Stock-Based Compensation

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Total stock-based compensation expense is recorded in the condensed consolidated statements of operations as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Cost of revenue	$	97	$	187	$	324	$	403
Sales and marketing	2,881		2,429		6,499		5,057
Research and development	7,978		6,890		17,765		15,560
General and administrative	6,683		8,154		14,622		17,134
Total stock-based compensation	$	17,639	$	17,660	$	39,210	$	38,154

Equity Incentive Plan and Employee Stock Purchase Plan

Under the Company’s 2021 Equity Incentive Plan, as of June 30, 2023, 24.3 million shares of Class A common stock were authorized, of which 14.8 million shares of Class A common stock were available for

future issuance. The number of shares reserved for issuance was increased in January 2023 pursuant to the evergreen provisions set forth in the 2021 Equity Incentive Plan.

Under the Company’s 2021 Employee Stock Purchase Plan (the “ESPP”), as of June 30, 2023, 3.0 million shares of Class A common stock were authorized. The number of shares reserved for issuance was increased in January 2023 pursuant to the evergreen provisions set forth in the ESPP.

The ESPP provides for concurrent six-month offering and purchase periods beginning February 15 and August 15 of each year. During the three months ended June 30, 2023, no shares of Class A common stock were purchased under the ESPP. During the six months ended June 30, 2023, 0.2 million shares of Class A common stock were purchased under the ESPP for an aggregate amount of $4.2 million.

For the ESPP, the Company recorded stock-based compensation expense of $0.4 million and $1.0 million during the three and six months ended June 30, 2023, respectively, and $0.5 million and $1.3 million during the three and six months ended June 30, 2022, respectively. As of June 30, 2023, there was $0.2 million of unrecognized stock-based compensation expense that is expected to be recognized over the remaining term of the offering period ending August 14, 2023. As of June 30, 2023, the Company recorded a liability of $2.3 million related to the accumulated payroll deductions, which are refundable to employees who withdraw from the ESPP. This amount is included within accrued expenses in the accompanying condensed consolidated balance sheets.

Stock Options

A summary of the Company’s stock option activity for the six months ended June 30, 2023 is as follows (in thousands, except weighted average information):


	Number of Options Outstanding	Weighted Average Exercise Price Per Share
Outstanding at December 31, 2022	6,746	$	2.31
Granted	—	—
Exercised	(1,119)	2.25
Forfeited/Canceled	(29)	2.01
Outstanding at June 30, 2023	5,598	$	2.32
Exercisable at June 30, 2023	5,458	$	2.32

As of June 30, 2023, total remaining stock-based compensation expense for unvested stock options is $1.7 million, which is expected to be recognized over a weighted average period of 0.8 years.

Restricted Stock Units

The Company’s CEO Performance Award provides for a grant of 1.4 million RSUs consisting of five vesting tranches with a vesting schedule based upon achieving stock price targets as well as satisfying certain minimum service requirements. During the three and six months ended June 30, 2023, the Company recorded stock-based compensation expense of $1.5 million and $3.0 million, respectively, related to the CEO Performance Award. During the three and six months ended June 30, 2022, the Company recorded stock-based compensation expense of $1.4 million and $2.9 million, respectively, related to the CEO Performance Award.

For all RSUs, excluding the CEO Performance Award, the Company recorded stock-based compensation expense of $15.4 million and $34.6 million during the three and six months ended June 30,

2023, respectively, and $15.4 million and $33.1 million during the three and six months ended June 30, 2022, respectively.

A summary of the Company’s RSU activity for the six months ended June 30, 2023 is as follows (in thousands, except weighted average information):


	Number of Shares	Weighted Average Grant Date Fair Value Per Share
Unvested at December 31, 2022	7,641	$	21.20
Granted	3,986	21.36
Vested	(1,562)	23.09
Forfeited/Canceled	(1,285)	22.07
Unvested at June 30, 2023	8,780	$	20.69

As of June 30, 2023, total unrecognized stock-based compensation expense for RSUs associated with the CEO Performance Award was $10.4 million, which is expected to be recognized over a weighted average period of 2.0 years. The Company had no other performance-based RSUs as of June 30, 2023. For the remaining RSUs, total unrecognized stock-based compensation expense for unvested RSUs as of June 30, 2023 was $152.0 million, which is expected to be recognized over a weighted average period of 1.5 years.