. Accordingly, the Company does not report such information. Additionally, the CODM does not evaluate the Company’s operating segments using discrete asset information. The segments share the majority of the Company’s assets. Therefore, no segment asset information is reported.



	Year Ended December 31,
	2015		2016		2017
CPaaS
Revenue	$	101,502	$	117,078	$	131,572
Cost of revenue	64,760		71,218		75,859
Gross profit	$	36,742	$	45,860	$	55,713
Other
Revenue	$	36,299	$	35,057	$	31,383
Cost of revenue	14,482		14,000		13,403
Gross profit	$	21,817	$	21,057	$	17,980
Consolidated
Revenue	$	137,801	$	152,135	$	162,955
Cost of revenue	79,242		85,218		89,262
Gross profit	$	58,559	$	66,917	$	73,693

All assets were held in the United States as of December 31, 2016 and 2017.

The Company generates its revenue primarily in the United States. Revenue by geographical area is detailed in the table below (which is determined based on the customer billing address):



	Year Ended December 31,
	2015		2016		2017
United States	$	137,514	$	151,618	$	162,393
International	287		517		562
Total	$	137,801	$	152,135	$	162,955

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity	12 Months Ended
	Dec. 31, 2017
Equity [Abstract]
Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity	Redeemable Convertible Preferred Stock and Stockholders’ (Deficit) Equity Prior to the IPO, the Company had three classes of stock: 1) Series A redeemable convertible preferred stock ("Series A preferred stock"), 2) Old Class A common stock, and 3) Old Class B common stock. On October 19, 2017, the Company’s Board of Directors approved, and on October 23, 2017 the Company effected, a 2.5-to-1 split of its common stock. In connection with the common stock split, each share of outstanding common stock, option to purchase common stock and warrant to purchase common stock was increased to 2.5 shares of common stock and the exercise price of each outstanding option or warrant to purchase common stock was proportionately decreased. The stock split has been reflected retrospectively in these consolidated financial statements. In connection with the stock split, the conversion ratio of each share of outstanding Series A preferred stock was also adjusted such that each share of outstanding Series A preferred stock converted into 2.5 shares of Old Class A common stock after the 2.5-to-1 split. Redeemable Convertible Preferred Stock As of January 1, 2010, the Company had authorized 5,000,000 shares of Series A preferred stock. On February 22, 2011, the Company amended and restated its Certificate of Incorporation such that the Company authorized 1,200,000 shares of preferred stock, all of which have been designated as Series A preferred stock. On February 22, 2011, the Company completed the issuance of 663,907 shares of Series A preferred stock at $30.8358 per preferred share. On March 24, 2011, the Company completed the final closing of 46,093 shares of Series A preferred stock at $30.8358 per preferred share. Pursuant to the Spin-Off, each holder of Series A preferred stock received a share of Republic Class A voting common stock for each share of Series A preferred stock held by such holder equal to the number of shares of Class A common stock into which such share of Series A preferred stock is then convertible. As of December 31, 2016, the Company had 710,000 issued and outstanding shares of Series A preferred stock. On November 9, 2017, each share of Series A preferred stock converted into 2.5 shares of Old Class A common stock at the stockholders' option resulting in the issuance of 1,775,000 shares of Old Class A common stock. Conversion Each share of Series A preferred stock was convertible, at the option of the shareholder, into such number of fully paid and non-assessable shares of common stock as is determined by dividing the Series A original issue price by the Series A conversion price in effect at the time of the conversion. The Series A conversion price was initially equal to $30.8358 and is subject to adjustment related to dilutive transactions. As a result of the stock split, the conversion ratio of each share of outstanding preferred stock also was adjusted, such that each share of outstanding preferred stock converts into 2.5 shares of Old Class A common stock at a conversion price of $12.3343. Liquidation Preference In the event of any Liquidation Event or Deemed Liquidation Event, the holders of Series A, preferred stock were entitled to receive, in preference to any distribution of the proceeds to the holders of common stock, an amount per share equal to the greater of (1) an amount equal to the original issue price for Series A preferred stock plus declared but unpaid dividends on such share, plus the product of (a) the number of days elapsed since issuance divided by 365, multiplied by (b) 0.08 multiplied by (c) the Series A original issue price, or (2) such amount as would have been payable had all shares of Series A preferred stock had been converted to common stock immediately prior to such Liquidation or Deemed Liquidation Event. If the proceeds thus distributed among the holders of the Series A preferred stock are insufficient to permit payment to such holders of the full preferential amounts, then the entire proceeds available for distribution shall be distributed ratably. Upon completion of the distribution referred to above, all of the remaining proceeds available for distribution shall be distributed to the holders of the Company’s common stock pro rata based on the number of common stock held by each. As of December 31, 2016, the liquidation preference totaled $32,148. Redemption Shares of Series A preferred stock were redeemable by the Company out of funds lawfully available at a price equal to the Series A original issue price per share, plus all declared but unpaid dividends thereon, in three annual installments commencing not more than 60 days after receipt by the Company at any time on or after December 31, 2020, from the holders of a majority of the then-outstanding shares of Series A preferred stock. At each redemption date, shares of Series A Preferred stock were redeemable, on a pro-rata basis in accordance with the number of shares of Series A preferred stock owned by each holder, that number of outstanding shares of Series A preferred stock determined by dividing the total number of shares of Series A preferred stock outstanding by the number of remaining redemption dates (including the redemption date to which such calculation applies). Voting Rights The holders of Series A preferred stock were entitled to cast the number of votes equal to the number of whole shares of common stock into which the shares of Series A preferred stock are convertible as of the record date for determining stockholders entitled to vote on such matter. Holders of Series A preferred stock shall vote together with the holders of Old Class A common stock as a single class. The holders of record of the shares of Series A preferred stock, exclusively and as a separate class, were entitled to elect one director of the Company. The Company could not, without the approval of the holders of record of a majority of the shares of Series A preferred stock, as a separate class, undertake certain actions as specified in the Certificate of Incorporation, as amended and restated as of February 22, 2011 and as subsequently amended. Dividends The amount of any dividend on an outstanding share of Series A preferred stock is determinable based upon the number of shares of common stock into which such Series A preferred stock is then convertible based upon the original issuance price of a share of Series A preferred stock of $30.8358 per share, subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Series A preferred stock. During the years ended December 31, 2016 and 2017, no dividends were declared. Preferred Stock On November 9, 2017, the Company filed its second amended and restated certificate of incorporation and authorized 10,000,000 shares of undesignated preferred stock, par value $0.001, of which no shares were issued and outstanding as of December 31, 2017. Common Stock As of December 31, 2016, the Company had two classes of common stock: (1) Old Class A common stock and (2) Old Class B common stock. The Old Class A common stock had one vote per share and the Old Class B common stock had no voting rights. As of December 31, 2016, there were 11,779,975 shares of Old Class A common stock issued and outstanding at $0.001 par value per share. As of December 31, 2016, there were 18,590 shares of Old Class B common stock issued and outstanding at $0.001 par value per share. On November 9, 2017, the Company filed its second amended and restated certificate of incorporation. Upon the effectiveness of the Company's second amended and restated certificate of incorporation and the effectiveness of the Company's second amended and restated bylaws, i) each share of Old Class A common stock was reclassified as one share of Class B common stock with ten votes per share, ii) each share of Old Class B common stock was reclassified as one share of Class A common stock with one vote per share. Consequently, the Series A preferred stock, that had previously converted into 2.5 shares of the Old Class A common stock, at the option of the holder, was converted into 1,775,000 shares of Class B common stock. Subsequent to the effectiveness of the Company’s second amended and restated certificate of incorporation, the Company’s common stock consists of 120,000,000 authorized shares, par value $0.001 per share, of which the authorized Class A common stock consists of 100,000,000 shares and the authorized Class B common stock consists of 20,000,000 shares as of December 31, 2017. As of December 31, 2017, there were 4,197,831 shares of Class A common stock issued and outstanding at $0.001 par value per share. As of December 31, 2017, there were 13,440,725 shares of Class B common stock issued and outstanding at $0.001 par value per share. Shares of Class B common stock are convertible into shares of Class A common stock upon the stockholder's voluntary written notice to the Company's transfer agent or a transfer by the stockholder, subject to limited exceptions for transfers for estate planning purposes. Voting Rights The holders of Class A common stock and Class B common stock have identical rights, except that holders of Class A voting common stock are entitled to one vote per share of Class A common stock and holder of Class B common stock are entitled to ten votes per share of Class B common stock. Dividends Any dividends or distributions paid or payable to the holders of shares of Class A common stock and Class B common stock shall be paid pro rata, on an equal priority. During the year ended December 31, 2017, no dividends were declared. Dividend payments are subject to a restriction by the Company’s Loan and Security Agreement prohibiting the Company to pay any dividends or any other distribution or payment on account of or in redemption, retirement or purchase of any capital stock through the term of the agreement. Option to Purchase Additional Shares On November 28, 2017, the Underwriters exercised their option to purchase 162,991 of Class B common stock held by certain selling shareholders. Immediately upon transfer, the shares converted into Class A common stock in accordance with the Company's second amendment and restated certificate of incorporation. Stock Purchase Warrants In connection with four notes payable issued December 20, 2010, the Company granted stock purchase warrants to the previous debt holders. The warrants were exercisable for 30,470 shares of the Company’s Old Class A common stock at an exercise price of $5.80 per share. Warrants outstanding at December 31, 2016 and 2017, were 15,844 and 0, respectively. The Company granted other stock purchase warrants in 2011 that were exercisable for 43,847 shares of the Company’s Old Class A common stock at an exercise price of $0.001 per share. Warrants outstanding to purchase shares of the Company’s Old Class A common stock were 39,000 at December 31, 2016 and 2017, and expire on March 25, 2018. Additional warrants to purchase 9,846 shares of the Company’s Old Class A common stock were granted in 2011 at an exercise price of $5.80 per share, which expire on February 22, 2018. Warrants to purchase 4,531 shares of the Company's Old Class A common stock were granted in 2017 at an exercise price of $6.57 per share. Warrants outstanding at December 31, 2017 were 2,504, which expire on January 19, 2018. Pursuant to the Spin-Off, each holder of a warrant to purchase common stock was issued a warrant to purchase shares of Republic Class A voting common stock with equivalent economic terms. A total of 64,691 and 51,350 shares of common stock were reserved for the issuance of stock purchase warrants at December 31, 2016 and 2017, respectively. On November 9, 2017, the Company filed its second amended and restated certificate of incorporation. Upon the effectiveness of the Company's second amended and restated certificate of incorporation and the effectiveness of the Company's second amended and restated bylaws, warrants exercisable for shares of Old Class A common stock became exercisable into shares of Class B common stock. Spin-Off Pursuant to the Spin-Off, (i) each holder of Old Class A common stock received one share of Republic Class A common stock for each share of Old Class A common stock held by such holder, (ii) each holder of Old Class B common stock received one share of Republic Class B non-voting common stock for each share of Old Class B non-voting common stock held by such holder and (iii) each holder of Series A preferred stock received a number of shares of Republic Class A voting common stock for each share of Series A preferred stock held by such holder equal to the number of shares of Old Class A common stock into which such share of Series A preferred stock is then convertible.

Stock Based Compensation

12 Months Ended

Dec. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Based Compensation

11. Stock Based Compensation

2001 and 2010 Stock Option Plans

During 2001, the Company adopted the Bandwidth Inc. Stock Option Plan (the "2001 Plan"). As of July 26, 2010, the Company adopted the 2010 Equity Compensation Plan (the "2010 Plan"). On August 24, 2017, the 2010 Plan was amended to provide for a total of 3,466,275 shares of common stock reserved for issuance under the 2010 Plan.

Eligible plan participants include employees, directors and consultants. The 2001 Plan and the 2010 Plan each permit the granting of incentive stock options and non-qualified stock options.

Following the effectiveness of the 2010 Plan, the Company did not make any further grants under the 2001 Plan. However, the 2001 Plan continues to govern the terms and conditions of the outstanding awards granted under it. On November 9, 2017, the 2010 Plan was terminated in connection with the Company's IPO. Accordingly, no shares are available for future issuance under the 2010 Plan. However, the 2010 Plan will continue to govern the terms and conditions of the outstanding awards granted thereunder.

On November 9, 2017, the Company filed its second amended and restated certificate of incorporation. Upon the effectiveness of the Company's second amended and restated certificate of incorporation and the effectiveness of the Company's second amended and restated bylaws, options exercisable into shares of Old Class A common stock and Old Class B common stock became exercisable into shares of Class B common stock and Class A common stock, respectively.

2017 Incentive Award Plan

The Company's 2017 Incentive Award Plan (the "2017 Plan") became effective on November 9, 2017. The 2017 Plan provides for the grant of stock options, including incentive stock options and non-qualified stock options, stock appreciation rights, restricted stock, dividend equivalents, restricted stock units, and other stock or cash based awards to employees, consultants and directors of the Company. A total of 1,050,000 shares of the Company's Class A common stock were originally reserved for issuance under the 2017 Plan.

The terms of the stock option grants are determined by the Company’s Board of Directors. The Company’s stock options vest based on terms in the stock option agreements, which is generally over four years. The stock options have a contractual life of ten years.

Stock options

The fair value, adjusted for the stock split, of options granted is estimated on the date of grant using the Black-Scholes option pricing model based on the assumptions in the table below:



	Year Ended December 31,
	2015	2016	2017
Expected dividend yield	0%	0%	0%
Expected stock price volatility	44%	44%	44%-49%
Average risk-free interest rate	1.5%-1.9%	1.3%-2.0%	1.9%-2.3%
Expected life	6.2 years	6.2 years	6.2 years
Fair value of common stock	$9.43-$9.57	$9.57-$9.60	$9.60-$20.83

The following summarizes the stock option activity for the periods presented:



	Number of Options Outstanding		Weighted- Average Exercise Price (per share)		Weighted- Average Remaining Contract Life (in years)	Aggregate Intrinsic value (in thousands)
Outstanding as of December 31, 2016	3,582,241		$	6.54	5.12	$	11,049
Grants	179,922		13.79
Exercised	(58,162	)	5.27			445
Forfeited or cancelled	(44,210	)	9.46
Outstanding as of December 31, 2017	3,659,791		$	6.88	4.38	$	59,436

Options vested and exercisable at December 31, 2017	3,209,890		$	6.28	3.83	$	54,051

Options vested and expected to vest as of December 31, 2017	3,641,078		$	6.85	4.35	$	59,230

Aggregate intrinsic value represents the total pre-tax intrinsic value, which is computed based on the difference between the option exercise price and the estimated fair value of the Company’s common stock. This amount changes based on the fair value of the Company’s stock.

The weighted average grant-date fair value of stock options granted was $4.24 , $4.06 and $7.72 for the years ended December 31, 2015, 2016 and 2017, respectively.

The total estimated grant date fair value of options vested was $2,107, $2,082 and $1,299 for the years ended December 31, 2015, 2016 and 2017, respectively.

The Company recognized total stock-based compensation expense in continuing operations as follows:



	Year Ended December 31,
	2015		2016		2017
Cost of revenue	$	45	$	61	$	80
Research and development	189		138		155
Sales and marketing	239		182		172
General and administrative (1)	3,020		989		1,396
Total	$	3,493	$	1,370	$	1,803

________________________

(1) On September 1, 2017, the Company reached a separation agreement with one of its executives. The agreement resulted in a modification of the former employee's 194,234 outstanding options to purchase common stock, which accelerated the vesting period and extended the exercise period, resulting in the recognition of $394 of additional stock compensation expense for the year ended December 31, 2017.

The Company will recognize $1,935 of compensation cost in the future for stock-based employee compensation over the weighted-average period of 2.59 years for stock options granted before December 31, 2017.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

12. Commitments and Contingencies

Operating Leases

The Company leases office space under operating lease agreements that expire at various dates beginning in 2016 and extend through 2022 in several locations within the United States including its headquarters, which is located in Raleigh, NC. On September 26, 2016, the Company amended its operating lease agreement with one of its landlords. The 63-month lease, which began on April 14, 2017, provides for an additional 40,657 square feet of office space as well as an extension of the termination date for the lease of approximately 128,200 square feet of office space. The leases contain escalation clauses and various landlord concessions including a tenant improvement allowance. The Company recognizes the total minimum lease payments on a straight-line basis over the term of the lease.

Future minimum lease payments required under operating leases as of December 31, 2017 are as follows:



	Amount
2018	$	3,631
2019	3,700
2020	3,838
2021	3,873
2022	2,018
	$	17,060

The Company incurred rent expense of $1,656, $2,003 and $3,327 for the years ended December 31, 2015, 2016 and 2017, respectively, which is included in general and administrative expenses in the consolidated statements of operations and comprehensive income (loss).

In conjunction with the Spin-Off, the Company signed a Facilities Service Agreement with Republic in which the Company agreed to sub-lease 40,657 square feet of office space to Republic. The sub-lease is non-cancellable and extends to May 2022. The Company recorded a reduction of rent expense of $47 and $949 for the years ended December 31, 2016 and 2017, respectively, which is included in general and administrative expenses in the consolidated statements of operations and comprehensive income (loss).

Future minimum sub-lease receipts required under the non-cancellable lease as of December 31, 2017 are as follows:



	Amount
2018	$	1,020
2019	1,042
2020	1,065
2021	1,089
2022	594
	$	4,810

Contractual Obligations

On October 25, 2015, the Company entered into an agreement with a telecommunications service provider. The service agreement requires the Company to pay a monthly recurring charge beginning on January 1, 2016 associated with the services received. The service agreement is non-cancellable and contains annual minimum commitments of $1,200 to be fulfilled over five years or for as long as the Company continues to receive services from this vendor. In addition, the Company has other non-cancellable purchase obligations totaling $5,249 as of December 31, 2017, which consists primarily of network equipment to be received in less than one year.

Legal Matters

The Company is involved as a defendant in various lawsuits alleging that the Company failed to bill, collect and remit certain taxes and surcharges associated with the provision of 911 services pursuant to applicable laws in various jurisdictions. In August 2016, the Company received a Civil Investigative Demand from the Consumer Protection Division of the North Carolina Department of Justice, though no formal complaint has been filed in connection with that investigation. The North Carolina Department of Justice is investigating the billing, collection and remission of certain taxes and surcharges associated with 911 service pursuant to applicable laws of the State of North Carolina.

In April 2016, the Company filed counterclaims against Verizon in the United States District Court for the Northern District of Texas. The Company is pursuing collection of unpaid intercarrier compensation charges for providing switched access services related to the exchange of telecommunications traffic with Verizon entities across the United States. As of October 27, 2017, Verizon has asserted a counterclaim against the Company. The Company intends to contest such counterclaim vigorously. Verizon’s prior September 2014 complaint against the Company and other defendants regarding intercarrier compensation charges for providing switched access services related to the exchange of telecommunications traffic has been dismissed without prejudice, but remains subject to appeal. See Note 17, "Subsequent Events," for current developments.

While the results of these legal proceedings cannot be predicted with certainty, in the opinion of management, the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial position or results of operations.

Employee Benefit Plan	12 Months Ended
Employee Benefit Plan	Dec. 31, 2017
Retirement Benefits [Abstract]
Employee Benefit Plan	13. Employee Benefit Plan The Company sponsors a defined contribution 401(k) plan which allows eligible employees to defer a portion of their compensation. The Company, at its discretion, may make matching contributions. The Company made matching contributions of $698, $716 and $806 for the years ended December 31, 2015, 2016 and 2017, respectively.

Income Taxes

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Income Taxes

14. Income Taxes

(Provision) benefit for income taxes from continuing operations consists of the following:



	Year Ended December 31,
	2015			2016			2017
Current:
Federal	$	—		$	66		$	(448	)
State	(104		)	(58		)	(302		)
Total	(104		)	8			(750		)
Deferred:
Federal	(272		)	9,999			(5,983		)
State	(32		)	1,087			(185		)
Total	(304		)	11,086			(6,168		)
Total (provision) benefit for income taxes	$	(408	)	$	11,094		$	(6,918	)

The following table presents a reconciliation of the statutory federal tax rate and the Company’s effective tax rate for the years ended December 31, 2015, 2016 and 2017:



	Year Ended December 31,
	2015		2016		2017
Federal	34.0	%	34.0	%	34.0	%
State	2.5		4.2		4.7
Non-deductible expenses	1.0		5.0		1.2
Research credit	(3.2	)	(2.3	)	(1.5	)
Stock-based compensation	11.0		(24.5	)	0.1
Change in valuation allowance	(42.5	)	(98.6	)	—
Deferred tax rate change	0.8		0.8		16.1
Other	1.9		4.0		(0.9	)
Total	5.5	%	(77.4	)%	53.7	%

The following table presents the significant components of the Company’s net deferred tax assets:



	Year Ended December 31,
	2016		2017
Deferred tax assets:
Allowance for doubtful accounts	$	95	$	48
Accrued liabilities	2,011		1,687
Deferred revenue	241		395
Intangibles	237		166
Stock-based compensation	6,458		4,668
Tax credits	2,369		2,071
Net operating losses	4,249		26
Other	59		37
Total deferred tax assets	15,719		9,098
Less: valuation allowance	—		—
Net deferred tax assets	15,719		9,098
Deferred tax liability:
Property and equipment	2,083		1,797
Goodwill	654		582
Other liability	288		193
Total deferred tax liabilities	3,025		2,572
Net deferred tax asset	$	12,694	$	6,526

The Company’s accounting for deferred taxes involves the evaluation of a number of factors concerning the realizability of its net deferred tax assets. The Company primarily considered the historic performance of Bandwidth, the nature of the Company's deferred tax assets and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary differences and carryforwards become deductible. Based on an analysis of these factors, the Company determined that in 2017 no valuation allowance against deferred tax assets was required.

As of December 31, 2017, the Company had approximately $2,563 in federal tax credits. If not utilized, the federal tax credit carryforwards will expire at various dates beginning in 2032.

As of December 31, 2017, the Company had approximately $590 in state net operating loss carryforwards. If not utilized, the state net operating loss carryforwards will expire at various dates beginning in 2020.

A limitation may apply to the use of the net operating loss and credit carryforwards, under Internal Revenue Code (IRC) §382 and §383, and similar state tax provisions that are applicable if the Company experiences an “ownership change.” An ownership change may occur, for example, as a result of issuance of new equity. Should these limitations apply, the carryforwards would be subject to an annual limitation.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted into law. The income tax effects of changes in tax law are recognized in the period when enacted. Among its numerous changes to the Internal Revenue Code, the Act reduces U.S. corporate rates from 35% to 21% for periods beginning on or after January 1, 2018. The Company has incurred additional expense of $2,073 due to the remeasurement of the deferred tax assets at the lower corporate tax rate. Other provisions of the Act did not have a significant impact on the Company’s consolidated financial statements for the year ended December 31, 2017, but may impact the effective tax rate in subsequent periods.

Additional federal and state interpretive guidance is still forthcoming that could potentially affect the remeasurement of the deferred tax balance or give rise to new deferred tax amounts. As such, the remeasurement of the deferred tax balance is provisional pending future guidance. Accordingly, the Company is relying on the guidance in the SEC Staff Accounting Bulletin (“SAB”) 118 and has included a reasonable estimate of the effect of the new rules in its Annual Report on Form 10-K while it waits for additional guidance to be released. The final impact may differ from this provisional amount due to, among other things, issuance of additional regulatory guidance, changes in interpretations and assumptions the Company has made, and actions the Company may take as a result of the Act. In accordance with SAB 118 the financial reporting impact of the Tax Reform Act will be completed no later than the fourth quarter of 2018.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



	Year Ended December 31,
	2016		2017
Unrecognized tax benefits—January 1,	$	456	$	671
Gross increases—tax positions in prior period	104		—
Gross decreases—tax positions in prior period	—		—
Gross increases—tax positions in current period	111		64
Settlement	—		—
Lapse of statute of limitations	—		(4		)
Unrecognized tax benefits—December 31,	$	671	$	731

If the $731 of unrecognized tax benefit is recognized, it would impact the effective tax rate.

The Company has not incurred any material tax interest or penalties with respect to income taxes in the years ended December 31, 2016 and 2017.

The Company expects no material changes in the twelve months following December 31, 2017 in its uncertain tax positions.

The Company files U.S. federal income tax returns as well as income tax returns in many U.S. states. The tax years 2008-2010 and 2012-2016 remain open to examination by the major jurisdictions in which the Company is subject to tax due to the carryforward of net operating losses.

Related Parties	12 Months Ended
Related Parties	Dec. 31, 2017
Related Party Transactions [Abstract]
Related Parties	15. Related Parties In connection with the Spin-Off on November 30, 2016, the Company and Republic entered into certain agreements in order to govern the ongoing relationships between the two companies after the Spin-Off and to provide for an orderly transition. The agreements include a Transition Services Agreement, Facilities Sharing Agreement, Tax Sharing Agreement, and Master Services Agreement. The equity holders of Bandwidth are comprised of substantially the same individuals and entities that are the equity owners of Republic. The Company has determined the equity owners of Republic are related parties of Bandwidth. The Company has certain involvement with Republic via ongoing services arrangements, with these ongoing services arrangements creating a variable interest in Republic. The Company assessed the relationship with Republic under guidance for variable interest entities. Because investors in Republic have disproportionate voting rights, the Company concluded that Republic is a VIE, but Bandwidth is not a primary beneficiary. The Company’s maximum exposure to loss relating to this variable interest entity is limited to amounts due under the service agreements between the Company and Republic. The Transition Services Agreement specifies certain services to be provided by the Company for a period of up to two years from the Spin-Off. These services include insurance administration, billing and collections, and other technical support as well as legal services related to intellectual property. The Company is compensated by Republic for these services based on costs incurred by the Company. For the period of December 1, 2016 to December 31, 2016 and the year ended December 31, 2017, the Company received compensation of $134 and $575, respectively, which is included in general and administrative expenses in the consolidated statements of operations and comprehensive income (loss). In addition, there was approximately $0 and $15 due from Republic as of December 31, 2016 and 2017, respectively, which was recorded within accounts receivable in the accompanying consolidated balance sheet. The Facilities Sharing Agreement specifies that the Company will sublet office space to Republic for at least 63 months. During the period of December 1, 2016 to December 31, 2016 and the year ended December 31, 2017, the Company sublet office space to Republic. For the years ended December 31, 2016 and 2017, the Company received rental payments of $47 and $949, respectively, which is included in general and administrative expenses in the consolidated statements of operations and comprehensive income (loss). No amounts were due to the Company under the Facilities Sharing Agreement as of December 31, 2016 and 2017. The Tax Sharing Agreement governs rights and obligations after the Spin-Off regarding income taxes and other taxes, including tax liabilities and benefits, attributes, returns and contests. There are no amounts outstanding or payable under this agreement as of December 31, 2016 and 2017. The Master Services Agreement specifies certain wholesale telecommunications services to be provided by the Company. The agreement is cancellable at any time by either party. During the period of December 1, 2016 to December 31, 2016 and the year ended December 31, 2017, the Company provided telecommunication services to Republic of $173 and $2,451, respectively. The Company recognized such amounts as revenue in the accompanying consolidated statements of operations and comprehensive income (loss). As of December 31, 2016 and 2017, the Company had a receivable of $3 and $311, respectively, under the Master Services Agreement.

Basic and Diluted (Loss) Income per Common Share

12 Months Ended

Dec. 31, 2017

Earnings Per Share [Abstract]

Basic and Diluted (Loss) Income per Common Share

The Company uses the two-class method to compute net (loss) income per common share, because it has issued securities, other than common stock, that contractually entitle the holders to participate in dividends and earnings. These participating securities include the Company’s redeemable convertible preferred stock which have non-forfeitable rights to participate in any dividends declared on the Company’s common stock. The two-class method requires earnings for the period to be allocated between common stock and participating securities based upon their respective rights to receive distributed and undistributed earnings.

Under the two-class method, for periods with net income, basic net income per common share is computed by dividing the net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Net income attributable to common stockholders is computed by subtracting from net income the portion of current period earnings that the participating securities would have been entitled to receive pursuant to their dividend rights had all of the period’s earnings been distributed. No such adjustment to earnings is made during periods with a net loss, as the holders of the participating securities have no obligation to fund losses.

Diluted net (loss) income per common share is computed under the two-class method by using the weighted average number of shares of common stock outstanding, plus, for periods with net income attributable to common stockholders, the potential dilutive effects of stock options and warrants. The Company analyzed the potential dilutive effect of any outstanding dilutive securities under the “if-converted” method and treasury-stock method when calculating diluted earnings per share, in which it is assumed that the outstanding participating securities convert into common stock at the beginning of the period or date of issuance, if later. The Company reports the more dilutive of the approaches (two-class or “if-converted”) as its diluted net income per share during the period.

The components of basic and diluted earnings per share, or EPS, are as follows:



	Year Ended December 31,
	2015			2016			2017
Income from Continuing Operations
Income from continuing operations	$	6,965		$	25,430		$	5,971
Less: income allocated to participating securities	931			3,355			644
Income from continuing operations attributable to common stockholders	$	6,034		$	22,075		$	5,327
Income from continuing operations per share:
Basic	$	0.52		$	1.89		$	0.42
Diluted	$	0.48		$	1.72		$	0.37
Loss from Discontinued Operations
Loss from discontinued operations, net on income taxes	$	(13,665	)	$	(3,072	)	$	—
Less: loss allocated to participating securities	(1,827		)	(405		)	—
Loss from discontinued operations attributable to common stockholders	$	(11,838	)	$	(2,667	)	$	—
Loss from discontinued operations per share attributable to stockholders:
Basic	$	(1.03	)	$	(0.23	)	$	—
Diluted	$	(0.95	)	$	(0.21	)	$	—
Net (loss) income
Net (loss) income	$	(6,700	)	$	22,358		$	5,971
Less: (loss) income allocated to participating securities	(896		)	2,950			644
Net (loss) income attributable to common stockholders	$	(5,804	)	$	19,408		$	5,327
Net (loss) income per share:
Basic	$	(0.50	)	$	1.66		$	0.42
Diluted	$	(0.47	)	$	1.51		$	0.37
Weighted Average Number of Common Shares Outstanding
Basic	11,497,727			11,678,568			12,590,221
Dilutive effect of stock options and warrants	958,813			1,192,064			1,952,949
Diluted	12,456,540			12,870,632			14,543,170

The following common share equivalents have been excluded from the calculation of weighted-average common shares outstanding, because the effect is anti-dilutive for the periods presented:



	Year Ended December 31,
	2015	2016	2017
Anti-dilutive Disclosure
Series A redeemable convertible preferred stock outstanding	1,775,000	1,775,000	1,522,123
Stock options issued and outstanding	401,835	237,185	50,604

Subsequent Events

12 Months Ended

Dec. 31, 2017

Subsequent Events [Abstract]

Subsequent Events

17. Subsequent Events

On January 12, 2018, the Company entered into an 84 month operating lease agreement to provide 40,035 square feet of additional office space. The new lease is expected to commence in September 2018. Future expected minimum payments under the lease are as follows:



	Amount
2018	$	397
2019	1,203
2020	1,239
2021	1,276
2022 and thereafter	5,011
	$	9,126

On January 29, 2018, the Company and Verizon entered into a settlement agreement to resolve the ongoing dispute and litigation with Verizon, which is a CABS customer of the Company. The settlement agreement also resolved Verizon’s counter-claims against the Company. Pursuant to the settlement agreement, Verizon made a lump sum payment to the Company on February 8, 2018 of $4,400. Following receipt of the $4,400 payment, the Company will issue to Verizon bill credits with respect to other CABS amounts previously billed to Verizon, which were previously reserved and comprised the majority of the allowance for CABS revenue as of year-end. The settlement agreement also specifies certain term for the Company's CABS billings to Verizon prospectively. The Company will continue to assess collectability of its outstanding CABS accounts receivable, including amounts due under this settlement agreement.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Basis of Presentation

Reclassification

Principles of Consolidation

The consolidated financial statements include the accounts of Bandwidth Inc. and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

Revenue Recognition

Cost of Revenue

Research and Development

Selling and Marketing and General and Administrative

Sales and Marketing

General and Administrative

Cash and Cash Equivalents and Restricted Cash

Cash and Cash Equivalents

Restricted Cash

Accounts Receivable and Allowance for Doubtful Accounts

The Company includes unbilled receivables in its accounts receivable balance. Generally, these receivables represent services provided to customers, which will be billed in the next billing cycle.

Concentration of Credit Risk

Property and Equipment, net



Computer hardware and software	2 to 5 years
Internal-use software development costs	3 years
Furniture and fixtures	2 to 7 years
Leasehold improvements	Shorter of the estimated lease term or useful life

Maintenance and repairs are charged to expense as incurred.

Deferred Costs

Software Development Costs

Debt Issuance Costs

Goodwill

Impairment of Long-Lived Assets

Advertising Costs

The Company expenses advertising costs as incurred.

Commissions

Stock-Based Compensation

The Black-Scholes option pricing model requires the use of objective and subjective assumptions, which determine the fair-value of stock-based awards. These assumptions include:

•


•	Expected term. The expected term was estimated using the simplified method allowed under SEC guidance as the Company does not have sufficient historical data to use any other method to estimate the expected term.


•	Expected volatility. The expected volatility is derived from an average of the historical volatilities of the common stock of several entities with characteristics similar to those of the Company, such as the size, and operational and economic similarities to its principle business operations. The Company uses this method because it has limited information on the volatility of its common stock.


•	Risk-free interest rate. The risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the options for each option group as of the grant date.


•	Expected dividends. The expected dividend is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock.

Income Taxes

Operating Segments

Earnings (Loss) per Share

Emerging Growth Company Status

Recent Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Recent Accounting Pronouncements Not Yet Adopted

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Property and Equipment - Estimated Useful Lives

Depreciation and amortization is calculated on a straight-line basis over the estimated useful lives of those assets as follows:



Computer hardware and software	2 to 5 years
Internal-use software development costs	3 years
Furniture and fixtures	2 to 7 years
Leasehold improvements	Shorter of the estimated lease term or useful life

Discontinued Operations (Tables)

12 Months Ended

Dec. 31, 2017

Discontinued Operations and Disposal Groups [Abstract]

Summary of Distribution Recorded at the Carrying Amount

The distribution was recorded at the carrying amount of Republic’s net liabilities of $1,101 as of November 30, 2016, as follows:



Assets
Accounts receivable, net of allowance for doubtful accounts	$	1,199
Inventory	7,305
Prepaid expenses and other current assets	2,540
Total current assets	11,044
Property and equipment, net	1,898
Other long-term assets	196
Total assets	$	13,138



Liabilities
Accounts payable	$	7,126
Accrued expenses	3,662
Deferred revenue	3,310
Total current liabilities	14,098
Other long-term liabilities	141
Total liabilities	$	14,239
Net liabilities of Republic	$	1,101

The table below provides the operating results of the discontinued operations through the date of the Spin-Off for the years ended December 31, 2016:



	Year Ended December 31,
	2015			2016

Revenue	$	91,304		$	83,156
Direct costs of network services and equipment	(78,922		)	(61,582		)
Operating expense	(24,692		)	(25,502		)
Depreciation and interest	(1,355		)	(949		)
Income tax benefit	—			1,805
Loss from discontinued operations	$	(13,665	)	$	(3,072	)

Summary of Operating Results of the Discontinued Operations Through the Date of the Spin-Off

The distribution was recorded at the carrying amount of Republic’s net liabilities of $1,101 as of November 30, 2016, as follows:



Assets
Accounts receivable, net of allowance for doubtful accounts	$	1,199
Inventory	7,305
Prepaid expenses and other current assets	2,540
Total current assets	11,044
Property and equipment, net	1,898
Other long-term assets	196
Total assets	$	13,138



Liabilities
Accounts payable	$	7,126
Accrued expenses	3,662
Deferred revenue	3,310
Total current liabilities	14,098
Other long-term liabilities	141
Total liabilities	$	14,239
Net liabilities of Republic	$	1,101

The table below provides the operating results of the discontinued operations through the date of the Spin-Off for the years ended December 31, 2016:



	Year Ended December 31,
	2015			2016

Revenue	$	91,304		$	83,156
Direct costs of network services and equipment	(78,922		)	(61,582		)
Operating expense	(24,692		)	(25,502		)
Depreciation and interest	(1,355		)	(949		)
Income tax benefit	—			1,805
Loss from discontinued operations	$	(13,665	)	$	(3,072	)

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 45
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=65878427&loc=SL51721533-107759

Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=84176398&loc=SL51724579-110230

Reference 7: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table summarizes the assets measured at fair value as of December 31, 2016 and 2017:



	Fair Value Measurements on a Recurring Basis December 31, 2016
	Level 1		Level 2		Level 3		Total
Stockholders’ anti-dilutive arrangement	$	—	$	—	$	184	$	184
Total	$	—	$	—	$	184	$	184



	Fair Value Measurements on a Recurring Basis December 31, 2017
	Level 1		Level 2		Level 3		Total
Money Market Account	$	28,015	$	—	$	—	$	28,015
Total	$	28,015	$	—	$	—	$	28,015

Financial Statement Components (Tables)

12 Months Ended

Dec. 31, 2017

Financial Statement Components [Abstract]

Schedule of Allowance for Doubtful Accounts

Accounts receivable, net of allowance for doubtful accounts consist of the following:



	December 31,
	2016			2017
Trade accounts receivable	$	31,734		$	44,692
Unbilled accounts receivable	7,368			8,653
Allowance for doubtful accounts	(22,571		)	(32,463		)
Other accounts receivable	307			343
Total accounts receivable, net	$	16,838		$	21,225

Components of allowance for doubtful accounts are as follows:



	Year Ended December 31,
Allowance for doubtful accounts:	2016			2017
Balance, beginning of period	$	238		$	255
Charged to bad debt expense	238			176
Deductions(1)	(221		)	(242		)
Balance, end of period	$	255		$	189

________________________

(1) Write off of uncollectible accounts after all collection efforts have been exhausted.



	Year Ended December 31,
Allowance for CABS revenue:	2016			2017
Balance, beginning of period	$	12,317		$	22,316
Billings deemed not probable of collection(1)	10,494			10,024
Deductions(2)	(495		)	(66		)
Balance, end of period	$	22,316		$	32,274

________________________

(2) Write off of uncollectible accounts after all collection efforts have been exhausted.



	Year Ended December 31,
CABS revenue:	2015		2016		2017
Billed	$	15,617	$	19,838	$	19,147
Revenue recognized	8,454		9,344		9,123
Billings deemed not probable of collection(1)	$	7,163	$	10,494	$	10,024

________________________

(1) Represents amounts billed but where collectibility is not probable based on customers collection experience. Amounts were charged to a contra-revenue account.

Schedule of Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following:



	December 31,
	2016		2017
Accrued expense	$	6,853	$	6,851
Accrued compensation and benefits	4,373		5,237
Accrued sales, use, and telecom related taxes	2,769		3,030
Other accrued expenses	654		515
Total accrued expenses	$	14,649	$	15,633

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2017

Property, Plant and Equipment [Abstract]

Summary of Property and Equipment, Net

Property and equipment, net consisted of the following:



	December 31,
	2016			2017
Furniture and fixtures	$	680		$	863
Computer and office equipment	7,539			7,545
Telecommunications equipment	13,718			19,985
Leasehold improvements	453			453
Software development costs	13,676			15,517
Automobile	10			10
Total cost	36,076			44,373
Less—accumulated depreciation	(24,896		)	(29,427		)
Total property and equipment, net	$	11,180		$	14,946

The Company recognized depreciation expense, which includes amortization of capitalized software development costs, as follows:



	Year Ended December 31,
	2015		2016		2017
Cost of revenue	$	5,258	$	4,574	$	4,315
Research and development	21		29		81
Sales and marketing	16		21		27
General and administrative	872		627		450
Total depreciation expense	$	6,167	$	5,251	$	4,873

Summary of Depreciation Expense

Property and equipment, net consisted of the following:



	December 31,
	2016			2017
Furniture and fixtures	$	680		$	863
Computer and office equipment	7,539			7,545
Telecommunications equipment	13,718			19,985
Leasehold improvements	453			453
Software development costs	13,676			15,517
Automobile	10			10
Total cost	36,076			44,373
Less—accumulated depreciation	(24,896		)	(29,427		)
Total property and equipment, net	$	11,180		$	14,946

The Company recognized depreciation expense, which includes amortization of capitalized software development costs, as follows:



	Year Ended December 31,
	2015		2016		2017
Cost of revenue	$	5,258	$	4,574	$	4,315
Research and development	21		29		81
Sales and marketing	16		21		27
General and administrative	872		627		450
Total depreciation expense	$	6,167	$	5,251	$	4,873

Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Indefinite-Lived Intangible Assets

Intangible assets consisted of the following as of December 31, 2016:



	Gross Amount		Accumulated Amortization			Net Carrying Value		Amortization Period
								(Years)
Customer relationships	$	10,396	$	(3,032	)	$	7,364	20
Domain name and related trademarks	2,678		(2,324		)	354		3–7
Licenses, amortizable	341		(341		)	—		2
Non-compete agreements	139		(139		)	—		2–5
Developed technology	775		(775		)	—		3
Licenses, indefinite lived	764		—			764		Indefinite
Total intangible assets, net	$	15,093	$	(6,611	)	$	8,482

Intangible assets consisted of the following as of December 31, 2017:



	Gross Amount		Accumulated Amortization			Net Carrying Value		Amortization Period
								(Years)
Customer relationships	$	10,396	$	(3,552	)	$	6,844	20
Domain name and related trademarks	2,678		(2,643		)	35		3–7
Licenses, amortizable	341		(341		)	—		2
Non-compete agreements	139		(139		)	—		2–5
Developed technology	775		(775		)	—		3
Licenses, indefinite lived	764		—			764		Indefinite
Total intangible assets, net	$	15,093	$	(7,450	)	$	7,643

Schedule of Future Estimated Amortization Expense

Future estimated amortization expense for definite lived intangible assets subsequent to December 31, 2017 is as follows:



	Amount
2018	$	555
2019	520
2020	520
2021	520
2022	520
Thereafter	4,244
	$	6,879

Debt (Tables)

12 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Schedule of Remaining Payments due on Capital Lease Obligations

Remaining payments due on the Company’s capital lease obligations as of December 31, 2017, are as follows:



	Amount
2018	$	92
Less amount representing interest	—
	92
Less current maturities	92
	$	—

Segment and Geographic Information (Tables)

12 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment



	Year Ended December 31,
	2015		2016		2017
CPaaS
Revenue	$	101,502	$	117,078	$	131,572
Cost of revenue	64,760		71,218		75,859
Gross profit	$	36,742	$	45,860	$	55,713
Other
Revenue	$	36,299	$	35,057	$	31,383
Cost of revenue	14,482		14,000		13,403
Gross profit	$	21,817	$	21,057	$	17,980
Consolidated
Revenue	$	137,801	$	152,135	$	162,955
Cost of revenue	79,242		85,218		89,262
Gross profit	$	58,559	$	66,917	$	73,693

Schedule of Revenue by Geographical Area

The Company generates its revenue primarily in the United States. Revenue by geographical area is detailed in the table below (which is determined based on the customer billing address):



	Year Ended December 31,
	2015		2016		2017
United States	$	137,514	$	151,618	$	162,393
International	287		517		562
Total	$	137,801	$	152,135	$	162,955

Stock Based Compensation (Tables)

12 Months Ended

Dec. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Fair Value of Options Granted Using the Black-Scholes Pricing Model

The fair value, adjusted for the stock split, of options granted is estimated on the date of grant using the Black-Scholes option pricing model based on the assumptions in the table below:



	Year Ended December 31,
	2015	2016	2017
Expected dividend yield	0%	0%	0%
Expected stock price volatility	44%	44%	44%-49%
Average risk-free interest rate	1.5%-1.9%	1.3%-2.0%	1.9%-2.3%
Expected life	6.2 years	6.2 years	6.2 years
Fair value of common stock	$9.43-$9.57	$9.57-$9.60	$9.60-$20.83

Summary of Stock Option Activity

The following summarizes the stock option activity for the periods presented:



	Number of Options Outstanding		Weighted- Average Exercise Price (per share)		Weighted- Average Remaining Contract Life (in years)	Aggregate Intrinsic value (in thousands)
Outstanding as of December 31, 2016	3,582,241		$	6.54	5.12	$	11,049
Grants	179,922		13.79
Exercised	(58,162	)	5.27			445
Forfeited or cancelled	(44,210	)	9.46
Outstanding as of December 31, 2017	3,659,791		$	6.88	4.38	$	59,436

Options vested and exercisable at December 31, 2017	3,209,890		$	6.28	3.83	$	54,051

Options vested and expected to vest as of December 31, 2017	3,641,078		$	6.85	4.35	$	59,230

Schedule of Stock-Based Compensation Expense in Continuing Operations

The Company recognized total stock-based compensation expense in continuing operations as follows:



	Year Ended December 31,
	2015		2016		2017
Cost of revenue	$	45	$	61	$	80
Research and development	189		138		155
Sales and marketing	239		182		172
General and administrative (1)	3,020		989		1,396
Total	$	3,493	$	1,370	$	1,803

________________________

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments for Operating Leases

Future minimum lease payments required under operating leases as of December 31, 2017 are as follows:



	Amount
2018	$	3,631
2019	3,700
2020	3,838
2021	3,873
2022	2,018
	$	17,060

Schedule of Future Minimum Lease Receipts for Operating Lease

Future minimum sub-lease receipts required under the non-cancellable lease as of December 31, 2017 are as follows:



	Amount
2018	$	1,020
2019	1,042
2020	1,065
2021	1,089
2022	594
	$	4,810

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Components of (Provision) Benefit for Income Taxes from Continuing Operations

(Provision) benefit for income taxes from continuing operations consists of the following:



	Year Ended December 31,
	2015			2016			2017
Current:
Federal	$	—		$	66		$	(448	)
State	(104		)	(58		)	(302		)
Total	(104		)	8			(750		)
Deferred:
Federal	(272		)	9,999			(5,983		)
State	(32		)	1,087			(185		)
Total	(304		)	11,086			(6,168		)
Total (provision) benefit for income taxes	$	(408	)	$	11,094		$	(6,918	)

Schedule of Effective Income Tax Rate Reconciliation

The following table presents a reconciliation of the statutory federal tax rate and the Company’s effective tax rate for the years ended December 31, 2015, 2016 and 2017:



	Year Ended December 31,
	2015		2016		2017
Federal	34.0	%	34.0	%	34.0	%
State	2.5		4.2		4.7
Non-deductible expenses	1.0		5.0		1.2
Research credit	(3.2	)	(2.3	)	(1.5	)
Stock-based compensation	11.0		(24.5	)	0.1
Change in valuation allowance	(42.5	)	(98.6	)	—
Deferred tax rate change	0.8		0.8		16.1
Other	1.9		4.0		(0.9	)
Total	5.5	%	(77.4	)%	53.7	%

Significant Components of Deferred Tax Assets and Liabilities

The following table presents the significant components of the Company’s net deferred tax assets:



	Year Ended December 31,
	2016		2017
Deferred tax assets:
Allowance for doubtful accounts	$	95	$	48
Accrued liabilities	2,011		1,687
Deferred revenue	241		395
Intangibles	237		166
Stock-based compensation	6,458		4,668
Tax credits	2,369		2,071
Net operating losses	4,249		26
Other	59		37
Total deferred tax assets	15,719		9,098
Less: valuation allowance	—		—
Net deferred tax assets	15,719		9,098
Deferred tax liability:
Property and equipment	2,083		1,797
Goodwill	654		582
Other liability	288		193
Total deferred tax liabilities	3,025		2,572
Net deferred tax asset	$	12,694	$	6,526

Summary of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



	Year Ended December 31,
	2016		2017
Unrecognized tax benefits—January 1,	$	456	$	671
Gross increases—tax positions in prior period	104		—
Gross decreases—tax positions in prior period	—		—
Gross increases—tax positions in current period	111		64
Settlement	—		—
Lapse of statute of limitations	—		(4		)
Unrecognized tax benefits—December 31,	$	671	$	731

Basic and Diluted (Loss) Income per Common Share (Tables)

12 Months Ended

Dec. 31, 2017

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The components of basic and diluted earnings per share, or EPS, are as follows:



	Year Ended December 31,
	2015			2016			2017
Income from Continuing Operations
Income from continuing operations	$	6,965		$	25,430		$	5,971
Less: income allocated to participating securities	931			3,355			644
Income from continuing operations attributable to common stockholders	$	6,034		$	22,075		$	5,327
Income from continuing operations per share:
Basic	$	0.52		$	1.89		$	0.42
Diluted	$	0.48		$	1.72		$	0.37
Loss from Discontinued Operations
Loss from discontinued operations, net on income taxes	$	(13,665	)	$	(3,072	)	$	—
Less: loss allocated to participating securities	(1,827		)	(405		)	—
Loss from discontinued operations attributable to common stockholders	$	(11,838	)	$	(2,667	)	$	—
Loss from discontinued operations per share attributable to stockholders:
Basic	$	(1.03	)	$	(0.23	)	$	—
Diluted	$	(0.95	)	$	(0.21	)	$	—
Net (loss) income
Net (loss) income	$	(6,700	)	$	22,358		$	5,971
Less: (loss) income allocated to participating securities	(896		)	2,950			644
Net (loss) income attributable to common stockholders	$	(5,804	)	$	19,408		$	5,327
Net (loss) income per share:
Basic	$	(0.50	)	$	1.66		$	0.42
Diluted	$	(0.47	)	$	1.51		$	0.37
Weighted Average Number of Common Shares Outstanding
Basic	11,497,727			11,678,568			12,590,221
Dilutive effect of stock options and warrants	958,813			1,192,064			1,952,949
Diluted	12,456,540			12,870,632			14,543,170

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following common share equivalents have been excluded from the calculation of weighted-average common shares outstanding, because the effect is anti-dilutive for the periods presented:



	Year Ended December 31,
	2015	2016	2017
Anti-dilutive Disclosure
Series A redeemable convertible preferred stock outstanding	1,775,000	1,775,000	1,522,123
Stock options issued and outstanding	401,835	237,185	50,604

Subsequent Events (Tables)

12 Months Ended

Dec. 31, 2017

Subsequent Events [Abstract]

Future Expected Minimum Payments

Future expected minimum payments under the lease are as follows:



	Amount
2018	$	397
2019	1,203
2020	1,239
2021	1,276
2022 and thereafter	5,011
	$	9,126

Organization and Description of Business (Details)			12 Months Ended
Organization and Description of Business (Details)	Nov. 09, 2017 USD ($) vote $ / shares shares	Nov. 30, 2016	Dec. 31, 2017 USD ($) vote segment	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Nov. 14, 2017 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of operating segments \| segment			2
Number of reportable segments \| segment			2
Underwriting discounts and commissions \| $			$ 5,385,000	$ 0	$ 0
Secured Debt
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Long-term debt \| $			$ 0	$ 40,000,000		$ 38,500
Common Class B
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Reclassification of shares ratio		1
Votes per share of stock held \| vote			10
Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Reclassification of shares ratio		1
Votes per share of stock held \| vote			1
IPO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Proceeds from the initial public offering, net of underwriting discounts \| $	$ 74,400,000
Underwriting discounts and commissions \| $	$ 5,600,000
IPO \| Common Class B
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Reclassification of shares ratio	1
Votes per share of stock held \| vote	10
IPO \| Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Reclassification of shares ratio	1
Votes per share of stock held \| vote	1
IPO \| New Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares) \| shares	4,000,000
Shares issued, price (in usd per share) \| $ / shares	$ 20

Summary of Significant Accounting Policies (Details)			12 Months Ended
Summary of Significant Accounting Policies (Details)	Nov. 14, 2017 USD ($)	Nov. 04, 2016	Dec. 31, 2017 USD ($) segment reporting_unit	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Property, Plant and Equipment [Line Items]
Restricted cash			$ 243,000	$ 240,000
Allowance for doubtful accounts			32,463,000	22,571,000
Unbilled accounts receivable			$ 8,653,000	7,368,000
Customer useful life			3 years
Debt instrument, term		5 years	5 years
Amortization of debt issuance costs	$ 260,000		$ 376,000	52,000	$ 49,000
Number of reporting units \| reporting_unit			2
Goodwill			$ 6,867,000	6,867,000
Goodwill impairment charges			$ 0	0
Share-based compensation arrangement, requisite service period			4 years
Advertising costs			$ 464,000	197,000	329,000
Number of operating segments \| segment			2
Recognition of previously unrecognized excess tax benefits					420,000
Prepaid Expenses and Other Current Assets
Property, Plant and Equipment [Line Items]
Unamortized debt issuance costs			$ 175,000	200,000
Long-term Debt
Property, Plant and Equipment [Line Items]
Unamortized debt issuance costs			$ 0	326,000
Minimum
Property, Plant and Equipment [Line Items]
Customer arrangement, term			2 years
Maximum
Property, Plant and Equipment [Line Items]
Customer arrangement, term			3 years
Computer hardware and software \| Minimum
Property, Plant and Equipment [Line Items]
Property and equipment, useful life			2 years
Computer hardware and software \| Maximum
Property, Plant and Equipment [Line Items]
Property and equipment, useful life			5 years
Internal-use software development costs
Property, Plant and Equipment [Line Items]
Property and equipment, useful life			3 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Property and equipment, useful life			2 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Property and equipment, useful life			7 years
Retained Earnings
Property, Plant and Equipment [Line Items]
Recognition of previously unrecognized excess tax benefits					$ 420,000
Retained Earnings \| Accounting Standards Update 2016-09
Property, Plant and Equipment [Line Items]
Recognition of previously unrecognized excess tax benefits				$ 420,000
Customer One \| Accounts Receivable
Property, Plant and Equipment [Line Items]
Concentration risk percentage			13.00%

Discontinued Operations - Additional Information (Details) $ in Thousands		12 Months Ended
	Nov. 30, 2016 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash distribution to Republic	$ 30,000	$ 0	$ 30,000	$ 0
Net assets distributed to the stockholders	$ 28,899		$ (28,899)
Republic
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Common stock, conversion basis ratio	1

Discontinued Operations - Distribution Recorded at the Carrying Amount (Details) - Discontinued Operations, Disposed of by Means Other than Sale, Spinoff $ in Thousands	Nov. 30, 2016 USD ($)
Assets
Accounts receivable, net of allowance for doubtful accounts	$ 1,199
Inventory	7,305
Prepaid expenses and other current assets	2,540
Total current assets	11,044
Property and equipment, net	1,898
Other long-term assets	196
Total assets	13,138
Liabilities
Accounts payable	7,126
Accrued expenses	3,662
Deferred revenue	3,310
Total current liabilities	14,098
Other long-term liabilities	141
Total liabilities	14,239
Net liabilities of Republic	$ 1,101

Discontinued Operations - Operating Results of the Discontinued Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss from discontinued operations	$ 0	$ (3,072)	$ (13,665)
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue		83,156	91,304
Direct costs of network services and equipment		(61,582)	(78,922)
Operating expense		(25,502)	(24,692)
Depreciation and interest		(949)	(1,355)
Income tax benefit		1,805	0
Loss from discontinued operations		$ (3,072)	$ (13,665)

- Definition

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

+ References + Details

- Definition

Amount after tax of income (loss) from a discontinued operation attributable to the parent. Includes, but is not limited to, the income (loss) from operations during the phase-out period, gain (loss) on disposal, gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and adjustments to a prior period gain (loss) on disposal.

+ References + Details

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Shareholder agreement, term of notice (in days)	90 days
Shareholder agreement, qualified public offering threshold	$ 20,000
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Stockholders’ anti-dilutive arrangement		$ 184
Money Market Account	28,015
Total assets	28,015
Fair Value, Measurements, Recurring \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Stockholders’ anti-dilutive arrangement		0
Money Market Account	28,015
Total assets	28,015	0
Fair Value, Measurements, Recurring \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Stockholders’ anti-dilutive arrangement		0
Money Market Account	0
Total assets	0	0
Fair Value, Measurements, Recurring \| Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Stockholders’ anti-dilutive arrangement		184
Money Market Account	0
Total assets	$ 0	$ 184

Financial Statement Components - Accounts Receivable, Net of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Financial Statement Components [Abstract]
Trade accounts receivable	$ 44,692	$ 31,734
Unbilled accounts receivable	8,653	7,368
Allowance for doubtful accounts	(32,463)	(22,571)
Other accounts receivable	343	307
Total accounts receivable, net	$ 21,225	$ 16,838

Financial Statement Components - Allowance For Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Allowance for Doubtful Accounts Receivable [Roll Forward]
Revenue	$ 162,955	$ 152,135	$ 137,801
Carrier Access Billing (CAB)
Allowance for Doubtful Accounts Receivable [Roll Forward]
Billings deemed not probable of collection	10,024	10,494	7,163
Billed	19,147	19,838	15,617
Revenue	9,123	9,344	8,454
Accounts Receivable, Excluding Carrier Access Billing (CAB)
Allowance for Doubtful Accounts Receivable [Roll Forward]
Balance, beginning of period	255	238
Billings deemed not probable of collection	176	238
Deductions	(242)	(221)
Balance, end of period	189	255	238
Carrier Access Billing (CAB)
Allowance for Doubtful Accounts Receivable [Roll Forward]
Balance, beginning of period	22,316	12,317
Billings deemed not probable of collection	10,024	10,494
Deductions	(66)	(495)
Balance, end of period	$ 32,274	$ 22,316	$ 12,317

Financial Statement Components - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Financial Statement Components [Abstract]
Accrued expense	$ 6,851	$ 6,853
Accrued compensation and benefits	5,237	4,373
Accrued sales, use, and telecom related taxes	3,030	2,769
Other accrued expenses	515	654
Total accrued expenses	$ 15,633	$ 14,649

Property and Equipment - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 44,373	$ 36,076
Less—accumulated depreciation	(29,427)	(24,896)
Total property and equipment, net	14,946	11,180
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	863	680
Computer and office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	7,545	7,539
Telecommunications equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	19,985	13,718
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	453	453
Software development costs
Property, Plant and Equipment [Line Items]
Property and equipment, gross	15,517	13,676
Automobile
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 10	$ 10

Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Unamortized software development costs	$ 3,795	$ 4,056
Amortization of capitalized software development costs	2,133	2,820	$ 2,842
Capitalized software impairment	81	91	71
Capitalized software development costs	$ 2,942	$ 2,230	$ 3,011
Software development costs
Property, Plant and Equipment [Line Items]
Property and equipment, useful life	3 years

Property and Equipment - Depreciation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Depreciation Expense [Line Items]
Depreciation	$ 4,873	$ 5,251	$ 6,167
Cost of revenue
Depreciation Expense [Line Items]
Depreciation	4,315	4,574	5,258
Research and development
Depreciation Expense [Line Items]
Depreciation	81	29	21
Sales and marketing
Depreciation Expense [Line Items]
Depreciation	27	21	16
General and administrative
Depreciation Expense [Line Items]
Depreciation	$ 450	$ 627	$ 872

Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Accumulated Amortization	$ (7,450)	$ (6,611)
Finite-lived intangible assets, net	6,879
Gross Amount	15,093	15,093
Net Carrying Value	7,643	8,482
Licenses
Indefinite-lived Intangible Assets [Line Items]
Licenses, indefinite lived	764	764
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	10,396	10,396
Accumulated Amortization	(3,552)	(3,032)
Finite-lived intangible assets, net	$ 6,844	$ 7,364
Amortization Period	20 years	20 years
Domain name and related trademarks
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	$ 2,678	$ 2,678
Accumulated Amortization	(2,643)	(2,324)
Finite-lived intangible assets, net	$ 35	$ 354
Domain name and related trademarks \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	3 years	3 years
Domain name and related trademarks \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	7 years	7 years
Licenses
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	$ 341	$ 341
Accumulated Amortization	(341)	(341)
Finite-lived intangible assets, net	$ 0	$ 0
Amortization Period	2 years	2 years
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	$ 139	$ 139
Accumulated Amortization	(139)	(139)
Finite-lived intangible assets, net	$ 0	$ 0
Non-compete agreements \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	2 years	2 years
Non-compete agreements \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	5 years	5 years
Developed technology
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	$ 775	$ 775
Accumulated Amortization	(775)	(775)
Finite-lived intangible assets, net	$ 0	$ 0
Amortization Period	3 years	3 years

Intangible Assets - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Amortization expense	$ 839,000	$ 891,000	$ 908,000
Weighted average amortization period	19 years
Impairment of indefinite-lived intangible assets	$ 0	0
Impairment of finite-lived intangible assets	$ 0	$ 695,000	$ 0

Intangible Assets - Future Estimated Amortization Expense (Details) $ in Thousands	Dec. 31, 2017 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2018	$ 555
2019	520
2020	520
2021	520
2022	520
Thereafter	4,244
Finite-lived intangible assets, net	$ 6,879

Debt - Additional Information (Details) - USD ($)		12 Months Ended
Debt - Additional Information (Details) - USD ($)	Nov. 04, 2016	Dec. 31, 2017	Nov. 14, 2017	Dec. 31, 2016	Dec. 14, 2015
Debt Instrument [Line Items]
Debt instrument, term	5 years	5 years
Cost of assets under capital leases		$ 1,951,000		$ 1,951,000
Accumulated depreciation of assets under capital leases		1,855,000		1,807,000
Maximum
Debt Instrument [Line Items]
Bridge loan	$ 1,000,000
Secured Debt
Debt Instrument [Line Items]
Term loan, face amount	40,000,000
Long-term debt		0	$ 38,500	40,000,000
Revolving Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	25,000,000				$ 25,000,000
Line of credit		0		$ 5,000,000
Available borrowing capacity		$ 25,000,000
Revolving Credit Facility \| Maximum
Debt Instrument [Line Items]
Letter of credit commitments	$ 2,500,000

Debt - Remaining Payments due on Capital Lease Obligations (Details) $ in Thousands	Dec. 31, 2017 USD ($)
Debt Disclosure [Abstract]
2018	$ 92
Less amount representing interest	0
Capital lease obligations	92
Less current maturities	92
Capital lease obligations, noncurrent	$ 0

Segment and Geographic Information - Reconciliation of Segment Profit (Loss) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($) segment	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments \| segment	2
Revenue	$ 162,955	$ 152,135	$ 137,801
Cost of revenue	89,262	85,218	79,242
Gross profit	73,693	66,917	58,559
CPaaS
Segment Reporting Information [Line Items]
Revenue	131,572	117,078	101,502
Cost of revenue	75,859	71,218	64,760
Gross profit	55,713	45,860	36,742
Other
Segment Reporting Information [Line Items]
Revenue	31,383	35,057	36,299
Cost of revenue	13,403	14,000	14,482
Gross profit	$ 17,980	$ 21,057	$ 21,817

Segment and Geographic Information - Reconciliation of Revenue by Geographic Area (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 162,955	$ 152,135	$ 137,801
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	162,393	151,618	137,514
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 562	$ 517	$ 287

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity - Redeemable Convertible Preferred Stock (Details) $ / shares in Units, $ in Thousands			12 Months Ended
	Nov. 09, 2017 $ / shares shares	Nov. 30, 2016	Dec. 31, 2017 $ / shares shares	Dec. 31, 2016 USD ($) $ / shares shares	Nov. 08, 2017 $ / shares	Dec. 31, 2015 shares	Dec. 31, 2014 shares	Mar. 24, 2011 $ / shares shares	Feb. 22, 2011 $ / shares shares	Jan. 01, 2010 shares
Class of Stock [Line Items]
Series A redeemable convertible preferred stock, shares authorized (in shares)			1,200,000	1,200,000					1,200,000	5,000,000
Series A redeemable convertible preferred stock, shares issued (in shares)			0	710,000				46,093	663,907
Series A redeemable convertible preferred stock, shares outstanding (in shares)			0	710,000		710,000	710,000
Series A redeemable convertible preferred stock, par value (in usd per share) \| $ / shares			$ 0.001	$ 0.001				$ 30.8358	$ 30.8358
Liquidation preference multiple			0.08
Preferred stock, liquidation preference value \| $				$ 32,148
Temporary equity, redemption period			60 days
Preferred stock, dividends declared (in usd per share) \| $ / shares			$ 0	$ 0
Old Common Class A
Class of Stock [Line Items]
Stock split conversion ratio	2.5
Shares converted (in shares)	1,775,000
Series A Preferred Stock
Class of Stock [Line Items]
Preferred stock, conversion basis ratio		1
Convertible preferred stock, conversion price (in usd per share) \| $ / shares	$ 12.3343				$ 30.8358
Shares issued, price (in usd per share) \| $ / shares			$ 30.8358
New Common Class B
Class of Stock [Line Items]
Shares converted (in shares)	1,775,000
Common Class A \| Republic
Class of Stock [Line Items]
Preferred stock, conversion basis ratio		1

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity - Preferred Stock (Details) - $ / shares	Dec. 31, 2017	Dec. 31, 2016
Equity [Abstract]
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, par value (in usd per share)	$ 0.001	$ 0.001
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity - Common Stock (Details)		12 Months Ended
	Nov. 09, 2017 $ / shares shares	Dec. 31, 2017 vote $ / shares shares	Dec. 31, 2016 $ / shares shares
Class of Stock [Line Items]
Common stock, par value (in usd per share) \| $ / shares	$ 0.001
Common stock, shares authorized (in shares)	120,000,000
Common stock, dividends declared (in usd per share) \| $ / shares		$ 0
Old Common Class A
Class of Stock [Line Items]
Common stock, shares issued (in shares)		0	11,779,975
Common stock, shares outstanding (in shares)		0	11,779,975
Common stock, par value (in usd per share) \| $ / shares		$ 0.001	$ 0.001
Stock split conversion ratio	2.5
Shares converted (in shares)	1,775,000
Common stock, shares authorized (in shares)		0	20,000,000
Old Common Class B
Class of Stock [Line Items]
Common stock, shares issued (in shares)		0	18,590
Common stock, shares outstanding (in shares)		0	18,590
Common stock, par value (in usd per share) \| $ / shares		$ 0.001	$ 0.001
Common stock, shares authorized (in shares)		0	3,341,275
New Common Class B
Class of Stock [Line Items]
Shares converted (in shares)	1,775,000
Common Class B
Class of Stock [Line Items]
Common stock, shares issued (in shares)		13,440,725	0
Common stock, shares outstanding (in shares)		13,440,725	0
Common stock, par value (in usd per share) \| $ / shares		$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	20,000,000	20,000,000	0
Votes per share of stock held \| vote		10
Common Class A
Class of Stock [Line Items]
Common stock, shares issued (in shares)		4,197,831	0
Common stock, shares outstanding (in shares)		4,197,831	0
Common stock, par value (in usd per share) \| $ / shares		$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000,000	100,000,000	0
Votes per share of stock held \| vote		1

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity - Option to Purchase Additional Shares (Details)	Nov. 28, 2017 shares
Over-Allotment Option \| Common Class A
Class of Stock [Line Items]
Underwriters exercise of options (in shares)	162,991

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity - Stock Purchase Warrants (Details) - $ / shares	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2011	Dec. 20, 2010
Stock Purchase Warrant
Class of Stock [Line Items]
Warrants, shares exercisable (in shares)				30,470
Warrants, exercise price (in usd per share)				$ 5.80
Warrants outstanding (in shares)	0	15,844
Common stock reserved for future issuance (in shares)	51,350	64,691
Stock Purchase Warrant, Expire March 25, 2018
Class of Stock [Line Items]
Warrants, shares exercisable (in shares)			43,847
Warrants, exercise price (in usd per share)			$ 0.001
Warrants outstanding (in shares)	39,000	39,000
Stock Purchase Warrant, Expire February 22, 2018
Class of Stock [Line Items]
Warrants, shares exercisable (in shares)			9,846
Warrants, exercise price (in usd per share)			$ 5.80
Stock Purchase Warrant, Expire January 19, 2018
Class of Stock [Line Items]
Warrants, shares exercisable (in shares)	4,531
Warrants, exercise price (in usd per share)	$ 6.57
Warrants outstanding (in shares)	2,504

Redeemable Convertible Preferred Stock and Stockholder's (Deficit) Equity - Spin-Off (Details)	Nov. 30, 2016
Republic
Class of Stock [Line Items]
Common stock, conversion basis ratio	1
Common Class A
Class of Stock [Line Items]
Common stock, conversion basis ratio	1
Common Class A \| Republic
Class of Stock [Line Items]
Common stock, conversion basis ratio	1
Common Class B
Class of Stock [Line Items]
Common stock, conversion basis ratio	1
Common Class B \| Republic
Class of Stock [Line Items]
Common stock, conversion basis ratio	1

Stock Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Nov. 09, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Aug. 24, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated grant date fair value of options vested		$ 1,299	$ 2,082	$ 2,107
Unrecognized cost for stock based compensation		$ 1,935
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized cost for stock based compensation, period for recognition (in years)		2 years 7 months 2 days
2010 Equity Compensation Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant-date fair value of stock options granted (in usd per share)		$ 7.72	$ 4.06	$ 4.24
2010 Equity Compensation Plan \| Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance (in shares)					3,466,275
Vesting period (in years)	4 years
Contractual life (in years)	10 years
2017 Equity Compensation Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)	1,050,000

Stock Based Compensation - Fair Value of Options Granted Using the Black-Scholes Pricing Model (Details) - Employee Stock Option - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend yield	0.00%	0.00%	0.00%
Expected stock price volatility		44.00%	44.00%
Average risk-free interest rate, minimum	1.90%	1.30%	1.50%
Average risk-free interest rate, maximum	2.30%	2.00%	1.90%
Expected life (in years)	6 years 2 months 12 days	6 years 2 months 12 days	6 years 2 months 12 days
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected stock price volatility	44.00%
Fair value of common stock (in usd per share)	$ 9.60	$ 9.57	$ 9.43
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected stock price volatility	49.00%
Fair value of common stock (in usd per share)	$ 20.83	$ 9.60	$ 9.57

Stock Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Number of options outstanding, beginning balance (in shares)	3,582,241
Number of options, granted (in shares)	179,922
Number of options exercised (in shares)	(58,162)
Number of options, forfeited or cancelled (in shares)	(44,210)
Number of options outstanding, ending balance (in shares)	3,659,791	3,582,241
Number of options outstanding, options vested and exercisable (in shares)	3,209,890
Number of options outstanding, options vested and expected to vest (in shares)	3,641,078
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Weighted-average exercise price, ending balance (in usd per share)	$ 6.54
Weighted-average exercise price, granted (in usd per share)	13.79
Weighted-average exercise price, exercised (in usd per share)	5.27
Weighted-average exercise price, forfeited or cancelled (in usd per share)	9.46
Weighted-average exercise price, ending balance (in usd per share)	6.88	$ 6.54
Weighted-average exercise price, options vested and exercisable (in usd per share)	6.28
Weighted-average exercise price, options vested and expected to vest (in usd per share)	$ 6.85
Weighted-average remaining contract life, options outstanding (in years)	4 years 4 months 17 days	5 years 1 month 13 days
Weighted-average remaining contract life, options vested and exercisable (in years)	3 years 9 months 29 days
Weighted-average remaining contract life, options vested and expected to vest (in years)	4 years 4 months 6 days
Aggregate intrinsic value, options outstanding	$ 59,436	$ 11,049
Aggregate intrinsic value, options exercised	445
Aggregate intrinsic value, options vested and exercisable	54,051
Aggregate intrinsic value, options vested and expected to vest	$ 59,230

Stock Based Compensation - Allocated Stock Based Compensation Expense (Details) - USD ($) $ in Thousands		12 Months Ended
	Sep. 01, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Allocated share-based compensation expense	$ 394	$ 1,803	$ 1,370	$ 3,493
Number of options outstanding (in shares)	194,234	3,659,791	3,582,241
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Allocated share-based compensation expense		$ 80	$ 61	45
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Allocated share-based compensation expense		155	138	189
Selling and marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Allocated share-based compensation expense		172	182	239
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Allocated share-based compensation expense		$ 1,396	$ 989	$ 3,020

Commitments and Contingencies - Operating Leases (Details) $ in Thousands		12 Months Ended
	Apr. 14, 2017 ft²	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Lessee, Lease, Description [Line Items]
Rent expense \| $		$ 3,327	$ 2,003	$ 1,656
General and administrative
Lessee, Lease, Description [Line Items]
Reduction of rent expense \| $		$ (949)	$ (47)
Amended Operating Lease Agreement, Original
Lessee, Lease, Description [Line Items]
Term of lease (in months)	63 months
Office space (in square foot) \| ft²	40,657
Amended Operating Lease Agreement, Extension
Lessee, Lease, Description [Line Items]
Office space (in square foot) \| ft²	128,200

Commitments and Contingencies - Future Minimum Rental Payments for Operating Leases (Details) $ in Thousands	Dec. 31, 2017 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2018	$ 3,631
2019	3,700
2020	3,838
2021	3,873
2022 and thereafter	2,018
Future minimum payments due, total	$ 17,060

Commitments and Contingencies - Future Minimum Lease Receipts (Details) $ in Thousands	Dec. 31, 2017 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2018	$ 1,020
2019	1,042
2020	1,065
2021	1,089
2022	594
Future minimum lease receipts, total	$ 4,810

Commitments and Contingencies - Contractual Obligations (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Annual minimum commitments	$ 1,200
Term of agreement (in years)	5 years
Non-cancellable purchase obligation	$ 5,249

Employee Benefit Plan (Details) - USD ($) $ in Thousands	12 Months Ended
Employee Benefit Plan (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Retirement Benefits [Abstract]
Matching contributions	$ 806	$ 716	$ 698

Income Taxes - Components of (Provision) Benefit for Income Taxes from Continuing Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Current
Federal	$ (448)	$ 66	$ 0
State	(302)	(58)	(104)
Total	(750)	8	(104)
Deferred:
Federal	(5,983)	9,999	(272)
State	(185)	1,087	(32)
Total	(6,168)	11,086	(304)
Total (provision) benefit for income taxes	$ (6,918)	$ 11,094	$ (408)

Income Taxes - Effective Income Tax Rate Reconciliation (Details)	3 Months Ended		12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Federal	34.00%	34.00%	34.00%	34.00%	34.00%
State			4.70%	4.20%	2.50%
Non-deductible expenses			1.20%	5.00%	1.00%
Research credit			(1.50%)	(2.30%)	(3.20%)
Stock-based compensation			0.10%	(24.50%)	11.00%
Change in valuation allowance			0.00%	(98.60%)	(42.50%)
Deferred tax rate change			16.10%	0.80%	0.80%
Other			(0.90%)	4.00%	1.90%
Total			53.70%	(77.40%)	5.50%

Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Deferred tax assets
Allowance for doubtful accounts	$ 48	$ 95
Accrued liabilities	1,687	2,011
Deferred revenue	395	241
Intangibles	166	237
Stock-based compensation	4,668	6,458
Tax credits	2,071	2,369
Net operating losses	26	4,249
Other	37	59
Total deferred tax assets	9,098	15,719
Less: valuation allowance	0	0
Net deferred tax assets	9,098	15,719
Deferred tax liability
Property and equipment	1,797	2,083
Goodwill	582	654
Other liability	193	288
Total deferred tax liabilities	2,572	3,025
Net deferred tax asset	$ 6,526	$ 12,694

Income Taxes - Additional Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($)
Income Tax Disclosure [Abstract]
Federal tax credits	$ 2,563
Net operating loss carryforwards	590
Unrecognized tax benefits	731
Remeasurement of the deferred tax assets at the lower corporate tax rate	$ 2,073

Income Taxes - Summary of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefits, beginning balance	$ 671	$ 456
Gross increases—tax positions in prior period	0	104
Gross decreases—tax positions in prior period	0	0
Gross increases—tax positions in current period	64	111
Settlement	0	0
Lapse of statute of limitations	(4)	0
Unrecognized tax benefits, ending balance	$ 731	$ 671

Related Parties (Details) - Affiliated Entity - Republic - USD ($)	1 Months Ended	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Transition Services Agreement
Related Party Transaction [Line Items]
Term of agreement		2 years
Revenue from related parties	$ 134,000	$ 575,000
Due from related parties	0	$ 15,000	$ 0
Facilities Sharing Agreement
Related Party Transaction [Line Items]
Lease term		63 months
Rental payments received		$ 949,000	47,000
Due from related parties	0	0	0
Tax Sharing Agreement
Related Party Transaction [Line Items]
Due from related parties	0	0	0
Due to related parties	0	0	0
Master Services Agreement
Related Party Transaction [Line Items]
Revenue from related parties	173,000	2,451,000
Due from related parties	$ 3,000	$ 311,000	$ 3,000

Basic and Diluted (Loss) Income per Common Share - Components of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income from Continuing Operations
Income from continuing operations	$ 5,971	$ 25,430	$ 6,965
Less: income allocated to participating securities	644	3,355	931
Income from continuing operations attributable to common stockholders	$ 5,327	$ 22,075	$ 6,034
Income (loss) from continuing operations per share:
Basic (in usd per share)	$ 0.42	$ 1.89	$ 0.52
Diluted (in usd per share)	$ 0.37	$ 1.72	$ 0.48
Loss from Discontinued Operations
Loss from discontinued operations, net on income taxes	$ 0	$ (3,072)	$ (13,665)
Less: loss allocated to participating securities	0	(405)	(1,827)
Loss from discontinued operations attributable to common stockholders	$ 0	$ (2,667)	$ (11,838)
Loss from discontinued operations per share attributable to stockholders:
Basic (in usd per share)	$ 0.00	$ (0.23)	$ (1.03)
Diluted (in usd per share)	$ 0.00	$ (0.21)	$ (0.95)
Net (loss) income
Net (loss) income	$ 5,971	$ 22,358	$ (6,700)
Less: (loss) income allocated to participating securities	644	2,950	(896)
Net (loss) income attributable to common stockholders	$ 5,327	$ 19,408	$ (5,804)
Net (loss) income per share:
Basic (in usd per share)	$ 0.42	$ 1.66	$ (0.50)
Diluted (in usd per share)	$ 0.37	$ 1.51	$ (0.47)
Weighted Average Number of Common Shares Outstanding
Basic (in shares)	12,590,221	11,678,568	11,497,727
Dilutive effect of stock options and warrants (in shares)	1,952,949	1,192,064	958,813
Diluted (in shares)	14,543,170	12,870,632	12,456,540

Basic and Diluted (Loss) Income per Common Share - Antidilutive Securities Excluded from the Computation (Details) - shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Series A redeemable convertible preferred stock outstanding
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from calculation of weighted-average common shares outstanding	1,522,123	1,775,000	1,775,000
Stock options issued and outstanding
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from calculation of weighted-average common shares outstanding	50,604	237,185	401,835

Subsequent Events (Details) - Subsequent Event $ in Thousands	Feb. 08, 2018 USD ($)	Jan. 12, 2018 ft²
Subsequent Event [Line Items]
Term of lease (in months)		84 months
Office space (in square foot) \| ft²		40,035
Litigation settlement payment from Verizon \| $	$ 4,400

Subsequent Events - Future Expected Minimum Lease Payments (Details) - USD ($) $ in Thousands	Jan. 12, 2018	Dec. 31, 2017
Subsequent Event [Line Items]
2018		$ 3,631
2019		3,700
2020		3,838
2021		3,873
2022 and thereafter		2,018
Future minimum payments due, total		$ 17,060
Subsequent Event
Subsequent Event [Line Items]
2018	$ 397
2019	1,203
2020	1,239
2021	1,276
2022 and thereafter	5,011
Future minimum payments due, total	$ 9,126