TOAST, INC., 10-K filed on 3/1/2023
Annual Report
v3.22.4
Cover Page - USD ($)
$ in Billions
 12 Months Ended
Dec. 31, 2022
Feb. 21, 2023
Jun. 30, 2022
Document Information [Line Items]      
Document Type 10-K    
Document Annual Report true    
Document Period End Date Dec. 31, 2022    
Current Fiscal Year End Date --12-31    
Document Transition Report false    
Entity File Number 001-40819    
Entity Registrant Name TOAST, INC.    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 45-4168768    
Entity Address, Address Line One 401 Park Drive    
Entity Address, Address Line Two Suite 801    
Entity Address, City or Town Boston    
Entity Address, State or Province MA    
Entity Address, Postal Zip Code 02215    
City Area Code 617    
Local Phone Number 297-1005    
Title of 12(b) Security Class A common stock, par value of $0.000001 per share    
Trading Symbol TOST    
Security Exchange Name NYSE    
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    
ICFR Auditor Attestation Flag true    
Entity Shell Company false    
Entity Public Float     $ 5
Documents Incorporated by Reference Portions of the registrant's Definitive Proxy Statement relating to the 2023 Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. Such Definitive Proxy Statement will be filed with the Securities and Exchange Commission within 120 days after the end of the registrant's fiscal year ended December 31, 2022.    
Entity Central Index Key 0001650164    
Amendment Flag false    
Document Fiscal Year Focus 2022    
Document Fiscal Period Focus FY    
Common Class A      
Document Information [Line Items]      
Entity Common Stock, Shares Outstanding   357,008,583  
Common Class B      
Document Information [Line Items]      
Entity Common Stock, Shares Outstanding   169,821,735  
v3.22.4
Audit Information
 12 Months Ended
Dec. 31, 2022
Audit Information [Abstract]  
Auditor Name Ernst & Young LLP
Auditor Location Boston, Massachusetts
Auditor Firm ID 42
v3.22.4
CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Current Assets:    
Cash and cash equivalents $ 547 $ 809
Marketable securities 474 457
Accounts receivable, net 77 55
Inventories, net 110 42
Deferred costs, net 44 30
Prepaid expenses and other current assets 155 92
Total current assets 1,407 1,485
Property and equipment, net 61 41
Operating lease right-of-use assets 77 79
Intangible assets, net 29 16
Goodwill 107 74
Restricted cash 28 8
Deferred costs, non-current 38 25
Other non-current assets 14 7
Total non-current assets 354 250
Total assets 1,761 1,735
Current liabilities:    
Accounts payable 30 40
Operating lease liabilities 14 22
Deferred revenue 39 44
Accrued expenses and other current liabilities 413 246
Total current liabilities 496 352
Warrants to purchase common stock 68 181
Deferred revenue, non-current 7 12
Operating lease liabilities, non-current 80 77
Other long-term liabilities 12 22
Total liabilities 663 644
Commitments and Contingencies (Note 18)
Stockholders’ Equity:    
Preferred stock- par value $0.000001; 100,000,000 shares authorized, no shares issued or outstanding 0 0
Treasury stock, at cost- 225,000 shares outstanding at December 31, 2022 and 2021, respectively 0 0
Accumulated other comprehensive loss (2) (1)
Additional paid-in capital 2,477 2,194
Accumulated deficit (1,377) (1,102)
Total stockholders’ equity 1,098 1,091
Total liabilities and stockholders’ equity 1,761 1,735
Common Class A    
Stockholders’ Equity:    
Common stock 0 0
Common Class B    
Stockholders’ Equity:    
Common stock $ 0 $ 0
v3.22.4
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
Dec. 31, 2022
Dec. 31, 2021
Stockholders’ Equity:    
Preferred stock, par value (in dollars per share) $ 0.000001 $ 0.000001
Preferred stock, authorized (in shares) 100,000,000 100,000,000
Preferred stock, issued (in shares) 0 0
Preferred stock, outstanding (in shares) 0 0
Treasury stock (in shares) 225,000 225,000
Common Class A    
Stockholders’ Equity:    
Common stock, par value (in dollars per share) $ 0.000001 $ 0.000001
Common stock, authorized (in shares) 7,000,000,000 7,000,000,000
Common stock, issued (in shares) 353,094,009 167,732,925
Common stock, outstanding (in shares) 353,094,009 167,732,925
Common Class B    
Stockholders’ Equity:    
Common stock, par value (in dollars per share) $ 0.000001 $ 0.000001
Common stock, authorized (in shares) 700,000,000 700,000,000
Common stock, issued (in shares) 169,933,289 339,437,440
Common stock, outstanding (in shares) 169,933,289 339,437,440
v3.22.4
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Revenue:      
Total revenue $ 2,731 $ 1,705 $ 823
Costs of revenue:      
Amortization of acquired intangible assets 5 4 4
Total costs of revenue 2,220 1,391 683
Gross profit 511 314 140
Operating expenses:      
Sales and marketing 319 190 138
Research and development 282 163 109
General and administrative 294 189 113
Total operating expenses 895 542 360
Loss from operations (384) (228) (220)
Other income (expenses):      
Interest income (expense), net 11 (12) (12)
Change in fair value of warrant liability 95 (97) (8)
Change in fair value of derivative liability 0 (103) (7)
Loss on debt extinguishment 0 (50) 0
Other income (expense), net 1 0 (1)
Loss before benefit from income taxes (277) (490) (248)
Benefit from income taxes 2 3 0
Net loss (275) (487) (248)
Redemption of Series B Preferred Stock 0 0 (1)
Net loss attributable to common stockholders $ (275) $ (487) $ (249)
Net loss per share attributable to common stockholders:      
Basic (in dollars per share) $ (0.54) $ (1.68) $ (1.25)
Diluted (in dollars per share) $ (0.72) $ (1.68) $ (1.25)
Weighted average shares used in computing net loss per share:      
Basic (in shares) 511,754,986 289,584,001 199,982,965
Diluted (in shares) 512,243,106 289,584,001 199,982,965
Subscription services      
Revenue:      
Total revenue $ 324 $ 169 $ 101
Costs of revenue:      
Cost of revenue 112 63 40
Financial technology solutions      
Revenue:      
Total revenue 2,268 1,406 644
Costs of revenue:      
Cost of revenue 1,792 1,120 509
Hardware      
Revenue:      
Total revenue 113 112 64
Costs of revenue:      
Cost of revenue 215 152 85
Professional services      
Revenue:      
Total revenue 26 18 14
Costs of revenue:      
Cost of revenue $ 96 $ 52 $ 45
v3.22.4
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Statement of Comprehensive Income [Abstract]      
Net loss $ (275) $ (487) $ (248)
Other comprehensive loss:      
Unrealized loss on marketable securities (1) (1) 0
Total other comprehensive loss (1) (1) 0
Comprehensive loss $ (276) $ (488) $ (248)
v3.22.4
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Parenthetical) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Statement of Comprehensive Income [Abstract]      
Unrealized losses on marketable securities, tax $ 0 $ 0 $ 0
v3.22.4
CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($)
$ in Millions
Total
Cumulative adjustment for adoption new accounting standard
Common Stock
Common Stock
Unvested restricted stock
Treasury Stock
Additional Paid-in Capital
Accumulated Deficit
Accumulated Deficit
Cumulative adjustment for adoption new accounting standard
Accumulated Other Comprehensive Loss
Temporary equity, beginning balance (in shares) at Dec. 31, 2019 209,608,075                
Temporary equity, beginning balance at Dec. 31, 2019 $ 447                
Convertible Preferred Preferred Stock                  
Redemption of Series B preferred stock (in shares) (77,270)                
Issuance of preferred stock (in shares) 44,301,220                
Issuance of preferred stock $ 403                
Issuance cost of Series F preferred stock $ (1)                
Temporary equity, ending balance (in shares) at Dec. 31, 2020 253,832,025                
Temporary equity, ending balance at Dec. 31, 2020 $ 849                
Beginning balance (in shares) at Dec. 31, 2019     214,901,400            
Beginning balance at Dec. 31, 2019 (330) $ 18 $ 0   $ 0 $ 56 $ (386) $ 18 $ 0
Beginning balance (in shares) at Dec. 31, 2019         200,000        
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Repurchase of common stock (in shares)     (1,011,880)            
Common stock repurchased (in shares)         25,000        
Redemption of Series B preferred stock (1)         (1)      
Issuance of common stock upon exercise of common stock options (in shares)     5,865,910            
Issuance of common stock upon exercise of common stock options 4         4      
Stock-based compensation expense 86         86      
Unrealized loss on marketable securities 0                
Net loss (248)           (248)    
Ending balance (in shares) at Dec. 31, 2020     219,755,430            
Ending balance at Dec. 31, 2020 $ (471) $ 1 $ 0   $ 0 145 (616) $ 1 0
Ending balance (in shares) at Dec. 31, 2020         225,000        
Convertible Preferred Preferred Stock                  
Conversion of preferred stock (in shares) (253,832,025)                
Conversion of preferred stock $ (849)                
Issuance of common stock in connection with initial public offering, net of offering costs, underwriting discounts and commissions (in shares)     25,000,000            
Issuance of common stock in connection with initial public offering, net of offering costs $ 944         944      
Temporary equity, ending balance (in shares) at Dec. 31, 2021 0                
Temporary equity, ending balance at Dec. 31, 2021 $ 0                
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Repurchase of common stock (in shares)     (35,665)            
Issuance of common stock upon net exercise of common stock warrants (in shares)     1,140,931            
Issuance of common stock upon net exercise of common stock warrants 56         56      
Conversion of preferred stock (in shares)     253,832,025            
Conversion of preferred stock 849         849      
Issuance of common stock upon exercise of common stock options (in shares)     6,307,785            
Issuance of common stock upon exercise of common stock options 7         7      
Exercise of common stock options in connection with promissory notes repayment 14         14      
Issuance of common stock upon vesting of restricted stock units (in shares)     53,570            
Stock-based compensation expense [1] 141         141      
Vesting of restricted stock 4         4      
Issuance of common stock in connection with business combination (in shares)     569,400            
Issuance of common stock in connection with business combination 15         15      
Charitable contribution stock-based expense (in shares)     546,889            
Charitable contribution stock-based expense 19         19      
Unrealized loss on marketable securities (1)               (1)
Issuance of common stock in connection with initial public offering, net of offering costs, underwriting discounts and commissions (in shares)     25,000,000            
Issuance of common stock in connection with initial public offering, net of offering costs 944         944      
Net loss (487)           (487)    
Ending balance (in shares) at Dec. 31, 2021     507,170,365            
Ending balance at Dec. 31, 2021 $ 1,091   $ 0   $ 0 2,194 (1,102)   (1)
Ending balance (in shares) at Dec. 31, 2021 225,000       225,000        
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Repurchase of common stock (in shares)     (33,475)            
Issuance of common stock upon net exercise of common stock warrants (in shares)     371,573            
Issuance of common stock upon net exercise of common stock warrants $ 18         18      
Issuance of common stock upon exercise of common stock options (in shares) 7,633,661   7,633,661            
Issuance of common stock upon exercise of common stock options $ 15         15      
Issuance of common stock upon vesting of restricted stock units (in shares)     5,962,878            
Stock-based compensation expense 235         235      
Vesting of restricted stock 4         4      
Issuance of common stock in connection with business combination (in shares)     37,179 1,338,228          
Issuance of common stock in connection with business combination 1         1      
Charitable contribution stock-based expense (in shares)     546,889            
Charitable contribution stock-based expense 10         10      
Unrealized loss on marketable securities (1)               (1)
Cumulative translation adjustment 0               0
Net loss (275)           (275)    
Ending balance (in shares) at Dec. 31, 2022     523,027,298            
Ending balance at Dec. 31, 2022 $ 1,098   $ 0   $ 0 $ 2,477 $ (1,377)   $ (2)
Ending balance (in shares) at Dec. 31, 2022 225,000       225,000        
[1] During the year ended December 31, 2021, stock-based compensation expense recorded within additional paid-in capital does not include $2 of expense recognized as a result of the acquisition of xtraCHEF due to accelerated vesting of acquiree option awards on the acquisition date (see Note 3, "Business Combinations").
v3.22.4
CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) (Parenthetical) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Stock-based compensation expense $ 228 $ 142 $ 86
xtraCHEF, Inc.      
Stock-based compensation expense   $ 2  
v3.22.4
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Cash flows from operating activities:      
Net loss $ (275) $ (487) $ (248)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:      
Depreciation and amortization 24 21 27
Stock-based compensation expense 228 140 86
Amortization of deferred costs 44 30 15
Change in fair value of derivative liability 0 103 7
Change in fair value of warrant liability (95) 97 8
Change in deferred income taxes (5) (3) 0
Loss on debt extinguishment 0 50 0
Credit loss expense 34 4 0
Non-cash interest on convertible notes 0 12 8
Charitable contribution stock-based expense 10 19 0
Change in fair value of contingent consideration 3 3 0
Other non-cash items 5 2 0
Changes in operating assets and liabilities:      
Account receivable, net (35) (23) (13)
Acquired loans and merchant cash advances repaid 4 1 9
Prepaid expenses and other current assets (40) (45) 18
Deferred costs, net (71) (56) (25)
Inventories, net (68) (23) (4)
Operating lease right-of-use assets (4) 16 0
Accounts payable (11) 15 (6)
Accrued expenses and other current liabilities 116 145 (3)
Deferred revenue (11) (2) (8)
Operating lease liabilities 4 (16) 0
Other assets and liabilities (13) (1) 4
Net cash (used in) provided by operating activities (156) 2 (125)
Cash flows from investing activities:      
Cash paid for acquisition, net of cash acquired (46) (26) 0
Capitalized software (17) (7) (8)
Purchases of property and equipment (16) (12) (28)
Purchases of marketable securities (434) (469) 0
Proceeds from the sale of marketable securities 46 5 0
Maturities of marketable securities 369 5 0
Other 0 1 0
Net cash used in investing activities (98) (503) (36)
Cash flows from financing activities:      
Proceeds from initial public offering, net 0 950 0
Payment of deferred offering costs 0 (5) 0
Payment of contingent consideration (2) 0 0
Repayments of secured borrowings 0 0 (9)
Extinguishment of convertible notes 0 (245) 0
Change in customer funds obligations, net 26 24 4
Proceeds from issuance of long-term debt 0 0 195
Proceeds from exercise of stock options 15 21 3
Proceeds from issuance of restricted stock 0 10 0
Proceeds from issuance of Series E and Series F Preferred 0 0 402
Redemption of Series B Preferred 0 0 (1)
Proceeds from exercise of common stock warrants 0 3 0
Other financing activities (1) 1 0
Net cash provided by financing activities 38 759 594
Net (decrease) increase in cash, cash equivalents, cash held on behalf of customers and restricted cash (216) 258 433
Effect of exchange rate changes on cash and cash equivalents and restricted cash 0 (1) 2
Cash, cash equivalents, cash held on behalf of customers and restricted cash at beginning of period 851 594 159
Cash, cash equivalents, cash held on behalf of customers and restricted cash at end period 635 851 594
Reconciliation of cash, cash equivalents, cash held on behalf of customers and restricted cash      
Cash and cash equivalents 547 809 582
Cash held on behalf of customers 60 34 11
Restricted cash 28 8 1
Total cash, cash equivalents, cash held on behalf of customers and restricted cash 635 851 594
Supplemental disclosure of cash flow information      
Cash paid for interest 0 13 5
Cash paid for income taxes 1 0 0
Supplemental disclosure of non-cash investing and financing activities:      
Purchase of property and equipment included in accounts payable and accrued expenses 1 1 5
Stock-based compensation included in capitalized software 7 1 0
Stock Issued 1 0 0
Deferred offering costs included in accounts payable and accrued expenses 0 1 0
Conversion of convertible preferred stock into Class B common stock upon initial public offering 0 849 0
Issuance of common stock warrants upon debt extinguishment 0 125 0
Deferred payments included in purchase price 2 5 0
Contingent consideration included in purchase price 0 2 0
Common Class B      
Supplemental disclosure of non-cash investing and financing activities:      
Issuance of Class B common stock upon exercise of common stock warrants 18 56 0
xtraCHEF, Inc.      
Supplemental disclosure of non-cash investing and financing activities:      
Stock Issued $ 0 $ 15 $ 0
v3.22.4
Description of Business and Basis of Presentation
 12 Months Ended
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business and Basis of Presentation Description of Business and Basis of Presentation
Toast ("we," or the “Company”), is a cloud-based all-in-one digital technology platform purpose-built for the entire restaurant community. Our platform provides a comprehensive suite of software as a service, or SaaS, products, financial technology solutions including integrated payment processing, restaurant-grade hardware, and a broad ecosystem of third-party partners. We serve as the restaurant operating system, connecting front of house and back of house operations across dine-in, takeout, and delivery channels.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, and the rules and regulations of the Securities and Exchange Commission, or SEC. The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Initial Public Offering and Stock Split

On September 24, 2021, we completed our IPO where we sold 25,000,000 shares of our Class A common stock at the public offering price of $40.00 per share, which included the full exercise of the underwriters’ option to purchase an additional 3,260,869 shares. We received net proceeds of $944 after deducting underwriting discounts and commissions and other offering costs.

Immediately prior to the completion of our IPO, 253,832,025 shares of convertible preferred stock were automatically converted into an equal number of shares of Class B common stock, and 1,002,035 warrants to purchase shares of Series B and Series C convertible preferred stock were automatically exchanged or became exercisable for the same number of shares of Class B common stock. The holders of our convertible preferred stock had certain voting, conversion, dividend, and redemption rights, as well as liquidation preferences and conversion privileges in respect of the convertible preferred stock which were terminated upon IPO. Each share of Class A common stock entitles the holder to one vote per share and each share of Class B common stock entitles the holder to ten votes per share on all matters submitted to a vote of stockholders. Holders of Class A common stock and Class B common stock are entitled to receive dividends, when and if declared by the Board of Directors, or the Board.

Risks and Uncertainties

We are subject to a number of risks and uncertainties, including global events and macroeconomic conditions such as inflation and its potential impact on consumer spending, rising interest rates, global supply chain issues, and any public health concerns, which may also impact consumer behavior, the restaurant industry, and our business.

During 2020, we completed a significant reduction in workforce, pursuant to which we incurred severance costs of $10 and stock-based compensation expense of $3 in connection with the modification of previously issued employee stock option awards.

Reclassifications

Certain amounts in prior period financial statements have been reclassified to conform to the current period presentation. None of the reclassifications materially affected previously reported amounts.
v3.22.4
Summary of Significant Accounting Policies
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies Summary of Significant Accounting Policies
Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgements and assumptions that can affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from estimates.

Estimates, judgments, and assumptions in these consolidated financial statements include, but are not limited to, those related to revenue recognition, allowance for credit losses, liabilities associated with financial guarantees related to loan repurchase activities, incremental borrowing rates applied in valuation of lease liabilities, fair values and useful lives of assets acquired and liabilities assumed through business combinations, stock-based compensation expense, warrants, convertible debt, debt derivatives and common stock valuation, as well as amortization period for deferred contract acquisition costs.

Fair Value Measurements

Certain assets and liabilities are carried at fair value under U.S. GAAP. These include cash and cash equivalents, marketable securities, warrants to purchase common and preferred stock, contingent consideration liability, non-contingent stand-ready liabilities, and convertible debt-related derivative liabilities. Assets and liabilities measured at fair value on a nonrecurring basis include assets acquired and liabilities assumed in business combinations. Other financial assets and liabilities are carried at cost with fair value disclosed, if required. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

•Level 1—Quoted prices in active markets for identical assets or liabilities.

•Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

•Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The fair value of our marketable securities is determined based on quoted market prices of similar assets and classified as Level 2 within the fair value hierarchy. (See Note 4, “Fair Value of Financial Instruments”). The carrying values of accounts receivable, accounts payable, and accrued expenses approximate their fair values due to their short-term nature.

Foreign Currency Translation

The functional currency of our foreign subsidiaries is the local currency. The assets and liabilities of foreign subsidiaries are translated into U.S. dollars using exchange rates in effect at the Consolidated Balance Sheet date. Revenue and expenses are translated using the average exchange rates during the period. Equity transactions are translated using historical exchange rates. Exchange-rate differences resulting from translation adjustments are accounted for as a component of accumulated other comprehensive loss. Foreign currency transaction gains and losses are included in "Other income (expense), net" in the Consolidated Statements of Operations for the period.
Concentration of Credit Risk and Significant Customers

Financial instruments that subject us to significant concentrations of credit risk primarily consist of cash deposits and cash equivalents, marketable securities, and accounts receivable. We maintain a large portion of our cash deposits and cash equivalents with primarily one financial institution, which, at times, may exceed federally insured limits. We have not incurred any losses associated with this concentration of deposits. Our investment policy provides guidelines and limits regarding investment type, concentration, credit quality, and maturity aimed at maintaining sufficient liquidity to satisfy operating and working capital requirements along with strategic initiatives, preserving capital, and minimizing risk of capital loss while generating returns on our investments.

Accounts receivable are typically unsecured. We regularly monitor the creditworthiness of our customers and believe that we have adequately provided for exposure to potential credit losses. During the years ended December 31, 2022, 2021, and 2020, we had no customers that accounted for more than 10% of our total revenue. No customers accounted for more than 10% of our total receivables as of December 31, 2022 or 2021.

Segment Information

Our operations constitute a single operating segment. Operating segments are defined as components of an enterprise for which discrete financial information is available and is evaluated regularly by the chief operating decision maker, or CODM, in deciding how to allocate resources and assess performance. Our CODM is our Chief Executive Officer who reviews financial information presented on a consolidated basis for the purposes of allocating resources and evaluating financial performance.

Revenue Recognition

During the years ended December 31, 2022, 2021, and 2020, we generated four types of revenue, including: (1) subscription services from our SaaS products, (2) financial technology solutions, including loan servicing activities, (3) hardware, and (4) professional services.

Determining whether products and services are considered distinct performance obligations that should be accounted for separately as opposed to being combined requires judgment. We allocate total arrangement consideration at the inception of an arrangement to each performance obligation using the relative selling price allocation method based on each distinct performance obligation’s standalone selling price, or SSP. Judgment is required to determine the SSP for each distinct performance obligation. We determine SSP for hardware and professional services revenue using an adjusted market assessment approach which analyzes discounts provided to similar customers based on customer category, sales channel, and size. SSP for subscription services revenue was established using the adjusted market approach considering relevant information, such as current and new customer pricing, renewal pricing, competitor information, market trends and market share for similar services. SSP for financial technology solutions revenue was determined using our own standalone sales data. We allocate variable fees earned from financial technology services revenue to those distinct performance obligations where pricing practices are consistent with the allocation objective under ASC 606.

Customer credits represent variable consideration which is estimated based on historical experience and accounted for as a reduction of transaction price. The provision for these estimates is recorded as a reduction of revenue and an increase to liabilities at the time that the related revenue is recognized. Sales taxes collected from customers and remitted to government authorities are excluded from revenue and deferred revenue.

We also facilitate customers receiving financing from third-party financing firms for hardware, professional services, and the initial SaaS subscription services term. We pay the equivalent of an early payment discount to the third-party financing partners and recognize the payment as a reduction of revenue, as we believe these costs represent a customer sales incentive.
Subscription Services

Subscription services revenue is generated from fees charged to customers for access to our software applications. Subscription services revenue is primarily based on a rate per location, and this rate varies depending on the number of software products purchased, hardware configuration, and employee count. The performance obligation is satisfied ratably over the contract period as the service is provided, commencing when the subscription service is made available to the customer. Our contracts with customers are generally for a term ranging from 12 to 36 months.

Financial Technology Solutions

Financial technology solutions revenue includes transaction-based payment processing services for customers who are charged a transaction fee for payment-processing. This transaction fee is generally calculated as a percentage of the total transaction amount processed plus a fixed per-transaction fee, which is earned as transactions are authorized and submitted for processing. We incur costs of interchange and network assessment fees, processing fees, and bank settlement fees to the third-party payment processors and financial institutions involved in settlement, which are recorded as costs of revenues. We satisfy our payment processing performance obligations and recognize the transaction fees as revenue upon authorization by the issuing bank and submission for processing. The transaction fees collected are recognized as revenue on a gross basis as we are the principal in the delivery of the managed payments solutions to the customers.

We have concluded that we are the principal in this performance obligation to provide a managed payment solution because we control the payment processing services before the customer receives them, perform authorization and fraud check procedures prior to submitting transactions for processing in the payment network, have sole discretion over which third-party acquiring payment processors we will use and are ultimately responsible to the customers for amounts owed if those acquiring payment processors do not fulfill their obligations. We generally have full discretion in setting prices charged to the customers. Additionally, we are obligated to comply with certain payment card network operating rules and contractual obligations under the terms of our registration as a payment facilitator and as a master merchant under our third-party acquiring payment processor agreements which make us liable for the costs of processing the transactions for our customers and chargebacks and other financial losses if such amounts cannot be recovered from the restaurant.

Financial technology solutions revenue is recorded net of refunds and reversals initiated by the restaurant and is recognized upon authorization by the issuing bank and submission for processing.

Financial technology solutions revenue also includes fees earned from marketing and servicing loans to customers through our wholly-owned subsidiary, Toast Capital, that are originated by a third-party banking partner. In these arrangements, Toast Capital’s bank partner originates all loans, and Toast Capital then services the loans using Toast’s payments infrastructure to remit a fixed percentage of daily sales to our bank partner until the loan is repaid. Toast Capital earns fees for the underwriting and marketing of loans, which are recognized upon origination of the loan, and loan servicing fees, based on a percentage of each outstanding loan, which are recognized as servicing revenue as the servicing is delivered in accordance with ASC 860, Transfers and Servicing. Servicing revenue is adjusted for the amortization of servicing rights carried at amortized cost. The marketing and facilitation fees earned upon execution of these loan agreements with its customers are recognized as revenue on a gross basis.

Hardware

Hardware revenue is generated from the sale of terminals, tablets, handhelds, and related devices and accessories, net of estimated returns. We invoice end-user customers upon shipment of the products. Revenue for hardware sales is recognized at the point in time when the transfer of control occurs, which is upon product shipment. We accept returns for hardware sales and recognize them at the time of the sale as a reduction of transaction price based on historical experience.
Professional Services

Professional services revenue is generated from fees charged to customers for installation services, including business process mapping, configuration, and training. The duration of providing professional services to the customer is relatively short and completed in a matter of days. The performance obligation for professional services is considered to be satisfied upon the completion of the installation.

Cash, Cash Equivalents, Cash Held on Behalf of Customers and Restricted Cash

We define cash and cash equivalents as cash deposits, money market funds, and highly liquid investments with original maturities of 90 days or less at the time of purchase that are readily convertible to known amounts of cash.

Cash held on behalf of customers represents an asset that is restricted for the purpose of satisfying obligations to remit funds to various tax authorities to satisfy customers’ payroll, tax and other obligations. Cash held on behalf of customers is included within "Prepaid expenses and other current assets," and the corresponding customer funds obligation is included within "Accrued expenses and other current liabilities" on our Consolidated Balance Sheets.

Restricted cash represents cash held with commercial lending institutions. The restrictions are related to cash held as collateral pursuant to an agreement with the originating third-party bank for the working capital loans serviced by Toast Capital (See Note 6, "Loan Servicing Activities and Acquired Loans Receivable, Net").

Marketable Securities

Our marketable securities are classified as available-for-sale. We classify our marketable securities as current assets, including those with maturities greater than 12 months, as they are available for use in current operations or to satisfy other liquidity requirements.

Marketable securities are carried at fair value, and we report unrealized gains and losses as a component of accumulated other comprehensive loss, net of tax, until the security is sold or matures, except for changes in allowance for expected credit losses, which are recorded in our results of operations. Gains or losses realized from sales of marketable securities are computed based on the specific identification method and recognized as a component of "Other income (expense), net" in the accompanying Consolidated Statements of Operations.

Accounts Receivable, net

Accounts receivable, net consisted of the following:
December 31,
20222021
Accounts receivable
$45 $20 
Unbilled receivables
44 39 
Less: Allowance for credit losses
(12)(4)
Accounts receivable, net$77 $55 

Our allowance for credit losses was comprised of the following:

Twelve Months Ended December 31,
20222021
Beginning balance$(4)$(4)
Impact of adopting ASU 2016-13— (2)
Additions(13)(1)
Write offs5 3 
Ending balance$(12)$(4)
Accounts receivable, net consists of trade accounts receivable and unbilled receivables (which we collectively refer to as accounts receivable), net of an allowance for credit losses. Unbilled receivables represent revenue recognized on a contract in excess of billings.

We record an allowance for expected credit losses for accounts receivable upon the initial recognition of an accounts receivable balance in accordance with ASC 326. The allowance for credit losses represents the best estimate of lifetime expected credit losses, based on customer-specific information, historical loss rates and the impact of current and future conditions, including an assessment of customer creditworthiness, historical payment experience and the age of outstanding receivables. Accounts receivable balances are written off against the allowance for credit losses when we determine that the balances are not recoverable. Provisions for the allowance for expected credit losses are recorded in "General and administrative" expenses in the Consolidated Statements of Operations. We evaluate the allowance for credit losses for the entire portfolio of accounts receivable on an aggregate basis due to similar risk characteristics of our customers based on similar industry and historical loss patterns.

Inventory

Inventory, which consists of tablets, printers, and networking equipment, are stated at the lower of cost or net realizable value and are accounted for using the average cost method. Substantially all inventory consists of finished goods. We evaluate ending inventory for estimated excess and obsolete inventory based primarily on historical sales levels by product and projections of future demand, as well as the impact of changing product design and technology. We recognize outbound freight, handling costs, and damaged inventory as current-period costs. We recorded provisions for excess and obsolete inventory of $13 and $3, respectively, within "Costs of Revenue" for the years ended December 31, 2022 and 2021.

Assets and Liabilities Recorded with Loan Servicing Activities

We perform loan servicing activities through the Toast Capital loan program, where we partner with an industrial bank to provide working capital loans to qualified Toast customers based on the customer’s current payment processing and point of sale data. Under the program, our bank partner originates the loans and we market and service the loans and facilitate the loan application and origination process. These loans provide eligible customers with access to financing up to $300 thousand, and loan repayment occurs automatically through a fixed percentage of every payment transaction processed on Toast’s platform.

Under the terms of our agreement with our industrial bank partner, we are obligated to repurchase certain loans originated by our industrial banking partner in cases where the customer's payments on the loan are missing or delayed for a defined period of time, and the loan is considered defaulted or delinquent (ineligible). Our obligation is limited to a specified percentage of the total loans originated, measured on a quarterly basis. The loan repurchase, net of expected recoveries, reduces our potential liability with respect to the quarterly cohort of loans from which the ineligible loan originated. Refer to "Acquired Loans Receivable, Net" section within this note for information on our accounting for repurchased loans.

This obligation represents a financial guarantee with two aspects: a contingent liability accounted for under ASC 326 related to our contingent obligation to purchase ineligible loans, and a non-contingent liability accounted for under ASC 460 related to our obligation to stand-ready to perform under the obligation, both of which are included in “Accrued Expenses and other current liabilities” in the Consolidated Balance Sheets. We adopted ASC 326 effective January 1, 2021 which applies to the contingent component of the guarantee arrangement. We measure a contingent liability for expected credit losses which is based on historical lifetime loss data, as well as macroeconomic forecasts applied to the loan portfolio. Probability of default curves are generated using historical default data for portfolios of guaranteed loans with similar risk characteristics. Loss severity estimates are generated using historical collections data for the loans repurchased by us. Additionally, we apply macroeconomic factors, such as forecasted trends in unemployment rates, which are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period. Projected loss rates, inclusive of historical loss data and macroeconomic factors, are applied to the outstanding principal amounts of the guaranteed loans. We may also include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of its current expected credit losses. The expected term of the loans guaranteed by us typically range from 90 to 360 days, and the reasonable and supportable forecast period we have included in our projected loss rates is approximately 12 months based on externally sourced data.
Contingent liabilities for expected credit losses are recorded as loans are originated, along with a corresponding non-cash charge recorded within "General and administrative" expense in the Consolidated Statements of Operations. We remeasure contingent liabilities each reporting period and reverse the liability upon loan purchase or upon the expiration of the obligation. We record a non-contingent liability at fair value as loans are originated, with a corresponding charge recorded within "General and administrative" expense in the accompanying Consolidated Statements of Operations. Subsequently, the liability is amortized on a straight-line basis over the average expected obligation term, which ranges from 90 to 360 days, and derecognized upon loan repurchase. Fair value of a non-contingent liability is measured based on a discounted cash flow model under the income approach which reflects various inputs and assumptions, including the probability and amount of payments to be made under the guarantee based on probabilities of loan defaults and delinquency, as well as associated losses, and a discount rate reflecting our credit risk as the guarantor. The fair value measurement of the non-contingent liability is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy.

Please refer to Note 6, “Loan Servicing Activities and Acquired Loans Receivable, Net” for additional information on the liabilities related to the financial guarantees.

We facilitate customers receiving financing from third-party financing firms for hardware, professional services, and the initial SaaS subscription services term and assume a limited portion of the risk of customer defaults under our arrangements. We recognize a contingent guarantee liability for expected credit losses and a non-contingent stand-ready liability related to the financial guarantees in accordance with ASC 460 along with a corresponding non-cash charge recorded as "General and administrative" expense in the Consolidated Statements of Operations. Costs incurred to date under such guarantees have not been material.

Acquired Loans Receivable, Net

We are obligated to purchase delinquent loans from our industrial bank partner. Such purchases, net of expected recoveries, are recorded as a reduction of contingent liabilities with respect to the quarterly cohort of loans from which the defaulted loan originated. We account for purchased loans in accordance with the guidance for purchased credit deteriorated, or PCD, assets as the loans experienced credit quality deterioration between their origination and purchase, and write off their unpaid principal balance at the time of purchase as collectability is not probable. However, when we have an expectation of collecting cash flows, a negative allowance is established for repurchased loans based on our historical experience of expected recoveries across our portfolio. As of December 31, 2022 and 2021, we have established a negative allowance for expected recoveries which is included within "Prepaid expenses and other current assets" in the Consolidated Balance Sheets. We had $13 and $2 of acquired loans outstanding as of December 31, 2022 and 2021.

We estimate a negative allowance on an undiscounted basis using historical collections data for loans purchased by us and qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected recoveries. Cash collections related to acquired loans receivable are first applied to the negative allowance balance, and when recoveries received exceed the negative allowance, we recognize amounts as reductions of operating expenses in the Consolidated Statements of Operations. Please refer to Note 6, "Loan Servicing Activities and Acquired Loans Receivable, Net" for additional information on the liabilities related to loan financial guarantees and negative allowance.

Deferred Costs, Net

Based on ASC 340-40, Other Assets and Deferred Costs, we capitalize and amortize incremental costs of obtaining a contract, such as sales commissions and related payroll taxes, over the period we expect to derive benefits from the contract, which we have determined to be three years. The period of benefit for commissions paid for the acquisition of initial subscription services is determined by taking into consideration the initial estimated customer life and the technological life of our subscription services platform and related significant features. We adjust the carrying value of the deferred commissions assets periodically to account for customer churn, which occurs when customers have ceased operations or otherwise discontinued using our subscription services and financial technology solutions. Amortization expense is included in "Sales and marketing" expense in the Consolidated Statements of Operations.
Property and Equipment, Intangible Assets and Impairment of Long-lived Assets

Property and equipment are stated at cost, net of accumulated depreciation, and are depreciated using the straight-line method over their estimated lives, as follows:

Property and EquipmentEstimated Useful Life
Computer and other equipment3 years
Office furniture and fixtures3 years
Tooling and equipment
3-7 years
Capitalized software2 years

Leasehold improvements are amortized over the shorter of their estimated useful lives or the remaining terms of the respective leases. Repair and maintenance costs are expensed as incurred, whereas major improvements are capitalized as additions to property and equipment.

We account for our internal use software and website development costs in accordance with the guidance in ASC 350-40, Internal-Use Software. The costs incurred prior to the application development stage and post implementation are expensed as incurred. Direct and incremental internal and external costs incurred during the application development stage are capitalized until the application is substantially complete and ready for its intended use, at which point amortization begins. Training and data conversion costs are expensed as incurred.

Operating Leases

We adopted ASU 2016-02, Leases, or ASC 842, effective January 1, 2021. We determine if an arrangement is or contains a lease at contract inception. Lease agreements generally contain lease and non-lease components, which we elect to combine for all asset classes as a single lease component. Payments under lease arrangements are primarily fixed. Variable payments typically represent non-lease components, which consist primarily of payments for maintenance, utilities, and management fees. Variable payments included in lease arrangements are expensed as incurred and excluded from the right of use assets and lease liabilities.

Right-of-use assets and lease liabilities for operating leases are initially measured on the lease commencement date based on a present value of lease payments over the lease term, net of any lease incentives received by the lessor. Lease payments are discounted to present value using our estimated incremental borrowing rate, because a readily determinable implicit rate is not available. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located.

Lease term includes the non-cancelable term, unless it is reasonably certain that a renewal or termination option will be exercised.

We do not record right-of-use assets and lease liabilities for leases with an initial term of 12 months or less and recognize lease expense on a straight-line basis over the lease term.

Business Combinations and Goodwill

We account for business combinations using the acquisition method of accounting in accordance with which assets acquired and liabilities assumed are recorded at their respective fair values on the acquisition date. The fair value of the consideration transferred in a business combination, including any contingent consideration, is allocated to the assets acquired and liabilities assumed based on their respective fair values. The excess of the consideration transferred over the fair values of the assets acquired and the liabilities assumed is recorded as goodwill. During the measurement period, which may be up to one year from the acquisition date or upon a final determination of asset and liability fair values, whichever occurs first, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Any subsequent adjustments are recorded on the Consolidated Statements of Operations.
Goodwill represents the excess of purchase price over the fair value of net tangible and identifiable intangible assets of the businesses acquired by us. Goodwill is tested for impairment annually during the fourth quarter or more often if impairment indicators are present, based on events and circumstances indicating that it is more likely than not that the fair value of the reporting unit is below its carrying value. There were no goodwill impairment losses recognized during the years ended December 31, 2022, 2021, and 2020. We performed our annual quantitative goodwill impairment test as of December 31, 2022 and 2021 and determined that no adjustment to goodwill was necessary because the reporting unit's fair value significantly exceeded its book value.

Intangible Assets

Intangible assets consist of finite-lived acquired technology, customer relationships, and acquired trade names. Finite-lived intangible assets are valued based on estimated future cash flows and amortized on a straight-line basis over their estimated useful lives. We evaluate the remaining estimated useful life of our intangible assets on an ongoing basis to determine whether events and circumstances warrant a revision to the remaining amortization period.

Acquired technology and customer relationships amortization is recorded within "Costs of revenue" and “Sales and marketing” expenses, respectively, within the Consolidated Statements of Operations and amounted to $5, $4 and $4, respectively, during the years ended December 31, 2022, 2021, and 2020.

The estimated useful lives for acquired technology and customer relationship intangible assets are as follows:
Estimated Useful Life
Acquired technology
3 - 10 years
Customer acquired intangible assets
5 - 6 years

We evaluate the recoverability of property and equipment and finite lived intangible assets for impairment whenever events or circumstances indicate that the carrying amounts of such assets may not be recoverable. For purposes of this assessment, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability is measured by comparing the carrying amount of an asset group to the estimated future undiscounted future net cash flows expected to be generated from their use and eventual disposal. If the carrying amount is not recoverable, the carrying amount is reduced to fair value and impairment loss is recognized. We did not identify any events or circumstances that indicated the carrying amounts of our long-lived assets may not be recoverable and did not recognize any impairment losses during the years ended December 31, 2022, 2021 and 2020.

Deferred Revenue

Deferred revenue represents our obligation to transfer products or services to customers for which consideration has been received and consists of amounts deferred from subscription services contracts, professional service engagements, and customer deposits received in advance. Amounts deferred under subscription service contracts are recognized ratably over the respective term of the customer contract.

Costs of Revenue

Costs of revenue primarily consists of costs associated with payment processing, personnel, and related infrastructure for operation of our cloud-based platform, data center operations, customer support, loan servicing and allocated overhead. Hardware costs consist of all product and shipping costs associated with tablets, printers, and other peripherals. Employee-related costs consist of salaries, benefits, bonuses, and stock-based compensation expense. Overhead consists of certain facilities costs, depreciation expense, and amortization costs associated with internally developed software.

Payment processing costs include interchange fees, network assessment fees and fees paid to the acquiring payment processors.

Stock-Based Compensation Expense
We grant equity awards, including stock options which vest upon the satisfaction of service conditions and restricted stock units, or RSUs, which vest upon the satisfaction of performance conditions and/or service conditions. We account for stock-based compensation expense related to equity awards in accordance with ASC 718, Compensation—Stock Compensation. Stock-based awards are measured at fair value on the grant date and compensation cost is recognized over the service period, net of estimated forfeitures. We estimate a forfeiture rate to calculate the stock-based compensation expense for all awards based on an analysis of actual historical experience and expected employee attrition rates.

Compensation cost is recognized on a straight-line basis for stock-options, RSUs and our 2021 Employee Stock Purchase Plan, or ESPP, and on an accelerated attribution basis for awards with a performance condition for each separately vesting portion of the award over the applicable vesting period.

We use the Black-Scholes option-pricing model to determine the estimated fair value of stock option and ESPP awards. We estimate the following assumptions used in the option pricing model:

•Expected Volatility—We do not have sufficient history of market prices for our Class A common stock due to our recently completed IPO. As such, we estimate volatility for stock option grants by evaluating the average historical volatility of a peer group of similar public companies over a period commensurate with the options' expected term.

•Expected Term—The expected term of our stock options represents the period that the stock-based awards are expected to be outstanding. We do not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. As such, we estimate the expected term of the options based on the simplified method determined based on the midpoint of the stock options vesting term and contractual expiration period.

•Risk-Free Interest Rate—The risk-free interest rate is based on the U.S. Treasury yield curve published as of the grant date, with maturities approximating the expected term of the options granted.

•Dividend Yield—We have not declared or paid dividends to date and do not anticipate declaring dividends. As such, the expected dividend is zero.

Prior to our IPO, the fair value of our common stock was determined by our Board, with the assistance of management, as there was no public market for the underlying common stock. Our Board determined the fair value of our common stock by considering a number of objective and subjective factors, such as contemporaneous third-party valuations of our common stock, the valuation of comparable companies, sales of our common and redeemable convertible preferred stock to outside investors in arms-length transactions, our operating and financial performance, the lack of marketability, and the general and industry specific economic outlook, amongst other factors. After the completion of the IPO, the fair value of our Class A common stock is determined based on the NYSE closing price on the date of grant.

RSUs granted by us prior to September 2021 commenced vesting upon the satisfaction of both the service-based vesting condition, which is typically four years, and liquidity event-related performance vesting condition related to IPO. Stock compensation expense is recognized when the performance condition becomes probable of achievement. All performance conditions were achieved upon the completion of our IPO, and we recorded a cumulative stock compensation expense of $63 during the year ended December 31, 2021 related to the awards with an IPO-related vesting condition.

The Amended and Restated 2014 Stock Incentive Plan, as amended, or the 2014 Plan, allows for early exercise of all granted options, before vesting requirements have been satisfied. Shares acquired through the early exercise of options which have not vested at the time of an employee’s termination may be repurchased by us at the lower of the original exercise price or the then current fair value. We have not recognized any tax benefits related to the effects of employee stock-based compensation expense.

Advertising Costs
We expense advertising costs as incurred. Advertising expense for the years ended December 31, 2022, 2021, and 2020, was $25, $17, and $6, respectively, and is included in "Sales and marketing" expense in the accompanying Consolidated Statements of Operations.

Income Taxes

We account for income taxes in accordance with ASC 740, Income Taxes. Under this method, deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. In addition, this method requires a valuation allowance against net deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

We account for uncertain tax positions recognized in the consolidated financial statements by prescribing a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Interest and penalties, if applicable, related to uncertain tax positions would be recognized as a component of income tax expense.

Net Loss Per Share

During the year ended December 31, 2021, we amended and restated our certificate of incorporation and created two classes of common stock: Class A common stock and Class B common stock (see Note 1, "Description of Business and Basis of Presentation"). Class A common stock and Class B common stock share proportionately, on a per share basis, in our net income (losses) and participate equally in the dividends on common stock, if declared. We allocate net losses attributable to common stock between the common stock classes on a one-to-one basis when computing net income (loss) per share. As a result, basic and diluted net income (loss) per share of Class A common stock and Class B common stock are equivalent.

We compute net loss per common share based on the two-class method required for multiple classes of common stock and participating securities. The two-class method requires income (loss) available to common stockholders for the period to be allocated between multiple classes of common stock and participating securities based upon their respective rights to receive dividends as if all income (loss) for the period had been distributed.

We consider our currently outstanding restricted shares issued upon early exercise of stock options and our convertible preferred stock which was outstanding prior to the completion of the IPO to be participating securities. Restricted shares issued upon early exercise of stock options are considered participating securities because holders of such shares have non-forfeitable dividend rights in the event of a dividend declaration for common shares. The holders of our convertible preferred stock were entitled to non-cumulative dividends in preference to common stockholders, at specified rates, if declared. The holders of our convertible preferred stock were not, and restricted shares are not contractually obligated to participate in our losses. As such, our net losses for the years ended December 31, 2022, 2021, and 2020 were not allocated to these participating securities.

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of our Class A and Class B common stock outstanding, adjusted for outstanding shares that are subject to repurchase and Class A restricted common stock. Diluted net loss per common share gives effect to all potentially dilutive securities which are excluded from the computation if the effect is antidilutive.
Recently Adopted Accounting Pronouncements

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, or ASU 2021-08. The standard requires an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606, as if it had originated the contracts, rather than at fair value on the acquisition date. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. The amendments in ASU 2021-08 should be applied prospectively to business combinations occurring on or after the effective date of the standard. Early adoption is permitted. We early adopted ASU 2021-08 during the year ended December 31, 2022, which did not have a material impact on the consolidated financial statements and related disclosures. We applied ASU 2021-08 in our acquisition of Sling Inc. as discussed in Note 3, “Business Combinations”.

In August 2020, the FASB issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, or ASU 2020-06. The new guidance simplifies the accounting for certain financial instruments by removing certain separation models required under current U.S. GAAP, including the beneficial conversion feature and cash conversion feature. ASU 2020-06 also improves and amends the related earnings per share guidance for both subtopics. ASU 2020-06 is effective for public business entities for fiscal years beginning after December 15, 2021 and interim periods within that fiscal year. We adopted ASU 2020-06 during the year ended December 31, 2022 which did not have a material impact on our consolidated financial statements and related disclosures.

We adopted the following accounting standards during the year ended December 31, 2021:

Leases

In February 2016, the FASB issued ASC 842, as amended, which superseded the guidance in former ASC 840, Leases. Based on ASC 842, a lessee is required to recognize in the statement of financial position a lease obligation related to making lease payments and a right-of-use asset representing its right to control the use of the underlying asset during the lease term, including optional payments that are reasonably certain to occur.

We adopted ASC 842 on January 1, 2021 and applied the following practical expedients:

•comparative periods prior to the adoption date are not adjusted to reflect the new guidance (the modified retrospective method of transition); and
•the historical determination as to the existence and classification of leases and the accounting for initial direct costs is carried forward for existing contracts as of the adoption date.

The adoption of Topic 842 resulted in a recognition of operating lease right-of-use assets of $95, operating lease obligations of $115, and an immaterial cumulative-effect adjustment to accumulated deficit as of January 1, 2021. The adoption of Topic 842 did not have a material impact on our results of operations and cash flows.

Credit Losses

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, or ASC 326. The guidance and related amendments modify the accounting for credit losses for most financial assets and require the use of an expected credit loss model replacing the currently used incurred loss method. The primary financial instruments in the scope of ASC 326 include cash equivalents, accounts receivable, off-balance sheet credit exposures under financial guarantee arrangements, and acquired loans receivable.
We adopted the standard as of January 1, 2021 and recognized a cumulative-effect adjustment of $1 to the opening accumulated deficit as of that date. Therefore, our Consolidated Financial Statements for the year ended December 31, 2021 are presented in accordance with ASC 326, while the prior comparative period has not been recast.
v3.22.4
Business Combinations
 12 Months Ended
Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract]  
Business Combinations Business Combinations
Sling Inc.

On July 6, 2022, we acquired 100% of the outstanding capital stock of Sling Inc., or Sling, an employee scheduling, communication and management solution, to expand our product portfolio in the team scheduling and communication space. The total purchase price of $49 consisted of cash payments of $38 on the acquisition date and $9 placed in escrow related to general representations, indemnities and warranties, as well as a deferred consideration of $2. The escrow will be released between 18 months and 60 months following the acquisition date.

In conjunction with the acquisition, we issued 1,338,228 shares of Class A restricted common stock at a fair market value of $13.91 per share to certain members of Sling management for a total of $19. The shares vest over a service period of one to three years and are subject to forfeiture upon termination during the service period. No shares vested during the year ended December 31, 2022. Stock-based compensation expense for these shares is recognized on a straight line basis over the related service period and amounted to $3 during the year ended December 31, 2022.
We used a market participant approach to record the assets acquired and liabilities assumed in the acquisition of Sling. Due to the timing of the acquisition, the accounting for this acquisition was not complete as of December 31, 2022 primarily for accounting for goodwill, deferred tax assets and deferred tax liabilities. The fair values of the assets acquired and the liabilities assumed have been determined provisionally and are subject to adjustments as we obtain additional information. In particular, additional time is needed to review and finalize the results of the valuation of assets acquired and liabilities assumed. Any adjustments to the purchase price allocation will be made as soon as practicable, but no later than one year from the acquisition date.
The following table summarizes the preliminary acquisition date fair values of assets acquired and liabilities assumed at the acquisition date:
Amount
Cash$1 
Intangible assets:
Developed technology, useful life of 5 years
17 
Customer relationships, useful life of 5 years
2 
Goodwill33 
Net working capital1 
Deferred tax liability(5)
Net assets acquired$49 

The fair values of the developed technology and customer relationships intangible assets were based on Level 3 inputs using the cost and income approaches, respectively. The primary unobservable inputs were development effort and after tax cash flows, respectively.
Goodwill, which is not deductible for tax purposes, represents the excess of the consideration transferred over the fair value of the net assets acquired, and is primarily attributable to expected synergies between our operations and those of Sling, as well as the assembled workforce.
The operating results of Sling have been reflected in our results of operations from the date of the acquisition. Pro forma results of operations have not been presented as they are not material to our consolidated results of operations for the years ended December 31, 2022 and 2021.
xtraCHEF

On June 8, 2021, we acquired 100% of the outstanding capital stock of xtraCHEF, Inc., or xtraCHEF, a provider of restaurant-specific invoice management software that automates the accounts payable and inventory workflow and improves efficiencies related to expense tracking and recording. The acquisition has expanded our product portfolio and enabled our customers to improve operational efficiencies and financial decision making.

The aggregate purchase price, net of cash acquired of $1, was subject to normal and customary purchase price adjustments and was as follows on the acquisition date:
Amount
Cash consideration, net of cash acquired$24 
Fair value of common stock issued15 
Fair value of settled stock option awards1 
Fair value of contingent consideration2 
Liabilities settled on behalf of xtraCHEF1 
Deferred payments for indemnity claims and working capital funds, net of adjustments (1)
5 
Total purchase price$48 
(1)In consideration for the acquisition of xtraCHEF, we issued 569,400 shares of common stock to the seller shareholders with a fair value of $26.10 per share on the acquisition date supported by a contemporaneous valuation. Additionally, we settled an immaterial amount of option awards that were subject to accelerated vesting on the acquisition date. Total consideration transferred for the settled option awards consisted of cash consideration of $3 and deferred consideration of $1. The consideration transferred for the settled option awards of $3 approximated the estimated fair value of the settled option awards on the acquisition date, of which $1 was attributable to pre-acquisition services and included in the purchase price. The remaining amount of $2 was recorded as a stock-based compensation expense on the acquisition date within "General and administrative" expenses in our Consolidated Statements of Operations.

Total contingent consideration obligation is limited to a maximum payment amount of $7. Refer to Note 4, “Fair Value of Financial Instruments” for more information on the contingent consideration. During the year ended December 31, 2022, $5 related to the indemnity fund was released to the sellers.

There were no purchase price adjustments recorded since the acquisition date upon finalizing the purchase price allocation and fair values of assets acquired and liabilities assumed.. The following table summarizes the allocation of the purchase price and the amounts of assets acquired and liabilities assumed for the acquisition:
Amount
Developed technology, useful life of 10 years
13 
Customer relationship, useful life of 6 years
1 
Goodwill38 
Deferred tax liability(3)
Other(1)
Net assets acquired$48 

The fair values of the intangible assets, the developed technology and the customer relationships, were estimated using income approach, specifically, the relief-form royalty method and the excess-earnings income method, respectively.

The acquisition of xtraCHEF did not have a material impact on our reported revenue or net loss amounts. Accordingly, pro forma financial information has not been presented.
v3.22.4
Fair Value of Financial Instruments
 12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments Fair Value of Financial Instruments
The following table presents information about our financial assets and liabilities that were measured at fair value on a recurring basis and indicates the level of the fair value hierarchy used to determine such fair values:

Fair Value Measurements at December 31, 2022
Using:
Level 1Level 2Level 3Total
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 

Fair Value Measurements at December 31, 2021
Using:
Level 1Level 2Level 3Total
Assets:
Money market funds$50 $— $— $50 
Commercial paper— 134 — 134 
Certificates of Deposit— 14 — 14 
Corporate Bonds— 193 — 193 
Treasury Bonds— 67 — 67 
Asset-back securities— 49 — 49 
$50 $457 $— $507 
Liabilities:
Warrants to purchase common stock$— $— $181 $181 
Contingent consideration— — 5 5 
$— $— $186 $186 

During the years ended December 31, 2022 and 2021, there were no transfers between Level 1, Level 2 and Level 3.
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 for the years ended December 31, 2022 and 2021:
Year Ended December 31, 2022Year Ended December 31, 2021
Risk-free interest rate4.1 %1.3 %
Contractual term (in years)45
Expected volatility60.3 %50.8 %
Expected dividend yield— %— %
Exercise price$17.16 $17.15 

Valuations of Bifurcated Derivative Liability and Contingently Issuable Warrants Related to Convertible Notes

In June 2020, we issued $200 aggregate principal amount of senior unsecured convertible promissory notes, or the Convertible Notes. Upon a voluntary redemption of the Convertible Notes, we were obligated to issue warrants to the note holders to purchase common stock (see Note 9, "Debt").

The fair value of the bifurcated derivative liability related to the conversion option and contingently issuable warrants associated with the Convertible Notes was determined based on inputs not observable in the market, which represented a Level 3 measurement within the fair value hierarchy. Our valuations of the bifurcated derivative liability and contingently issuable warrants were measured using an income approach based on a discounted cash flow model, as well as a probability-weighted expected return method, or PWERM. We used various key assumptions, such as estimation of the timing and probability of expected future events, and selection of discount rates applied to future cash flows using a yield curve representative of our credit risk.

On June 21, 2021, we prepaid all of the then-outstanding Convertible Notes as an optional prepayment (see Note 9, "Debt"). In connection with the optional prepayment, we derecognized the bifurcated derivative liability and contingently issuable warrants which were remeasured at fair value on the settlement date.

Valuation of Warrants to Purchase Preferred Stock

The warrants were measured at fair value at issuance and subsequently remeasured at fair value at each reporting date. The fair value of the warrants are a Level 3 fair value measurement, determined using the Black-Scholes option-pricing model. The following table indicates the weighted-average assumptions made in estimating the fair value for the years ended December 31, 2021 and 2020:
December 31,
2021(1)
2020
Risk-free interest rate
0.8%0.3%
Expected term (in years)
5
5-7
Expected volatility
54%60%
Expected dividend yield
0%0%
Exercise price
$0.74$0.74

(1) During the year ended December 31, 2021, fair value of the preferred stock warrants liability was measured based on the weighted average assumptions from January 1, 2021 through September 24, 2021, the date they were converted into common stock warrants.
Contingent Consideration Liability

Contingent consideration is based on a cumulative achievement of certain recurring revenue targets, as defined in the acquisition agreement, and represents a potential obligation by us to pay cash and issue shares of our common stock to the former xtraCHEF shareholders up to a certain amount based on the achievement of the required revenue targets during the years ended December 31, 2021 and 2022. Fair value of contingent consideration liability incurred in connection with the acquisition of xtraCHEF was estimated at $2 on the acquisition date based on a Monte Carlo simulation. The Monte Carlo simulation performs numerous simulations utilizing certain assumptions, such as projected revenue amounts over the related period, risk-free rate, and risk-adjusted discount rate. The fair value measurement of contingent consideration is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. At the conclusion of the performance period all required revenue targets were met resulting in recognizing the liability at the full payout amount as of December 31, 2022. We recognized $3 and $3 as the change in fair value of the contingent consideration liability within "General and administrative" expense in our Consolidated Statements of Operations for the years ended December 31, 2022 and 2021, respectively.

Fair Value of Liabilities

The following table provides a roll-forward of the aggregate fair value of our liabilities for which fair value is determined on recurring basis using Level 3 inputs:

Preferred
Stock Warrant Liability (1)		Common Stock Warrant LiabilityDerivative LiabilityContingent Consideration Liability (2)
Balance as of December 31, 2020
$11 $— $37 $— 
Fair value at issuance— 125 — — 
Fair value on the acquisition date— — — 2 
Change in fair value and other adjustments38 59 103 3 
Settlement(43)(9)(140)— 
Conversion of preferred stock warrants into common stock warrants upon initial public offering(6)6 — — 
Balance as of December 31, 2021
— 181 — 5 
Change in fair value— (95)— 3 
Settlement— (18)— (4)
Balance as of December 31, 2022
$— $68 $— $4 
(1) Changes in the fair value of the preferred stock warrant liability were recognized as a component of “Other income (expenses)” in our Consolidated Statements of Operations. We recorded a loss of $8 during the year ended December 31, 2020.

(2) During the year ended December 31, 2022, we paid $2 in cash and issued 37,179 shares of our Class B common stock to settle a portion of the contingent consideration. In February 2023, we fully settled the contingent consideration liability via a cash payment of $2 and issuance of 38,908 shares of our Class B common stock.
v3.22.4
Marketable Securities
 12 Months Ended
Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]  
Marketable Securities Marketable Securities
The amortized cost, gross unrealized holding losses and fair value of marketable securities classified as available for sale, excluding accrued interest receivable, consisted of the following:

December 31, 2022
Amortized CostGross Unrealized LossesFair Value
Commercial paper$140 $— $140 
Certificates of deposit104 — 104 
Corporate bonds110 (1)109 
U.S. government agency securities33 — 33 
Treasury securities61 (1)60 
Asset-backed securities28 — 28 
Total$476 $(2)$474 

December 31, 2021
Amortized CostGross Unrealized LossesFair Value
Commercial paper$134 $— $134 
Certificates of deposit14 — 14 
Corporate bonds194 (1)193 
Treasury securities67 — 67 
Asset-backed securities49 — 49 
Total$458 $(1)$457 


The fair values of the marketable securities by contractual maturities at December 31, 2022 were as follows:
December 31, 2022
Due within 1 year$442 
Due after 1 year through 5 years32 
Due after 5 years through 10 years— 
Total marketable securities$474 

We review marketable securities for impairment during each reporting period to determine if any of the securities have experienced an other-than-temporary decline in fair value. Credit losses are recognized up to the amount equal to the difference between the fair value and the amortized cost basis and recorded as an allowance for credit losses in the Consolidated Balance Sheets with a corresponding adjustment to earnings. Unrealized losses that are not related to credit losses are recognized in accumulated other comprehensive loss. Unrealized losses were not significant for the securities held in our portfolio as of December 31, 2022 and 2021. There were no impairment losses or expected credit losses related to our marketable securities during the years ended December 31, 2022 and 2021.
v3.22.4
Loan Servicing Activities and Acquired Loans Receivable, Net
 12 Months Ended
Dec. 31, 2022
Guarantees and Product Warranties [Abstract]  
Loan Servicing Activities and Acquired Loans Receivable, Net Loan Servicing Activities and Acquired Loans Receivable, Net
Changes in the contingent liability for expected credit losses for the years ended December 31, 2022 and 2021 were as follows:
Year Ended December 31,
20222021
Beginning balance
$2 $— 
Impact upon ASC 326 adoption
— 1 
Credit loss expense
20 2 
Reductions due to loan purchases
(8)(1)
Ending balance
$14 $2 

The increase in the contingent liability for expected credit losses for the year ended December 31, 2022 was primarily driven by growth in bank partner loan originations.

The balance of the non-contingent stand-ready liability was $6 and $1, respectively, as of December 31, 2022 and 2021.

Changes in the negative allowance for acquired loans for the years ended December 31, 2022 and 2021 were as follows:

Year Ended December 31,
20222021
Beginning balance
$1 $— 
Impact of adopting ASC 326
— 3 
Expected recoveries
5 1 
Reduction due to cash collections
(4)(3)
Ending balance
$2 $1 
v3.22.4
Goodwill and Intangible Assets
 12 Months Ended
Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Goodwill and Intangible Assets
The changes in the carrying amount of goodwill for the periods presented were as follows:

Amount
Balance as of December 31, 2020
$36 
Acquisitions
38 
Balance as of December 31, 2021
74 
Acquisitions
33 
Balance as of December 31, 2022
$107 

Intangible assets, net consisted of the following:
As of December 31, 2022
Technology AssetsCustomer AssetsTotal
Gross carrying amount$38 $6 $44 
Accumulated amortization(13)(2)(15)
Intangible assets, net$25 $4 $29 
As of December 31, 2021
Technology AssetsCustomer AssetsTotal
Gross carrying amount$22 $4 $26 
Accumulated amortization(8)(2)(10)
Intangible assets, net$14 $2 $16 

The total estimated future amortization of intangible assets as of December 31, 2022 was as follows:

Year ended December 31,Amount
2023$6 
20246 
20255 
20265 
20273 
Thereafter4 
$29 
v3.22.4
Lessee Arrangements
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Lessee Arrangements Lessee Arrangements
The components of lease expense were as follows during the years ended December 31, 2022 and 2021:

Year Ended December 31,
20222021
Operating lease expense
$21 $25 
Variable lease expense
4 1 
Total
$25 $26 

Weighted average remaining lease term and discount rate for our operating leases were as follows:

Year Ended December 31,
20222021
Weighted-average remaining lease term (years)
6.46.9
Weighted-average discount rate
5.19%2.62%

The following table summarizes maturities of our operating lease liabilities as of December 31, 2022:

Amount
2023$17 
202418 
202518 
202617 
202714 
Thereafter28 
Total future minimum lease payments112 
Less: Imputed interest18 
Present value of future minimum lease payments$94 
The following table summarizes supplemental cash flow information related to operating leases during the years ended December 31, 2022 and 2021:
Year Ended December 31,
20222021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases
$24 $25 
Operating lease right of use assets obtained in exchange for new or modified lease obligations:
Upon the adoption of ASC 842
— 95 
During the remainder of the period
14 4 
Total
$14 $99 
During 2020, we terminated leases for two office facilities and recognized termination costs of $3. In addition, we recognized $16 of accelerated depreciation on certain leasehold improvements and other property and equipment as a result of exiting the leased space. Depreciation expense was accelerated prospectively for the year ended December 31, 2020 based on the new remaining useful life of the related assets. Additionally, during the year ended December 31, 2020, we recognized total rent expense of $28 related to operating leases.
v3.22.4
Debt
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Debt Debt
Revolving Line of Credit

On June 8, 2021, we entered into a revolving line of credit facility, or 2021 Facility, equal to $330. Interest on outstanding loans under the 2021 Facility is determined based on loan type and accrues at an annual rate, as defined in the agreement, of: (a) LIBO Rate multiplied by the Statutory Reserve Rate, plus 1.50% per annum; or 0.5% per annum plus the highest of: (i) the Prime Rate, (ii) the Federal Reserve Bank of New York Rate plus 0.5%, or (iii) the Adjusted LIBO Rate plus 1.00%. The 2021 Facility is subject to a minimum liquidity covenant of $250. As of December 31, 2022 and 2021, no amount was drawn and outstanding under the 2021 Facility which had $330 available for borrowings. As of December 31, 2022 and 2021, there were $8 and $13 of letters of credit outstanding, respectively. As a result of entering into a 2021 Facility, we became obligated to prepay or redeem the Convertible Notes which occurred on June 21, 2021.

Convertible Notes

In June 2020, we issued the Convertible Notes pursuant to the Senior Unsecured Convertible Promissory Note Purchase Agreement or the NPA. The aggregate principal amount of Convertible Notes issued at the time of closing of the convertible notes transaction was $200. The Convertible Notes bore interest at a rate of 8.5% per annum, 50% of which was payable in cash and the other 50% payable in kind. Interest was payable semi-annually in arrears, beginning on December 31, 2020. Unless earlier converted, redeemed, or repaid, the Convertible Notes would mature on June 19, 2027. The carrying value of the Convertible Notes was accreted to the principal amount along with the 15% exit fee payable at maturity as interest expense using the effective interest method over the term of the Convertible Notes. The effective interest rate on the Convertible Notes was 13.33%. Interest expense related to the Convertible Notes was $12 during each of the years ended December 31, 2021 and 2020.

Upon the issuance of the Convertible Notes, we identified and assessed the embedded features of the Convertible Notes. We concluded that certain conversion and redemption features were not clearly and closely related to the Convertible Notes and met the definition of a derivative which was bifurcated and accounted for separately based on its estimated fair value. Additionally, we concluded the contingently issuable warrants to purchase common stock met the definition of a derivative, and accounted for them separately based on their fair value, adjusted for the probability that there would be a voluntary redemption of the Convertible Notes. The bifurcated derivative liability and contingently issuable warrants were subsequently adjusted to their fair value during each reporting period with the change in fair value recorded in “Other income (expense), net” in the Consolidated Statements of Operations.
Upon a voluntary redemption of the Convertible Notes, we were obligated to pay an applicable premium, as further described in the NPA and in the Convertible Notes, and issue warrants to the note holders to purchase a number of shares of common stock. On June 21, 2021, we prepaid all of the outstanding Convertible Notes with a carrying amount of $183, including principal and accrued cash and paid in kind interest, net of an unamortized discount, for an aggregate amount equal to $249. In connection with the prepayment, we issued to the registered holders of the Convertible Notes the warrants to purchase 8,113,585 shares of our common stock with an exercise price of $17.51 per share. The fair value of the warrants of $125 was included in the Convertible Notes’ aggregate settlement consideration of $374. Additionally, we derecognized the liability for the bifurcated derivative and contingently issuable warrants of $141 which were remeasured at fair value on the settlement date. During the year ended December 31, 2021, we recognized a loss of $50 on the settlement of the Convertible Notes and a loss of $103 on the change in fair value of the bifurcated derivative liability and contingently issuable warrants which were recorded in "Other income (expense), net" in the Consolidated Statements of Operations.
v3.22.4
Other Balance Sheet Information
 12 Months Ended
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Other Balance Sheet Information Other Balance Sheet Information
Prepaid expenses and other current assets consisted of the following:
December 31,
20222021
Cash held on behalf of customers
$60 $34 
Prepaid expenses
27 25 
Deposits for inventory purchases20 21 
Other current assets48 12 
$155 $92 

Property and equipment consisted of the following:
December 31,
20222021
Leasehold improvements
$36 $29 
Capitalized software49 25 
Computer equipment
14 8 
Furniture and fixtures
8 8 
Tooling and equipment
2 2 
109 72 
Less: Accumulated depreciation
(48)(31)
$61 $41 

Depreciation expense for the years ended December 31, 2022, 2021, and 2020, was $10, $9, and $19, respectively.

During the years ended December 31, 2022 and 2021, we capitalized $24 and $8, respectively, in capitalized software and website development costs. As of December 31, 2022 and 2021, capitalized software and website development costs of $25 and $10, respectively, are included in "Property and equipment, net" in the Consolidated Balance Sheets. Depreciation expense attributable to capitalized software and website development costs was $9, $8, and $5, respectively, for the years ended December 31, 2022, 2021 and 2020.
Accrued expenses and other current liabilities consisted of the following:

December 31,
20222021
Accrued transaction-based costs
$181 $120 
Accrued payroll and bonus
59 24 
Customer funds obligation
60 34 
Accrued expenses
45 21 
Accrued commissions
15 19 
Contingent liability for expected credit losses
14 2 
Other liabilities
39 26 
$413 $246 
v3.22.4
Warrants to Purchase Common Stock
 12 Months Ended
Dec. 31, 2022
Equity [Abstract]  
Warrants to Purchase Common Stock Warrants to Purchase Common Stock
In conjunction with the optional prepayment of the Convertible Notes on June 21, 2021, we issued warrants to purchase 8,113,585 shares of our common stock with an exercise price of $17.51 per share (see Note 9, "Debt"). These warrants became exercisable 50 trading days following the completion of the IPO.

We classify the warrants as liabilities and recognize them at fair value in our Consolidated Balance Sheets because they meet the definition of a derivative. The warrants were initially measured at fair value upon their issuance and are subsequently measured at fair value during each reporting date. Changes in the fair value of the warrants liability are recognized as a component of "Other income (expense), net" in our Consolidated Statements of Operations. We evaluated the warrants and concluded that they do not meet the criteria to be classified within stockholders’ equity (deficit). The agreement governing the warrants includes a provision that could result in a different exercise price and a settlement value depending on the assumption of the warrants by their holders. The warrants are not considered to be indexed to our own stock because the actions of the warrant holders do not represent an input into the pricing of a fixed-for-fixed option on our shares of common stock which precludes us from classifying the warrants in stockholders’ equity.

During the year ended December 31, 2022, we issued 371,573 shares of Class B common stock as a result of warrants exercised and recognized a remeasurement gain of $6 for the fair value of warrant liability. The remaining outstanding warrants were remeasured at fair value resulting in a remeasurement gain of $89 during the year ended December 31, 2022.

During the year ended December 31, 2021, 1,002,035 common stock warrants were exercised for the same number of shares of Class B Common stock. The warrant liability was remeasured at fair value on the exercise dates resulting in a remeasurement loss of $19 for the warrants exercised during the year ended December 31, 2021. The remaining warrants were remeasured at December 31, 2021 resulting in a total remeasurement loss of $62 for the year ended December 31, 2021.
Common Stock
Shares Reserved for Charitable Donations

In recognition of our values and commitment to local communities, we joined the Pledge 1% movement to fund our social impact initiatives through Toast.org, our philanthropic branch. During the year ended December 31, 2021, the Board approved reserving 5,468,890 shares of Class A common stock that we may, but are not obligated to, issue over a period of ten years in ten equal installments as a bona fide gift to a charitable organization to fund its social impact initiatives through Toast.org. During each of the years ended December 31, 2022 and 2021, we transferred 546,889 shares, of our Class A common stock to an independent donor advised fund. During the years ended December 31, 2022 and 2021, we recognized a charitable contribution stock-based expense of $10 and $19, respectively, for the fair value of the donated shares, which was recorded within "General and administrative" expenses in the Consolidated Statements of Operations.

Restricted Stock and Promissory Notes

As of December 31, 2022, we issued 2,703,538 shares of Class A common stock and Class B common stock subject to restrictions. This included 1,365,310 shares of Class A common stock and Class B common stock issued upon the early exercise of stock options and 1,338,228 shares of restricted Class A common stock issued to certain members of management of Sling in conjunction with its acquisition in 2022 (see Note 3, “Business Combinations”). As of December 31, 2021, we issued 4,133,955 shares of Class B common stock upon the early exercise of stock options.

Pursuant to the associated agreements, upon termination of employment, unvested shares held by such individuals are subject to repurchase by us. As of December 31, 2022 and 2021, cash paid for unvested shares of $2 and $6, respectively, is included in "Other long-term liabilities" in the Consolidated Balance Sheets.

At each Consolidated Balance Sheet date, shares subject to restriction consisted of the following:
Shares
Unvested as of January 1, 2021
1,096,800 
Exercise of stock options412,810 
Exercise of stock options in connection with promissory notes repayment14,267,650 
Repurchases(35,665)
Vested(11,607,640)
Unvested as of December 31, 2021
4,133,955 
Issuance of restricted stock for acquisition1,338,228 
Exercise of stock options27,305 
Repurchases
(33,475)
Vested
(2,762,475)
Unvested as of December 31, 2022
2,703,538 

In February 2019, the Board authorized certain senior executives to exercise an aggregate of 15,057,340 of stock options by issuing to us an aggregate of $23 in interest-bearing promissory notes (the “Promissory Notes”).

In May 2021, we issued 8,045,300 shares of common stock for the exercise of vested options upon the Promissory Notes full repayment of $23, which included outstanding principal and accrued interest, and recognized $14 of the associated cash proceeds in Additional Paid in Capital during the year ended December 31, 2021. Additionally, we recognized a liability of $9 related to unvested shares in "Other long-term liabilities" in the Consolidated Balance Sheets.
As of each Consolidated Balance Sheet date, we had reserved shares of Class A common stock and Class B common stock for issuance in connection with the following:
December 31,
20222021
Options to purchase Class A common stock and Class B common stock53,728,512 58,917,018 
Restricted stock units31,242,263 15,384,809 
Warrants to purchase Class B common stock6,902,6337,961,455 
Shares available for future grant under the 2021 Plan and 2014 Plan
55,009,13653,916,105 
Shares reserved for charitable donations4,375,1124,922,001 
Shares available for issuance under 2021 Employee Stock Purchase Plan16,709,89311,638,189 
167,967,549152,739,577 
v3.22.4
Common Stock
 12 Months Ended
Dec. 31, 2022
Equity [Abstract]  
Common Stock Warrants to Purchase Common Stock
In conjunction with the optional prepayment of the Convertible Notes on June 21, 2021, we issued warrants to purchase 8,113,585 shares of our common stock with an exercise price of $17.51 per share (see Note 9, "Debt"). These warrants became exercisable 50 trading days following the completion of the IPO.

We classify the warrants as liabilities and recognize them at fair value in our Consolidated Balance Sheets because they meet the definition of a derivative. The warrants were initially measured at fair value upon their issuance and are subsequently measured at fair value during each reporting date. Changes in the fair value of the warrants liability are recognized as a component of "Other income (expense), net" in our Consolidated Statements of Operations. We evaluated the warrants and concluded that they do not meet the criteria to be classified within stockholders’ equity (deficit). The agreement governing the warrants includes a provision that could result in a different exercise price and a settlement value depending on the assumption of the warrants by their holders. The warrants are not considered to be indexed to our own stock because the actions of the warrant holders do not represent an input into the pricing of a fixed-for-fixed option on our shares of common stock which precludes us from classifying the warrants in stockholders’ equity.

During the year ended December 31, 2022, we issued 371,573 shares of Class B common stock as a result of warrants exercised and recognized a remeasurement gain of $6 for the fair value of warrant liability. The remaining outstanding warrants were remeasured at fair value resulting in a remeasurement gain of $89 during the year ended December 31, 2022.

During the year ended December 31, 2021, 1,002,035 common stock warrants were exercised for the same number of shares of Class B Common stock. The warrant liability was remeasured at fair value on the exercise dates resulting in a remeasurement loss of $19 for the warrants exercised during the year ended December 31, 2021. The remaining warrants were remeasured at December 31, 2021 resulting in a total remeasurement loss of $62 for the year ended December 31, 2021.
Common Stock
Shares Reserved for Charitable Donations

In recognition of our values and commitment to local communities, we joined the Pledge 1% movement to fund our social impact initiatives through Toast.org, our philanthropic branch. During the year ended December 31, 2021, the Board approved reserving 5,468,890 shares of Class A common stock that we may, but are not obligated to, issue over a period of ten years in ten equal installments as a bona fide gift to a charitable organization to fund its social impact initiatives through Toast.org. During each of the years ended December 31, 2022 and 2021, we transferred 546,889 shares, of our Class A common stock to an independent donor advised fund. During the years ended December 31, 2022 and 2021, we recognized a charitable contribution stock-based expense of $10 and $19, respectively, for the fair value of the donated shares, which was recorded within "General and administrative" expenses in the Consolidated Statements of Operations.

Restricted Stock and Promissory Notes

As of December 31, 2022, we issued 2,703,538 shares of Class A common stock and Class B common stock subject to restrictions. This included 1,365,310 shares of Class A common stock and Class B common stock issued upon the early exercise of stock options and 1,338,228 shares of restricted Class A common stock issued to certain members of management of Sling in conjunction with its acquisition in 2022 (see Note 3, “Business Combinations”). As of December 31, 2021, we issued 4,133,955 shares of Class B common stock upon the early exercise of stock options.

Pursuant to the associated agreements, upon termination of employment, unvested shares held by such individuals are subject to repurchase by us. As of December 31, 2022 and 2021, cash paid for unvested shares of $2 and $6, respectively, is included in "Other long-term liabilities" in the Consolidated Balance Sheets.

At each Consolidated Balance Sheet date, shares subject to restriction consisted of the following:
Shares
Unvested as of January 1, 2021
1,096,800 
Exercise of stock options412,810 
Exercise of stock options in connection with promissory notes repayment14,267,650 
Repurchases(35,665)
Vested(11,607,640)
Unvested as of December 31, 2021
4,133,955 
Issuance of restricted stock for acquisition1,338,228 
Exercise of stock options27,305 
Repurchases
(33,475)
Vested
(2,762,475)
Unvested as of December 31, 2022
2,703,538 

In February 2019, the Board authorized certain senior executives to exercise an aggregate of 15,057,340 of stock options by issuing to us an aggregate of $23 in interest-bearing promissory notes (the “Promissory Notes”).

In May 2021, we issued 8,045,300 shares of common stock for the exercise of vested options upon the Promissory Notes full repayment of $23, which included outstanding principal and accrued interest, and recognized $14 of the associated cash proceeds in Additional Paid in Capital during the year ended December 31, 2021. Additionally, we recognized a liability of $9 related to unvested shares in "Other long-term liabilities" in the Consolidated Balance Sheets.
As of each Consolidated Balance Sheet date, we had reserved shares of Class A common stock and Class B common stock for issuance in connection with the following:
December 31,
20222021
Options to purchase Class A common stock and Class B common stock53,728,512 58,917,018 
Restricted stock units31,242,263 15,384,809 
Warrants to purchase Class B common stock6,902,6337,961,455 
Shares available for future grant under the 2021 Plan and 2014 Plan
55,009,13653,916,105 
Shares reserved for charitable donations4,375,1124,922,001 
Shares available for issuance under 2021 Employee Stock Purchase Plan16,709,89311,638,189 
167,967,549152,739,577 
v3.22.4
Revenue from Contracts with Customers
 12 Months Ended
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
The following table summarizes the activity in deferred revenue:

Year Ended December 31,
20222021
Deferred revenue, beginning of year$56 $59 
Deferred revenue, end of period$46 $56 
Revenue recognized in the period from amounts included in deferred revenue at the beginning of period$51 $43 

As of December 31, 2022, $480 of revenue is expected to be recognized from remaining performance obligations for customer contracts. We expect to recognize revenue on approximately $462 of these remaining performance obligations over the next 24 months, with the balance recognized thereafter.

The following table summarizes the activity in deferred contract acquisition costs:

Year Ended December 31,
20222021
Beginning balance$55 $29 
Capitalization of sales commissions costs71 56 
Amortization of sales commissions costs(44)(30)
Ending balance$82 $55 

December 31,
20222021
Deferred costs, current
$44 $30 
Deferred costs, non-current
38 25 
Total
$82 $55 
v3.22.4
Stock-Based Compensation Expense
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation Expense Stock-Based Compensation Expense
2021 Stock Option and Incentive Plan

The 2021 Stock Option and Incentive Plan, or the 2021 Plan, was adopted and approved in 2021. The 2021 Plan replaced the 2014 Plan, which continues to govern outstanding equity awards granted thereunder. The 2021 Plan allows us to make equity-based and cash-based incentive awards to our officers, employees, directors, and consultants. We initially reserved 58,190,945 shares of Class A common stock for the issuance of awards under the 2021 Plan. The number of shares reserved and available for issuance under the 2021 Plan automatically increases each January 1, by 5% of the outstanding number of shares of the Class A common stock and Class B common stock on the immediately preceding December 31, or such lesser number of shares as determined by the Compensation Committee of the Board.

2014 Stock Incentive Plan

The 2014 Plan was initially adopted in 2014 and amended and restated in 2020. A total of 167,777,810 shares of our Class B common stock were reserved for issuance under the 2014 Plan. Shares of Class B common stock underlying any awards under the 2014 Plan that are forfeited, canceled, reacquired by us prior to vesting, satisfied without the issuance of stock or otherwise terminated (other than by exercise) were added to the shares of Class A common stock available for issuance under the 2021 Plan.

Stock-based compensation expense recognized for December 31, 2022, 2021, and 2020, were as follows:

Year Ended December 31,
202220212020
Costs of revenue
$33 $12 $7 
Sales and marketing
50 24 16 
Research and development
72 48 30 
General and administrative
73 58 33 
$228 $142 $86 

Stock-based compensation expense of $7 and $1, respectively, was capitalized as software development costs for the years ended December 31, 2022 and December 31, 2021. There were no such costs during the year ended December 31, 2020.

2021 Employee Stock Purchase Plan

In 2021, our Board adopted, and our stockholders approved, the 2021 Employee Stock Purchase Plan, or ESPP. We initially reserved and authorized the issuance of up to a total of 11,638,189 shares of our Class A common stock to participating employees under the ESPP. The ESPP provides that the number of shares reserved and available for issuance will automatically increase on January 1 of each year through January 1, 2031, by the lesser of: (i) 11,638,189 shares of our Class A common stock, (ii) 1% of the issued and outstanding number of shares of Class A common stock and Class B common stock on the date immediately preceding December 31, or (iii) such lesser number of shares of Class A common stock as determined by the plan administrator of the ESPP.

As of December 31, 2022, 16,709,893 shares of our Class A common stock were authorized for issuance to participating employees who are allowed to purchase shares of Class A common stock at a price equal to 85% of its fair market value at the beginning or the end of the offering period, whichever is lower. There were no shares of Class A common stock purchased under the ESPP during the year ended December 31, 2022.

ESPP expense was not material to our consolidated results of operations for the year ended December 31, 2022.
Stock Options

Our stock option awards generally have a requisite service period of four to five years and a contractual life of ten years.

The following table indicates the weighted-average assumptions made in estimating the fair value based on the Black-Scholes model as of December 31, 2022, 2021, and 2020:

Year Ended December 31,
202220212020
Risk-free interest rate
2.42%1.00%0.49%
Expected term (in years)
6.076.326.64
Expected volatility
52%65%63%
Expected dividend yield
0%0%0%
Weighted-average fair value of common stock
$17.24$17.00$3.23
Weighted-average fair value per share of options issued
$8.94$10.12$1.95

The following is a summary of stock option activity under our stock option plans:

Number of SharesWeighted Average Exercise PriceWeighted Average Remaining Contractual TermAggregate Intrinsic Value(1)
(in years)
Outstanding as of December 31, 2021
58,917,018$4.53 7.65$1,778 
Granted6,311,68017.24 
Exercised(7,633,661)1.93 
Forfeited(3,866,525)10.21 
Outstanding as of December 31, 2022
53,728,512$5.98 6.94$655 
Options vested and expected to vest as of
December 31, 2022
50,866,098$5.70 6.87$634 
Options exercisable as of December 31, 2022
48,402,325$4.63 6.67$649 
(1) The aggregate intrinsic value was determined as the difference between the closing price of the Class A common stock on the last trading day of the month of December or the date of exercise, as appropriate, and the exercise price, multiplied by the number of in-the-money options that would have been received by the option holders had all option holders exercised their in-the-money options at period end.

As of December 31, 2022 and December 31, 2021, the total number of vested, unexercised options was 29,934,775 and 25,983,807, respectively, with an intrinsic value of $438 and $855, respectively. As of December 31, 2022 and December 31, 2021, the total number of unvested options was 23,793,737 and 37,106,955, respectively. The aggregate intrinsic values of options exercised was $134, $162, and $38, respectively, for the years ended December 31, 2022, 2021, and 2020, respectively. Total exercise value of options vested during the years ended December 31, 2022, 2021, and 2020 was $82, $36, and $23, respectively.

As of December 31, 2022, total unrecognized stock-based compensation expense related to the options was $97 and is expected to be recognized over the remaining weighted-average service period of 3.1 years.
Restricted Stock Units

The majority of our RSU awards have a requisite service period of four years. We reflect RSUs as issued and outstanding shares of common stock when such units vest. The following table summarizes RSU activity as of December 31, 2022:
RSUWeighted Average Grant Date Fair Value
Outstanding balance as of December 31, 2021
15,384,809 $29.71 
Granted24,272,078 18.40 
Vested(5,981,213)25.14 
Forfeited(2,433,411)25.63 
Outstanding balance as of December 31, 2022
31,242,263 $22.11 

The weighted average grant-date fair value of RSUs granted during the years ended December 31, 2021 and 2020 was $29.80 and $2.21, respectively. As of December 31, 2022, we issued 5,962,878 shares of Class A common stock and Class B common stock to settle RSUs upon vesting. The fair value of RSUs vested during the years ended December 31, 2022 and 2021 was $108 and $1, respectively. No RSUs vested during the year ended December 31, 2020.

As of December 31, 2022, total unrecognized stock-based compensation expense related to the RSUs was $479 and is expected to be recognized over the remaining weighted-average service period of 3.31 years.

Secondary Sales and Tender Offer

During 2021 and 2020, secondary investors purchased 975,057 and 9,498,100 shares of common stock from certain employees, respectively. Stock-based compensation expense related to these transactions representing amounts paid in excess of then current fair value, totaled $46 and $53, respectively, during the years ended December 31, 2021 and 2020, and is recorded in operating expenses in the accompanying Consolidated Statements of Operations.

During the year ended December 31, 2020, we facilitated a tender offer of common stock whereby certain third parties purchased an aggregate of 3,281,510 shares of common stock from certain eligible employees and non-employees for an aggregate purchase price of $49. We recognized stock-based compensation expense of $17 in connection with the tender offer which represented the difference between the purchase price and the fair value of common stock on the date of sale.
v3.22.4
Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of income (loss) before provision for income taxes are as follows (in millions):

Year Ended December 31,
202220212020
United States$(286)$(493)$(249)
Foreign9 3 1 
Total loss before income taxes$(277)$(490)$(248)
The components of income tax (benefit) expense for the years ended December 31, 2022, 2021, and 2020, were as follows:
Year Ended December 31,
202220212020
Current state
$1 $— $— 
Current foreign
2 — — 
Current tax expense
3 — — 
Deferred federal
(4)(2)— 
Deferred state
(1)(1)— 
Deferred tax benefit
(5)(3)— 
Total income tax (benefit) expense
$(2)$(3)$— 

The tax effects of temporary differences that gave rise to a significant portion of the deferred tax assets and liabilities at December 31, 2022 and 2021, were as follows:
December 31,
20222021
Deferred tax assets:
Net operating loss carryforwards$160 $150 
Stock-based compensation expense34 19 
Credit carryforward42 24 
Accrued expenses and reserves28 13 
Charitable contributions8 5 
Deferred revenue2 7 
Depreciation1 2 
Capitalized R&D
57 — 
Inventory reserve2 1 
Lease liability23 25 
Total deferred tax assets357 246 
Valuation allowance(310)(206)
Net deferred tax assets47 40 
Deferred tax liabilities:
       Amortization(8)(4)
       Other— (2)
       Capitalized contract acquisition costs(21)(14)
       Right-of-use asset(18)(20)
Total deferred tax liabilities(47)(40)
Net deferred tax asset (liability)$— $— 
A reconciliation of our effective tax rate to the United States federal income tax rate were as follows:

December 31,
202220212020
Tax provision at statutory rate
21.0%21.0%21.0%
State tax—net of federal
7.8%1.2%5.4%
Permanent items - Other
(1.5)%(0.6)%(0.8)%
Warrants7.3%(4.2)%—%
Convertible debt extinguishment—%(1.5)%—%
Research and development credits
4.6%1.0%1.6%
Stock-based compensation expense
(1.0)%(0.8)%(4.0)%
Derivative liability
0.0%(5.6)%(1.3)%
Other, net
—%—%0.3%
Change in valuation allowance
(37.5)%(10.0)%(22.3)%
Effective Tax Rate
0.6%0.5%(0.1)%

During the year ended December 31, 2022, we recorded an income tax benefit of $2, which is primarily attributable to a non-recurring benefit of $5 for the release of a portion of our valuation allowance partially offset by U.S. state tax expense, and the tax expense recorded on the earnings of our profitable foreign subsidiaries. The valuation allowance release was due to taxable temporary differences available as a source of income to realize the benefit of certain pre-existing Toast deferred tax assets as a result of the Sling acquisition.

Management has evaluated the positive and negative evidence bearing upon the realizability of its net deferred tax assets, which are composed principally of net operating loss, tax credit carryforwards and capitalized research and development costs. Management has determined that it is more likely than not that we will not recognize the benefits of our deferred tax assets and, as a result, a full valuation allowance has been recorded against our net deferred tax assets as of December 31, 2022 and 2021. The valuation allowance increased by $104, $52 and $50 during the years ended December 31, 2022, 2021 and 2020, respectively, primarily due to the operating losses incurred and tax credits generated, for the period ending December 31, 2022.

As of December 31, 2022, we had U.S. federal net operating loss carryforwards of $597 which may be able to offset future income tax liabilities. Of the federal net operating loss carryforward $513 has an indefinite carryforward period, and $85 will expire at various dates through 2037. As of December 31, 2022, we had U.S. state net operating loss carryforwards of $573, of which $480 begin to expire in 2032 and the remaining $93 do not expire. As of December 31, 2022, we had U.S. federal tax credit carryforwards of $29 which expire between 2034 and 2042. As of December 31, 2022 we had U.S. state tax credit carryforwards of $17 which expire between 2031 and 2037.

Ownership changes, as defined in the Internal Revenue Code Section 382, could limit the amount of U.S. net operating loss and tax credit carryforwards that can be utilized annually to offset future taxable income. Generally, an ownership change occurs when the ownership percentage of 5% or greater stockholders increases by more than 50% over a three-year period. The company's ability to utilize its federal and state tax attributes may be limited by ownership changes that have occurred in the past or may occur in the future.

As of December 31, 2022, 2021, and 2020, we had immaterial tax reserves for uncertain tax positions, none of which would impact the effective tax rate if recognized. We will recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2022, 2021, and 2020, we have accrued and recognized immaterial interest or penalties related to uncertain tax positions.

We file income tax returns in the United States (federal, and various state jurisdictions), as well as various foreign jurisdictions. The federal, state and foreign income tax returns are generally subject to tax examinations for the tax years ended December 31, 2019 through December 31, 2022. To the extent we have tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service, state or foreign tax authorities until utilized in a future period.
As of December 31, 2022, the Company has not provided deferred U.S. income taxes or foreign withholding taxes on temporary differences resulting from unremitted earnings for certain non-U.S. subsidiaries, which are permanently reinvested outside of the U.S. The amount of unrecognized deferred tax liability on these undistributed earnings is not material as of December 31, 2022.
v3.22.4
Loss Per Share
 12 Months Ended
Dec. 31, 2022
Earnings Per Share [Abstract]  
Loss Per Share Loss Per Share
Basic net loss per share is determined by dividing net loss by the weighted average shares outstanding for the period. We analyze the potential dilutive effect of stock options, unvested restricted stock, RSUs, shares under our ESPP, and warrants to purchase common stock (as applicable), during periods we generate net income, or when income is recognized related to changes in fair value of our warrant liability. For the year ended December 31, 2022, we recorded a gain on fair value remeasurement of our warrant liability which was added back to the numerator to adjust net loss for the dilutive impact of the warrants. We adjusted the denominator for the incremental dilutive shares using the treasury stock method. During the years ended December 31, 2021 and 2020, we recorded a loss on fair value remeasurement of our warrant liability which was excluded from the calculation of diluted earnings per share due to antidilutive effect.

The following table sets forth the computation of net loss per share attributable to common stockholders:

Year Ended December 31,
202220212020
Numerator:
Net loss $(275)$(487)$(248)
Redemption of Series B Preferred Stock— — (1)
Net loss attributable to common stockholders- basic(275)$(487)$(249)
Gain on change in fair value of warrant liability95— — 
Net loss attributable to common stockholders- diluted$(370)$(487)$(249)
Denominator:
Weighted average shares of common stock outstanding -basic511,754,986289,584,001199,982,965
Effect of dilutive securities:
Warrants to purchase Class B common stock488,120— — 
Weighted average shares of common stock outstanding - diluted512,243,106 289,584,001 199,982,965 
Net loss per share attributable to common stockholders - basic $(0.54)$(1.68)$(1.25)
Net loss per share attributable to common stockholders - diluted$(0.72)$(1.68)$(1.25)

We excluded the following potential shares of common stock from the computation of diluted net loss per share because including them would have an antidilutive effect for the years ended December 31, 2022, 2021, and 2020:
Year Ended December 31,
202220212020
Options to purchase Class A common stock, Class B common stock, and common stock
53,728,512 58,917,018 58,035,220 
Unvested restricted stock
2,703,538 4,133,955 1,096,800 
Unvested restricted stock units31,242,263 15,384,809 — 
Shares issued for exercise of non-recourse notes
— — 14,267,650 
Convertible preferred stock (as converted to common stock)
— — 253,832,025 
Warrants to purchase Class B common stock and common stock and preferred stock (as if converted to warrants to purchase common stock)
— 7,961,455 1,002,035 
Employee Stock Purchase Plan169,448 
Total87,843,761 86,397,237 328,233,730 
Potential shares issuable based on the contingent conversion features under the Convertible Notes prior to their repayment were also excluded from the computation of diluted net loss per share because the number of shares issuable was contingent on the enterprise value of the business and number of shares outstanding at the time of conversion, and such shares would be antidilutive as of December 31, 2021 and 2020 (see Note 9, "Debt").
v3.22.4
Segment Information
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Segment Information Segment Information
We have significant operations in the United States, Ireland, and India. We did not earn material revenue in any country other than the United States during the years ended December 31, 2022, 2021, and 2020.

The following table sets forth the breakdown of long-lived assets based on geography:
December 31,
20222021
United States$122 $119 
Ireland10 1 
India5 — 
Other1 — 
Total long-lived assets$138 $120 
Tangible long-lived assets consist of property and equipment and operating lease right-of-use assets. Long-lived assets attributed to specific countries are based upon the country in which the asset is located.
v3.22.4
Commitment and Contingencies
 12 Months Ended
Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
Purchase Commitments

We had non-cancelable purchase obligations to hardware suppliers and cloud service providers of $231 and $315 as of December 31, 2022 and 2021, respectively. As of December 31, 2022, $196 of our non-cancelable purchase obligations are due in 2023 and $35 thereafter.

As of December 31, 2022 and 2021, we had issued standby letters of credit in the amount of $8 and $13, respectively, held as collateral for various real estate leases.

Legal Proceedings

From time to time, we may be involved in legal actions arising in the ordinary course of business. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved unfavorably. We establish accruals for losses that management deems to be probable and subject to reasonable estimates. As of December 31, 2022 and December 31, 2021, we do not expect any claims with a reasonably possible adverse outcome to have a material impact to us, and accordingly, have not accrued for any material claims.
v3.22.4
Retirement Plan
 12 Months Ended
Dec. 31, 2022
Retirement Benefits [Abstract]  
Retirement Plan Retirement PlanSubstantially all employees are eligible to participate in the 401(k) defined contribution plan which is sponsored by us. Participants may contribute a portion of their compensation to the plan, up to the maximum amount permitted under Section 401(k) of the Internal Revenue Code. At our discretion, we can match a portion of the participants’ contributions. During the years ended December 31, 2022, 2021, and 2020, we recognized $14, $6, and $2, respectively, of expense for the defined contribution plans. This matching program was temporarily suspended from April 1, 2020 through December 31, 2020 and was reinstated on January 1, 2021.
v3.22.4
Summary of Significant Accounting Policies (Policies)
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, and the rules and regulations of the Securities and Exchange Commission, or SEC. The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Reclassifications Certain amounts in prior period financial statements have been reclassified to conform to the current period presentation. None of the reclassifications materially affected previously reported amounts.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgements and assumptions that can affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from estimates.

Estimates, judgments, and assumptions in these consolidated financial statements include, but are not limited to, those related to revenue recognition, allowance for credit losses, liabilities associated with financial guarantees related to loan repurchase activities, incremental borrowing rates applied in valuation of lease liabilities, fair values and useful lives of assets acquired and liabilities assumed through business combinations, stock-based compensation expense, warrants, convertible debt, debt derivatives and common stock valuation, as well as amortization period for deferred contract acquisition costs.
Fair Value Measurements
Certain assets and liabilities are carried at fair value under U.S. GAAP. These include cash and cash equivalents, marketable securities, warrants to purchase common and preferred stock, contingent consideration liability, non-contingent stand-ready liabilities, and convertible debt-related derivative liabilities. Assets and liabilities measured at fair value on a nonrecurring basis include assets acquired and liabilities assumed in business combinations. Other financial assets and liabilities are carried at cost with fair value disclosed, if required. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

•Level 1—Quoted prices in active markets for identical assets or liabilities.

•Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

•Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The fair value of our marketable securities is determined based on quoted market prices of similar assets and classified as Level 2 within the fair value hierarchy. (See Note 4, “Fair Value of Financial Instruments”). The carrying values of accounts receivable, accounts payable, and accrued expenses approximate their fair values due to their short-term nature.
Foreign Currency Translation The functional currency of our foreign subsidiaries is the local currency. The assets and liabilities of foreign subsidiaries are translated into U.S. dollars using exchange rates in effect at the Consolidated Balance Sheet date. Revenue and expenses are translated using the average exchange rates during the period. Equity transactions are translated using historical exchange rates. Exchange-rate differences resulting from translation adjustments are accounted for as a component of accumulated other comprehensive loss. Foreign currency transaction gains and losses are included in "Other income (expense), net" in the Consolidated Statements of Operations for the period.
Concentration of Credit Risk and Significant Customers Financial instruments that subject us to significant concentrations of credit risk primarily consist of cash deposits and cash equivalents, marketable securities, and accounts receivable. We maintain a large portion of our cash deposits and cash equivalents with primarily one financial institution, which, at times, may exceed federally insured limits. We have not incurred any losses associated with this concentration of deposits. Our investment policy provides guidelines and limits regarding investment type, concentration, credit quality, and maturity aimed at maintaining sufficient liquidity to satisfy operating and working capital requirements along with strategic initiatives, preserving capital, and minimizing risk of capital loss while generating returns on our investments. Accounts receivable are typically unsecured. We regularly monitor the creditworthiness of our customers and believe that we have adequately provided for exposure to potential credit losses.
Segment Information Our operations constitute a single operating segment. Operating segments are defined as components of an enterprise for which discrete financial information is available and is evaluated regularly by the chief operating decision maker, or CODM, in deciding how to allocate resources and assess performance. Our CODM is our Chief Executive Officer who reviews financial information presented on a consolidated basis for the purposes of allocating resources and evaluating financial performance.
Revenue Recognition
During the years ended December 31, 2022, 2021, and 2020, we generated four types of revenue, including: (1) subscription services from our SaaS products, (2) financial technology solutions, including loan servicing activities, (3) hardware, and (4) professional services.

Determining whether products and services are considered distinct performance obligations that should be accounted for separately as opposed to being combined requires judgment. We allocate total arrangement consideration at the inception of an arrangement to each performance obligation using the relative selling price allocation method based on each distinct performance obligation’s standalone selling price, or SSP. Judgment is required to determine the SSP for each distinct performance obligation. We determine SSP for hardware and professional services revenue using an adjusted market assessment approach which analyzes discounts provided to similar customers based on customer category, sales channel, and size. SSP for subscription services revenue was established using the adjusted market approach considering relevant information, such as current and new customer pricing, renewal pricing, competitor information, market trends and market share for similar services. SSP for financial technology solutions revenue was determined using our own standalone sales data. We allocate variable fees earned from financial technology services revenue to those distinct performance obligations where pricing practices are consistent with the allocation objective under ASC 606.

Customer credits represent variable consideration which is estimated based on historical experience and accounted for as a reduction of transaction price. The provision for these estimates is recorded as a reduction of revenue and an increase to liabilities at the time that the related revenue is recognized. Sales taxes collected from customers and remitted to government authorities are excluded from revenue and deferred revenue.

We also facilitate customers receiving financing from third-party financing firms for hardware, professional services, and the initial SaaS subscription services term. We pay the equivalent of an early payment discount to the third-party financing partners and recognize the payment as a reduction of revenue, as we believe these costs represent a customer sales incentive.
Subscription Services

Subscription services revenue is generated from fees charged to customers for access to our software applications. Subscription services revenue is primarily based on a rate per location, and this rate varies depending on the number of software products purchased, hardware configuration, and employee count. The performance obligation is satisfied ratably over the contract period as the service is provided, commencing when the subscription service is made available to the customer. Our contracts with customers are generally for a term ranging from 12 to 36 months.

Financial Technology Solutions

Financial technology solutions revenue includes transaction-based payment processing services for customers who are charged a transaction fee for payment-processing. This transaction fee is generally calculated as a percentage of the total transaction amount processed plus a fixed per-transaction fee, which is earned as transactions are authorized and submitted for processing. We incur costs of interchange and network assessment fees, processing fees, and bank settlement fees to the third-party payment processors and financial institutions involved in settlement, which are recorded as costs of revenues. We satisfy our payment processing performance obligations and recognize the transaction fees as revenue upon authorization by the issuing bank and submission for processing. The transaction fees collected are recognized as revenue on a gross basis as we are the principal in the delivery of the managed payments solutions to the customers.

We have concluded that we are the principal in this performance obligation to provide a managed payment solution because we control the payment processing services before the customer receives them, perform authorization and fraud check procedures prior to submitting transactions for processing in the payment network, have sole discretion over which third-party acquiring payment processors we will use and are ultimately responsible to the customers for amounts owed if those acquiring payment processors do not fulfill their obligations. We generally have full discretion in setting prices charged to the customers. Additionally, we are obligated to comply with certain payment card network operating rules and contractual obligations under the terms of our registration as a payment facilitator and as a master merchant under our third-party acquiring payment processor agreements which make us liable for the costs of processing the transactions for our customers and chargebacks and other financial losses if such amounts cannot be recovered from the restaurant.

Financial technology solutions revenue is recorded net of refunds and reversals initiated by the restaurant and is recognized upon authorization by the issuing bank and submission for processing.

Financial technology solutions revenue also includes fees earned from marketing and servicing loans to customers through our wholly-owned subsidiary, Toast Capital, that are originated by a third-party banking partner. In these arrangements, Toast Capital’s bank partner originates all loans, and Toast Capital then services the loans using Toast’s payments infrastructure to remit a fixed percentage of daily sales to our bank partner until the loan is repaid. Toast Capital earns fees for the underwriting and marketing of loans, which are recognized upon origination of the loan, and loan servicing fees, based on a percentage of each outstanding loan, which are recognized as servicing revenue as the servicing is delivered in accordance with ASC 860, Transfers and Servicing. Servicing revenue is adjusted for the amortization of servicing rights carried at amortized cost. The marketing and facilitation fees earned upon execution of these loan agreements with its customers are recognized as revenue on a gross basis.

Hardware

Hardware revenue is generated from the sale of terminals, tablets, handhelds, and related devices and accessories, net of estimated returns. We invoice end-user customers upon shipment of the products. Revenue for hardware sales is recognized at the point in time when the transfer of control occurs, which is upon product shipment. We accept returns for hardware sales and recognize them at the time of the sale as a reduction of transaction price based on historical experience.
Professional Services

Professional services revenue is generated from fees charged to customers for installation services, including business process mapping, configuration, and training. The duration of providing professional services to the customer is relatively short and completed in a matter of days. The performance obligation for professional services is considered to be satisfied upon the completion of the installation.
Deferred revenue represents our obligation to transfer products or services to customers for which consideration has been received and consists of amounts deferred from subscription services contracts, professional service engagements, and customer deposits received in advance. Amounts deferred under subscription service contracts are recognized ratably over the respective term of the customer contract.
Cash, Cash Equivalents, Cash Held on Behalf of Customers and Restricted Cash
We define cash and cash equivalents as cash deposits, money market funds, and highly liquid investments with original maturities of 90 days or less at the time of purchase that are readily convertible to known amounts of cash.

Cash held on behalf of customers represents an asset that is restricted for the purpose of satisfying obligations to remit funds to various tax authorities to satisfy customers’ payroll, tax and other obligations. Cash held on behalf of customers is included within "Prepaid expenses and other current assets," and the corresponding customer funds obligation is included within "Accrued expenses and other current liabilities" on our Consolidated Balance Sheets.

Restricted cash represents cash held with commercial lending institutions. The restrictions are related to cash held as collateral pursuant to an agreement with the originating third-party bank for the working capital loans serviced by Toast Capital (See Note 6, "Loan Servicing Activities and Acquired Loans Receivable, Net").
Marketable Securities
Our marketable securities are classified as available-for-sale. We classify our marketable securities as current assets, including those with maturities greater than 12 months, as they are available for use in current operations or to satisfy other liquidity requirements.

Marketable securities are carried at fair value, and we report unrealized gains and losses as a component of accumulated other comprehensive loss, net of tax, until the security is sold or matures, except for changes in allowance for expected credit losses, which are recorded in our results of operations. Gains or losses realized from sales of marketable securities are computed based on the specific identification method and recognized as a component of "Other income (expense), net" in the accompanying Consolidated Statements of Operations.
Accounts Receivable Accounts receivable, net consists of trade accounts receivable and unbilled receivables (which we collectively refer to as accounts receivable), net of an allowance for credit losses. Unbilled receivables represent revenue recognized on a contract in excess of billings. We record an allowance for expected credit losses for accounts receivable upon the initial recognition of an accounts receivable balance in accordance with ASC 326. The allowance for credit losses represents the best estimate of lifetime expected credit losses, based on customer-specific information, historical loss rates and the impact of current and future conditions, including an assessment of customer creditworthiness, historical payment experience and the age of outstanding receivables. Accounts receivable balances are written off against the allowance for credit losses when we determine that the balances are not recoverable. Provisions for the allowance for expected credit losses are recorded in "General and administrative" expenses in the Consolidated Statements of Operations. We evaluate the allowance for credit losses for the entire portfolio of accounts receivable on an aggregate basis due to similar risk characteristics of our customers based on similar industry and historical loss patterns.
Inventory Inventory, which consists of tablets, printers, and networking equipment, are stated at the lower of cost or net realizable value and are accounted for using the average cost method. Substantially all inventory consists of finished goods. We evaluate ending inventory for estimated excess and obsolete inventory based primarily on historical sales levels by product and projections of future demand, as well as the impact of changing product design and technology. We recognize outbound freight, handling costs, and damaged inventory as current-period costs.
Assets and Liabilities Recorded with Loan Servicing Activities
We perform loan servicing activities through the Toast Capital loan program, where we partner with an industrial bank to provide working capital loans to qualified Toast customers based on the customer’s current payment processing and point of sale data. Under the program, our bank partner originates the loans and we market and service the loans and facilitate the loan application and origination process. These loans provide eligible customers with access to financing up to $300 thousand, and loan repayment occurs automatically through a fixed percentage of every payment transaction processed on Toast’s platform.

Under the terms of our agreement with our industrial bank partner, we are obligated to repurchase certain loans originated by our industrial banking partner in cases where the customer's payments on the loan are missing or delayed for a defined period of time, and the loan is considered defaulted or delinquent (ineligible). Our obligation is limited to a specified percentage of the total loans originated, measured on a quarterly basis. The loan repurchase, net of expected recoveries, reduces our potential liability with respect to the quarterly cohort of loans from which the ineligible loan originated. Refer to "Acquired Loans Receivable, Net" section within this note for information on our accounting for repurchased loans.

This obligation represents a financial guarantee with two aspects: a contingent liability accounted for under ASC 326 related to our contingent obligation to purchase ineligible loans, and a non-contingent liability accounted for under ASC 460 related to our obligation to stand-ready to perform under the obligation, both of which are included in “Accrued Expenses and other current liabilities” in the Consolidated Balance Sheets. We adopted ASC 326 effective January 1, 2021 which applies to the contingent component of the guarantee arrangement. We measure a contingent liability for expected credit losses which is based on historical lifetime loss data, as well as macroeconomic forecasts applied to the loan portfolio. Probability of default curves are generated using historical default data for portfolios of guaranteed loans with similar risk characteristics. Loss severity estimates are generated using historical collections data for the loans repurchased by us. Additionally, we apply macroeconomic factors, such as forecasted trends in unemployment rates, which are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period. Projected loss rates, inclusive of historical loss data and macroeconomic factors, are applied to the outstanding principal amounts of the guaranteed loans. We may also include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of its current expected credit losses. The expected term of the loans guaranteed by us typically range from 90 to 360 days, and the reasonable and supportable forecast period we have included in our projected loss rates is approximately 12 months based on externally sourced data.
Contingent liabilities for expected credit losses are recorded as loans are originated, along with a corresponding non-cash charge recorded within "General and administrative" expense in the Consolidated Statements of Operations. We remeasure contingent liabilities each reporting period and reverse the liability upon loan purchase or upon the expiration of the obligation. We record a non-contingent liability at fair value as loans are originated, with a corresponding charge recorded within "General and administrative" expense in the accompanying Consolidated Statements of Operations. Subsequently, the liability is amortized on a straight-line basis over the average expected obligation term, which ranges from 90 to 360 days, and derecognized upon loan repurchase. Fair value of a non-contingent liability is measured based on a discounted cash flow model under the income approach which reflects various inputs and assumptions, including the probability and amount of payments to be made under the guarantee based on probabilities of loan defaults and delinquency, as well as associated losses, and a discount rate reflecting our credit risk as the guarantor. The fair value measurement of the non-contingent liability is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy.
Acquired Loans Receivable, Net We are obligated to purchase delinquent loans from our industrial bank partner. Such purchases, net of expected recoveries, are recorded as a reduction of contingent liabilities with respect to the quarterly cohort of loans from which the defaulted loan originated. We account for purchased loans in accordance with the guidance for purchased credit deteriorated, or PCD, assets as the loans experienced credit quality deterioration between their origination and purchase, and write off their unpaid principal balance at the time of purchase as collectability is not probable. However, when we have an expectation of collecting cash flows, a negative allowance is established for repurchased loans based on our historical experience of expected recoveries across our portfolio. As of December 31, 2022 and 2021, we have established a negative allowance for expected recoveries which is included within "Prepaid expenses and other current assets" in the Consolidated Balance Sheets. We had $13 and $2 of acquired loans outstanding as of December 31, 2022 and 2021. We estimate a negative allowance on an undiscounted basis using historical collections data for loans purchased by us and qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected recoveries. Cash collections related to acquired loans receivable are first applied to the negative allowance balance, and when recoveries received exceed the negative allowance, we recognize amounts as reductions of operating expenses in the Consolidated Statements of Operations.
Deferred Costs, Net Based on ASC 340-40, Other Assets and Deferred Costs, we capitalize and amortize incremental costs of obtaining a contract, such as sales commissions and related payroll taxes, over the period we expect to derive benefits from the contract, which we have determined to be three years. The period of benefit for commissions paid for the acquisition of initial subscription services is determined by taking into consideration the initial estimated customer life and the technological life of our subscription services platform and related significant features. We adjust the carrying value of the deferred commissions assets periodically to account for customer churn, which occurs when customers have ceased operations or otherwise discontinued using our subscription services and financial technology solutions. Amortization expense is included in "Sales and marketing" expense in the Consolidated Statements of Operations.
Amortization Leasehold improvements are amortized over the shorter of their estimated useful lives or the remaining terms of the respective leases. Repair and maintenance costs are expensed as incurred, whereas major improvements are capitalized as additions to property and equipment.
Internal Use Software We account for our internal use software and website development costs in accordance with the guidance in ASC 350-40, Internal-Use Software. The costs incurred prior to the application development stage and post implementation are expensed as incurred. Direct and incremental internal and external costs incurred during the application development stage are capitalized until the application is substantially complete and ready for its intended use, at which point amortization begins. Training and data conversion costs are expensed as incurred.
Operating Leases
We adopted ASU 2016-02, Leases, or ASC 842, effective January 1, 2021. We determine if an arrangement is or contains a lease at contract inception. Lease agreements generally contain lease and non-lease components, which we elect to combine for all asset classes as a single lease component. Payments under lease arrangements are primarily fixed. Variable payments typically represent non-lease components, which consist primarily of payments for maintenance, utilities, and management fees. Variable payments included in lease arrangements are expensed as incurred and excluded from the right of use assets and lease liabilities.

Right-of-use assets and lease liabilities for operating leases are initially measured on the lease commencement date based on a present value of lease payments over the lease term, net of any lease incentives received by the lessor. Lease payments are discounted to present value using our estimated incremental borrowing rate, because a readily determinable implicit rate is not available. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located.

Lease term includes the non-cancelable term, unless it is reasonably certain that a renewal or termination option will be exercised.

We do not record right-of-use assets and lease liabilities for leases with an initial term of 12 months or less and recognize lease expense on a straight-line basis over the lease term.
Business Combinations We account for business combinations using the acquisition method of accounting in accordance with which assets acquired and liabilities assumed are recorded at their respective fair values on the acquisition date. The fair value of the consideration transferred in a business combination, including any contingent consideration, is allocated to the assets acquired and liabilities assumed based on their respective fair values. The excess of the consideration transferred over the fair values of the assets acquired and the liabilities assumed is recorded as goodwill. During the measurement period, which may be up to one year from the acquisition date or upon a final determination of asset and liability fair values, whichever occurs first, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Any subsequent adjustments are recorded on the Consolidated Statements of Operations.
Goodwill Goodwill represents the excess of purchase price over the fair value of net tangible and identifiable intangible assets of the businesses acquired by us. Goodwill is tested for impairment annually during the fourth quarter or more often if impairment indicators are present, based on events and circumstances indicating that it is more likely than not that the fair value of the reporting unit is below its carrying value. There were no goodwill impairment losses recognized during the years ended December 31, 2022, 2021, and 2020. We performed our annual quantitative goodwill impairment test as of December 31, 2022 and 2021 and determined that no adjustment to goodwill was necessary because the reporting unit's fair value significantly exceeded its book value.
Intangible Assets Intangible assets consist of finite-lived acquired technology, customer relationships, and acquired trade names. Finite-lived intangible assets are valued based on estimated future cash flows and amortized on a straight-line basis over their estimated useful lives. We evaluate the remaining estimated useful life of our intangible assets on an ongoing basis to determine whether events and circumstances warrant a revision to the remaining amortization period.Acquired technology and customer relationships amortization is recorded within "Costs of revenue" and “Sales and marketing” expenses, respectively, within the Consolidated Statements of Operations and amounted to $5, $4 and $4, respectively, during the years ended December 31, 2022, 2021, and 2020.
Impairment of Property and Equipment and Finite-Lived Intangible Assets We evaluate the recoverability of property and equipment and finite lived intangible assets for impairment whenever events or circumstances indicate that the carrying amounts of such assets may not be recoverable. For purposes of this assessment, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability is measured by comparing the carrying amount of an asset group to the estimated future undiscounted future net cash flows expected to be generated from their use and eventual disposal. If the carrying amount is not recoverable, the carrying amount is reduced to fair value and impairment loss is recognized. We did not identify any events or circumstances that indicated the carrying amounts of our long-lived assets may not be recoverable and did not recognize any impairment losses during the years ended December 31, 2022, 2021 and 2020.
Cost of Revenue
Costs of revenue primarily consists of costs associated with payment processing, personnel, and related infrastructure for operation of our cloud-based platform, data center operations, customer support, loan servicing and allocated overhead. Hardware costs consist of all product and shipping costs associated with tablets, printers, and other peripherals. Employee-related costs consist of salaries, benefits, bonuses, and stock-based compensation expense. Overhead consists of certain facilities costs, depreciation expense, and amortization costs associated with internally developed software.

Payment processing costs include interchange fees, network assessment fees and fees paid to the acquiring payment processors.
Stock-Based Compensation Expense
We grant equity awards, including stock options which vest upon the satisfaction of service conditions and restricted stock units, or RSUs, which vest upon the satisfaction of performance conditions and/or service conditions. We account for stock-based compensation expense related to equity awards in accordance with ASC 718, Compensation—Stock Compensation. Stock-based awards are measured at fair value on the grant date and compensation cost is recognized over the service period, net of estimated forfeitures. We estimate a forfeiture rate to calculate the stock-based compensation expense for all awards based on an analysis of actual historical experience and expected employee attrition rates.

Compensation cost is recognized on a straight-line basis for stock-options, RSUs and our 2021 Employee Stock Purchase Plan, or ESPP, and on an accelerated attribution basis for awards with a performance condition for each separately vesting portion of the award over the applicable vesting period.

We use the Black-Scholes option-pricing model to determine the estimated fair value of stock option and ESPP awards. We estimate the following assumptions used in the option pricing model:

•Expected Volatility—We do not have sufficient history of market prices for our Class A common stock due to our recently completed IPO. As such, we estimate volatility for stock option grants by evaluating the average historical volatility of a peer group of similar public companies over a period commensurate with the options' expected term.

•Expected Term—The expected term of our stock options represents the period that the stock-based awards are expected to be outstanding. We do not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. As such, we estimate the expected term of the options based on the simplified method determined based on the midpoint of the stock options vesting term and contractual expiration period.

•Risk-Free Interest Rate—The risk-free interest rate is based on the U.S. Treasury yield curve published as of the grant date, with maturities approximating the expected term of the options granted.

•Dividend Yield—We have not declared or paid dividends to date and do not anticipate declaring dividends. As such, the expected dividend is zero.

Prior to our IPO, the fair value of our common stock was determined by our Board, with the assistance of management, as there was no public market for the underlying common stock. Our Board determined the fair value of our common stock by considering a number of objective and subjective factors, such as contemporaneous third-party valuations of our common stock, the valuation of comparable companies, sales of our common and redeemable convertible preferred stock to outside investors in arms-length transactions, our operating and financial performance, the lack of marketability, and the general and industry specific economic outlook, amongst other factors. After the completion of the IPO, the fair value of our Class A common stock is determined based on the NYSE closing price on the date of grant.

RSUs granted by us prior to September 2021 commenced vesting upon the satisfaction of both the service-based vesting condition, which is typically four years, and liquidity event-related performance vesting condition related to IPO. Stock compensation expense is recognized when the performance condition becomes probable of achievement. All performance conditions were achieved upon the completion of our IPO, and we recorded a cumulative stock compensation expense of $63 during the year ended December 31, 2021 related to the awards with an IPO-related vesting condition.

The Amended and Restated 2014 Stock Incentive Plan, as amended, or the 2014 Plan, allows for early exercise of all granted options, before vesting requirements have been satisfied. Shares acquired through the early exercise of options which have not vested at the time of an employee’s termination may be repurchased by us at the lower of the original exercise price or the then current fair value. We have not recognized any tax benefits related to the effects of employee stock-based compensation expense.
Advertising Costs We expense advertising costs as incurred.
Income Taxes We account for income taxes in accordance with ASC 740, Income Taxes. Under this method, deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. In addition, this method requires a valuation allowance against net deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.We account for uncertain tax positions recognized in the consolidated financial statements by prescribing a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Interest and penalties, if applicable, related to uncertain tax positions would be recognized as a component of income tax expense.
Net Loss Per Share
During the year ended December 31, 2021, we amended and restated our certificate of incorporation and created two classes of common stock: Class A common stock and Class B common stock (see Note 1, "Description of Business and Basis of Presentation"). Class A common stock and Class B common stock share proportionately, on a per share basis, in our net income (losses) and participate equally in the dividends on common stock, if declared. We allocate net losses attributable to common stock between the common stock classes on a one-to-one basis when computing net income (loss) per share. As a result, basic and diluted net income (loss) per share of Class A common stock and Class B common stock are equivalent.

We compute net loss per common share based on the two-class method required for multiple classes of common stock and participating securities. The two-class method requires income (loss) available to common stockholders for the period to be allocated between multiple classes of common stock and participating securities based upon their respective rights to receive dividends as if all income (loss) for the period had been distributed.

We consider our currently outstanding restricted shares issued upon early exercise of stock options and our convertible preferred stock which was outstanding prior to the completion of the IPO to be participating securities. Restricted shares issued upon early exercise of stock options are considered participating securities because holders of such shares have non-forfeitable dividend rights in the event of a dividend declaration for common shares. The holders of our convertible preferred stock were entitled to non-cumulative dividends in preference to common stockholders, at specified rates, if declared. The holders of our convertible preferred stock were not, and restricted shares are not contractually obligated to participate in our losses. As such, our net losses for the years ended December 31, 2022, 2021, and 2020 were not allocated to these participating securities.
Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of our Class A and Class B common stock outstanding, adjusted for outstanding shares that are subject to repurchase and Class A restricted common stock. Diluted net loss per common share gives effect to all potentially dilutive securities which are excluded from the computation if the effect is antidilutive.
Recently Issued Accounting Pronouncements Not Yet Adopted and Emerging Growth Company Status
Recently Adopted Accounting Pronouncements

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, or ASU 2021-08. The standard requires an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606, as if it had originated the contracts, rather than at fair value on the acquisition date. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. The amendments in ASU 2021-08 should be applied prospectively to business combinations occurring on or after the effective date of the standard. Early adoption is permitted. We early adopted ASU 2021-08 during the year ended December 31, 2022, which did not have a material impact on the consolidated financial statements and related disclosures. We applied ASU 2021-08 in our acquisition of Sling Inc. as discussed in Note 3, “Business Combinations”.

In August 2020, the FASB issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, or ASU 2020-06. The new guidance simplifies the accounting for certain financial instruments by removing certain separation models required under current U.S. GAAP, including the beneficial conversion feature and cash conversion feature. ASU 2020-06 also improves and amends the related earnings per share guidance for both subtopics. ASU 2020-06 is effective for public business entities for fiscal years beginning after December 15, 2021 and interim periods within that fiscal year. We adopted ASU 2020-06 during the year ended December 31, 2022 which did not have a material impact on our consolidated financial statements and related disclosures.

We adopted the following accounting standards during the year ended December 31, 2021:

Leases

In February 2016, the FASB issued ASC 842, as amended, which superseded the guidance in former ASC 840, Leases. Based on ASC 842, a lessee is required to recognize in the statement of financial position a lease obligation related to making lease payments and a right-of-use asset representing its right to control the use of the underlying asset during the lease term, including optional payments that are reasonably certain to occur.

We adopted ASC 842 on January 1, 2021 and applied the following practical expedients:

•comparative periods prior to the adoption date are not adjusted to reflect the new guidance (the modified retrospective method of transition); and
•the historical determination as to the existence and classification of leases and the accounting for initial direct costs is carried forward for existing contracts as of the adoption date.

The adoption of Topic 842 resulted in a recognition of operating lease right-of-use assets of $95, operating lease obligations of $115, and an immaterial cumulative-effect adjustment to accumulated deficit as of January 1, 2021. The adoption of Topic 842 did not have a material impact on our results of operations and cash flows.

Credit Losses

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, or ASC 326. The guidance and related amendments modify the accounting for credit losses for most financial assets and require the use of an expected credit loss model replacing the currently used incurred loss method. The primary financial instruments in the scope of ASC 326 include cash equivalents, accounts receivable, off-balance sheet credit exposures under financial guarantee arrangements, and acquired loans receivable.
We adopted the standard as of January 1, 2021 and recognized a cumulative-effect adjustment of $1 to the opening accumulated deficit as of that date. Therefore, our Consolidated Financial Statements for the year ended December 31, 2021 are presented in accordance with ASC 326, while the prior comparative period has not been recast.
Marketable Securities Impairment We review marketable securities for impairment during each reporting period to determine if any of the securities have experienced an other-than-temporary decline in fair value. Credit losses are recognized up to the amount equal to the difference between the fair value and the amortized cost basis and recorded as an allowance for credit losses in the Consolidated Balance Sheets with a corresponding adjustment to earnings. Unrealized losses that are not related to credit losses are recognized in accumulated other comprehensive loss.
v3.22.4
Summary of Significant Accounting Policies (Tables)
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Schedule of Accounts, Notes, Loans and Financing Receivable
Accounts receivable, net consisted of the following:
December 31,
20222021
Accounts receivable
$45 $20 
Unbilled receivables
44 39 
Less: Allowance for credit losses
(12)(4)
Accounts receivable, net$77 $55 
Accounts Receivable, Allowance for Credit Loss
Our allowance for credit losses was comprised of the following:

Twelve Months Ended December 31,
20222021
Beginning balance$(4)$(4)
Impact of adopting ASU 2016-13— (2)
Additions(13)(1)
Write offs5 3 
Ending balance$(12)$(4)
Property, Plant and Equipment
Property and equipment are stated at cost, net of accumulated depreciation, and are depreciated using the straight-line method over their estimated lives, as follows:

Property and EquipmentEstimated Useful Life
Computer and other equipment3 years
Office furniture and fixtures3 years
Tooling and equipment
3-7 years
Capitalized software2 years
Property and equipment consisted of the following:
December 31,
20222021
Leasehold improvements
$36 $29 
Capitalized software49 25 
Computer equipment
14 8 
Furniture and fixtures
8 8 
Tooling and equipment
2 2 
109 72 
Less: Accumulated depreciation
(48)(31)
$61 $41 
Schedule of Acquired Finite-Lived Intangible Assets by Major Class
The estimated useful lives for acquired technology and customer relationship intangible assets are as follows:
Estimated Useful Life
Acquired technology
3 - 10 years
Customer acquired intangible assets
5 - 6 years
v3.22.4
Business Combinations (Tables)
 12 Months Ended
Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract]  
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed The following table summarizes the preliminary acquisition date fair values of assets acquired and liabilities assumed at the acquisition date:
Amount
Cash$1 
Intangible assets:
Developed technology, useful life of 5 years
17 
Customer relationships, useful life of 5 years
2 
Goodwill33 
Net working capital1 
Deferred tax liability(5)
Net assets acquired$49 
Amount
Developed technology, useful life of 10 years
13 
Customer relationship, useful life of 6 years
1 
Goodwill38 
Deferred tax liability(3)
Other(1)
Net assets acquired$48 
Schedule of Business Acquisitions, by Acquisition
The aggregate purchase price, net of cash acquired of $1, was subject to normal and customary purchase price adjustments and was as follows on the acquisition date:
Amount
Cash consideration, net of cash acquired$24 
Fair value of common stock issued15 
Fair value of settled stock option awards1 
Fair value of contingent consideration2 
Liabilities settled on behalf of xtraCHEF1 
Deferred payments for indemnity claims and working capital funds, net of adjustments (1)
5 
Total purchase price$48 
(1)In consideration for the acquisition of xtraCHEF, we issued 569,400 shares of common stock to the seller shareholders with a fair value of $26.10 per share on the acquisition date supported by a contemporaneous valuation. Additionally, we settled an immaterial amount of option awards that were subject to accelerated vesting on the acquisition date. Total consideration transferred for the settled option awards consisted of cash consideration of $3 and deferred consideration of $1. The consideration transferred for the settled option awards of $3 approximated the estimated fair value of the settled option awards on the acquisition date, of which $1 was attributable to pre-acquisition services and included in the purchase price. The remaining amount of $2 was recorded as a stock-based compensation expense on the acquisition date within "General and administrative" expenses in our Consolidated Statements of Operations.
v3.22.4
Fair Value of Financial Instruments (Tables)
 12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis
The following table presents information about our financial assets and liabilities that were measured at fair value on a recurring basis and indicates the level of the fair value hierarchy used to determine such fair values:

Fair Value Measurements at December 31, 2022
Using:
Level 1Level 2Level 3Total
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 

Fair Value Measurements at December 31, 2021
Using:
Level 1Level 2Level 3Total
Assets:
Money market funds$50 $— $— $50 
Commercial paper— 134 — 134 
Certificates of Deposit— 14 — 14 
Corporate Bonds— 193 — 193 
Treasury Bonds— 67 — 67 
Asset-back securities— 49 — 49 
$50 $457 $— $507 
Liabilities:
Warrants to purchase common stock$— $— $181 $181 
Contingent consideration— — 5 5 
$— $— $186 $186 
Fair Value Measurement Inputs and Valuation Techniques The following table indicates the weighted-average assumptions made in estimating the fair value for the years ended December 31, 2022 and 2021:
Year Ended December 31, 2022Year Ended December 31, 2021
Risk-free interest rate4.1 %1.3 %
Contractual term (in years)45
Expected volatility60.3 %50.8 %
Expected dividend yield— %— %
Exercise price$17.16 $17.15 
The following table indicates the weighted-average assumptions made in estimating the fair value for the years ended December 31, 2021 and 2020:
December 31,
2021(1)
2020
Risk-free interest rate
0.8%0.3%
Expected term (in years)
5
5-7
Expected volatility
54%60%
Expected dividend yield
0%0%
Exercise price
$0.74$0.74

(1) During the year ended December 31, 2021, fair value of the preferred stock warrants liability was measured based on the weighted average assumptions from January 1, 2021 through September 24, 2021, the date they were converted into common stock warrants.
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis
The following table provides a roll-forward of the aggregate fair value of our liabilities for which fair value is determined on recurring basis using Level 3 inputs:

Preferred
Stock Warrant Liability (1)		Common Stock Warrant LiabilityDerivative LiabilityContingent Consideration Liability (2)
Balance as of December 31, 2020
$11 $— $37 $— 
Fair value at issuance— 125 — — 
Fair value on the acquisition date— — — 2 
Change in fair value and other adjustments38 59 103 3 
Settlement(43)(9)(140)— 
Conversion of preferred stock warrants into common stock warrants upon initial public offering(6)6 — — 
Balance as of December 31, 2021
— 181 — 5 
Change in fair value— (95)— 3 
Settlement— (18)— (4)
Balance as of December 31, 2022
$— $68 $— $4 
(1) Changes in the fair value of the preferred stock warrant liability were recognized as a component of “Other income (expenses)” in our Consolidated Statements of Operations. We recorded a loss of $8 during the year ended December 31, 2020.

(2) During the year ended December 31, 2022, we paid $2 in cash and issued 37,179 shares of our Class B common stock to settle a portion of the contingent consideration. In February 2023, we fully settled the contingent consideration liability via a cash payment of $2 and issuance of 38,908 shares of our Class B common stock.
v3.22.4
Marketable Securities (Tables)
 12 Months Ended
Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]  
Debt Securities, Available-for-sale
The amortized cost, gross unrealized holding losses and fair value of marketable securities classified as available for sale, excluding accrued interest receivable, consisted of the following:

December 31, 2022
Amortized CostGross Unrealized LossesFair Value
Commercial paper$140 $— $140 
Certificates of deposit104 — 104 
Corporate bonds110 (1)109 
U.S. government agency securities33 — 33 
Treasury securities61 (1)60 
Asset-backed securities28 — 28 
Total$476 $(2)$474 

December 31, 2021
Amortized CostGross Unrealized LossesFair Value
Commercial paper$134 $— $134 
Certificates of deposit14 — 14 
Corporate bonds194 (1)193 
Treasury securities67 — 67 
Asset-backed securities49 — 49 
Total$458 $(1)$457 


The fair values of the marketable securities by contractual maturities at December 31, 2022 were as follows:
December 31, 2022
Due within 1 year$442 
Due after 1 year through 5 years32 
Due after 5 years through 10 years— 
Total marketable securities$474 
v3.22.4
Loan Servicing Activities and Acquired Loans Receivable, Net (Tables)
 12 Months Ended
Dec. 31, 2022
Guarantees and Product Warranties [Abstract]  
Off-Balance Sheet, Credit Loss, Liability
Changes in the contingent liability for expected credit losses for the years ended December 31, 2022 and 2021 were as follows:
Year Ended December 31,
20222021
Beginning balance
$2 $— 
Impact upon ASC 326 adoption
— 1 
Credit loss expense
20 2 
Reductions due to loan purchases
(8)(1)
Ending balance
$14 $2 
Changes in the negative allowance for acquired loans for the years ended December 31, 2022 and 2021 were as follows:

Year Ended December 31,
20222021
Beginning balance
$1 $— 
Impact of adopting ASC 326
— 3 
Expected recoveries
5 1 
Reduction due to cash collections
(4)(3)
Ending balance
$2 $1 
v3.22.4
Goodwill and Intangible Assets (Tables)
 12 Months Ended
Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Goodwill
The changes in the carrying amount of goodwill for the periods presented were as follows:

Amount
Balance as of December 31, 2020
$36 
Acquisitions
38 
Balance as of December 31, 2021
74 
Acquisitions
33 
Balance as of December 31, 2022
$107 
Schedule of Finite-Lived Intangible Assets
Intangible assets, net consisted of the following:
As of December 31, 2022
Technology AssetsCustomer AssetsTotal
Gross carrying amount$38 $6 $44 
Accumulated amortization(13)(2)(15)
Intangible assets, net$25 $4 $29 
As of December 31, 2021
Technology AssetsCustomer AssetsTotal
Gross carrying amount$22 $4 $26 
Accumulated amortization(8)(2)(10)
Intangible assets, net$14 $2 $16 
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense
The total estimated future amortization of intangible assets as of December 31, 2022 was as follows:

Year ended December 31,Amount
2023$6 
20246 
20255 
20265 
20273 
Thereafter4 
$29 
v3.22.4
Lessee Arrangements (Tables)
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Lease, Cost
The components of lease expense were as follows during the years ended December 31, 2022 and 2021:

Year Ended December 31,
20222021
Operating lease expense
$21 $25 
Variable lease expense
4 1 
Total
$25 $26 
The following table summarizes supplemental cash flow information related to operating leases during the years ended December 31, 2022 and 2021:
Year Ended December 31,
20222021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases
$24 $25 
Operating lease right of use assets obtained in exchange for new or modified lease obligations:
Upon the adoption of ASC 842
— 95 
During the remainder of the period
14 4 
Total
$14 $99 
Schedule of Weighted Average Lease Term And Discount Rate
Weighted average remaining lease term and discount rate for our operating leases were as follows:

Year Ended December 31,
20222021
Weighted-average remaining lease term (years)
6.46.9
Weighted-average discount rate
5.19%2.62%
Lessee, Operating Lease, Liability, Maturity
The following table summarizes maturities of our operating lease liabilities as of December 31, 2022:

Amount
2023$17 
202418 
202518 
202617 
202714 
Thereafter28 
Total future minimum lease payments112 
Less: Imputed interest18 
Present value of future minimum lease payments$94 
v3.22.4
Other Balance Sheet Information (Tables)
 12 Months Ended
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure
Prepaid expenses and other current assets consisted of the following:
December 31,
20222021
Cash held on behalf of customers
$60 $34 
Prepaid expenses
27 25 
Deposits for inventory purchases20 21 
Other current assets48 12 
$155 $92 
Property, Plant and Equipment
Property and equipment are stated at cost, net of accumulated depreciation, and are depreciated using the straight-line method over their estimated lives, as follows:

Property and EquipmentEstimated Useful Life
Computer and other equipment3 years
Office furniture and fixtures3 years
Tooling and equipment
3-7 years
Capitalized software2 years
Property and equipment consisted of the following:
December 31,
20222021
Leasehold improvements
$36 $29 
Capitalized software49 25 
Computer equipment
14 8 
Furniture and fixtures
8 8 
Tooling and equipment
2 2 
109 72 
Less: Accumulated depreciation
(48)(31)
$61 $41 
Schedule of Accounts Payable and Accrued Liabilities
Accrued expenses and other current liabilities consisted of the following:

December 31,
20222021
Accrued transaction-based costs
$181 $120 
Accrued payroll and bonus
59 24 
Customer funds obligation
60 34 
Accrued expenses
45 21 
Accrued commissions
15 19 
Contingent liability for expected credit losses
14 2 
Other liabilities
39 26 
$413 $246 
v3.22.4
Common Stock (Tables)
 12 Months Ended
Dec. 31, 2022
Equity [Abstract]  
Share-based Payment Arrangement, Outstanding Award, Activity, Excluding Option
At each Consolidated Balance Sheet date, shares subject to restriction consisted of the following:
Shares
Unvested as of January 1, 2021
1,096,800 
Exercise of stock options412,810 
Exercise of stock options in connection with promissory notes repayment14,267,650 
Repurchases(35,665)
Vested(11,607,640)
Unvested as of December 31, 2021
4,133,955 
Issuance of restricted stock for acquisition1,338,228 
Exercise of stock options27,305 
Repurchases
(33,475)
Vested
(2,762,475)
Unvested as of December 31, 2022
2,703,538 
We reflect RSUs as issued and outstanding shares of common stock when such units vest. The following table summarizes RSU activity as of December 31, 2022:
RSUWeighted Average Grant Date Fair Value
Outstanding balance as of December 31, 2021
15,384,809 $29.71 
Granted24,272,078 18.40 
Vested(5,981,213)25.14 
Forfeited(2,433,411)25.63 
Outstanding balance as of December 31, 2022
31,242,263 $22.11 
Schedule of Stock by Class As of each Consolidated Balance Sheet date, we had reserved shares of Class A common stock and Class B common stock for issuance in connection with the following:
December 31,
20222021
Options to purchase Class A common stock and Class B common stock53,728,512 58,917,018 
Restricted stock units31,242,263 15,384,809 
Warrants to purchase Class B common stock6,902,6337,961,455 
Shares available for future grant under the 2021 Plan and 2014 Plan
55,009,13653,916,105 
Shares reserved for charitable donations4,375,1124,922,001 
Shares available for issuance under 2021 Employee Stock Purchase Plan16,709,89311,638,189 
167,967,549152,739,577 
v3.22.4
Revenue from Contracts with Customers (Tables)
 12 Months Ended
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]  
Contract with Customer, Contract Asset, Contract Liability, and Receivable
The following table summarizes the activity in deferred revenue:

Year Ended December 31,
20222021
Deferred revenue, beginning of year$56 $59 
Deferred revenue, end of period$46 $56 
Revenue recognized in the period from amounts included in deferred revenue at the beginning of period$51 $43 
Capitalized Contract Cost
The following table summarizes the activity in deferred contract acquisition costs:

Year Ended December 31,
20222021
Beginning balance$55 $29 
Capitalization of sales commissions costs71 56 
Amortization of sales commissions costs(44)(30)
Ending balance$82 $55 

December 31,
20222021
Deferred costs, current
$44 $30 
Deferred costs, non-current
38 25 
Total
$82 $55 
v3.22.4
Stock-Based Compensation Expense (Tables)
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Share-based Payment Arrangement, Expensed and Capitalized, Amount
Stock-based compensation expense recognized for December 31, 2022, 2021, and 2020, were as follows:

Year Ended December 31,
202220212020
Costs of revenue
$33 $12 $7 
Sales and marketing
50 24 16 
Research and development
72 48 30 
General and administrative
73 58 33 
$228 $142 $86 
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions
The following table indicates the weighted-average assumptions made in estimating the fair value based on the Black-Scholes model as of December 31, 2022, 2021, and 2020:

Year Ended December 31,
202220212020
Risk-free interest rate
2.42%1.00%0.49%
Expected term (in years)
6.076.326.64
Expected volatility
52%65%63%
Expected dividend yield
0%0%0%
Weighted-average fair value of common stock
$17.24$17.00$3.23
Weighted-average fair value per share of options issued
$8.94$10.12$1.95
Share-based Payment Arrangement, Option, Activity
The following is a summary of stock option activity under our stock option plans:

Number of SharesWeighted Average Exercise PriceWeighted Average Remaining Contractual TermAggregate Intrinsic Value(1)
(in years)
Outstanding as of December 31, 2021
58,917,018$4.53 7.65$1,778 
Granted6,311,68017.24 
Exercised(7,633,661)1.93 
Forfeited(3,866,525)10.21 
Outstanding as of December 31, 2022
53,728,512$5.98 6.94$655 
Options vested and expected to vest as of
December 31, 2022
50,866,098$5.70 6.87$634 
Options exercisable as of December 31, 2022
48,402,325$4.63 6.67$649 
(1) The aggregate intrinsic value was determined as the difference between the closing price of the Class A common stock on the last trading day of the month of December or the date of exercise, as appropriate, and the exercise price, multiplied by the number of in-the-money options that would have been received by the option holders had all option holders exercised their in-the-money options at period end.
Share-based Payment Arrangement, Outstanding Award, Activity, Excluding Option
At each Consolidated Balance Sheet date, shares subject to restriction consisted of the following:
Shares
Unvested as of January 1, 2021
1,096,800 
Exercise of stock options412,810 
Exercise of stock options in connection with promissory notes repayment14,267,650 
Repurchases(35,665)
Vested(11,607,640)
Unvested as of December 31, 2021
4,133,955 
Issuance of restricted stock for acquisition1,338,228 
Exercise of stock options27,305 
Repurchases
(33,475)
Vested
(2,762,475)
Unvested as of December 31, 2022
2,703,538 
We reflect RSUs as issued and outstanding shares of common stock when such units vest. The following table summarizes RSU activity as of December 31, 2022:
RSUWeighted Average Grant Date Fair Value
Outstanding balance as of December 31, 2021
15,384,809 $29.71 
Granted24,272,078 18.40 
Vested(5,981,213)25.14 
Forfeited(2,433,411)25.63 
Outstanding balance as of December 31, 2022
31,242,263 $22.11 
v3.22.4
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Schedule of Components of Income Tax Expense (Benefit)
The components of income (loss) before provision for income taxes are as follows (in millions):

Year Ended December 31,
202220212020
United States$(286)$(493)$(249)
Foreign9 3 1 
Total loss before income taxes$(277)$(490)$(248)
The components of income tax (benefit) expense for the years ended December 31, 2022, 2021, and 2020, were as follows:
Year Ended December 31,
202220212020
Current state
$1 $— $— 
Current foreign
2 — — 
Current tax expense
3 — — 
Deferred federal
(4)(2)— 
Deferred state
(1)(1)— 
Deferred tax benefit
(5)(3)— 
Total income tax (benefit) expense
$(2)$(3)$— 
Schedule of Deferred Tax Assets and Liabilities
The tax effects of temporary differences that gave rise to a significant portion of the deferred tax assets and liabilities at December 31, 2022 and 2021, were as follows:
December 31,
20222021
Deferred tax assets:
Net operating loss carryforwards$160 $150 
Stock-based compensation expense34 19 
Credit carryforward42 24 
Accrued expenses and reserves28 13 
Charitable contributions8 5 
Deferred revenue2 7 
Depreciation1 2 
Capitalized R&D
57 — 
Inventory reserve2 1 
Lease liability23 25 
Total deferred tax assets357 246 
Valuation allowance(310)(206)
Net deferred tax assets47 40 
Deferred tax liabilities:
       Amortization(8)(4)
       Other— (2)
       Capitalized contract acquisition costs(21)(14)
       Right-of-use asset(18)(20)
Total deferred tax liabilities(47)(40)
Net deferred tax asset (liability)$— $— 
Schedule of Effective Income Tax Rate Reconciliation
A reconciliation of our effective tax rate to the United States federal income tax rate were as follows:

December 31,
202220212020
Tax provision at statutory rate
21.0%21.0%21.0%
State tax—net of federal
7.8%1.2%5.4%
Permanent items - Other
(1.5)%(0.6)%(0.8)%
Warrants7.3%(4.2)%—%
Convertible debt extinguishment—%(1.5)%—%
Research and development credits
4.6%1.0%1.6%
Stock-based compensation expense
(1.0)%(0.8)%(4.0)%
Derivative liability
0.0%(5.6)%(1.3)%
Other, net
—%—%0.3%
Change in valuation allowance
(37.5)%(10.0)%(22.3)%
Effective Tax Rate
0.6%0.5%(0.1)%
v3.22.4
Loss Per Share (Tables)
 12 Months Ended
Dec. 31, 2022
Earnings Per Share [Abstract]  
Schedule of Earnings Per Share, Basic and Diluted
The following table sets forth the computation of net loss per share attributable to common stockholders:

Year Ended December 31,
202220212020
Numerator:
Net loss $(275)$(487)$(248)
Redemption of Series B Preferred Stock— — (1)
Net loss attributable to common stockholders- basic(275)$(487)$(249)
Gain on change in fair value of warrant liability95— — 
Net loss attributable to common stockholders- diluted$(370)$(487)$(249)
Denominator:
Weighted average shares of common stock outstanding -basic511,754,986289,584,001199,982,965
Effect of dilutive securities:
Warrants to purchase Class B common stock488,120— — 
Weighted average shares of common stock outstanding - diluted512,243,106 289,584,001 199,982,965 
Net loss per share attributable to common stockholders - basic $(0.54)$(1.68)$(1.25)
Net loss per share attributable to common stockholders - diluted$(0.72)$(1.68)$(1.25)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share
We excluded the following potential shares of common stock from the computation of diluted net loss per share because including them would have an antidilutive effect for the years ended December 31, 2022, 2021, and 2020:
Year Ended December 31,
202220212020
Options to purchase Class A common stock, Class B common stock, and common stock
53,728,512 58,917,018 58,035,220 
Unvested restricted stock
2,703,538 4,133,955 1,096,800 
Unvested restricted stock units31,242,263 15,384,809 — 
Shares issued for exercise of non-recourse notes
— — 14,267,650 
Convertible preferred stock (as converted to common stock)
— — 253,832,025 
Warrants to purchase Class B common stock and common stock and preferred stock (as if converted to warrants to purchase common stock)
— 7,961,455 1,002,035 
Employee Stock Purchase Plan169,448 
Total87,843,761 86,397,237 328,233,730 
v3.22.4
Segment Information (Tables)
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Long-lived Assets by Geographic Areas
The following table sets forth the breakdown of long-lived assets based on geography:
December 31,
20222021
United States$122 $119 
Ireland10 1 
India5 — 
Other1 — 
Total long-lived assets$138 $120 
Tangible long-lived assets consist of property and equipment and operating lease right-of-use assets. Long-lived assets attributed to specific countries are based upon the country in which the asset is located.
v3.22.4
Description of Business and Basis of Presentation (Details)
$ / shares in Units, $ in Millions
 12 Months Ended
Sep. 24, 2021
USD ($)
vote
$ / shares
shares
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
shares
Dec. 31, 2020
USD ($)
shares
Sep. 23, 2021
shares
Dec. 31, 2019
shares
Class of Stock [Line Items]            
Convertible preferred stock, outstanding (in shares)     0 253,832,025   209,608,075
Stock-based compensation expense | $   $ 228 $ 142 $ 86    
COVID-19            
Class of Stock [Line Items]            
Severance costs | $       10    
Stock-based compensation expense | $       $ 3    
Common Class B            
Class of Stock [Line Items]            
Convertible preferred stock, outstanding (in shares)         253,832,025  
Outstanding warrants (in shares)         1,002,035  
Number of voting rights | vote 10          
Common Class A            
Class of Stock [Line Items]            
Number of voting rights | vote 1          
IPO            
Class of Stock [Line Items]            
Sale of stock, number of shares issued (in shares) 25,000,000,000,000          
Sale of stock, share price (in dollars per share) | $ / shares $ 40.00          
Sale of stock, consideration received | $ $ 944          
Over-Allotment Option            
Class of Stock [Line Items]            
Sale of stock, number of shares issued (in shares) 3,260,869,000,000          
v3.22.4
Summary of Significant Accounting Policies - Narrative (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2022
USD ($)
revenue_type
class
shares
Dec. 31, 2021
USD ($)
revenue_type
Dec. 31, 2020
USD ($)
revenue_type
Jan. 01, 2021
USD ($)
Dec. 31, 2019
USD ($)
Subsidiary, Sale of Stock [Line Items]          
Number of revenue types | revenue_type 4 4 4    
Description of payment Our contracts with customers are generally for a term ranging from 12 to 36 months        
Provision for excess and obsolete inventory $ 13,000 $ 3,000      
Face amount per loan 300        
Acquired loans $ 13,000 2,000      
Deferred costs amortization period 3 years        
Goodwill impairment loss $ 0 0 $ 0    
Amortization expense for intangible assets 5,000 4,000 4,000    
Stock-based compensation expense 228,000 142,000 86,000    
Advertising expense $ 25,000 17,000 6,000    
Allocation of between common stock (in shares) | shares 1        
Number of classes of stock | class 2        
Operating lease right-of-use assets $ 77,000 79,000      
Operating lease obligations 94,000        
Accumulated deficit 1,098,000 1,091,000 (471,000)   $ (330,000)
Accumulated Deficit          
Subsidiary, Sale of Stock [Line Items]          
Accumulated deficit $ (1,377,000) (1,102,000) (616,000)   (386,000)
Cumulative adjustment for adoption new accounting standard          
Subsidiary, Sale of Stock [Line Items]          
Accumulated deficit     1,000   18,000
Cumulative adjustment for adoption new accounting standard | Accumulated Deficit          
Subsidiary, Sale of Stock [Line Items]          
Accumulated deficit     1,000 $ 1,000 $ 18,000
Accounting Standards Update 2016-02          
Subsidiary, Sale of Stock [Line Items]          
Operating lease right-of-use assets     95,000    
Operating lease obligations     $ 115,000    
Restricted Stock Units (RSUs)          
Subsidiary, Sale of Stock [Line Items]          
Award vesting period     4 years    
Stock-based compensation expense   $ 63,000      
v3.22.4
Summary of Significant Accounting Policies - Schedule of Accounts Receivable and Allowance For Credit Losses (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Accounts receivable $ 45 $ 20
Unbilled receivables 44 39
Less: Allowance for credit losses (12) (4)
Accounts receivable, net 77 55
Accounts Receivable, Allowance for Credit Loss [Roll Forward]    
Beginning balance (4) (4)
Additions (13) (1)
Write-offs 5 3
Ending balance (12) (4)
Cumulative adjustment for adoption new accounting standard    
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Less: Allowance for credit losses   0
Accounts Receivable, Allowance for Credit Loss [Roll Forward]    
Beginning balance $ 0 (2)
Ending balance   $ 0
v3.22.4
Summary of Significant Accounting Policies - Schedule of Useful Lives (Details)
 12 Months Ended
Dec. 31, 2022
Computer and other equipment  
Property, Plant and Equipment [Line Items]  
Useful life 3 years
Office furniture and fixtures  
Property, Plant and Equipment [Line Items]  
Useful life 3 years
Tooling and equipment | Minimum  
Property, Plant and Equipment [Line Items]  
Useful life 3 years
Tooling and equipment | Maximum  
Property, Plant and Equipment [Line Items]  
Useful life 7 years
Capitalized software  
Property, Plant and Equipment [Line Items]  
Useful life 2 years
v3.22.4
Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Intangible Assets (Details)
 12 Months Ended
Dec. 31, 2022
Acquired technology | Minimum  
Finite-Lived Intangible Assets [Line Items]  
Intangible asset, useful life 3 years
Acquired technology | Maximum  
Finite-Lived Intangible Assets [Line Items]  
Intangible asset, useful life 10 years
Customer acquired intangible assets | Minimum  
Finite-Lived Intangible Assets [Line Items]  
Intangible asset, useful life 5 years
Customer acquired intangible assets | Maximum  
Finite-Lived Intangible Assets [Line Items]  
Intangible asset, useful life 6 years
v3.22.4
Business Combinations - Narrative (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Jul. 06, 2022
Jun. 08, 2021
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Business Acquisition [Line Items]          
Cash consideration, net of cash acquired     $ 46 $ 26 $ 0
Vested (in shares)     0    
Stock-based compensation expense     $ 228 142 $ 86
Sling, Inc          
Business Acquisition [Line Items]          
Voting interest acquired (as a percent) 100.00%        
Total purchase price $ 49        
Cash consideration, net of cash acquired 38        
Fair value of common stock issued 9        
Equity interests settled, deferred consideration $ 2        
Deferred cash payments, period following acquisition date 18 months        
Business combination, pre-acquisition tax-related contingencies, period following acquisition date 60 months        
Stock-based compensation expense     3    
Sling, Inc | Minimum          
Business Acquisition [Line Items]          
Award vesting period 1 year        
Sling, Inc | Maximum          
Business Acquisition [Line Items]          
Award vesting period 3 years        
Sling, Inc | Common Class A          
Business Acquisition [Line Items]          
Fair value of common stock issued $ 19        
Number of shares issued (in shares) 1,338,228        
Fair value of common shares issued (in dollars per share) $ 13.91        
xtraCHEF, Inc.          
Business Acquisition [Line Items]          
Voting interest acquired (as a percent)   100.00%      
Total purchase price     $ 48    
Cash consideration, net of cash acquired   $ 24      
Fair value of common stock issued   15      
Equity interests settled, deferred consideration   $ 48      
Number of shares issued (in shares)   569,400      
Fair value of common shares issued (in dollars per share)   $ 26.10      
Stock-based compensation expense       $ 2  
Cash acquired from acquisition   $ 1      
Equity interests settled in cash   3      
Equity interests settled, deferred consideration   1      
Equity interests settled   3      
Equity interests settled, consideration transferred for services   1      
Contingent consideration obligation, maximum payment amount   7      
Liability related to indemnity fund   $ 5      
v3.22.4
Business Combinations - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($)
$ in Millions
Jul. 06, 2022
Jun. 08, 2021
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Business Acquisition [Line Items]          
Goodwill     $ 107 $ 74 $ 36
Sling, Inc          
Business Acquisition [Line Items]          
Cash $ 1        
Goodwill 33        
Net working capital 1        
Deferred tax liability (5)        
Net assets acquired 49        
Sling, Inc | Developed Technology          
Business Acquisition [Line Items]          
Intangible assets: $ 17        
Finite lived intangibles acquired, weighted average useful life 5 years        
Sling, Inc | Customer Relationships          
Business Acquisition [Line Items]          
Intangible assets: $ 2        
Finite lived intangibles acquired, weighted average useful life 5 years        
xtraCHEF, Inc.          
Business Acquisition [Line Items]          
Goodwill     38    
Deferred tax liability     (3)    
Other     (1)    
Net assets acquired     48    
xtraCHEF, Inc. | Developed Technology          
Business Acquisition [Line Items]          
Intangible assets:     13    
Finite lived intangibles acquired, weighted average useful life   10 years      
xtraCHEF, Inc. | Customer Relationships          
Business Acquisition [Line Items]          
Intangible assets:     $ 1    
Finite lived intangibles acquired, weighted average useful life   6 years      
v3.22.4
Business Combinations - Schedule of Preliminary Aggregate Purchase Price (Details) - USD ($)
$ in Millions
 12 Months Ended
Jun. 08, 2021
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Business Acquisition [Line Items]        
Cash consideration, net of cash acquired   $ 46 $ 26 $ 0
Fair value of contingent consideration   $ 0 $ 2 $ 0
xtraCHEF, Inc.        
Business Acquisition [Line Items]        
Cash consideration, net of cash acquired $ 24      
Fair value of common stock issued 15      
Fair value of settled stock option awards 1      
Fair value of contingent consideration 2      
Liabilities settled on behalf of xtraCHEF 1      
Deferred payments for indemnity claims and working capital funds, net of adjustments 5      
Total purchase price $ 48      
v3.22.4
Fair Value of Financial Instruments - Schedule of Assets and Liabilities Measured on Recurring Basis (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Jun. 21, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants to purchase common stock $ 68 $ 181 $ 125
Fair Value, Recurring      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Total assets 957 507  
Warrants to purchase common stock 68 181  
Contingent consideration 4 5  
Total liabilities 72 186  
Fair Value, Recurring | Money market funds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 483 50  
Fair Value, Recurring | Commercial paper      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 140 134  
Fair Value, Recurring | Certificates of deposit      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 104 14  
Fair Value, Recurring | Corporate bonds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 109 193  
Fair Value, Recurring | U.S. government agency securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 33    
Fair Value, Recurring | Treasury securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 60 67  
Fair Value, Recurring | Asset-back securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 28 49  
Fair Value, Recurring | Level 1      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Total assets 483 50  
Warrants to purchase common stock 0 0  
Contingent consideration 0 0  
Total liabilities 0 0  
Fair Value, Recurring | Level 1 | Money market funds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 483 50  
Fair Value, Recurring | Level 1 | Commercial paper      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 1 | Certificates of deposit      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 1 | Corporate bonds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 1 | U.S. government agency securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0    
Fair Value, Recurring | Level 1 | Treasury securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 1 | Asset-back securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 2      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Total assets 474 457  
Warrants to purchase common stock 0 0  
Contingent consideration 0 0  
Total liabilities 0 0  
Fair Value, Recurring | Level 2 | Money market funds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 2 | Commercial paper      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 140 134  
Fair Value, Recurring | Level 2 | Certificates of deposit      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 104 14  
Fair Value, Recurring | Level 2 | Corporate bonds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 109 193  
Fair Value, Recurring | Level 2 | U.S. government agency securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 33    
Fair Value, Recurring | Level 2 | Treasury securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 60 67  
Fair Value, Recurring | Level 2 | Asset-back securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 28 49  
Fair Value, Recurring | Level 3      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Total assets 0 0  
Warrants to purchase common stock 68 181  
Contingent consideration 4 5  
Total liabilities 72 186  
Fair Value, Recurring | Level 3 | Money market funds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 3 | Commercial paper      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 3 | Certificates of deposit      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 3 | Corporate bonds      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 3 | U.S. government agency securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0    
Fair Value, Recurring | Level 3 | Treasury securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets 0 0  
Fair Value, Recurring | Level 3 | Asset-back securities      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Assets $ 0 $ 0  
v3.22.4
Fair Value of Financial Instruments - Weighted Average Assumptions (Details) - Level 3
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Risk-free interest rate | Common Stock Warrant Liability      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs 0.041 0.013  
Risk-free interest rate | Preferred Stock Warrants      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs   0.008 0.003
Contractual term (in years) | Common Stock Warrant Liability      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs 4 5  
Contractual term (in years) | Preferred Stock Warrants      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs   5  
Contractual term (in years) | Preferred Stock Warrants | Minimum      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs     5
Contractual term (in years) | Preferred Stock Warrants | Maximum      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs     7
Expected volatility | Common Stock Warrant Liability      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs 0.603 0.508  
Expected volatility | Preferred Stock Warrants      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs   0.54 0.60
Expected dividend yield | Common Stock Warrant Liability      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs 0 0  
Expected dividend yield | Preferred Stock Warrants      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs   0 0
Exercise price | Common Stock Warrant Liability      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs 17.16 17.15  
Exercise price | Preferred Stock Warrants      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Warrants, measurement inputs   0.74 0.74
v3.22.4
Fair Value of Financial Instruments - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Jun. 08, 2021
Jun. 30, 2020
Jun. 19, 2020
Contingent Consideration Liability (2)          
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]          
Change in fair value and other adjustments $ 3,000,000 $ 3,000,000      
Level 3 | xtraCHEF, Inc.          
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]          
Contingent consideration liability     $ 2,000,000    
Convertible Notes          
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]          
Debt issued       $ 200,000,000 $ 200,000,000
v3.22.4
Fair Value of Financial Instruments - Rollforward of Level 3 Inputs (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Feb. 28, 2023
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Other income (expense), net $ 1 $ 0 $ (1)  
Common Class B        
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Cash $ 2      
Shares issued (in shares) 37,179      
Common Class B | Subsequent Event        
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Cash       $ 2
Shares issued (in shares)       38,908
Warrants | Preferred Stock Warrants        
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Beginning balance $ 0 11    
Fair value at issuance   0    
Fair value on the acquisition date   0    
Change in fair value and other adjustments 0 38    
Settlement 0 (43)    
Conversion of preferred stock warrants into common stock warrants upon initial public offering   (6)    
Ending balance 0 0 11  
Other income (expense), net     8  
Warrants | Common Stock Warrant Liability        
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Beginning balance 181 0    
Fair value at issuance   125    
Fair value on the acquisition date   0    
Change in fair value and other adjustments (95) 59    
Settlement (18) (9)    
Conversion of preferred stock warrants into common stock warrants upon initial public offering   6    
Ending balance 68 181 0  
Derivative Liability        
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Beginning balance 0 37    
Fair value at issuance   0    
Fair value on the acquisition date   0    
Change in fair value and other adjustments 0 103    
Settlement 0 (140)    
Conversion of preferred stock warrants into common stock warrants upon initial public offering   0    
Ending balance 0 0 37  
Contingent Consideration Liability (2)        
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]        
Beginning balance 5 0    
Fair value at issuance   0    
Fair value on the acquisition date   2    
Change in fair value and other adjustments 3 3    
Settlement (4) 0    
Conversion of preferred stock warrants into common stock warrants upon initial public offering   0    
Ending balance $ 4 $ 5 $ 0  
v3.22.4
Marketable Securities - Schedule of Available-for-Sale Securities (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost $ 476 $ 458
Gross Unrealized Losses (2) (1)
Fair Value 474 457
Commercial paper    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 140 134
Gross Unrealized Losses 0 0
Fair Value 140 134
Certificates of deposit    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 104 14
Gross Unrealized Losses 0 0
Fair Value 104 14
Corporate bonds    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 110 194
Gross Unrealized Losses (1) (1)
Fair Value 109 193
U.S. government agency securities    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 33  
Gross Unrealized Losses 0  
Fair Value 33  
Treasury securities    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 61 67
Gross Unrealized Losses (1) 0
Fair Value 60 67
Asset-back securities    
Debt Securities, Available-for-sale [Line Items]    
Amortized Cost 28 49
Gross Unrealized Losses 0 0
Fair Value $ 28 $ 49
v3.22.4
Marketable Securities - Scheduled Maturities of Available-for-Sale Securities (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Investments, Debt and Equity Securities [Abstract]    
Due within 1 year $ 442  
Due after 1 year through 5 years 32  
Due after 5 years through 10 years 0  
Total marketable securities $ 474 $ 457
v3.22.4
Loan Servicing Activities and Acquired Loans Receivable, Net - Rollforward of Credit Losses (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Off-Balance Sheet, Credit Loss, Liability [Roll Forward]    
Beginning balance $ 2 $ 0
Credit loss expense 20 2
Reductions due to loan purchases (8) (1)
Ending balance 14 2
Cumulative adjustment for adoption new accounting standard    
Off-Balance Sheet, Credit Loss, Liability [Roll Forward]    
Beginning balance $ 0 1
Ending balance   $ 0
v3.22.4
Loan Servicing Activities and Acquired Loans Receivable, Net - Narrative (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Non-contingent stand-ready liability    
Guarantor Obligations [Line Items]    
Guarantee liability $ 6 $ 1
v3.22.4
Loan Servicing Activities and Acquired Loans Receivable, Net - Acquired Loans and Merchant Cash Advances Receivable (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Beginning balance $ (2)  
Ending balance (13) $ (2)
Acquired Loans and Merchant Cash Advances Receivable    
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Beginning balance 1 0
Expected recoveries 5 1
Reduction due to cash collections (4) (3)
Ending balance 2 1
Cumulative adjustment for adoption new accounting standard | Acquired Loans and Merchant Cash Advances Receivable    
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Beginning balance $ 0 (3)
Ending balance   $ 0
v3.22.4
Goodwill and Intangible Assets - Rollforward of Goodwill (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Goodwill [Roll Forward]    
Beginning balance $ 74 $ 36
Acquisitions 33 38
Ending balance $ 107 $ 74
v3.22.4
Goodwill and Intangible Assets - Schedule of Intangible Assets, Net (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]    
Gross carrying amount $ 44 $ 26
Accumulated amortization (15) (10)
Intangible assets, net 29 16
Technology Assets    
Finite-Lived Intangible Assets [Line Items]    
Gross carrying amount 38 22
Accumulated amortization (13) (8)
Intangible assets, net 25 14
Customer Assets    
Finite-Lived Intangible Assets [Line Items]    
Gross carrying amount 6 4
Accumulated amortization (2) (2)
Intangible assets, net $ 4 $ 2
v3.22.4
Goodwill and Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]    
2023 $ 6  
2024 6  
2025 5  
2026 5  
2027 3  
Thereafter 4  
Intangible assets, net $ 29 $ 16
v3.22.4
Lessee Arrangements - Schedule of Components of Lease Expense (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Leases [Abstract]    
Operating lease expense $ 21 $ 25
Variable lease expense 4 1
Total $ 25 $ 26
v3.22.4
Lessee Arrangements - Weighted Average Remaining Lease Term and Discount Rate (Details)
Dec. 31, 2022
Dec. 31, 2021
Leases [Abstract]    
Weighted-average remaining lease term (years) 6 years 4 months 24 days 6 years 10 months 24 days
Weighted-average discount rate (as a percent) 5.19% 2.62%
v3.22.4
Lessee Arrangements - Schedule of Maturities of Operating Lease Liabilities (Details)
$ in Millions
Dec. 31, 2022
USD ($)
Leases [Abstract]  
2023 $ 17
2024 18
2025 18
2026 17
2027 14
Thereafter 28
Total future minimum lease payments 112
Less: Imputed interest 18
Present value of future minimum lease payments $ 94
v3.22.4
Lessee Arrangements - Schedule of Supplemental Cash Flow Information (Details) - USD ($)
$ in Millions
 12 Months Ended
Jan. 01, 2021
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2021
Lessee, Lease, Description [Line Items]        
Operating cash flows for operating leases   $ 24   $ 25
Operating lease right of use assets obtained in exchange for new or modified lease obligations:   $ 14 $ 4 $ 99
Accounting Standards Update 2016-02        
Lessee, Lease, Description [Line Items]        
Operating lease right of use assets obtained in exchange for new or modified lease obligations: $ 95      
v3.22.4
Lessee Arrangements - Narrative (Details)
$ in Millions
 12 Months Ended
Dec. 31, 2020
USD ($)
lease_agreement
Leases [Abstract]  
Number of leases terminated | lease_agreement 2
Termination cost $ 3
Accelerated depreciation 16
Rent expense $ 28
v3.22.4
Debt (Details) - USD ($)
 12 Months Ended
Jun. 21, 2021
Jun. 08, 2021
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Jun. 30, 2020
Jun. 19, 2020
Debt Instrument [Line Items]              
Letters of credit     $ 8,000,000 $ 13,000,000      
Warrants issued (in shares) 8,113,585            
Warrants issued, exercise price (in dollars per share) $ 17.51            
Warrants to purchase common stock $ 125,000,000   68,000,000 181,000,000      
Change in fair value of warrant liability 141,000,000   (95,000,000) 97,000,000 $ 8,000,000    
Loss on debt extinguishment     0 50,000,000 0    
Change in fair value of derivative liability     $ 0 103,000,000 $ 7,000,000    
Convertible Notes              
Debt Instrument [Line Items]              
Debt issued           $ 200,000,000 $ 200,000,000
Interest rate (as a percent)             8.50%
Interest rate payable in cash (as a percent)             50.00%
Interest rate payable in kind (as a percent)             50.00%
Exit fee (as a percent)     15.00%        
Effective interest rate (as a percent)     13.33%        
Interest expense     $ 12,000,000 12,000,000      
Repayments of convertible notes 183,000,000            
Aggregate amount of convertible notes prepaid 249,000,000            
Aggregate settlement consideration $ 374,000,000            
Loss on debt extinguishment     50,000,000        
Revolving Credit Facility | 2021 Credit Facility | Line of Credit              
Debt Instrument [Line Items]              
Maximum borrowing capacity   $ 330,000,000          
Minimum liquidity amount   $ 250,000,000          
Long term debt, amount available     0 0      
Remaining borrowing capacity     $ 330,000,000 $ 330,000,000      
Revolving Credit Facility | 2021 Credit Facility | Line of Credit | London Interbank Offered Rate (LIBOR)              
Debt Instrument [Line Items]              
Basis spread on variable rate (as a percent)   1.50%          
Revolving Credit Facility | 2021 Credit Facility | Line of Credit | Prime Rate              
Debt Instrument [Line Items]              
Basis spread on variable rate (as a percent)   0.50%          
Revolving Credit Facility | 2021 Credit Facility | Line of Credit | Federal Reserve Bank of New York Rate              
Debt Instrument [Line Items]              
Basis spread on variable rate (as a percent)   0.50%          
Revolving Credit Facility | 2021 Credit Facility | Line of Credit | Adjusted LIBOR Rate              
Debt Instrument [Line Items]              
Basis spread on variable rate (as a percent)   1.00%          
v3.22.4
Other Balance Sheet Information - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]      
Cash held on behalf of customers $ 60 $ 34 $ 11
Prepaid expenses 27 25  
Deposits for inventory purchases 20 21  
Other current assets 48 12  
Prepaid expenses and other current assets $ 155 $ 92  
v3.22.4
Other Balance Sheet Information - Schedule of Property and Equipment, Net (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Property, Plant and Equipment [Line Items]    
Property and equipment, gross $ 109 $ 72
Less: Accumulated depreciation (48) (31)
Property and equipment, net 61 41
Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross 36 29
Capitalized software    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross 49 25
Computer equipment    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross 14 8
Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross 8 8
Tooling and equipment    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross $ 2 $ 2
v3.22.4
Other Balance Sheet Information - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]      
Depreciation expense $ 10 $ 9 $ 19
Capitalized software 24 8  
Capitalized software and development costs 25 10  
Capitalized software, depreciation $ 9 $ 8 $ 5
v3.22.4
Other Balance Sheet Information - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Accrued transaction-based costs $ 181 $ 120
Accrued payroll and bonus 59 24
Customer funds obligation 60 34
Accrued expenses 45 21
Accrued commissions 15 19
Contingent liability for expected credit losses 14 2
Other liabilities 39 26
Total accrued expenses and other current liabilities $ 413 $ 246
v3.22.4
Warrants to Purchase Common Stock (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Jun. 21, 2021
Dec. 31, 2022
Dec. 31, 2021
Class of Warrant or Right [Line Items]      
Warrants issued (in shares) 8,113,585    
Warrants issued, exercise price (in dollars per share) $ 17.51    
Warrant exercises, remeasurement gain   $ 89  
Warrant exercises, remeasurement loss   $ 62  
Common Class B      
Class of Warrant or Right [Line Items]      
Issuance of common stock upon net exercise of common stock warrants (in shares)   371,573 1,002,035
Warrant exercises, remeasurement gain   $ 6  
Warrant exercises, remeasurement loss     $ 19
Common Stock Warrant Liability      
Class of Warrant or Right [Line Items]      
Warrants issued, exercise price (in dollars per share) $ 17.51    
v3.22.4
Common Stock - Narrative (Details)
$ in Millions
 1 Months Ended 12 Months Ended
May 31, 2021
shares
Feb. 28, 2019
USD ($)
shares
Dec. 31, 2022
USD ($)
shares
Dec. 31, 2021
USD ($)
installment
shares
Dec. 31, 2020
USD ($)
shares
Class of Stock [Line Items]          
Common stock reserved for issuance (in shares)     167,967,549 152,739,577  
Stock-based compensation expense | $     $ 228 $ 142 $ 86
Stock issued (in shares)       4,133,955  
Issuance of common stock upon exercise of common stock options (in shares)   15,057,340 7,633,661    
Issuance of common stock in connection with initial public offering, net of offering costs | $       $ 944  
Director          
Class of Stock [Line Items]          
Promissory notes | $   $ 23      
Issuance of common stock in connection with initial public offering, net of offering costs, underwriting discounts and commissions (in shares) 8,045,300        
Unrecognized stock-based compensation expense related to options | $     $ 9    
Director | Accumulated Deficit          
Class of Stock [Line Items]          
Issuance of common stock in connection with initial public offering, net of offering costs | $     $ 14    
Unvested restricted stock          
Class of Stock [Line Items]          
Stock issued (in shares)     2,703,538 4,133,955 1,096,800
Unrecognized stock-based compensation expense | $     $ 2 $ 6  
Pledge 1%          
Class of Stock [Line Items]          
Annual pledged percentage of maximum (as a percent)     1.00%    
Stock-based compensation expense | $     $ 10 $ 19  
Common Class A          
Class of Stock [Line Items]          
Common stock reserved for issuance (in shares)     16,709,893    
Common Class A | Pledge 1%          
Class of Stock [Line Items]          
Shares reserved for issuance, issuance period       10 years  
Number of annual installments | installment       10  
Shares transferred to independent donor     546,889 546,889  
Common Class A | Pledge 1% | Maximum          
Class of Stock [Line Items]          
Common stock reserved for issuance (in shares)       5,468,890  
Common Class B          
Class of Stock [Line Items]          
Stock issued (in shares)     1,365,310    
v3.22.4
Common Stock - Schedule of Restricted Stock Units (Details) - shares
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]    
Beginning balance (in shares) 4,133,955  
Ending balance (in shares)   4,133,955
Unvested restricted stock    
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]    
Beginning balance (in shares) 4,133,955 1,096,800
Exercise of stock options (in shares) 1,338,228 412,810
Exercise of stock options in connection with promissory notes repayment (in shares) 27,305 14,267,650
Repurchases (in shares) (33,475) (35,665)
Vested (in shares) (2,762,475) (11,607,640)
Ending balance (in shares) 2,703,538 4,133,955
v3.22.4
Common Stock - Schedule of Class A and Class B Common Shares Reserved For Issuance (Details) - shares
Dec. 31, 2022
Dec. 31, 2021
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 167,967,549 152,739,577
Options to purchase Class A common stock, Class B common stock and common stock    
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 53,728,512 58,917,018
Unvested restricted stock units    
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 31,242,263 15,384,809
Warrants to purchase Class B common stock and common stock and preferred stock (as if converted to warrants to purchase common stock) | Common Class B    
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 6,902,633 7,961,455
Shares available for future grant under the Stock Plans    
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 55,009,136 53,916,105
Charitable Donation Shares    
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 4,375,112 4,922,001
Deferred Compensation, Share-Based Payments    
Class of Stock [Line Items]    
Common stock reserved for issuance (in shares) 16,709,893 11,638,189
v3.22.4
Revenue from Contracts with Customers - Summary of Activity of Deferred Revenue (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Revenue from Contract with Customer [Abstract]      
Deferred revenue $ 46 $ 56 $ 59
Revenue recognized in the period from amounts included in deferred revenue at the beginning of period $ 51 $ 43  
v3.22.4
Revenue from Contracts with Customers - Narrative (Details)
$ in Millions
Dec. 31, 2022
USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]  
Remaining performance obligation, amount $ 480
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]  
Remaining performance obligation, amount $ 462
Remaining performance obligation, period 24 months
v3.22.4
Revenue from Contracts with Customers - Summary of Capitalized Costs (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Increase (Decrease) in Capitalized Contract Costs [Roll Forward]    
Beginning balance $ 55 $ 29
Capitalization of sales commissions costs 71 56
Amortization of sales commissions costs (44) (30)
Ending balance 82 55
Capitalized Contract Cost, Net, Classified [Abstract]    
Deferred costs, net 44 30
Deferred costs, non-current 38 25
Total capitalized sales commissions costs $ 82 $ 55
v3.22.4
Stock-Based Compensation Expense - Narrative (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares) 167,967,549 152,739,577  
Stock-based compensation included in capitalized software $ 7 $ 1 $ 0
Unexercised options vested (in shares) 25,983,807 29,934,775  
Unexercised options vested, intrinsic value $ 855 $ 438  
Non-vested options (in shares) 37,106,955 23,793,737  
Aggregate intrinsic value of options exercised $ 134 $ 162 38
Fair value of options vested $ 82 $ 36 $ 23
Options to purchase Class A common stock, Class B common stock and common stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares) 53,728,512 58,917,018  
Contractual life 10 years    
Expected period for recognition 3 years 1 month 6 days    
Unrecognized stock-based compensation expense $ 97    
Weighted average fair value per share of options granted (in dollars per share) $ 8.94 $ 10.12 $ 1.95
Unvested restricted stock units      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares) 31,242,263 15,384,809  
Requisite service period (in years) 4 years    
Expected period for recognition 3 years 3 months 21 days    
Weighted average fair value per share of options granted (in dollars per share) $ 29.80 $ 2.21  
Restricted stock issued (in shares) 5,962,878    
Fair value of RUSs vested $ 108 $ 1 $ 0
Unrecognized stock-based compensation expense related to options $ 479    
Performance Shares | Secondary Investors      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Equity interests settled (in shares) 975,057 9,498,100  
Incremental stock-based compensation expense $ 46 $ 53  
Performance Shares | Third Parties      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Equity interests settled (in shares)   3,281,510  
Incremental stock-based compensation expense   $ 17  
Aggregate purchase price   $ 49  
Minimum | Options to purchase Class A common stock, Class B common stock and common stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Requisite service period (in years) 4 years    
Maximum | Options to purchase Class A common stock, Class B common stock and common stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Requisite service period (in years) 5 years    
Common Class A      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares) 16,709,893    
Purchase shares of Class A common stock 85.00%    
The 2021 Stock Option and Incentive Plan      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Increase in number of shares reserved and available for issuance (as a percent)   5.00%  
The 2021 Stock Option and Incentive Plan | Common Class A      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares)   58,190,945  
The 2014 Stock Incentive Plan | Common Class B      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares)     167,777,810
The 2021 Employee Stock Purchase Plan | Common Class A      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock reserved for issuance (in shares)   11,638,189  
Stock reserved for future issuance, percentage of issued and outstanding stock (as a percent)   1.00%  
v3.22.4
Stock-Based Compensation Expense - Schedule of Stock-based Compensation (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock-based compensation expense $ 228 $ 142 $ 86
Costs of revenue      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock-based compensation expense 33 12 7
Sales and marketing      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock-based compensation expense 50 24 16
Research and development      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock-based compensation expense 72 48 30
General and administrative      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock-based compensation expense $ 73 $ 58 $ 33
v3.22.4
Stock-Based Compensation Expense - Schedule of Weighted Average Assumptions (Details) - Option - $ / shares
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Risk-free interest rate (as a percent) 2.42% 1.00% 0.49%
Expected term (in years) 6 years 25 days 6 years 3 months 25 days 6 years 7 months 20 days
Expected volatility (as a percent) 52.00% 65.00% 63.00%
Expected dividend yield (as a percent) 0.00% 0.00% 0.00%
Weighted-average fair value of common stock (in dollars per share) $ 17.24 $ 17.00 $ 3.23
Weighted average fair value per share of options granted (in dollars per share) $ 8.94 $ 10.12 $ 1.95
v3.22.4
Stock-Based Compensation Expense - Summary of Stock Option Activity (Details) - USD ($)
$ / shares in Units, $ in Millions
 1 Months Ended 12 Months Ended
Feb. 28, 2019
Dec. 31, 2022
Dec. 31, 2021
Number of Shares      
Beginning balance (in shares)   58,917,018  
Granted (in shares)   6,311,680  
Exercised (in shares) (15,057,340) (7,633,661)  
Forfeited (in shares)   (3,866,525)  
Ending balance (in shares)     58,917,018
Options vested and expected to vest (in shares)   50,866,098  
Options exercisable (in shares)   48,402,325  
Weighted Average Exercise Price      
Beginning balance (in dollars per share)   $ 4.53  
Granted (in dollars per share)   17.24  
Exercised (in dollars per share)   1.93  
Forfeited (in dollars per share)   10.21  
Ending balance (in dollars per share)   5.98 $ 4.53
Options vested and expected to vest, Weighted average exercise price (in dollars per share)   5.70  
Options exercisable, Weighted average exercise price per share (in dollars per share)   $ 4.63  
Weighted Average Remaining Contractual Term      
Options outstanding   6 years 11 months 8 days 7 years 7 months 24 days
Options vested and expected to vest   6 years 10 months 13 days  
Options exercisable   6 years 8 months 1 day  
Aggregate Intrinsic Value      
Options outstanding   $ 655 $ 1,778
Options vested and expected to vest   634  
Options exercisable   $ 649  
v3.22.4
Stock-Based Compensation Expense - Summary of RSU Activity (Details) - Unvested restricted stock units
 12 Months Ended
Dec. 31, 2022
$ / shares
shares
RSU  
Beginning balance (in shares) | shares 15,384,809
Granted (in shares) | shares 24,272,078
Vested (in shares) | shares (5,981,213)
Forfeited (in shares) | shares (2,433,411)
Ending balance (in shares) | shares 31,242,263
Weighted Average Grant Date Fair Value  
Beginning balance (in dollars per share) | $ / shares $ 29.71
Granted (in dollars per share) | $ / shares 18.40
Vested (in dollars per share) | $ / shares 25.14
Forfeited (in dollars per share) | $ / shares 25.63
Ending balance (in dollars per share) | $ / shares $ 22.11
v3.22.4
Income Taxes - Components of Loss Before Income Taxes (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Tax Disclosure [Abstract]      
United States $ (286) $ (493) $ (249)
Foreign 9 3 1
Loss before benefit from income taxes $ (277) $ (490) $ (248)
v3.22.4
Income Taxes - Schedule of Components of Income Tax Benefit (Expense) (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Tax Disclosure [Abstract]      
Current state $ 1 $ 0 $ 0
Current foreign 2 0 0
Current tax expense 3 0 0
Deferred federal (4) (2) 0
Deferred state (1) (1) 0
Deferred tax benefit (5) (3) 0
Total income tax (benefit) expense $ (2) $ (3) $ 0
v3.22.4
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Deferred tax assets:    
Net operating loss carryforwards $ 160 $ 150
Stock-based compensation expense 34 19
Credit carryforward 42 24
Accrued expenses and reserves 28 13
Charitable contributions 8 5
Deferred revenue 2 7
Depreciation 1 2
Capitalized R&D 57 0
Inventory reserve 2 1
Lease liability 23 25
Total deferred tax assets 357 246
Valuation allowance (310) (206)
Net deferred tax assets 47 40
Deferred tax liabilities:    
Amortization (8) (4)
Other 0 (2)
Capitalized contract acquisition costs (21) (14)
Right-of-use asset (18) (20)
Total deferred tax liabilities (47) (40)
Net deferred tax asset (liability) $ 0 $ 0
v3.22.4
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Tax Disclosure [Abstract]      
Tax provision at statutory rate 21.00% 21.00% 21.00%
State tax—net of federal 7.80% 1.20% 5.40%
Permanent items - Other (1.50%) (0.60%) (0.80%)
Warrants 7.30% (4.20%) 0.00%
Convertible debt extinguishment 0.00% (1.50%) 0.00%
Research and development credits 4.60% 1.00% 1.60%
Stock-based compensation expense (1.00%) (0.80%) (4.00%)
Derivative liability 0.00% (5.60%) (1.30%)
Other, net 0.00% 0.00% 0.30%
Change in valuation allowance (37.50%) (10.00%) (22.30%)
Effective Tax Rate 0.60% 0.50% (0.10%)
v3.22.4
Income Taxes - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Tax Credit Carryforward [Line Items]      
Benefit from income taxes $ 2,000,000 $ 3,000,000 $ 0
Release of portion of valuation allowance 5,000,000    
Increase in valuation allowance 104,000,000 52,000,000 50,000,000
Unrecognized tax benefits that would impact effective tax rate 0 $ 0 $ 0
Indefinite Carryforward Period      
Tax Credit Carryforward [Line Items]      
Operating loss carryforwards 93,000,000    
Tax Period 2034      
Tax Credit Carryforward [Line Items]      
Operating loss carryforwards 480,000,000    
Federal Tax Authority      
Tax Credit Carryforward [Line Items]      
Operating loss carryforwards 597,000,000    
Tax credit carryforwards 29,000,000    
Federal Tax Authority | Indefinite Carryforward Period      
Tax Credit Carryforward [Line Items]      
Operating loss carryforwards 513,000,000    
Federal Tax Authority | Tax Year 2037      
Tax Credit Carryforward [Line Items]      
Operating loss carryforwards 85,000,000    
State and Local Jurisdiction      
Tax Credit Carryforward [Line Items]      
Operating loss carryforwards 573,000,000    
Tax credit carryforwards $ 17,000,000    
v3.22.4
Loss Per Share - Schedule of Net Loss Per Share (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Numerator:      
Net loss $ (275) $ (487) $ (248)
Redemption of Series B Preferred Stock 0 0 (1)
Net loss attributable to common stockholders- basic (275) (487) (249)
Gain on change in fair value of warrant liability 95 0 0
Net loss attributable to common stockholders- diluted $ (370) $ (487) $ (249)
Denominator:      
Weighted average shares of common stock outstanding - basic (in shares) 511,754,986 289,584,001 199,982,965
Effect of dilutive securities:      
Warrants to purchase Class B common stock (in shares) 488,120 0 0
Weighted average shares of common stock outstanding - diluted (in shares) 512,243,106 289,584,001 199,982,965
Net loss per share attributable to common stockholders - basic (in dollars per share) $ (0.54) $ (1.68) $ (1.25)
Net loss per share attributable to common stockholders - diluted (in dollars per share) $ (0.72) $ (1.68) $ (1.25)
v3.22.4
Loss Per Share - Schedule of Antidilutive Shares (Details) - shares
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 87,843,761 86,397,237 328,233,730
Options to purchase Class A common stock, Class B common stock and common stock      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 53,728,512 58,917,018 58,035,220
Unvested restricted stock      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 2,703,538 4,133,955 1,096,800
Unvested restricted stock units      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 31,242,263 15,384,809 0
Shares issued for exercise of non-recourse notes      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 0 0 14,267,650
Convertible preferred stock (as converted to common stock)      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 0 0 253,832,025
Warrants to purchase Class B common stock and common stock and preferred stock (as if converted to warrants to purchase common stock)      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 0 7,961,455 1,002,035
Employee Stock Purchase Plan      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Antidilutive shares excluded from computation of earnings per share (in shares) 169,448
v3.22.4
Segment Information (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Segment Reporting Information [Line Items]    
Total long-lived assets $ 138 $ 120
United States    
Segment Reporting Information [Line Items]    
Total long-lived assets 122 119
Ireland    
Segment Reporting Information [Line Items]    
Total long-lived assets 10 1
India    
Segment Reporting Information [Line Items]    
Total long-lived assets 5 0
Other    
Segment Reporting Information [Line Items]    
Total long-lived assets $ 1 $ 0
v3.22.4
Commitment and Contingencies (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]    
Non-cancelable purchase obligations $ 231 $ 315
2023 196  
Thereafter 35  
Letters of credit $ 8 $ 13
v3.22.4
Retirement Plan (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Retirement Benefits [Abstract]      
Defined contribution plan cost $ 14 $ 6 $ 2