0001514416-20-000027 | 10-K | XBRL Viewer

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Cover - USD ($) $ in Millions	12 Months Ended
Cover - USD ($) $ in Millions	Dec. 31, 2019	Jan. 31, 2020	Jun. 28, 2019
Entity Information [Line Items]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2019
Document Transition Report	false
Entity File Number	001-38285
Entity Registrant Name	BANDWIDTH INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	56-2242657
Entity Address, Address Line One	900 Main Campus Drive
Entity Address, City or Town	Raleigh
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27606
City Area Code	(800)
Local Phone Number	808-5150
Title of 12(b) Security	Class A Common Stock, par value $0.001 per share
Trading Symbol	BAND
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 1,415
Documents Incorporated by Reference	Portions of the registrant’s Definitive Proxy Statement for the 2020 Annual Meeting of Stockholders are incorporated herein by reference in Part II and Part III of this Annual Report on Form 10-K to the extent stated herein. Such Definitive Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2019.
Entity Central Index Key	0001514416
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Amendment Flag	false
Common Class A
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		18,610,208
Common Class B
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		4,927,401

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets:
Cash, cash equivalents and restricted cash	$ 185,004	$ 41,501
Marketable securities	0	17,400
Accounts receivable, net of allowance for doubtful accounts	30,187	24,009
Prepaid expenses and other current assets	9,260	6,114
Deferred costs	2,498	2,630
Total current assets	226,949	91,654
Property and equipment, net	41,654	25,136
Operating right-of-use asset	21,031
Intangible assets, net	6,569	7,089
Deferred costs, non-current	1,952	1,828
Other long-term assets	1,533	487
Goodwill	6,867	6,867
Deferred tax asset	34,861	17,359
Total assets	341,416	150,420
Current liabilities:
Accounts payable	4,190	3,418
Accrued expenses and other current liabilities	27,328	21,393
Current portion of deferred revenue	5,177	5,324
Advanced billings	4,167	2,588
Operating lease liability, current	4,876
Total current liabilities	45,738	32,723
Long-term lease obligations	19,868
Deferred rent, net of current portion		2,503
Deferred revenue, net of current portion	5,720	6,424
Total liabilities	71,326	41,650
Commitments and contingencies
Stockholders’ equity:
Preferred stock	0	0
Additional paid-in capital	275,553	116,600
Accumulated deficit	(5,528)	(7,848)
Accumulated other comprehensive (loss) income	41	(1)
Total stockholders’ equity	270,090	108,770
Total liabilities and stockholders’ equity	341,416	150,420
Common Class A
Stockholders’ equity:
Class A and Class B common stock	19	13
Common Class B
Stockholders’ equity:
Class A and Class B common stock	$ 5	$ 6

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2019	Dec. 31, 2018	Nov. 09, 2017
Preferred stock, par value (in usd per share)	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in usd per share)			$ 0.001
Common stock, shares authorized (in shares)			120,000,000
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
Common stock, shares issued (in shares)	18,584,478	12,912,747
Common stock, shares outstanding (in shares)	18,584,478	12,912,747
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
Common stock, shares issued (in shares)	4,927,401	6,510,732
Common stock, shares outstanding (in shares)	4,927,401	6,510,732

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenue	$ 232,594	$ 204,113	$ 162,955
Cost of revenue	124,959	108,145	89,262
Gross profit	107,635	95,968	73,693
Operating expenses:
Research and development	31,461	20,897	10,789
Sales and marketing	35,020	20,731	11,218
General and administrative	58,847	47,588	37,069
Total operating expenses	125,328	89,216	59,076
Operating (loss) income	(17,693)	6,752	14,617
Other (expense) income:
Interest (expense) income, net	2,446	301	(1,728)
Other income, net	23	0	0
Total other (expense) income	2,469	301	(1,728)
(Loss) income before income taxes	(15,224)	7,053	12,889
Income tax (provision) benefit	17,718	10,870	(6,918)
Net (loss) income	2,494	17,923	5,971
Earnings per share:
Net income	2,494	17,923	5,971
Income allocated to participating securities	0	0	644
Net income attributable to common stockholders	$ 2,494	$ 17,923	$ 5,327
Net (loss) income per share
Basic (in usd per share)	$ 0.11	$ 0.96	$ 0.42
Diluted (in usd per share)	$ 0.10	$ 0.85	$ 0.37
Weighted average number of common shares outstanding:
Basic (in shares)	22,640,461	18,573,067	12,590,221
Diluted (in shares)	23,923,777	21,140,382	14,543,170
CPaaS
Revenue	$ 197,944	$ 164,415	$ 131,572
Cost of revenue	110,343	94,296	75,859
Other
Revenue	34,650	39,698	31,383
Cost of revenue	$ 14,616	$ 13,849	$ 13,403

Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ (Deficit) Equity - USD ($) $ in Thousands	Total	Conversion of Series A preferred stock to Old Class A voting common stock	Conversion of Old Class B non-voting common stock to Class A voting common stock	Conversion of Class B voting common stock to Class A voting common stock	Class A voting common stock	Class B voting common stock	Old Common Class A	Old Common Class B	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 Common Class A	Common stock Old Common Class A Conversion of Series A preferred stock to Old Class A voting common stock	Common stock Old Common Class B	Common stock Old Common Class B 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 Common Class A	Additional paid-in capital Old Common Class B	Accumulated other comprehensive (loss) income	Accumulated deficit
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2016	710,000
Series A redeemable convertible preferred stock, beginning balance at Dec. 31, 2016	$ 21,818
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
Beginning balance (in shares) at Dec. 31, 2016							11,779,975	18,590	0			0		11,779,975		18,590
Beginning balance at Dec. 31, 2016	(22,374)								$ 0			$ 0		$ 12		$ 0		$ 9,356				$ 0	$ (31,742)
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	0	$ 21,818	$ 0	$ 0								$ 13		$ (13)	$ 1				$ 21,817
Costs in connection with offering	(5,385)																	(5,385)
Termination of Shareholders’ anti-dilutive arrangement	184																	184
Net income (loss)	5,971																						5,971
Ending balance (in shares) at Dec. 31, 2017									4,197,831			13,440,725		0		0
Ending balance at Dec. 31, 2017	$ 76,711								$ 4			$ 13		$ 0		$ 0		102,465				0	(25,771)
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2018	0
Series A redeemable convertible preferred stock, ending balance at Dec. 31, 2018	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)									330
Issuance of common stock	11																	11
Exercise of warrants to purchase common stock (in shares)									48,904
Exercise of warrants to purchase common stock	37																	37
Stock based compensation	3,328																	3,328
Conversion of stock (in shares)									6,929,993			(6,929,993)
Conversion of stock									$ 7			$ (7)
Exercises of vested stock options (in shares)									1,724,689
Exercises of vested stock options	11,046								$ 2									11,044
Vesting of restricted stock units (in shares)									11,000
Costs in connection with offering	(285)																	(285)
Unrealized loss on marketable securities	(1)																					(1)
Net income (loss)	17,923																						17,923
Ending balance (in shares) at Dec. 31, 2018					12,912,747	6,510,732			12,912,747			6,510,732		0		0
Ending balance at Dec. 31, 2018	$ 108,770								$ 13			$ 6		$ 0		$ 0		116,600				(1)	(7,848)
Series A redeemable convertible preferred stock, shares outstanding, beginning balance (in shares) at Dec. 31, 2019	0
Series A redeemable convertible preferred stock, ending balance at Dec. 31, 2019	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)									2,875,000
Issuance of common stock	147,391								$ 3									147,388
Stock based compensation	6,626																	6,626
Conversion of stock (in shares)											1,583,331		(1,583,331)
Conversion of stock	1										$ 2		$ (1)
Exercises of vested stock options (in shares)									1,075,482
Exercises of vested stock options	7,357								$ 1									7,356
Vesting of restricted stock units (in shares)									163,944
Costs in connection with offering	(834)																	(834)
Equity awards withheld for tax liability (in shares)									(26,026)
Equity awards withheld for tax liability	(1,583)																	(1,583)
Unrealized loss on marketable securities	1																					1
Foreign currency translation	41																					41
Net income (loss)	2,494																						2,494
Ending balance (in shares) at Dec. 31, 2019					18,584,478	4,927,401			18,584,478			4,927,401		0		0
Ending balance at Dec. 31, 2019	$ 270,090								$ 19			$ 5		$ 0		$ 0		$ 275,553				$ 41	$ (5,528)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities
Net income	$ 2,494	$ 17,923	$ 5,971
Adjustments to reconcile net income to net cash provided by (used in) operating activities
Depreciation and amortization	9,538	5,824	5,712
Right-of-use asset amortization	4,269
Accretion of bond discount	(700)	(164)	0
Gain on sale of marketable securities	(4)	0	0
Amortization of debt issuance costs	177	64	376
Stock-based compensation	6,626	3,339	1,803
Deferred taxes	(17,502)	(10,833)	6,168
Loss on disposal of property and equipment	456	191	91
Changes in operating assets and liabilities:
Accounts receivable	(6,178)	(2,784)	(4,387)
Prepaid expenses and other assets	(4,176)	(1,926)	(1,622)
Deferred costs	(69)	243	(906)
Accounts payable	1,145	(169)	(2,429)
Accrued expenses and other liabilities	5,474	4,826	1,040
Deferred revenue and advanced billings	554	6,019	2,573
Operating right-of-use liability	(3,357)
Deferred rent	0	2,080	233
Net cash provided by (used in) operating activities	(1,253)	24,633	14,623
Cash flows from investing activities
Purchase of property and equipment	(22,215)	(12,419)	(5,021)
Capitalized software development costs	(3,544)	(2,028)	(2,942)
Purchase of marketable securities	(68,361)	(35,236)	0
Proceeds from Sale and Maturity of Marketable Securities	86,467	18,000	0
Net cash used in investing activities	(7,653)	(31,683)	(7,963)
Cash flows from financing activities
Borrowings on line of credit	0	0	4,000
Repayments on line of credit	0	0	(9,000)
Payments on capital leases		(92)	(73)
Payments on capital leases	0
Repayments on term loan	0	0	(40,000)
Proceeds from the initial public offering, net of underwriting discounts	0	0	74,400
Proceeds from the follow-on public offering, net of underwriting discounts	147,391	0	0
Payment of debt issuance costs	(167)	(25)	(25)
Proceeds from exercises of stock options	7,357	11,046	174
Proceeds from exercises of warrants	0	37	91
Value of equity awards withheld for tax liabilities	(1,406)	0	0
Net cash provided by financing activities	152,418	10,681	24,182
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(9)	0	0
Net increase in cash, cash equivalents, and restricted cash	143,503	3,631	30,842
Cash, cash equivalents, and restricted cash, beginning of period	41,501	37,870	7,028
Cash, cash equivalents, and restricted cash, end of period	185,004	41,501	37,870
Supplemental disclosure of cash flow information
Cash paid during the year for interest	341	107	1,535
Cash paid (refunded) for taxes	(178)	155	855
Right-of-use assets obtained in exchange for new operating lease liabilities	4,528
Supplemental disclosure of noncash investing and financing activities
Purchase of property and equipment, accrued but not paid	1,375	1,204	886
Equity awards withheld for tax liabilities, accrued but not paid	177	0	0
IPO
Cash flows from financing activities
Payments of costs related to public offering	0	(285)	(5,385)
Follow-on Public Offering
Cash flows from financing activities
Payments of costs related to public offering	$ (757)	$ 0	$ 0

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Statement of Comprehensive Income [Abstract]
Net income	$ 2,494	$ 17,923	$ 5,971
Other comprehensive income (loss)
Unrealized gain (loss) on marketable securities, net of income taxes	1	(1)	0
Foreign currency translation	41	0	0
Total other comprehensive income (loss)	42	(1)	0
Total comprehensive (loss) income	$ 2,536	$ 17,922	$ 5,971

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Organization and Description of Business	12 Months Ended
Organization and Description of Business	Dec. 31, 2019
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, and the Company has subsidiaries in the Netherlands, United Kingdom, Germany and Spain. 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 messaging 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. 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. Follow-on Public Offering On March 11, 2019, the Company completed a follow-on public equity offering in which the Company sold 2,875,000 shares of its Class A common stock, including 375,000 shares sold pursuant to the exercise by the underwriters of an option to purchase additional shares, at a public offering price of $54.25 per share. The Company received aggregate proceeds of $146,557, after deducting underwriting discounts and offering expenses paid by the Company.

Summary of Significant Accounting Policies	12 Months Ended
Summary of Significant Accounting Policies	Dec. 31, 2019
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”). 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 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, reserve for sales credits, recoverability of long lived and intangible assets, estimated period of benefit, valuation allowances on deferred tax assets, certain accrued expenses, and contingencies. Revenue Recognition Adoption of Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers” On January 1, 2019, the Company adopted the guidance of ASC 606, Revenue from Contracts with Customers, using the modified retrospective method applied to those contracts which were not completed as of January 1, 2019. The Company’s results for reporting periods beginning after January 1, 2019 are presented in accordance with the provisions under ASC 606 and prior period amounts have not been adjusted and continue to be reported in accordance with the Company’s revenue recognition policy as further described in Note 2, Summary of Significant Accounting Policies, to its Annual Report on Form 10-K for the year ended December 31, 2018. In connection with the adoption of ASC 606, the Company recognized a net increase to its opening accumulated deficit of $174 as of January 1, 2019, related to a discount present in one of its contracts. Prior to the adoption of ASC 606, the Company recognized the majority of its revenue based on the usage of its customers in the period the traffic traversed the Company’s network. The Company determined that ASC 606 continues to support the recognition of revenue over time for the majority of the Company’s contracts due to the continuous transfer of control to the customer. The adoption of ASC 606 did not result in a change in the Company’s accounting for its commission costs, which will continue to be expensed as incurred. The Company pays commissions over time and a corresponding requisite substantive service condition exists for the employee to receive the commission. The Company determined the timing of the commission payments and the underlying service performed by the employee were commensurate. The impact on the Company’s balance sheet presentation includes separately presenting customer refundable prepayments as advanced billings, whereas under ASC 605 these were included in the current portion of deferred revenue and advanced billings. Revenue Recognition Policy Revenue recognition commences upon transfer of control of promised goods or services to customers in an amount that the Company expects to receive in exchange for those products or services. The Company determines revenue recognition through the following steps: •identification of the contract, or contracts, with a customer; •identification of the performance obligations in the contract; •determination of the transaction price; •allocation of the transaction price to the performance obligations in the contract; and •recognition of revenue, when, or as, the Company satisfies a performance obligation. Nature of Products and Services Revenue consists primarily of the sale of communications services offered through Application Programming Interface (“API”) software solutions to large enterprise, as well as small and medium-sized business, customers and is generally derived from usage and service fees in both the CPaaS and Other segments. Usage revenue includes voice communication (primarily driven by inbound minutes, outbound minutes and toll-free minutes) and messaging communication (driven by the number of messages) that traverse the platform and network. Service fees include the provision and management of phone numbers and emergency services access. The majority of the Company’s revenue is generated from usage-based fees earned from customers accessing the Company’s communications platform. Access to the Company’s communication platform is considered a series of distinct services, with continuous transfer of control to the customer, comprising one performance obligation and usage-based fees are recognized in revenue in the period the traffic traverses the Company’s network. For the years ended December 31, 2017, 2018 and 2019 the revenue from usage-based fees represented $76,148, $105,481 and $131,626 of CPaaS revenue, respectively, and $22,473, $32,524 and $29,012 of Other revenue, respectively. Revenue from service fees is recognized on a ratable basis as the service is provided, which is typically one month. For the years ended December 31, 2017, 2018 and 2019 the revenue from service fees represented $52,580, $55,719 and $61,193 of CPaaS revenue, respectively, and $8,910, $7,174 and $5,638 of Other revenue, respectively. The remaining $2,844, $3,215 and $5,125 of CPaaS revenue for the years ended December 31, 2017, 2018 and 2019 respectively, are generated from other miscellaneous services. Infrequently, Bandwidth’s contracts with customers may include multiple performance obligations. For such arrangements, revenues are allocated to each performance obligation based on its relative standalone selling price. Generally, standalone selling prices are determined based on the prices charged to similar customers for similar services. 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. The Company’s contracts do not contain general rights of return. However, occasionally credits may be issued. The Company’s contracts do not provide customers with the right to take possession of the software supporting the applications. Amounts that have been invoiced are recorded in accounts receivable and in revenue or deferred revenue depending on whether the revenue recognition criteria have been met. The Company maintains a reserve for sales credits. Credits are accounted for as variable consideration and are estimated based on several inputs including historical experience and current trends of credit issuances. Adjustments to the reserve are recorded against revenue. The Company has various sales commission plans for which eligible employees can earn commissions from the sale of products and services to customers. Eligible employees must be employed at the time of payment in order to receive a commission. The Company pays commissions over time and a corresponding requisite substantive service condition exists for the employee to receive the commission. The Company determined that the timing of the commission payments and the underlying service performed by the employee were commensurate. Accordingly, sales commissions are generally expensed as incurred. These costs are recorded within sales and marketing expenses. Contract Assets and Liabilities The following table provides information about receivables and contract liabilities from contracts with customers:

Fair Value Measurements

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

3. Fair Value Measurements

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, 2018 and 2019:


	Amortized cost or carrying value		Unrealized gains		Unrealized losses		Fair value measurements on a recurring basis December 31, 2018
															Level 1	Level 2	Level 3	Total
Financial assets:
Cash and cash equivalents:
Money market account	$	8,194	$	—	$	—	$	8,194	$	—	$	—	$	8,194

U.S. Reverse repurchase agreements	26,000		—		—		—		26,000		—		26,000
Total included in cash and cash equivalents	34,194		—		—		8,194		26,000		—		34,194
Marketable securities:
U.S. treasury securities	17,402		—		(2)		17,400		—		—		17,400

Total marketable securities	17,402		—		(2)		17,400		—		—		17,400
Total financial assets	$	51,596	$	—	$	(2)	$	25,594	$	26,000	$	—	$	51,594


	Fair value measurements on a recurring basis December 31, 2019
			Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents:
Money market account	$	25,000	$	—	$	—	$	25,000
Time deposits	75,250				—		75,250







Total financial assets	$	100,250	—		—		$	100,250

The Company classifies its marketable securities as current assets as they are available for current operating needs. There were no marketable securities as of December 31, 2019.

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, 2018 and 2019.

The money market account is included in cash, cash equivalents and restricted cash in the consolidated balance sheets as of December 31, 2018 and 2019.

During the years ended December 31, 2017, 2018 and 2019 there were $0, $18,000 and $69,000 in maturities of marketable securities, respectively.

There were no sales of marketable securities for the years ended December 31, 2017 and 2018. Proceeds and gross realized gains from sales of marketable securities were $17,467 and $4, respectively, for the year ended

December 31, 2019. The cost of the securities sold was based on the specific identification method and the gross realized gain is recorded as other income, net, in the consolidated statements of operations.

Interest earned on marketable securities was $0, $77 and $6 for the years ended December 31, 2017, 2018 and 2019 respectively, and is recorded within interest (expense) income, net, in the accompanying consolidated statements of operations.

- 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, 2019

Financial Statement Components [Abstract]

Financial Statement Components

4. Financial Statement Components

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


	As of December 31,
	2018		2019
Trade accounts receivable	$	13,620	$	14,692
Unbilled accounts receivable	11,174		16,200
Allowance for doubtful accounts	(906)		(769)
Other accounts receivable	121		64
Total accounts receivable, net	$	24,009	$	30,187

Components of allowance for doubtful accounts are as follows:


	Year ended December 31,
	2018		2019
Allowance for doubtful accounts:
Balance, beginning of period	$	(32,463)	$	(906)
Charged to bad debt expense	(460)		(1,543)
Deductions (1)	1,138		1,680
Billings deemed not probable of collection (2)	(357)		—
Write-off of previously outstanding and fully reserved billings related to settlement	24,968		—
Revenue recognized from outstanding billings previously deemed uncollectible related to settlement	6,268		—
Balance, end of period	$	(906)	$	(769)

________________________

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

(2) Represents amounts billed in the period but where collectability is not probable based on customer's collection experience. Amounts were charged to a contra-revenue account.

On January 29, 2018, the Company and Verizon entered into a settlement agreement to resolve an 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, which was recognized as revenue. Immediately following receipt of the $4,400 payment, the Company issued to Verizon credits with respect to other CABS amounts previously billed to Verizon and fully reserved of $24,968. The amount credited to Verizon comprised the majority of the allowance for CABS revenue as of December 31, 2017. The Company recognized as revenue $6,268, including the $4,400 payment made on February 8, 2018 and the other current outstanding Verizon CABS receivables which had been previously reserved as uncollectible, but for which collection was no longer in doubt as a result of the settlement. The settlement agreement also specifies certain terms for the Company’s CABS billings to Verizon prospectively.

Accrued expenses and other current liabilities consisted of the following:


	As of December 31,
	2018		2019
Accrued expense	$	8,292	$	12,701
Accrued compensation and benefits	7,323		8,284
Accrued sales, use, and telecom related taxes	4,742		5,439
Deferred rent, current portion	298		—
Other accrued expenses	738		904
Total accrued expenses and other current liabilities	$	21,393	$	27,328

Right-of-Use Asset and Lease Liabilities

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Right-of-Use Asset and Lease Liabilities

5. Right-of-Use Asset and Lease Liabilities

ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The Company determines if an arrangement is a lease at inception. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company did not have any finance leases as of December 31, 2019. As the Company’s leases do not generally provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company’s lease agreements do not contain any restrictive covenants, variable lease payments or residual value guarantees. All leases with an initial term of 12 months or less are not recorded on the balance sheet and are not material. The Company presents the operating leases in long-term assets and current and long-term liabilities in the accompanying consolidated balance sheet as of December 31, 2019.

The Company leases approximately 216,000 square feet of office space under operating lease agreements that expire at various dates beginning in 2022 and extend through 2025 in several locations within the United States including its headquarters, which is located in Raleigh, NC. The leases contain escalation clauses and various landlord concessions including tenant improvement allowances. On January 1, 2019, the Company entered into an amendment to an office building lease for the Company’s headquarters. The amendment provides an additional 30,114 square feet to the previous 87,605 square feet and extends the lease term to January 31, 2024. In addition, this amendment gives the Company the option to extend the lease for an additional five-year term. The amendment to the office building lease commenced in April 2019. On May 29, 2019, the Company further amended the lease to provide an additional 2,322 square feet for a total of 120,041 square feet of office space. This amendment commenced in June 2019.

On April 4, 2019, the Company entered into an amendment to an office building lease. The amendment provides an additional 5,286 square feet to the previous 4,122 square feet for a total of 9,408 square feet of office space and extends the lease term to September 30, 2024. In addition, this amendment gives the Company the option to extend the lease for an additional five-year term. The amendment to the office building lease commenced in July 2019.

On January 1, 2019, the Company entered into an amendment to an office building lease relating to 40,657 square feet of office space, which the Company sub-leases to a related party, Republic Wireless, Inc. (“Republic”). The amendment gives the Company the options to extend the lease for an additional period of approximately 18 months and a subsequent additional five-year term. The amendment to the office building lease commenced in January 2019. On May 29, 2019, the Company further amended the sub-lease to reduce the square feet of office space sub-leased to 17,073. No other terms were amended. The amendment to the office building sub-lease commenced in June 2019.

Future minimum sub-lease receipts required under the non-cancellable lease are as follows:


	As of December 31, 2019

2020	$	447
2021	457
2022	249

	$	1,153

As of December 31, 2019, the Company had six leased properties, with remaining lease terms of 2.58 years to 5.67 years, some of which include options to extend the leases for up to five years. None of the options to extend the leases are recognized in operating lease ROU assets or lease liabilities. None of the leases include options to terminate the lease.

The components of lease expense recorded in the consolidated statement of operations were as follows:


	Year ended December 31, 2019
Operating lease cost	$	5,548





Sublease income (1)	(643)
Total net lease cost	$	4,905

________________________

(1) See Note 15, “Related Parties” to these consolidated financial statements for additional details on sublease income.

Supplemental balance sheet information related to leases was as follows:


Leases	Classification	As of December 31, 2019
Assets:
Operating lease assets	Operating right-of-use asset, net of accumulated amortization (1)	$	21,031

Total leased assets				$	21,031

Liabilities:
Current
Operating	Operating lease liability, current	$	4,876

Non-current
Operating	Operating lease liability, non-current	19,868

Total lease liabilities				$	24,744

________________________

(1) Operating lease assets are recorded net of accumulated amortization of $4,269 as of December 31, 2019.

Supplemental cash flow and other information related to leases was as follows:


	Year ended December 31, 2019
Cash paid for amounts included in the measurement of operating lease liabilities:	$	3,357




Weighted average remaining operating lease term (in years):	4.35



Weighted average operating lease discount rate:	4.98		%

Maturities of operating lease liabilities were as follows:


	As of December 31, 2019

2020	$	5,907
2021	6,587
2022	6,302
2023	5,926
2024	1,987
Thereafter	949
Total lease payments	27,658
Less: imputed interest	(2,894)
Less: accrued lease incentive	(20)
Total lease obligations	24,744
Less: current obligations	(4,876)
Long-term lease obligations	$	19,868

Disclosures related to periods prior to adoption of the New Lease Standard

Rent expense was $3,327 and $4,331 in the years ended December 31, 2017 and 2018, respectively.

Future minimum lease payment obligations under non-cancelable operating and finance leases were as follows:


	As of December 31, 2018

2019	$	5,044
2020	5,180
2021	5,254
2022	3,438
2023	1,399
Thereafter	2,343
	$	22,658

In conjunction with the sub-lease under the Facilities Service Agreement with Republic, the Company recorded a reduction of rent expense of $949 and $1,005 for the years ended December 31, 2017 and 2018, respectively, which is included in general and administrative expenses in the consolidated statements of operations.

Future minimum sub-lease receipts required under the non-cancellable lease are as follows:


	As of December 31, 2018
2019	$	1,042
2020	1,065
2021	1,089
2022	594


	$	3,790

Property and Equipment

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Property and Equipment

6. Property and Equipment

Property and equipment, net consisted of the following:


	As of December 31,
	2018		2019
Furniture and fixtures	$	1,741	$	2,373
Computer and office equipment	7,662		4,627
Telecommunications equipment	28,889		44,324
Leasehold improvements	2,438		5,263
Software	1,805		2,018
Internal-use software development	16,293		17,952
Automobile	10		10
Total cost	58,838		76,567
Less—accumulated depreciation	(33,702)		(34,913)
Total property and equipment, net	$	25,136	$	41,654

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 $4,355 and $5,746 as of December 31, 2018 and 2019, respectively.

Amortization expense related to capitalized software development costs were $2,133, $1,482 and $2,024 for the years ended December 31, 2017, 2018 and 2019 respectively.

The Company recognized an impairment of $81, $158 and $275 during the years ended December 31, 2017, 2018 and 2019, 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 $2,942, $2,028 and $3,612 of software development costs in the years ended December 31, 2017, 2018 and 2019, respectively.

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


	Year ended December 31,
	2017		2018		2019
Cost of revenue	$	4,315	$	4,490	$	6,583
Research and development	81		161		268
Sales and marketing	27		51		112
General and administrative	450		568		2,055
Total depreciation expense	$	4,873	$	5,270	$	9,018

Intangible Assets

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

7. Intangible Assets

Intangible assets, net consisted of the following as of December 31, 2018:


	Gross Amount		Accumulated Amortization		Net Carrying Value		Amortization Period
							(Years)
Customer relationships	$	10,396	$	(4,071)	$	6,325	20




Other, definite lived	3,933		(3,933)		—		2 - 7
Licenses, indefinite lived	764		—		764		Indefinite
Total intangible assets, net	$	15,093	$	(8,004)	$	7,089

Intangible assets, net consisted of the following as of December 31, 2019:

Debt	12 Months Ended
Debt	Dec. 31, 2019
Debt Disclosure [Abstract]
Debt	8. Debt On March 1, 2019, the Company amended and restated its Credit and Security Agreement with KeyBank National Association (“KeyBank”). The agreement is for 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. The term of the amended and restated Credit and Security Agreement is three years and matures on March 1, 2022. Loans under the Credit Agreement will bear interest at the highest of (i) the bank’s prime rate, (ii) the federal funds effective rate plus 0.5 percent, and (iii) the London Interbank Offered Rate plus 1.00 percent. This agreement requires that a specified minimum liquidity amount must be maintained in cash and cash equivalents at all times and that the Company meet a minimum revenue clause on a quarterly basis. In connection with amending its Credit and Security Agreement on March 1, 2019, the Company incurred $142 in debt issuance costs. Unamortized debt issuance costs from the original Credit and Security Agreement of $106 were recorded as interest expense. In addition, the Company incurred and capitalized $25 of periodic loan fees. As of December 31, 2018, unamortized debt issuance costs, which were included in prepaid expenses and other current assets in the accompanying consolidated balance sheets, were $136. As of December 31, 2019 the outstanding debt issuance costs are $125, of which $70 are included in prepaid expenses and other current assets and $55 are included in other long-term assets. On June 4, 2019, KeyBank and Pacific Western Bank entered into an Assignment and Acceptance Agreement, whereby KeyBank, as the Assignor, sold and assigned $10,000 of the Company's Revolving Credit Commitment to Pacific Western Bank, the Assignee. KeyBank retains $15,000 of the Revolving Credit Commitment. As of December 31, 2018 and December 31, 2019, the Company had $0 outstanding 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 revolving loan was $25,000 as of December 31, 2019.

Segment and Geographic Information

12 Months Ended

Dec. 31, 2019

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 Chief Operating Decision Maker 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,
	2017		2018		2019
CPaaS
Revenue	$	131,572	$	164,415	$	197,944
Cost of revenue	75,859		94,296		110,343
Gross profit	$	55,713	$	70,119	$	87,601
Other
Revenue	$	31,383	$	39,698	$	34,650
Cost of revenue	13,403		13,849		14,616
Gross profit	$	17,980	$	25,849	$	20,034
Consolidated
Revenue	$	162,955	$	204,113	$	232,594
Cost of revenue	89,262		108,145		124,959
Gross profit	$	73,693	$	95,968	$	107,635

The Company's long-lived assets were primarily held in the United States as of December 31, 2018 and December 31, 2019. As of December 31, 2018 and December 31, 2019, long-lived assets held outside of the United States were $0 and $2,924, respectively.

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


	Year ended December 31,
	2017		2018		2019
CPaaS
United States	$	131,263	$	164,135	$	192,506
International	309		280		5,438
Total	$	131,572	$	164,415	$	197,944

Other
United States	$	31,130	$	39,432	$	33,664
International	253		266		986
Total	$	31,383	$	39,698	$	34,650

Stockholders' Equity

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Stockholders' Equity

10. Stockholders’ 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 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.

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, 2018 and 2019.

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, 2018 and 2019.

As of December 31, 2018 and 2019, there were 12,912,747 and 18,584,478 shares, respectively, of Class A common stock issued and outstanding at $0.001 par value per share.

As of December 31, 2018 and 2019, there were 6,510,732 and 4,927,401 shares, respectively, 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 years ended December 31, 2017, 2018 and 2019, no dividends were declared.

Dividend payments are subject to a restriction by the Company’s Credit 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.

Reserved Shares

The Company had reserved shares of Class A common stock for issuance under stock-based award agreements as follows:


	As of December 31,
	2018	2019
Stock options issued and outstanding	1,937,370	853,399
Nonvested restricted stock units issued and outstanding	324,252	392,351
Stock-based awards available for grant under the 2017 Plan	896,760	1,310,354
	3,158,382	2,556,104

Stock Based Compensation

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Stock Based Compensation

11. Stock Based Compensation

2010 Stock Option 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 2010 Plan permits the granting of incentive stock options and non-qualified stock options.

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 continues to govern the terms and conditions of the outstanding awards granted thereunder.

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. These available shares automatically increase each January 1, beginning on January 1, 2018, by 5% of the number of shares of the Company’s Class A common stock outstanding on the final day of the immediately preceding calendar year. On January 1, 2019, the shares available for grant under the 2017 Plan were automatically increased by 645,637 shares.

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 of the stock option agreements, which is generally over four years. The stock options have a contractual life of ten years.

Restricted stock units (“RSU”) granted under the 2017 Plan are subject to a time-based vesting condition. The compensation expense related to these awards is based on the grant date fair value of the RSUs and is recognized on a ratable basis over the applicable service period. The Company granted restricted stock units to its non-employee Board of Directors, some of which vested immediately while others vest 25% as of each calendar quarter immediately following the grant date. Certain RSUs awarded to executives vest over four years with 50% vesting in the first year in 12.5% increments on each calendar quarter immediately following the grant date and the remaining 50% earned over years two, three and four. Other RSUs awarded to executives and employees generally are earned over a service period of four years.

Stock Options

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, 2018	1,937,370	$	7.41	4.00	$	64,596
Granted	—	—
Exercised	(1,075,482)	6.84			57,159
Forfeited or cancelled	(8,489)	12.36
Outstanding as of December 31, 2019	853,399	$	8.07	3.41	$	47,770

Options vested and exercisable at December 31, 2019	752,402	$	7.27	2.88	$	42,722
Options vested and expected to vest as of December 31, 2019	851,389	$	8.06	3.40	$	47,672

Aggregate intrinsic value is computed based on the difference between the option exercise price and the fair value of the Company’s common stock as of December 31, 2019 based on the Company’s Class A common stock price as reported on the NASDAQ Global Select Market.

The weighted average grant-date fair value of stock options granted was $7.72 and $11.10 for the years ended December 31, 2017 and 2018, respectively. No options were granted for the year ended December 31, 2019.

The total estimated grant date fair value of options vested was $1,299, $979 and $729 for the years ended December 31, 2017, 2018 and 2019, respectively.

As of December 31, 2019, total unrecognized compensation cost related to all non-vested stock options was $519, which will be amortized over a weighted-average period of 1.42 years.

Restricted Stock Units

The following summarizes the restricted stock unit activity for the periods presented:


	Number of awards outstanding	Weighted-average grant date fair value (per share)
Nonvested RSUs as of December 31, 2018	324,252	$	26.95
Granted	241,376	44.76
Vested	(163,944)	32.79
Forfeited or cancelled	(9,333)	37.60
Nonvested RSUs as of December 31, 2019	392,351	$	35.22

As of December 31, 2019, total unrecognized compensation cost related to non-vested RSUs was $11,252, which will be amortized over a weighted-average period of 2.76 years.

Stock-Based Compensation Expense

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


	Year ended December 31,
	2017		2018		2019
Cost of revenue	$	80	$	114	$	211
Research and development	155		555		1,461
Sales and marketing	172		511		1,199
General and administrative (1) (2)	1,396		2,159		3,755
Total	$	1,803	$	3,339	$	6,626

________________________

(1) On September 1, 2017, the Company reached a separation agreement with an executive. 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.

(2) On December 21, 2018, the Company reached a separation agreement with an executive. The agreement resulted in a modification of the former employee’s 17,725 non-vested restricted stock units, which accelerated the vesting period, resulting in the recognition of $535 of additional stock compensation expense for the year ended December 31, 2018.

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2019
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 over the next 5.67 years. See Note 5, “Right-of-Use Asset and Lease Liabilities” to the consolidated financial statements for additional details on the Company's operating lease commitments. 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, as of December 31, 2019 the Company has $8,565 in other non-cancellable purchase obligations, consisting of primarily network equipment maintenance and software license contracts, of which $4,915 will be fulfilled within a 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 the Company has not been served with a complaint 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. 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, 2019
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 $806, $1,117 and $1,731 for the years ended December 31, 2017, 2018 and 2019, respectively.

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

14. Income Taxes

The following table presents domestic and foreign components of income (loss) before income taxes for the tax years ended December 31, 2017, 2018 and 2019:


	Year ended December 31,
	2017		2018		2019
United States	$	12,889	$	7,053	$	(15,229)
International	—		—		5
Income (loss) before income taxes	$	12,889	$	7,053	$	(15,224)

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


	Year ended December 31,

	2017		2018		2019
Current:
Federal	$	(448)	$	162	$	81
State	(302)		(125)		132
Foreign	—		—		3
Total	(750)		37		216
Deferred:
Federal	(5,983)		8,945		15,205
State	(185)		1,888		2,297

Total	(6,168)		10,833		17,502
Income tax (provision) benefit	$	(6,918)	$	10,870	$	17,718

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, 2017, 2018 and 2019:


	Year ended December 31,
	2017		2018		2019
Federal Tax Rate	34.0	%	21.0	%	21.0	%
State Tax Rate	4.7		6.3		3.1
Non-deductible expenses	1.2		1.7		(1.6)
Research credit	(1.5)		(13.6)		7.2
Stock-based compensation	0.1		(168.0)		88.6

Deferred tax rate change	16.1		(0.7)		(0.3)
Other	(0.9)		(0.8)		(1.6)
Total	53.7	%	(154.1)	%	116.4	%

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


	As of December 31,
	2018		2019
Deferred tax assets:
Allowance for doubtful accounts	$	57	$	97
Accrued liabilities	2,755		2,083
Operating lease liabilities	—		6,335
Deferred revenue	734		1,682
Intangibles	85		—
Stock-based compensation - deferred tax asset	3,486		2,109
Tax credits	2,690		3,710
Net operating losses	11,359		30,835
Other deferred tax assets	61		90


Net deferred tax assets	21,227		46,941
Deferred tax liabilities:
Property and equipment	2,993		5,793
Goodwill	729		855
Intangibles	—		41
Operating lease assets	—		5,295
Other liability	146		96
Total deferred tax liabilities	3,868		12,080
Net deferred tax asset	$	17,359	$	34,861

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 2019 no valuation allowance against deferred tax assets was required.

As of December 31, 2019, the Company had approximately $125,367 in federal net operating loss carryforwards and $5,078 in federal tax credits. All federal net operating loss carryforwards were generated after the enactment of the Tax Cuts and Jobs Act (the “Act”) and as such do not expire, but can only be utilized to offset up to 80% of taxable income in any given year. The federal tax credits start to expire at various dates beginning in 2032.

As of December 31, 2019, the Company had approximately $79,890 in state net operating loss carryforwards. If not utilized, some state net operating loss carryforwards will expire at various dates beginning in 2023.

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


	Year ended December 31,
	2018		2019
Unrecognized tax benefits—January 1,	$	731	$	1,046
Gross increases—tax positions in prior period	56		—
Gross decreases—tax positions in prior period	—		(15)
Gross increases—tax positions in current period	287		367

Lapse of statute of limitations	(28)		—
Unrecognized tax benefits—December 31,	$	1,046	$	1,398

If the $1,398 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, 2017, 2018 and 2019.

The Company expects no material changes in the twelve months following December 31, 2019 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 2014 - 2018 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, 2019
Related Party Transactions [Abstract]
Related Parties	15. Related Parties On April 20, 2015, the Company created a wholly owned subsidiary, 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. 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. 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 below, 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 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 further below. The Company believes that for US Federal income tax purposes, the Spin-Off qualifies 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. 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 pre-initial public offering are comprised of substantially the same individuals and entities that are the equity owners of Republic. The Transition Services Agreement specified certain services to be provided by the Company for a period of up to two years from the Spin-Off, which ended in November 2018. These services included insurance administration, billing and collections, and other technical support as well as legal services related to intellectual property. The Company was compensated by Republic for these services based on costs incurred by the Company. The Company received net compensation under the Transition Services Agreement of $575 and $80 for the years ended December 31, 2017 and 2018, respectively, which is included in general and administrative expenses in the consolidated statements of operations. No amounts were due to the Company under the Transition Services Agreement as of December 31, 2018. The Facilities Sharing Agreement specifies that the Company will sublet office space to Republic for at least 63 months. The Company recorded a reduction of rent expense under the Facilities Sharing Agreement of $949, $1,005 and $643 for the years ended December 31, 2017, 2018 and 2019, respectively, which is included in general and administrative expenses in the consolidated statements of operations. No amounts were due to the Company under the Facilities Sharing Agreement as of December 31, 2018 and 2019. 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 were no amounts outstanding or payable under this agreement as of December 31, 2018 and 2019. 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. The Company provided telecommunication services to Republic of $2,451, $3,884 and $2,602 for the years ended December 31, 2017, 2018 and 2019, respectively. The Company recognized such amounts as revenue in the accompanying consolidated statements of operations. As of December 31, 2018 and 2019, the Company had a receivable of $327 and $161, respectively, under the Master Services Agreement. On March 1, 2019, an amendment to the current Master Services Agreement was executed. Pursuant to the terms of the new agreement, Republic receives reduced pricing on its messaging services, effective April 1, 2019. All other terms and conditions of the existing agreement remain. On June 20, 2019, Republic executed a further amendment to the current Master Services Agreement. Pursuant to the terms of the June 20, 2019 amendment, Republic receives reduced pricing on its outbound voice services effective on June 20, 2019. Republic also executed a revenue commitment schedule on June 20, 2019. Pursuant to the revenue commitment schedule, Republic agreed to spend a minimum of $100 per month during the 11-month period commencing July 1, 2019 through May 31, 2020. Subsequent to the expiration of the 180-day IPO blackout window on May 9, 2018, Republic employees that held Bandwidth stock options began exercising their options. Upon exercise, Bandwidth withholds the employee tax amounts due from the proceeds. Bandwidth had collected on behalf of, and remitted withholding tax to, Republic of $0, $9,213 and $1,781 for the years ended December 31, 2017, 2018 and 2019 respectively. There were no amounts outstanding or payable as of December 31, 2018 and 2019. On September 30, 2019, the Company entered into a services agreement with Republic. Pursuant to the terms of the new agreement, Republic receives services performed by the Company’s legal department, effective September 30, 2019. The Company is compensated by Republic for these services based on costs incurred by the Company. The Company received net compensation under this agreement of $31 for the year ended December 31, 2019, which is included in general and administrative expenses in the consolidated statements of operations. As of December 31, 2019, the Company had a receivable of $10 under this agreement.

Basic and Diluted Income per Common Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Basic and Diluted Income per Common Share

16. Basic and Diluted Income per Common Share

During the year ended December 31, 2017, the Company used the two-class method to compute net income per common share, because it had issued securities, other than common stock, that contractually entitled the holders to participate in dividends and earnings. These participating securities included the Company’s redeemable convertible preferred stock which had 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 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.

Subsequent to the IPO in November 2017, the Company no longer had outstanding securities other than common stock, which required holders’ participation in dividends and earnings; therefore, the Company was no longer required to calculate EPS under the two-class method. Basic net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share is computed by giving effect to all potential shares of common stock, including stock options, stock related to unvested restricted stock awards, and outstanding warrants to the extent dilutive.

The components of basic and diluted income per share are as follows:


	Year ended December 31,
	2017		2018		2019
Earnings per share
Net income	$	5,971	$	17,923	$	2,494
Less: net income allocated to participating securities	644		—		—
Net income attributable to common stockholders	$	5,327	$	17,923	$	2,494
Net income per share:
Basic	$	0.42	$	0.96	$	0.11
Diluted	$	0.37	$	0.85	$	0.10














Weighted Average Number of Common Shares Outstanding
Basic	12,590,221		18,573,067		22,640,461
Dilutive effect of stock options, restricted stock units, and warrants	1,952,949		2,567,315		1,283,316
Diluted	14,543,170		21,140,382		23,923,777

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,
	2017	2018	2019
Anti-dilutive disclosure
Series A redeemable convertible preferred stock outstanding	1,522,123	—	—
Stock options issued and outstanding	50,604	—	—

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

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”).

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

Use of EstimatesThe preparation of the Company’s consolidated financial statements in conformity with 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, reserve for sales credits, recoverability of long lived and intangible assets, estimated period of benefit, valuation allowances on deferred tax assets, certain accrued expenses, and contingencies.

Revenue Recognition

Adoption of Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers”

On January 1, 2019, the Company adopted the guidance of ASC 606, Revenue from Contracts with Customers, using the modified retrospective method applied to those contracts which were not completed as of January 1, 2019. The Company’s results for reporting periods beginning after January 1, 2019 are presented in accordance with the provisions under ASC 606 and prior period amounts have not been adjusted and continue to be reported in accordance with the Company’s revenue recognition policy as further described in Note 2, Summary of Significant Accounting Policies, to its Annual Report on Form 10-K for the year ended December 31, 2018.

In connection with the adoption of ASC 606, the Company recognized a net increase to its opening accumulated deficit of $174 as of January 1, 2019, related to a discount present in one of its contracts.

Prior to the adoption of ASC 606, the Company recognized the majority of its revenue based on the usage of its customers in the period the traffic traversed the Company’s network. The Company determined that ASC 606 continues to support the recognition of revenue over time for the majority of the Company’s contracts due to the continuous transfer of control to the customer.

The adoption of ASC 606 did not result in a change in the Company’s accounting for its commission costs, which will continue to be expensed as incurred. The Company pays commissions over time and a corresponding requisite substantive service condition exists for the employee to receive the commission. The Company determined the timing of the commission payments and the underlying service performed by the employee were commensurate.

The impact on the Company’s balance sheet presentation includes separately presenting customer refundable prepayments as advanced billings, whereas under ASC 605 these were included in the current portion of deferred revenue and advanced billings.

Revenue Recognition Policy

Revenue recognition commences upon transfer of control of promised goods or services to customers in an amount that the Company expects to receive in exchange for those products or services.

The Company determines revenue recognition through the following steps:

•identification of the contract, or contracts, with a customer;

•identification of the performance obligations in the contract;

•determination of the transaction price;

•allocation of the transaction price to the performance obligations in the contract; and

•recognition of revenue, when, or as, the Company satisfies a performance obligation.

Nature of Products and Services

Revenue consists primarily of the sale of communications services offered through Application Programming Interface (“API”) software solutions to large enterprise, as well as small and medium-sized business,

customers and is generally derived from usage and service fees in both the CPaaS and Other segments. Usage revenue includes voice communication (primarily driven by inbound minutes, outbound minutes and toll-free minutes) and messaging communication (driven by the number of messages) that traverse the platform and network. Service fees include the provision and management of phone numbers and emergency services access.

The majority of the Company’s revenue is generated from usage-based fees earned from customers accessing the Company’s communications platform. Access to the Company’s communication platform is considered a series of distinct services, with continuous transfer of control to the customer, comprising one performance obligation and usage-based fees are recognized in revenue in the period the traffic traverses the Company’s network. For the years ended December 31, 2017, 2018 and 2019 the revenue from usage-based fees represented $76,148, $105,481 and $131,626 of CPaaS revenue, respectively, and $22,473, $32,524 and $29,012 of Other revenue, respectively.

Revenue from service fees is recognized on a ratable basis as the service is provided, which is typically one month. For the years ended December 31, 2017, 2018 and 2019 the revenue from service fees represented $52,580, $55,719 and $61,193 of CPaaS revenue, respectively, and $8,910, $7,174 and $5,638 of Other revenue, respectively.

The remaining $2,844, $3,215 and $5,125 of CPaaS revenue for the years ended December 31, 2017, 2018 and 2019 respectively, are generated from other miscellaneous services.

Infrequently, Bandwidth’s contracts with customers may include multiple performance obligations. For such arrangements, revenues are allocated to each performance obligation based on its relative standalone selling price. Generally, standalone selling prices are determined based on the prices charged to similar customers for similar services.

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.

The Company’s contracts do not contain general rights of return. However, occasionally credits may be issued. The Company’s contracts do not provide customers with the right to take possession of the software supporting the applications. Amounts that have been invoiced are recorded in accounts receivable and in revenue or deferred revenue depending on whether the revenue recognition criteria have been met.

The Company maintains a reserve for sales credits. Credits are accounted for as variable consideration and are estimated based on several inputs including historical experience and current trends of credit issuances. Adjustments to the reserve are recorded against revenue.

The Company has various sales commission plans for which eligible employees can earn commissions from the sale of products and services to customers. Eligible employees must be employed at the time of payment in order to receive a commission. The Company pays commissions over time and a corresponding requisite substantive service condition exists for the employee to receive the commission. The Company determined that the timing of the commission payments and the underlying service performed by the employee were commensurate. Accordingly, sales commissions are generally expensed as incurred. These costs are recorded within sales and marketing expenses.

Contract Assets and Liabilities

The following table provides information about receivables and contract liabilities from contracts with customers:


	December 31, 2019
Receivables (1)	$	30,187
Contract liabilities (2)	10,897

________________________

(1) Included in accounts receivable, net of allowance for doubtful accounts on the consolidated balance sheet.

(2) Included in current portion of deferred revenue and deferred revenue, net of current portion on the consolidated balance sheet.

Deferred revenue is recorded when cash payments are received in advance of future usage on contracts. Revenue is typically recognized in the following month when service is rendered or, in the case of nonrefundable upfront fees, over the estimated period of benefit. Customer refundable payments are recorded as advanced billings. During the year ended December 31, 2019, the Company recognized revenue of $5,324 related to contract liabilities recorded at the beginning of the year. The Company expects to recognize $5,177 in revenue over the next twelve months related to its contract liabilities as of December 31, 2019.

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.

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, Cash Equivalents and Restricted Cash

The Company classifies all highly liquid investments with stated maturities of three months or less from the date of purchase as cash equivalents and all highly liquid investments with stated maturities of greater than three months from the date of purchase as current marketable securities. Cash deposits are primarily in financial institutions in the US. However, cash for monthly operating costs of international operations are deposited in banks outside the US. The Company has a policy of making investments only with commercial institutions that have at least an investment grade credit rating. The Company invests its cash primarily in government securities and obligations, corporate debt securities, money market funds and reverse repurchase agreements (“RRAs”). RRAs are collateralized by deposits in the form of Government Securities and Obligations for an amount not less than 102% of their value. The Company does not record an asset or liability as the Company is not permitted to sell or repledge the associated collateral. The Company has a policy that the collateral has at least an “A” (or equivalent) credit rating. The Company utilizes a third-party custodian to manage the exchange of funds and ensure that collateral received is maintained at 102% of the value of the RRAs on a daily basis. RRAs with stated maturities of greater than three months from the date of purchase are classified as marketable securities. As of December 31, 2018 and 2019, cash and cash equivalents were $41,261 and $184,414, respectively.

Restricted cash consists primarily of customer deposits, employee withholding tax liability and employee benefits contributions not yet remitted. The Company has classified this asset as a short-term asset in order to match the expected period of restriction. As of December 31, 2018 and 2019, restricted cash was $240 and $590, respectively.

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 $906 and $769 for uncollectible accounts and customer balances that are disputed were required as of December 31, 2018 and 2019, respectively. Refer to Note 4, “Financial Statement Components,” for a rollforward of the components of the allowance for doubtful accounts as of December 31, 2018 and 2019.

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.

Concentration of Credit Risk

Financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents, marketable securities 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.

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 contract or the estimated period of benefit, which is approximately three years.

Internal-Use Software Development Costs

Internal-use software includes software that has been acquired, internally developed, or modified exclusively to meet the Company’s needs. 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

Debt Issuance CostsThe Company incurred debt issuance costs associated with obtaining and entering into credit agreements. These costs customarily include non-refundable structuring fees, commitment fees, up-front fees and syndication expenses. The Company has a policy to defer and amortize these costs based on the effective interest method over the term of the credit agreements.

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 carrying 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 carrying 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, 2018 and 2019, the Company has recorded goodwill of $6,867. No goodwill impairment charges were recorded for the years ended December 31, 2017, 2018 and 2019.

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

Advertising CostsThe Company expenses advertising costs as incurred.

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 paid over time, based on monthly revenues, and are recognized as sales and marketing expense in the period incurred.

Share-Based Compensation

Stock-Based Compensation

The Company accounts for stock-based compensation expense related to all 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 fair value of the restricted stock units is determined using the fair value of the Company’s Class A common stock on the date of grant. The Company uses the Black-Scholes option pricing model, net of estimated forfeitures, to measure the fair value of its stock options.

The Company has elected to estimate expected forfeitures, and, as such, the Company must also determine a forfeiture rate to calculate the stock-based compensation for awards. Through December 31, 2019, 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 other financial information is evaluated on a consolidated basis.

Earnings Per Share

Earnings per Share

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

Diluted net income 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.

Historically, the Company issued securities other than common stock that participated in dividends (“Participating Securities”), and therefore utilized the two-class method to calculate net income per share. These Participating Securities included the Series A redeemable convertible preferred stock. The two-class method requires a portion of net income to be allocated to the Participating Securities to determine the net income

attributable to common stockholders. Net income attributable to the common stockholders is equal to the net income 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.

Foreign currency translation

The Company has foreign operations with non-USD functional currencies. The Euro and British Pound are the functional currencies for the Company’s international operations. Foreign exchange gains and losses, which result from the process of remeasuring foreign currency transactions into the appropriate functional currency, are included in other income, net in the Company’s consolidated statements of operations. The Company recorded $9 in related gains during the year ended December 31, 2019.

The impact of changes in foreign currency exchange rates resulting from the translation of foreign currency financial statements into U.S. dollars for financial reporting purposes is included in other comprehensive (loss) income, which is a separate component of stockholders’ equity. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at average rates for the period.

Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and accrued expenses approximate fair value as of December 31, 2018 and December 31, 2019 because of the relatively short duration of these instruments. Marketable securities consist of U.S. treasury securities not otherwise classified as cash equivalents. All marketable securities are considered to be available-for-sale and are recorded at their estimated fair values. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive (loss) income.

The Company minimizes its credit risk associated with investments by investing primarily in investment grade, liquid securities. The Company policy is designed to preserve capital, maintain liquidity and minimize credit risk, and the policy limits exposure to any one issuer and also establishes minimum credit ratings of approved investments. Periodic evaluations of relative credit standing of those issuers are considered in the Company's investment strategy.

Comprehensive Income

Comprehensive income refers to net income and other revenue, expenses, gains and losses that, under generally accepted accounting principles, are recorded as an element of stockholders’ equity but are excluded from the calculation of net income.

Recently Adopted Accounting Standards

In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, Leases (Topic 842), which was further clarified in July 2018 by ASU 2018-10, Codification Improvements to Topic 842, Leases, ASU 2018-11, Leases-Targeted Improvements, and ASU 2019-01, Leases (Topic 842): Codification Improvements,. ASU 2018-10 provides narrow amendments to clarify how to apply certain aspects of the new lease standard. ASU 2018-11 addresses implementation issues related to the new lease standard. ASU 2019-01 clarifies how to apply certain aspects of the new lease standard. Under the new standard, lessees are required to recognize in the balance sheet the right-of-use (“ROU”) assets and lease liabilities that arise from operating leases. As a result of the Company no longer qualifying for emerging growth Company filing status based on its public float as of the most recent second fiscal quarter, the ASU was adopted as of December 31, 2019 with an effective date as of the beginning of the Company’s fiscal year, January 1, 2019. The standard was applied to the operating leases that existed on that date using the optional alternative method on a prospective basis. Prior year comparative financial information was not recast under the new standard and continues to be presented under ASC 840. The Company elected to utilize the package of practical expedients available for expired or existing contracts which allowed the Company to carryforward historical assessments of (a) whether contracts are or contain leases, (b) lease classification, and (c) initial direct costs. The Company also elected to apply the short-term lease exception for all leases. The Company did not elect the use of hindsight practical expedient in determining the lease term and assessing the likelihood that lease renewal, termination or purchase option will be exercised. Under the short-term lease exception, the Company will not recognize ROU assets or lease liabilities for leases that, at the acquisition date, have a remaining lease term of 12 months or less.

As a result of losing emerging growth status on June 30, 2019, the Company implemented this guidance for the year ended December 31, 2019. The Company recognized a $20,772 operating ROU asset and a $23,808 operating lease liability in its consolidated balance sheet as of January 1, 2019, with no material impact to its consolidated statements of operations.

The Company measured the lease liability at the present value of the future lease payments as of January 1, 2019. The Company used its incremental borrowing rate to discount the lease payments as of January 1, 2019. The Company derived the discount rate, adjusted for differences in the term and payment patterns, from the information available at the adoption date. The right-of-use asset is valued at the amount of the lease liability adjusted for the remaining December 31, 2018, balance of unamortized lease incentives, prepaid rent and deferred rent. The lease liability is subsequently measured at the present value of unpaid future lease payments as of the reporting date with a corresponding adjustment to the right-of-use asset. Absent a lease modification, the Company will continue to utilize the January 1, 2019, incremental borrowing rate.

The Company recognizes operating lease costs on a straight-line basis and presents these costs as operating expenses within the consolidated statements of operations. Within the consolidated statements of cash flows the Company presents the lease payments made on the operating leases within cash flows from operating activities and principal payments made on the finance leases as part of financing activities.

The financial results for the year ended December 31, 2019 are presented under the new standard, while the comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy.

See Note 5, “Right-of-Use Asset and Lease Liabilities” for further information.

Recent Accounting Pronouncements Not Yet Adopted

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, including adoption in an interim period. The Company is evaluating the effect of adopting this new accounting guidance, but does not expect adoption will have a material impact on the Company’s financial statements.

In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. This standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. ASU 2018-15 will be effective for the Company in interim and annual reporting periods beginning after December 15, 2019. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some disclosure requirements. ASU 2018-13 is effective for the Company for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years. An entity is permitted to early adopt either the entire standard or only the provisions that eliminate or modify requirements. The Company is evaluating the effect of adopting this new accounting guidance, but does not expect adoption will have a material impact on the Company’s financial statements.

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 the Company in periods beginning after December 15, 2019. Management does not expect the adoption of this guidance to have a significant impact on the Company’s financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments–Credit Losses: Measurement of Credit Losses on Financial Instruments, which changes the impairment model for most financial assets. The new model uses a forward-looking expected loss method, which will generally result in earlier recognition of allowances for losses. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of Topic 326, Financial Instruments – Credit Losses. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases. In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments, which clarifies how to apply certain aspects of the new credit losses standard. In November 2019, the FASB issued ASU 2019-10, Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates, which amends certain effective dates for the new standard. In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, which clarifies how to apply certain aspects of the new credit losses standard. The accounting standard is effective for the Company for annual and interim periods beginning after December 15, 2019. The Company is evaluating the effect of adopting this accounting guidance, but does not expect adoption will have a material impact to its consolidated financial statements.

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Schedule of Contract Assets and Liabilities

Contract Assets and Liabilities

The following table provides information about receivables and contract liabilities from contracts with customers:


	December 31, 2019
Receivables (1)	$	30,187
Contract liabilities (2)	10,897

________________________

(1) Included in accounts receivable, net of allowance for doubtful accounts on the consolidated balance sheet.

(2) Included in current portion of deferred revenue and deferred revenue, net of current portion on the consolidated balance sheet.

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Schedule of Assets Measured at Fair Value on a Recurring Basis

The following table summarizes the assets measured at fair value as of December 31, 2018 and 2019:


	Amortized cost or carrying value		Unrealized gains		Unrealized losses		Fair value measurements on a recurring basis December 31, 2018
															Level 1	Level 2	Level 3	Total
Financial assets:
Cash and cash equivalents:
Money market account	$	8,194	$	—	$	—	$	8,194	$	—	$	—	$	8,194

U.S. Reverse repurchase agreements	26,000		—		—		—		26,000		—		26,000
Total included in cash and cash equivalents	34,194		—		—		8,194		26,000		—		34,194
Marketable securities:
U.S. treasury securities	17,402		—		(2)		17,400		—		—		17,400

Total marketable securities	17,402		—		(2)		17,400		—		—		17,400
Total financial assets	$	51,596	$	—	$	(2)	$	25,594	$	26,000	$	—	$	51,594


	Fair value measurements on a recurring basis December 31, 2019
			Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents:
Money market account	$	25,000	$	—	$	—	$	25,000
Time deposits	75,250				—		75,250







Total financial assets	$	100,250	—		—		$	100,250

Financial Statement Components (Tables)

12 Months Ended

Dec. 31, 2019

Financial Statement Components [Abstract]

Schedule of Accounts Receivable, net, and Allowance for Doubtful Accounts

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


	As of December 31,
	2018		2019
Trade accounts receivable	$	13,620	$	14,692
Unbilled accounts receivable	11,174		16,200
Allowance for doubtful accounts	(906)		(769)
Other accounts receivable	121		64
Total accounts receivable, net	$	24,009	$	30,187

Components of allowance for doubtful accounts are as follows:


	Year ended December 31,
	2018		2019
Allowance for doubtful accounts:
Balance, beginning of period	$	(32,463)	$	(906)
Charged to bad debt expense	(460)		(1,543)
Deductions (1)	1,138		1,680
Billings deemed not probable of collection (2)	(357)		—
Write-off of previously outstanding and fully reserved billings related to settlement	24,968		—
Revenue recognized from outstanding billings previously deemed uncollectible related to settlement	6,268		—
Balance, end of period	$	(906)	$	(769)

________________________

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

(2) Represents amounts billed in the period but where collectability is not probable based on customer's 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:


	As of December 31,
	2018		2019
Accrued expense	$	8,292	$	12,701
Accrued compensation and benefits	7,323		8,284
Accrued sales, use, and telecom related taxes	4,742		5,439
Deferred rent, current portion	298		—
Other accrued expenses	738		904
Total accrued expenses and other current liabilities	$	21,393	$	27,328

Right-of-Use Asset and Lease Liabilities (Tables)

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Schedule of Future Minimum Lease Receipts for Operating Lease

Future minimum sub-lease receipts required under the non-cancellable lease are as follows:


	As of December 31, 2019

2020	$	447
2021	457
2022	249

	$	1,153

Components of Lease Expense

The components of lease expense recorded in the consolidated statement of operations were as follows:


	Year ended December 31, 2019
Operating lease cost	$	5,548





Sublease income (1)	(643)
Total net lease cost	$	4,905

________________________

(1) See Note 15, “Related Parties” to these consolidated financial statements for additional details on sublease income.

Supplemental cash flow and other information related to leases was as follows:


	Year ended December 31, 2019
Cash paid for amounts included in the measurement of operating lease liabilities:	$	3,357




Weighted average remaining operating lease term (in years):	4.35



Weighted average operating lease discount rate:	4.98		%

Supplemental Balance Sheet Information

Supplemental balance sheet information related to leases was as follows:


Leases	Classification	As of December 31, 2019
Assets:
Operating lease assets	Operating right-of-use asset, net of accumulated amortization (1)	$	21,031

Total leased assets				$	21,031

Liabilities:
Current
Operating	Operating lease liability, current	$	4,876

Non-current
Operating	Operating lease liability, non-current	19,868

Total lease liabilities				$	24,744

________________________

(1) Operating lease assets are recorded net of accumulated amortization of $4,269 as of December 31, 2019.

Schedule of Maturities of Lease Liabilities

Maturities of operating lease liabilities were as follows:


	As of December 31, 2019

2020	$	5,907
2021	6,587
2022	6,302
2023	5,926
2024	1,987
Thereafter	949
Total lease payments	27,658
Less: imputed interest	(2,894)
Less: accrued lease incentive	(20)
Total lease obligations	24,744
Less: current obligations	(4,876)
Long-term lease obligations	$	19,868

Schedule of Future Minimum Lease Payments for Operating Leases

Future minimum lease payment obligations under non-cancelable operating and finance leases were as follows:


	As of December 31, 2018

2019	$	5,044
2020	5,180
2021	5,254
2022	3,438
2023	1,399
Thereafter	2,343
	$	22,658

Future minimum sub-lease receipts required under the non-cancellable lease are as follows:


	As of December 31, 2018
2019	$	1,042
2020	1,065
2021	1,089
2022	594


	$	3,790

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Summary of Property and Equipment, Net

Property and equipment, net consisted of the following:


	As of December 31,
	2018		2019
Furniture and fixtures	$	1,741	$	2,373
Computer and office equipment	7,662		4,627
Telecommunications equipment	28,889		44,324
Leasehold improvements	2,438		5,263
Software	1,805		2,018
Internal-use software development	16,293		17,952
Automobile	10		10
Total cost	58,838		76,567
Less—accumulated depreciation	(33,702)		(34,913)
Total property and equipment, net	$	25,136	$	41,654

Schedule of Depreciation Expense

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


	Year ended December 31,
	2017		2018		2019
Cost of revenue	$	4,315	$	4,490	$	6,583
Research and development	81		161		268
Sales and marketing	27		51		112
General and administrative	450		568		2,055
Total depreciation expense	$	4,873	$	5,270	$	9,018

Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets

Intangible assets, net consisted of the following as of December 31, 2018:


	Gross Amount		Accumulated Amortization		Net Carrying Value		Amortization Period
							(Years)
Customer relationships	$	10,396	$	(4,071)	$	6,325	20




Other, definite lived	3,933		(3,933)		—		2 - 7
Licenses, indefinite lived	764		—		764		Indefinite
Total intangible assets, net	$	15,093	$	(8,004)	$	7,089

Intangible assets, net consisted of the following as of December 31, 2019:


	Gross Amount		Accumulated Amortization		Net Carrying Value		Amortization Period
							(Years)
Customer relationships	$	10,396	$	(4,591)	$	5,805	20




Other, definite lived	3,933		(3,933)		—		2 - 7
Licenses, indefinite lived	764		—		764		Indefinite
Total intangible assets, net	$	15,093	$	(8,524)	$	6,569

Schedule of Future Estimated Amortization Expense

Future estimated amortization expense for definite lived intangible assets is as follows:


	As of December 31, 2019

2020	$	520
2021	520
2022	520
2023	520
2024	520
Thereafter	3,205
	$	5,805

Segment and Geographic Information (Tables)

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment


	Year ended December 31,
	2017		2018		2019
CPaaS
Revenue	$	131,572	$	164,415	$	197,944
Cost of revenue	75,859		94,296		110,343
Gross profit	$	55,713	$	70,119	$	87,601
Other
Revenue	$	31,383	$	39,698	$	34,650
Cost of revenue	13,403		13,849		14,616
Gross profit	$	17,980	$	25,849	$	20,034
Consolidated
Revenue	$	162,955	$	204,113	$	232,594
Cost of revenue	89,262		108,145		124,959
Gross profit	$	73,693	$	95,968	$	107,635

Schedule of Revenue by Geographical Area

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


	Year ended December 31,
	2017		2018		2019
CPaaS
United States	$	131,263	$	164,135	$	192,506
International	309		280		5,438
Total	$	131,572	$	164,415	$	197,944

Other
United States	$	31,130	$	39,432	$	33,664
International	253		266		986
Total	$	31,383	$	39,698	$	34,650

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Schedule of Reserved Shares of Common Stock for Issuance

The Company had reserved shares of Class A common stock for issuance under stock-based award agreements as follows:


	As of December 31,
	2018	2019
Stock options issued and outstanding	1,937,370	853,399
Nonvested restricted stock units issued and outstanding	324,252	392,351
Stock-based awards available for grant under the 2017 Plan	896,760	1,310,354
	3,158,382	2,556,104

- Definition

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

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+ Details

Stock Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

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, 2018	1,937,370	$	7.41	4.00	$	64,596
Granted	—	—
Exercised	(1,075,482)	6.84			57,159
Forfeited or cancelled	(8,489)	12.36
Outstanding as of December 31, 2019	853,399	$	8.07	3.41	$	47,770

Options vested and exercisable at December 31, 2019	752,402	$	7.27	2.88	$	42,722
Options vested and expected to vest as of December 31, 2019	851,389	$	8.06	3.40	$	47,672

Summary of Restricted Stock Unit Activity

The following summarizes the restricted stock unit activity for the periods presented:


	Number of awards outstanding	Weighted-average grant date fair value (per share)
Nonvested RSUs as of December 31, 2018	324,252	$	26.95
Granted	241,376	44.76
Vested	(163,944)	32.79
Forfeited or cancelled	(9,333)	37.60
Nonvested RSUs as of December 31, 2019	392,351	$	35.22

Schedule of Stock-Based Compensation Expense

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


	Year ended December 31,
	2017		2018		2019
Cost of revenue	$	80	$	114	$	211
Research and development	155		555		1,461
Sales and marketing	172		511		1,199
General and administrative (1) (2)	1,396		2,159		3,755
Total	$	1,803	$	3,339	$	6,626

________________________

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of Domestic and Foreign Components of Income (Loss)

The following table presents domestic and foreign components of income (loss) before income taxes for the tax years ended December 31, 2017, 2018 and 2019:


	Year ended December 31,
	2017		2018		2019
United States	$	12,889	$	7,053	$	(15,229)
International	—		—		5
Income (loss) before income taxes	$	12,889	$	7,053	$	(15,224)

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

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


	Year ended December 31,

	2017		2018		2019
Current:
Federal	$	(448)	$	162	$	81
State	(302)		(125)		132
Foreign	—		—		3
Total	(750)		37		216
Deferred:
Federal	(5,983)		8,945		15,205
State	(185)		1,888		2,297

Total	(6,168)		10,833		17,502
Income tax (provision) benefit	$	(6,918)	$	10,870	$	17,718

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, 2017, 2018 and 2019:


	Year ended December 31,
	2017		2018		2019
Federal Tax Rate	34.0	%	21.0	%	21.0	%
State Tax Rate	4.7		6.3		3.1
Non-deductible expenses	1.2		1.7		(1.6)
Research credit	(1.5)		(13.6)		7.2
Stock-based compensation	0.1		(168.0)		88.6

Deferred tax rate change	16.1		(0.7)		(0.3)
Other	(0.9)		(0.8)		(1.6)
Total	53.7	%	(154.1)	%	116.4	%

Significant Components of Deferred Tax Assets and Liabilities

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


	As of December 31,
	2018		2019
Deferred tax assets:
Allowance for doubtful accounts	$	57	$	97
Accrued liabilities	2,755		2,083
Operating lease liabilities	—		6,335
Deferred revenue	734		1,682
Intangibles	85		—
Stock-based compensation - deferred tax asset	3,486		2,109
Tax credits	2,690		3,710
Net operating losses	11,359		30,835
Other deferred tax assets	61		90


Net deferred tax assets	21,227		46,941
Deferred tax liabilities:
Property and equipment	2,993		5,793
Goodwill	729		855
Intangibles	—		41
Operating lease assets	—		5,295
Other liability	146		96
Total deferred tax liabilities	3,868		12,080
Net deferred tax asset	$	17,359	$	34,861

Summary of Unrecognized Tax Benefits

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


	Year ended December 31,
	2018		2019
Unrecognized tax benefits—January 1,	$	731	$	1,046
Gross increases—tax positions in prior period	56		—
Gross decreases—tax positions in prior period	—		(15)
Gross increases—tax positions in current period	287		367

Lapse of statute of limitations	(28)		—
Unrecognized tax benefits—December 31,	$	1,046	$	1,398

Basic and Diluted Income per Common Share (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The components of basic and diluted income per share are as follows:


	Year ended December 31,
	2017		2018		2019
Earnings per share
Net income	$	5,971	$	17,923	$	2,494
Less: net income allocated to participating securities	644		—		—
Net income attributable to common stockholders	$	5,327	$	17,923	$	2,494
Net income per share:
Basic	$	0.42	$	0.96	$	0.11
Diluted	$	0.37	$	0.85	$	0.10














Weighted Average Number of Common Shares Outstanding
Basic	12,590,221		18,573,067		22,640,461
Dilutive effect of stock options, restricted stock units, and warrants	1,952,949		2,567,315		1,283,316
Diluted	14,543,170		21,140,382		23,923,777

Schedule of Anti-dilutive Shares Excluded from Weighted-average Shares Outstanding

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,
	2017	2018	2019
Anti-dilutive disclosure
Series A redeemable convertible preferred stock outstanding	1,522,123	—	—
Stock options issued and outstanding	50,604	—	—

Organization and Description of Business (Details) $ / shares in Units, $ in Thousands		12 Months Ended
	Mar. 11, 2019 USD ($) $ / shares shares	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 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
Proceeds from follow-on public offering	$ 146,557
IPO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Underwriting discounts and commissions		$ 0	$ 285	$ 5,385
Follow-on Public Offering
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Underwriting discounts and commissions		$ 757	$ 0	$ 0
Follow-on Public Offering \| Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares) \| shares	2,875,000
Shares issued, price (in usd per share) \| $ / shares	$ 54.25
Over-Allotment Option \| Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares) \| shares	375,000

Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2019
Concentration Risk [Line Items]
Adjustment to opening retained earnings due to adoption of ASC 606				$ 174
Revenue	$ 232,594	$ 204,113	$ 162,955
Revenue recognized related to its contract liabilities	5,324
CPaaS, Usage-Based Fees
Concentration Risk [Line Items]
Revenue	131,626	105,481	76,148
Other, Usage-Based Fees
Concentration Risk [Line Items]
Revenue	29,012	32,524	22,473
CPaaS, Service Fees
Concentration Risk [Line Items]
Revenue	61,193	55,719	52,580
Other, Service Fees
Concentration Risk [Line Items]
Revenue	5,638	7,174	8,910
Other miscellaneous services
Concentration Risk [Line Items]
Revenue	$ 5,125	$ 3,215	$ 2,844
Retained earnings
Concentration Risk [Line Items]
Adjustment to opening retained earnings due to adoption of ASC 606				174
Retained earnings \| ASC 606
Concentration Risk [Line Items]
Adjustment to opening retained earnings due to adoption of ASC 606				$ 174

Summary of Significant Accounting Policies - Schedule of Contract Assets and Liabilities (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Accounting Policies [Abstract]
Receivables	$ 30,187
Contract liabilities	$ 10,897

Summary of Significant Accounting Policies - Remaining Performance Obligation (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 $ in Thousands	Dec. 31, 2019 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 5,177
Revenue, remaining performance obligation, amount, expected timing of satisfaction, period	12 months

Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Accounting Policies [Abstract]
RRAs collateralized by deposits in form of Government Securities and Obligations as percentage of value	102.00%
Cash and cash equivalents	$ 184,414	$ 41,261
Restricted cash	$ 590	$ 240

Summary of Significant Accounting Policies - Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Accounting Policies [Abstract]
Allowance for doubtful accounts	$ 769	$ 906
Unbilled accounts receivable	$ 16,200	$ 11,174

Summary of Significant Accounting Policies - Concentration of Credit Risk (Details)	12 Months Ended
	Dec. 31, 2018
Customer One \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk percentage	18.00%

Summary of Significant Accounting Policies - Property and Equipment, net and Deferred Costs (Details)	12 Months Ended
	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property and equipment, useful life	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

Summary of Significant Accounting Policies - Goodwill, Advertising Costs, Stock-Based Compensation, Operating Segments, Foreign Currency Translation (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Accounting Policies [Abstract]
Goodwill	$ 6,867	$ 6,867
Goodwill impairment charges	0	0	$ 0
Advertising costs	$ 1,528	$ 953	$ 464
Number of reportable segments \| segment	2
Number of operating segments \| segment	2
Foreign currency transaction gain	$ 9

Summary of Significant Accounting Policies - Recently Adopted Accounting Standards (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating right-of-use asset	$ 21,031
Operating lease liability	$ 24,744
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating right-of-use asset		$ 20,772
Operating lease liability		$ 23,808

Fair Value Measurements - Assets Measured at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market account	$ 185,004	$ 41,501	$ 37,870	$ 7,028
Cash and cash equivalents, amortized cost or carrying value	184,414	41,261
Marketable securities, amortized cost or carrying value		17,402
Marketable securities, unrealized gains		0
Marketable securities, unrealized losses		(2)
Money market account
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market account		8,194
Money market account, unrealized gains		0
Money market account, unrealized losses		0
U.S. Reverse repurchase agreements
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, amortized cost or carrying value		26,000
Cash and cash equivalents, unrealized gains		0
Cash and cash equivalents, unrealized losses		0
Total included in cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, amortized cost or carrying value		34,194
Cash and cash equivalents, unrealized gains		0
Cash and cash equivalents, unrealized losses		0
U.S. treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, amortized cost or carrying value		17,402
Marketable securities, unrealized gains		0
Marketable securities, unrealized losses		(2)
Financial assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets, fair value		51,596
Financial assets, unrealized gains		0
Financial assets, unrealized losses		(2)
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		17,400
Fair Value, Measurements, Recurring \| Money market account
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market account, fair value		8,194
Cash and cash equivalents, fair value	25,000
Fair Value, Measurements, Recurring \| Time deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value	75,250
Fair Value, Measurements, Recurring \| U.S. Reverse repurchase agreements
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		26,000
Fair Value, Measurements, Recurring \| Total included in cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		34,194
Fair Value, Measurements, Recurring \| U.S. treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		17,400
Fair Value, Measurements, Recurring \| Financial assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets, fair value	100,250	51,594
Level 1 \| Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		17,400
Level 1 \| Fair Value, Measurements, Recurring \| Money market account
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market account, fair value		8,194
Cash and cash equivalents, fair value	25,000
Level 1 \| Fair Value, Measurements, Recurring \| Time deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value	75,250
Level 1 \| Fair Value, Measurements, Recurring \| U.S. Reverse repurchase agreements
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		0
Level 1 \| Fair Value, Measurements, Recurring \| Total included in cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		8,194
Level 1 \| Fair Value, Measurements, Recurring \| U.S. treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		17,400
Level 1 \| Fair Value, Measurements, Recurring \| Financial assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets, fair value	100,250	25,594
Level 2 \| Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		0
Level 2 \| Fair Value, Measurements, Recurring \| Money market account
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market account, fair value		0
Cash and cash equivalents, fair value	0
Level 2 \| Fair Value, Measurements, Recurring \| Time deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value
Level 2 \| Fair Value, Measurements, Recurring \| U.S. Reverse repurchase agreements
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		26,000
Level 2 \| Fair Value, Measurements, Recurring \| Total included in cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		26,000
Level 2 \| Fair Value, Measurements, Recurring \| U.S. treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		0
Level 2 \| Fair Value, Measurements, Recurring \| Financial assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets, fair value	0	26,000
Level 3 \| Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		0
Level 3 \| Fair Value, Measurements, Recurring \| Money market account
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market account, fair value		0
Cash and cash equivalents, fair value	0
Level 3 \| Fair Value, Measurements, Recurring \| Time deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value	0
Level 3 \| Fair Value, Measurements, Recurring \| U.S. Reverse repurchase agreements
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		0
Level 3 \| Fair Value, Measurements, Recurring \| Total included in cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents, fair value		0
Level 3 \| Fair Value, Measurements, Recurring \| U.S. treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, fair value		0
Level 3 \| Fair Value, Measurements, Recurring \| Financial assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets, fair value	$ 0	$ 0

Fair Value Measurements - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Fair Value Disclosures [Abstract]
Maturities of marketable securities	$ 69,000,000	$ 18,000,000	$ 0
Gross realized gains from sales of marketable securities	17,467,000
Gain on sale of marketable securities	4,000	0	0
Interest earned on marketable securities	$ 6,000	$ 77,000	$ 0

Financial Statement Components - Accounts Receivable, Net of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Financial Statement Components [Abstract]
Trade accounts receivable	$ 14,692	$ 13,620
Unbilled accounts receivable	16,200	11,174
Allowance for doubtful accounts	(769)	(906)
Other accounts receivable	64	121
Total accounts receivable, net	$ 30,187	$ 24,009

Financial Statement Components - Allowance For Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Allowance for Doubtful Accounts Receivable [Roll Forward]
Balance, beginning of period	$ (906)	$ (32,463)
Balance, end of period	(769)	(906)
Accounts Receivable, Excluding Carrier Access Billing (CAB)
Allowance for Doubtful Accounts Receivable [Roll Forward]
Charged to bad debt expense	(1,543)	(460)
Deductions	1,680	1,138
Billings deemed not probable of collection	0	(357)
Carrier Access Billing (CAB)
Allowance for Doubtful Accounts Receivable [Roll Forward]
Write-off of previously outstanding and fully reserved billings related to settlement	0	24,968
Revenue recognized from outstanding billings previously deemed uncollectible related to settlement	$ 0	$ 6,268

Financial Statement Components - Additional Information (Details) - USD ($) $ in Thousands		12 Months Ended
	Feb. 08, 2018	Dec. 31, 2019	Dec. 31, 2018
Carrier Access Billing (CAB)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Write-off of previously outstanding and fully reserved billings related to settlement		$ 0	$ 24,968
Revenue recognized from outstanding billings previously deemed uncollectible related to settlement		$ 0	$ 6,268
Carrier Access Billing (CAB)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Settlement agreement lump sum payment	$ 4,400

Financial Statement Components - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Financial Statement Components [Abstract]
Accrued expense	$ 12,701	$ 8,292
Accrued compensation and benefits	8,284	7,323
Accrued sales, use, and telecom related taxes	5,439	4,742
Deferred rent, current portion		298
Other accrued expenses	904	738
Total accrued expenses and other current liabilities	$ 27,328	$ 21,393

Right-of-Use Asset and Lease Liabilities - Additional Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 property	Dec. 31, 2018 USD ($) ft²	Dec. 31, 2017 USD ($)	May 29, 2019 ft²	Apr. 04, 2019 ft²	Apr. 03, 2019 ft²	Jan. 01, 2019 ft²
Lessee, Lease, Description [Line Items]
Office space (in square foot)		87,605		17,073	9,408	4,122	216,000
Increase of office space (in square foot)					5,286
Lessee, operating lease, renewal term					5 years		5 years
Lessee, operating lease, additional renewal term	18 months
Number of leased properties \| property	6
Remaining lease term	4 years 4 months 6 days
Option to extend, term	5 years
Rent expense \| $		$ 4,331	$ 3,327
General and administrative
Lessee, Lease, Description [Line Items]
Reduction of rent expense \| $		$ 1,005	$ 949
Minimum
Lessee, Lease, Description [Line Items]
Remaining lease term	2 years 6 months 29 days
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease term	5 years 8 months 1 day
Republic \| Affiliated Entity
Lessee, Lease, Description [Line Items]
Office space (in square foot)							40,657
Raleigh, NC
Lessee, Lease, Description [Line Items]
Office space (in square foot)				120,041
Increase of office space (in square foot)				2,322			30,114
Lessee, operating lease, renewal term							5 years

Right-of-Use Asset and Lease Liabilities - Future Minimum Sub-lease Receipts (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2020	$ 447
2021	457
2022	249
Total	$ 1,153

Right-of-Use Asset and Lease Liabilities - Components of Lease Expense (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)
Leases [Abstract]
Operating lease cost	$ 5,548
Sublease income	(643)
Total net lease cost	$ 4,905

Right-of-Use Asset and Lease Liabilities - Assets And Liabilities, Lessee (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Leases [Abstract]
Operating right-of-use asset, net of accumulated amortization	$ 21,031
Operating lease liability, current	4,876
Long-term lease obligations	19,868
Total lease liabilities	24,744
Accumulated amortization	$ 4,269

Right-of-Use Asset and Lease Liabilities - Supplemental Cash Flow and Other Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)
Leases [Abstract]
Cash paid for amounts included in the measurement of operating lease liabilities:	$ 3,357
Weighted average remaining operating lease term (in years):	4 years 4 months 6 days
Weighted average operating lease discount rate:	4.98%

Right-of-Use Asset and Lease Liabilities - Schedule of Maturities of Lease Liabilities (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Leases [Abstract]
2020	$ 5,907
2021	6,587
2022	6,302
2023	5,926
2024	1,987
Thereafter	949
Total lease payments	27,658
Less: imputed interest	(2,894)
Less: accrued lease incentive	(20)
Total lease liabilities	24,744
Less: current obligations	(4,876)
Long-term lease obligations	$ 19,868

Right-of-Use Asset and Lease Liabilities - Schedule of Future Minimum Lease Payments for Operating Leases (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
2019	$ 5,044
2020		$ 5,180
2021		5,254
2022		3,438
2023		1,399
Thereafter		2,343
Future minimum payments due, total		$ 22,658

Right-of-Use Asset and Lease Liabilities - Future Minimum Lease Receipts (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
2019	$ 1,042
2020	1,065
2021	1,089
2022	594
Future minimum lease receipts, total	$ 3,790

Property and Equipment - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Total cost	$ 76,567	$ 58,838
Less—accumulated depreciation	(34,913)	(33,702)
Total property and equipment, net	41,654	25,136
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total cost	2,373	1,741
Computer and office equipment
Property, Plant and Equipment [Line Items]
Total cost	4,627	7,662
Telecommunications equipment
Property, Plant and Equipment [Line Items]
Total cost	44,324	28,889
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total cost	5,263	2,438
Software
Property, Plant and Equipment [Line Items]
Total cost	2,018	1,805
Internal-use software development
Property, Plant and Equipment [Line Items]
Total cost	17,952	16,293
Automobile
Property, Plant and Equipment [Line Items]
Total cost	$ 10	$ 10

Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Property and equipment, useful life	3 years
Unamortized software development costs	$ 5,746	$ 4,355
Amortization of capitalized software development costs	2,024	1,482	$ 2,133
Capitalized software impairments	275	158	81
Capitalized software development costs, additions	$ 3,612	$ 2,028	$ 2,942

Property and Equipment - Depreciation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Depreciation Expense [Line Items]
Total depreciation expense	$ 9,018	$ 5,270	$ 4,873
Cost of revenue
Depreciation Expense [Line Items]
Total depreciation expense	6,583	4,490	4,315
Research and development
Depreciation Expense [Line Items]
Total depreciation expense	268	161	81
Sales and marketing
Depreciation Expense [Line Items]
Total depreciation expense	112	51	27
General and administrative
Depreciation Expense [Line Items]
Total depreciation expense	$ 2,055	$ 568	$ 450

Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	$ (8,524)	$ (8,004)
Finite-lived intangible assets, net	5,805
Gross amount	15,093	15,093
Net carrying value	6,569	7,089
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	(4,591)	(4,071)
Finite-lived intangible assets, net	$ 5,805	$ 6,325
Amortization period	20 years	20 years
Other, definite lived
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross		$ 3,933
Accumulated amortization		(3,933)
Finite-lived intangible assets, net		$ 0
Other, definite lived \| Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization period	2 years	2 years
Other, definite lived \| Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization period	7 years	7 years

Intangible Assets - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 520,000	$ 554,000	$ 839,000
Weighted average amortization period	11 years
Impairment of indefinite-lived intangible assets	$ 0	$ 0

Intangible Assets - Future Estimated Amortization Expense (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2020	$ 520
2021	520
2022	520
2023	520
2024	520
Thereafter	3,205
Finite-lived intangible assets, net	$ 5,805

Debt (Details) - USD ($)		3 Months Ended
Debt (Details) - USD ($)	Mar. 01, 2019	Mar. 31, 2019	Dec. 31, 2019	Jun. 04, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Debt instrument, term	3 years
Unamortized debt issuance costs					$ 136,000
Debt issuance costs		$ 142,000
Previous unamortized loan fees expensed		$ 106,000
Periodic loan fees			$ 25,000
Outstanding unamortized loan fees			125,000
Prepaid Expenses and Other Current Assets
Debt Instrument [Line Items]
Outstanding unamortized loan fees			70,000
Noncurrent assets
Debt Instrument [Line Items]
Outstanding unamortized loan fees			55,000
Revolving Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 25,000,000
Available borrowing capacity			25,000,000
Debt outstanding			$ 0		$ 0
Revolving Credit Facility \| Pacific Western Bank
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity				$ 10,000,000
Revolving Credit Facility \| KeyBank National Association
Debt Instrument [Line Items]
Available borrowing capacity				$ 15,000,000
Revolving Credit Facility \| Federal Funds Effective Rate
Debt Instrument [Line Items]
Basis spread on variable rate	0.50%
Revolving Credit Facility \| London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate	1.00%
Swing line
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 1,000,000
Letters of credit
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 2,500,000

Segment and Geographic Information - Reconciliation of Segment Profit (Loss) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Segment Reporting [Abstract]
Number of reportable segments \| segment	2
Segment Reporting Information [Line Items]
Revenue	$ 232,594	$ 204,113	$ 162,955
Cost of revenue	124,959	108,145	89,262
Gross profit	107,635	95,968	73,693
CPaaS
Segment Reporting Information [Line Items]
Revenue	197,944	164,415	131,572
Cost of revenue	110,343	94,296	75,859
Gross profit	87,601	70,119	55,713
Other
Segment Reporting Information [Line Items]
Revenue	34,650	39,698	31,383
Cost of revenue	14,616	13,849	13,403
Gross profit	$ 20,034	$ 25,849	$ 17,980

Segment and Geographic Information - Reconciliation of Revenue by Geographic Area (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 232,594,000	$ 204,113,000	$ 162,955,000
Assets	341,416,000	150,420,000
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Assets	2,924,000	0
CPaaS
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	197,944,000	164,415,000	131,572,000
CPaaS \| United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	192,506,000	164,135,000	131,263,000
CPaaS \| International
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	5,438,000	280,000	309,000
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	34,650,000	39,698,000	31,383,000
Other \| United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	33,664,000	39,432,000	31,130,000
Other \| International
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 986,000	$ 266,000	$ 253,000

Stockholders' Equity - Redeemable Convertible Preferred Stock (Details)	Nov. 09, 2017 shares	Oct. 23, 2017	Dec. 31, 2019 shares	Dec. 31, 2018 shares	Dec. 31, 2017 shares	Dec. 31, 2016 shares
Class of Stock [Line Items]
Stock split conversion ratio		2.5
Series A redeemable convertible preferred stock, shares issued (in shares)						710,000
Series A redeemable convertible preferred stock, shares outstanding (in shares)			0	0	0	710,000
Old Common Class A
Class of Stock [Line Items]
Stock split conversion ratio	2.5
Common Class B
Class of Stock [Line Items]
Shares converted (in shares)	1,775,000

Stockholders' Equity - Preferred Stock (Details) - $ / shares	Dec. 31, 2019	Dec. 31, 2018	Nov. 09, 2017
Equity [Abstract]
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000	10,000,000
Preferred stock, par value (in usd per share)	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares issued (in shares)	0	0
Preferred A stock, shares outstanding (in shares)	0	0

Stockholders' Equity - Common Stock (Details)			12 Months Ended
Stockholders' Equity - Common Stock (Details)	Nov. 09, 2017 $ / shares shares	Oct. 23, 2017	Dec. 31, 2019 vote $ / shares shares	Dec. 31, 2018 $ / shares shares	Dec. 31, 2017 $ / shares	Dec. 31, 2016 vote $ / shares shares
Class of Stock [Line Items]
Common stock, par value (in usd per share) \| $ / shares	$ 0.001
Stock split conversion ratio		2.5
Common stock, shares authorized (in shares)	120,000,000
Common stock, dividends declared (in usd per share) \| $ / shares			$ 0	$ 0	$ 0
Old Common Class A
Class of Stock [Line Items]
Common stock voting rights, votes per share \| vote						1
Common stock, shares issued (in shares)						11,779,975
Common stock, shares outstanding (in shares)						11,779,975
Stock split conversion ratio	2.5
Old Common Class B
Class of Stock [Line Items]
Common stock voting rights, votes per share \| vote						0
Common stock, shares issued (in shares)						18,590
Common stock, shares outstanding (in shares)						18,590
Common stock, par value (in usd per share) \| $ / shares						$ 0.001
Common Class B
Class of Stock [Line Items]
Common stock voting rights, votes per share \| vote			10
Common stock, shares issued (in shares)			4,927,401	6,510,732
Common stock, shares outstanding (in shares)			4,927,401	6,510,732
Common stock, par value (in usd per share) \| $ / shares			$ 0.001	$ 0.001
Shares converted (in shares)	1,775,000
Common stock, shares authorized (in shares)			20,000,000	20,000,000
Common Class A
Class of Stock [Line Items]
Common stock voting rights, votes per share \| vote			1
Common stock, shares issued (in shares)			18,584,478	12,912,747
Common stock, shares outstanding (in shares)			18,584,478	12,912,747
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

Stockholders' Equity - Reserved Shares of Common Stock for Issuance (Details) - shares	Dec. 31, 2019	Dec. 31, 2018
Class of Stock [Line Items]
Common stock reserved for future issuance (in shares)	2,556,104	3,158,382
Stock options issued and outstanding
Class of Stock [Line Items]
Common stock reserved for future issuance (in shares)	853,399	1,937,370
Nonvested restricted stock units issued and outstanding
Class of Stock [Line Items]
Common stock reserved for future issuance (in shares)	392,351	324,252
Stock-based awards available for grant under the 2017 Plan
Class of Stock [Line Items]
Common stock reserved for future issuance (in shares)	1,310,354	896,760

Stock Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands			12 Months Ended
	Jan. 01, 2019	Jan. 01, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Nov. 09, 2017	Aug. 24, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)			2,556,104	3,158,382
Weighted average grant-date fair value of stock options granted (in usd per share)				$ 11.10	$ 7.72
Estimated grant date fair value of options vested			$ 729	$ 979	$ 1,299
Unrecognized cost for stock based compensation			519
Unrecognized compensation cost related to non-vested RSUs			$ 11,252
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)			1 year 5 months 1 day
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)			392,351	324,252
Vesting percentage			25.00%
Share-based compensation arrangement, requisite service period			4 years
Unrecognized cost for stock based compensation, period for recognition (in years)			2 years 9 months 3 days
Restricted Stock Units (RSUs) \| Non-employee Board of Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)			4 years
Restricted Stock Units (RSUs) \| Non-employee Board of Directors \| Year one vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			50.00%
Restricted Stock Units (RSUs) \| Non-employee Board of Directors \| First quarter vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			12.50%
Restricted Stock Units (RSUs) \| Non-employee Board of Directors \| Second quarter vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			12.50%
Restricted Stock Units (RSUs) \| Non-employee Board of Directors \| Third quarter vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			12.50%
Restricted Stock Units (RSUs) \| Non-employee Board of Directors \| Forth quarter vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			12.50%
Restricted Stock Units (RSUs) \| Non-employee Board of Directors \| Year two, three and four vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			50.00%
2010 Equity Compensation Plan \| Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)							3,466,275
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
Common stock reserved for future issuance, percent increase		5.00%
Increase in shares available for grant (in shares)	645,637
2017 Equity Compensation Plan \| Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)			4 years
Contractual life (in years)			10 years

Stock Based Compensation - Stock Option Activity (Details) - Employee Stock Option - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Number of options outstanding
Number of options outstanding, beginning balance (in shares)	1,937,370
Number of options, granted (in shares)	0
Number of options exercised (in shares)	(1,075,482)
Number of options, forfeited or cancelled (in shares)	(8,489)
Number of options outstanding, ending balance (in shares)	853,399	1,937,370
Options vested and exercisable (in shares)	752,402
Options vested and expected to vest (in shares)	851,389
Weighted- average exercise price (per share)
Weighted-average exercise price, beginning balance (in usd per share)	$ 7.41
Weighted-average exercise price, granted (in usd per share)	0
Weighted-average exercise price, exercised (in usd per share)	6.84
Weighted-average exercise price, forfeited or cancelled (in usd per share)	12.36
Weighted-average exercise price, ending balance (in usd per share)	8.07	$ 7.41
Weighted-average exercise price, options vested and exercisable (in usd per share)	7.27
Weighted average exercise price, options vested and expected to vest (in usd per share)	$ 8.06
Weighted-average remaining contract life, options outstanding (in years)	3 years 4 months 28 days	4 years
Weighted-average remaining contract life, options vested and exercisable (in years)	2 years 10 months 17 days
Weighted average remaining contract life, options vested and expected to vest	3 years 4 months 24 days
Aggregate intrinsic value, options outstanding	$ 47,770	$ 64,596
Aggregate intrinsic value, options exercised	57,159
Aggregate intrinsic value, options vested and exercisable	42,722
Aggregate intrinsic value, options vested and expected to vest	$ 47,672

Stock Based Compensation - Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs)	12 Months Ended
	Dec. 31, 2019 $ / shares shares
Number of awards outstanding
Number of nonvested RSUs outstanding, beginning balance (in shares) \| shares	324,252
Number of nonvested RSUs, granted (in shares) \| shares	241,376
Number of nonvested RSUs, vested (in shares) \| shares	(163,944)
Number of nonvested RSUs, forfeited or cancelled (in shares) \| shares	(9,333)
Number of nonvested RSUs outstanding, ending balance (in shares) \| shares	392,351
Weighted-average grant date fair value (per share)
Weighted-average grant date fair value, beginning balance (in usd per share) \| $ / shares	$ 26.95
Weighted average grant-date fair value of nonvested RSUs, granted (in usd per share) \| $ / shares	44.76
Weighted-average grant date fair value of nonvested RSUs, vested (in usd per share) \| $ / shares	32.79
Weighted-average grant date fair value of nonvested restricted RSUs, forfeited or cancelled (in usd per share) \| $ / shares	37.60
Weighted-average grant date fair value, ending balance (in usd per share) \| $ / shares	$ 35.22

Stock Based Compensation - Stock Based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 21, 2018	Sep. 01, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 6,626	$ 3,339	$ 1,803
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	211	114	80
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	1,461	555	155
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	1,199	511	172
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 3,755	2,159	1,396
Separation agreement with an executive
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Number of outstanding options modified (in shares)				17,725	194,234
Separation agreement with an executive \| General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense		$ 535	$ 394

Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Thousands	Oct. 25, 2015	Dec. 31, 2019
Lessee, Lease, Description [Line Items]
Remaining lease term		4 years 4 months 6 days
Service agreement, annual minimum commitments	$ 1,200
Service agreement, term of agreement (in years)	5 years
Non-cancellable purchase obligation		$ 8,565
Non-cancellable purchase obligation, fulfilled within a year		$ 4,915
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease term		5 years 8 months 1 day

Employee Benefit Plan (Details) - USD ($) $ in Thousands	12 Months Ended
Employee Benefit Plan (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Matching contributions	$ 1,731	$ 1,117	$ 806

Income Taxes - Schedule of Domestic and Foreign Components of Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
United States	$ (15,229)	$ 7,053	$ 12,889
International	5	0	0
Income (loss) before income taxes	$ (15,224)	$ 7,053	$ 12,889

Income Taxes - Components of (Provision) Benefit for Income Taxes from Continuing Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Current:
Federal	$ 81	$ 162	$ (448)
State	132	(125)	(302)
Foreign	3	0	0
Total	216	37	(750)
Deferred:
Federal	15,205	8,945	(5,983)
State	2,297	1,888	(185)
Total	17,502	10,833	(6,168)
Income tax (provision) benefit	$ 17,718	$ 10,870	$ (6,918)

Income Taxes - Effective Income Tax Rate Reconciliation (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Federal Tax Rate	21.00%	21.00%	34.00%
State Tax Rate	3.10%	6.30%	4.70%
Non-deductible expenses	(1.60%)	1.70%	1.20%
Research credit	7.20%	(13.60%)	(1.50%)
Stock-based compensation	88.60%	(168.00%)	0.10%
Deferred tax rate change	(0.30%)	(0.70%)	16.10%
Other	(1.60%)	(0.80%)	(0.90%)
Total	116.40%	(154.10%)	53.70%

Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets:
Allowance for doubtful accounts	$ 97	$ 57
Accrued liabilities	2,083	2,755
Operating lease liabilities	6,335	0
Deferred revenue	1,682	734
Intangibles	0	85
Stock-based compensation - deferred tax asset	2,109	3,486
Tax credits	3,710	2,690
Net operating losses	30,835	11,359
Other deferred tax assets	90	61
Total deferred tax assets	46,941	21,227
Deferred tax liabilities:
Property and equipment	5,793	2,993
Goodwill	855	729
Intangibles	41	0
Operating lease assets	5,295	0
Other liability	96	146
Total deferred tax liabilities	12,080	3,868
Net deferred tax asset	$ 34,861	$ 17,359

Income Taxes - Additional Information (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Operating Loss Carryforwards [Line Items]
Federal tax credits	$ 5,078
Federal
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	125,367
State
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 79,890

Income Taxes - Summary of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Unrecognized tax benefits—January 1,	$ 1,046	$ 731
Gross increases—tax positions in prior period	0	56
Gross decreases—tax positions in prior period	(15)	0
Gross increases—tax positions in current period	367	287
Lapse of statute of limitations	0	(28)
Unrecognized tax benefits—December 31,	$ 1,398	$ 1,046

Related Parties (Details) - USD ($)			12 Months Ended
Related Parties (Details) - USD ($)	Jun. 20, 2019	Nov. 30, 2016	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Related Party Transaction [Line Items]
Rental payments received			$ 643,000
Spin-off
Related Party Transaction [Line Items]
Number of shares issued for each share held		1
Cash distributed		$ 30,000,000
Net assets distributed		$ 28,899,000
Affiliated Entity \| Republic
Related Party Transaction [Line Items]
Amount collected on behalf			$ 1,781,000	$ 9,213,000	$ 0
Affiliated Entity \| Republic \| Transition Services Agreement
Related Party Transaction [Line Items]
Service term, period from spin-off			2 years
Revenue from related parties				80,000	575,000
Affiliated Entity \| Republic \| Facilities Sharing Agreement
Related Party Transaction [Line Items]
Due from related parties			$ 0	0
Sublease term			63 months
Rental payments received					949,000
Rental payments received			$ 643,000	1,005,000
Affiliated Entity \| Republic \| Tax Sharing Agreement
Related Party Transaction [Line Items]
Due from related parties			0	0
Affiliated Entity \| Republic \| Master Services Agreement
Related Party Transaction [Line Items]
Revenue from related parties			2,602,000	3,884,000	$ 2,451,000
Accounts receivable, related parties			161,000	$ 327,000
Minimum monthly revenue expected from related party	$ 100,000
Minimum monthly revenue expected from related party, period	11 months
Affiliated Entity \| Republic \| Services Agreement
Related Party Transaction [Line Items]
Revenue from related parties			31,000
Accounts receivable, related parties			$ 10,000

Basic and Diluted Income per Common Share - Components of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Earnings Per Share [Abstract]
Net income	$ 2,494	$ 17,923	$ 5,971
Less: net income allocated to participating securities	0	0	644
Net income (loss) attributable to common stockholders	$ 2,494	$ 17,923	$ 5,327
Net income per share:
Basic (in usd per share)	$ 0.11	$ 0.96	$ 0.42
Diluted (in usd per share)	$ 0.10	$ 0.85	$ 0.37
Weighted Average Number of Common Shares Outstanding
Basic (in shares)	22,640,461	18,573,067	12,590,221
Dilutive effect of stock options, restricted stock units, and warrants (in shares)	1,283,316	2,567,315	1,952,949
Diluted (in shares)	23,923,777	21,140,382	14,543,170

Basic and Diluted Income per Common Share - Additional Information (Details) - shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
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 (in shares)	0	0	1,522,123
Employee Stock Option
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from calculation of weighted-average common shares outstanding (in shares)	0	0	50,604