Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2023

The following table presents information about our financial assets and liabilities that are measured at fair value on a recurring basis and indicates the level of the fair value hierarchy used to determine such fair values:


	September 30, 2023
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	251	$	—	$	—	$	251
Commercial paper	—		88		—		88
Certificates of deposit	—		41		—		41
Corporate bonds	—		71		—		71
U.S. government agency securities	—		80		—		80
Treasury securities	—		154		—		154
Asset-backed securities	—		82		—		82
	$	251	$	516	$	—	$	767
Liabilities:
Warrants to purchase common stock	$	—	$	—	$	72	$	72

	$	—	$	—	$	72	$	72


	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	483	$	—	$	—	$	483
Commercial paper	—		140		—		140
Certificates of deposit	—		104		—		104
Corporate bonds	—		109		—		109
U.S. government agency securities	—		33		—		33
Treasury securities	—		60		—		60
Asset-backed securities	—		28		—		28
	$	483	$	474	$	—	$	957
Liabilities:
Warrants to purchase common stock	$	—	$	—	$	68	$	68
Contingent consideration	—		—		4		4
	$	—	$	—	$	72	$	72

During the nine months ended September 30, 2023 and 2022, there were no transfers into or out of Level 3 measurements within the fair value hierarchy.

Valuation of Warrants to Purchase Common Stock

The fair value of the warrants was determined using the Black-Scholes option-pricing model. The following table indicates the weighted-average assumptions made in estimating the fair value as of September 30, 2023 and December 31, 2022:


	September 30, 2023			December 31, 2022
Risk-free interest rate	4.7		%	4.1		%
Contractual term (in years)	4			4
Expected volatility	68.3		%	60.3		%
Expected dividend yield	—		%	—		%
Exercise price per share	$	17.16		$	17.16

Fair Value of Liabilities

The following tables provide a roll-forward of the aggregate fair value of our common stock warrant liability for which fair value is determined using Level 3 inputs:


	Common Stock Warrant Liability
Balance as of December 31, 2022	$	68


Change in fair value	5
Settlement	(1)

Balance as of September 30, 2023	$	72


	Common Stock Warrant Liability
Balance as of December 31, 2021	$	181
Change in fair value	(102)
Settlement	(18)
Balance as of September 30, 2022	$	61

- 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.

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