Veritone, Inc. General form of registration statement for all companies including face-amount certificate companies

General form of registration statement for all companies including face-amount certificate companies

Summary of Significant Accounting Policies (Tables)

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2017

The correction of the error is presented in the Company’s consolidated financial statements as of and for the year ended December 31, 2016 as follows:

Consolidated Balance Sheet


	As Originally Reported			Restatement Adjustments			As Restated
Deferred offering costs	$	8,317		$	(8,317	)	$	—
Total current assets		29,684			(8,317	)		21,367
Total assets		30,665			(8,317	)		22,348
Convertible note payable, net of discount		19,804			(6,416	)		13,388
Total current liability		50,917			(6,416	)		44,501
Total liabilities		50,939			(6,416	)		44,523
Additional paid-in capital		(2,105	)		1,812			(293	)
Accumulated deficit		(41,523	)		(3,713	)		(45,236	)
Total stockholders’ equity (deficit)		(43,624	)		(1,901	)		(45,525	)
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit)		30,665			(8,317	)		22,348

Consolidated Statement of Operations


	As Originally Reported			Restatement Adjustments			As Restated
Interest expense	$	(430	)	$	(3,460	)	$	(3,890	)
Other income (expense)		950			(253	)		697
Total other income (expense), net		520			(3,713	)		(3,193	)
Loss before provision for income taxes		(23,260	)		(3,713	)		(26,973	)
Net loss	$	(23,266	)		(3,713	)	$	(26,979	)

Net loss attributable to common stockholders	$	(26,470	)		(3,713	)	$	(30,183	)

Basic and diluted net loss per share attributable to common stockholders	$	(12.80	)		(1.79	)	$	(14.59	)

Weighted-average shares used to compute basic and diluted net loss per share		2,068,334						2,068,334

Schedule of Cash and Available-For-Sale Securities' Cost, Gross Unrealized Losses and Fair Value by Significant Investment Category

The following table shows the Company’s cash and available-for-sale securities’ cost, gross unrealized losses and fair value by significant investment category recorded as cash and cash equivalents or marketable securities as of September 30, 2017:


	Cost		Gross Unrealized Losses			Fair Value		Cash and Cash Equivalents		Marketable Securities
Cash	$	13,711	$	—		$	13,711	$	13,711	$	—
Level 1:
Money market funds		3,057		—			3,057		3,057		—
Level 2:
Corporate securities		43,726		(62	)		43,664		3,994		39,670

Total	$	60,494	$	(62	)	$	60,432	$	20,762	$	39,670

Summary of Quantitative Information with Respect to Significant Unobservable Inputs

The following table summarizes quantitative information with respect to the significant unobservable inputs used for the Company’s stock warrants that are categorized within the Level 3 fair value hierarchy:


	December 31, 2016
Volatility		80.0	%
Risk free rate		1.84	%
Discount for lack of marketability		20.0	%

The following table summarizes quantitative information with respect to the significant unobservable inputs used for the Company’s 10% Warrant that are categorized as Level 3 within the fair value hierarchy:


	May 17, 2017
Volatility		70.0	%
Risk free rate		1.44	%
Discount for lack of marketability		0	%

Reconciliation of Level 3 Measurement of Company's Primary Warrant

The following table represents a reconciliation of the Level 3 measurement of the Company’s Primary Warrant:


Balance, January 1, 2016	$	—
Issuance of warrant		8,064
Change in fair value of warrant liability		(950	)

Balance, December 31, 2016	$	7,114

Change in fair value of warrant liability		(7,114	)

Balance, September 30, 2017 (unaudited)	$	—

Summary of Net Revenues

Net revenues for the periods presented were comprised of the following:


	Year Ended December 31,				Nine Months Ended September 30,
	2016		2015		2017		2016
					(Unaudited)
Media agency revenues	$	8,404	$	13,887	$	9,926	$	6,197
SaaS revenues		507		41		988		211

Total net revenues	$	8,911	$	13,928	$	10,914	$	6,408

Schedule of Other Income (Expense), Net

Other income (expense), net for the years ended December 31, 2016 and 2015 and the nine-month periods ended September 30, 2017 and 2016 were comprised of the following:


	Years Ended December 31,					Nine Months Ended September 30,
	2016			2015		2017			2016
						(unaudited)
Interest income (expense), net	$	(3,890	)	$	17	$	(4,198	)	$	(1,341	)
Stock warrants issued		—			—		(5,790	)		—
Write-off of deferred debt discounts and issuance costs		—			—		(10,132	)		—
Write-off of legal fees in connection with the Primary Warrant		—			—		—			(253	)
Gain on fair value change of warrant liability		950			—		7,114			117
Other		(253	)		68		134			(6	)

Other income (expense), net	$	(3,193	)	$	85	$	(12,872	)	$	(1,483	)

Computation of Basic and Diluted Net Loss Per Common Share

The following table presents the computation of basic and diluted net loss per common share:


	Year Ended December 31,						Nine Month Ended September 30,
	2016			2015			2017			2016
							(Unaudited)
Historical net loss per share
Numerator
Net loss	$	(26,979	)	$	(6,210	)	$	(46,811	)	$	(17,915	)
Accretion of redeemable convertible preferred stock		(3,204	)		(3,330	)		(4,470	)		(2,383	)

Net loss attributable to common stockholders	$	(30,183	)	$	(9,540	)	$	(51,281	)	$	(20,298	)

Denominator
Weighted-average common shares outstanding		2,205,577			1,631,660			8,820,609			2,068,164
Less: Weighted-average shares subject to repurchase		(137,243	)		(214,928	)		(180,431	)		(110,568	)

Denominator for basic and diluted net loss per share attributable to common stockholders		2,068,334			1,416,732			8,640,178			1,957,596

Basic and diluted net loss per share attributable to common stockholders	$	(14.59	)	$	(6.73	)	$	(5.94	)	$	(10.37	)

Effect of Anti-dilutive Securities

Potentially dilutive securities that were not included in the calculation of diluted net loss per share attributable to common stockholders because their effect would be anti-dilutive are as follows (in common equivalent shares):


	Year Ended December 31,
	2016		2015
Common stock subject to repurchase		208,885		79,650
Common stock options		680,437		634,198
Warrants to purchase common stock		2,493,449		—
Shares issuable upon conversion of the convertible note payable		1,490,651		—
Redeemable convertible preferred stock		5,083,932		4,708,398

		9,957,354		5,422,246


	Nine Months Ended September 30,
	2017		2016
	(Unaudited)
Common stock options		2,636,548		660,762
Warrants to purchase common stock		987,200		1,185,214
Shares issuable upon conversion of convertible to note payable		—		736,076
Shares issuable upon conversion of redeemable convertible preferred stock		—		4,830,323

Total		3,623,748		7,412,375