View Filing Data

Cost of revenue, excluding depreciation and amortization:

^[1]

$ 154,941

$ 112,574

$ 73,081

Total cost of revenue, excluding depreciation and amortization

^[1]

75,345

59,852

43,642

Operating expenses:

^[1]

47,284

44,123

25,920

^[1]

46,252

38,592

28,470

^[1]

31,713

22,690

14,697

Loss on extinguishment of debt

^[1]

9,212

7,412

5,892

Total operating expenses

^[1]

134,461

112,817

74,979

Loss from operations

(54,865)

(60,095)

(45,540)

(1,670)

Interest and other expense, net

(3,419)

(2,024)

(1,469)

Loss before income taxes

(59,954)

(62,119)

(47,009)

Income tax provision (benefit)

142

(135)

Net loss

(60,096)

(61,984)

(47,035)

Less: accretion of redeemable convertible preferred stock

180,826

52,037

11,745

Net loss attributable to common stockholders

$ (240,922)

$ (114,021)

$ (58,780)

Net loss per share attributable to common stockholders, basic and diluted (in USD per share)

$ (12.86)

$ (23.76)

$ (12.13)

Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted

18,741,119

4,798,363

4,846,511

Technology

Revenue:

Cost of revenue, excluding depreciation and amortization:

^[1]

$ 83,975

$ 57,224

$ 31,693

Total cost of revenue, excluding depreciation and amortization

^[1]

27,797

19,429

11,610

Professional services

Revenue:

Cost of revenue, excluding depreciation and amortization:

^[1]

70,966

55,350

41,388

Total cost of revenue, excluding depreciation and amortization

^[1]

$ 47,548

$ 40,423

$ 32,032

[1]	Includes amounts attributable to related party transactions. See Note 18 for further details.

Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Statement of Comprehensive Income [Abstract]
Net Loss	$ (60,096)	$ (61,984)	$ (47,035)
Other comprehensive gain (loss):
Change in unrealized gain (loss) on investments	75	11	17
Change in foreign currency translation adjustment	(2)	0	0
Comprehensive loss	$ (60,023)	$ (61,973)	$ (47,018)

- Definition

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

+ References + Details

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	Common Stock	Common stock warrants	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	IPO	IPO Common Stock	IPO Additional Paid-In Capital
Redeemable convertible preferred stock, beginning balance (in shares) at Dec. 31, 2016	19,985,139
Redeemable convertible preferred stock, beginning balance at Dec. 31, 2016	$ 286,037
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of Series E redeemable convertible preferred stock, net of issuance costs of $13 (in shares)	1,124,632
Issuance of Series E redeemable convertible preferred stock, net of issuance costs of $13	$ 23,787
Accretion of redeemable convertible preferred stock	$ 11,745			$ (5,695)	$ 6,050
Redeemable convertible preferred stock, ending balance (in shares) at Dec. 31, 2017	21,109,771
Redeemable convertible preferred stock, ending balance at Dec. 31, 2017	$ 321,569
Common stock, beginning balance (in shares) at Dec. 31, 2016		4,840,810
Stockholders' equity (deficit), beginning balance at Dec. 31, 2016	(206,407)	$ 5		0	(206,383)	$ (29)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options (in shares)		13,031
Exercise of stock options	76			76
Stock-based compensation	4,223			4,223
Common stock warrants			$ 1,396
Net Loss	(47,035)				(47,035)
Other comprehensive gain	17					17
Common stock, ending balance (in shares) at Dec. 31, 2017		4,853,841
Stockholders' equity (deficit), ending balance at Dec. 31, 2017	$ (259,475)	$ 5		0	(259,468)	(12)
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of Series E redeemable convertible preferred stock, net of issuance costs of $13 (in shares)	1,603,923
Issuance of Series E redeemable convertible preferred stock, net of issuance costs of $13	$ 36,239
Accretion of redeemable convertible preferred stock	$ 52,037			1,283	53,320
Redeemable convertible preferred stock, ending balance (in shares) at Dec. 31, 2018	22,713,694
Redeemable convertible preferred stock, ending balance at Dec. 31, 2018	$ 409,845
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchase of common stock (in shares)		(798,372)
Repurchase of common stock	$ (8,712)	$ (1)		(8,711)
Exercise of stock options (in shares)	723,902	723,887
Exercise of stock options	$ 3,045	$ 1		3,044
Stock-based compensation	4,198			4,198
Common stock warrants			$ 186
Net Loss	(61,984)				(61,984)
Other comprehensive gain	11					11
Common stock, ending balance (in shares) at Dec. 31, 2018		4,779,356
Stockholders' equity (deficit), ending balance at Dec. 31, 2018	$ (374,768)	$ 5		0	(374,772)	(1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options (in shares)	373,292
Common stock, ending balance (in shares) at Mar. 31, 2019	36,731,632
Redeemable convertible preferred stock, beginning balance (in shares) at Dec. 31, 2018	22,713,694
Redeemable convertible preferred stock, beginning balance at Dec. 31, 2018	$ 409,845
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of Series E redeemable convertible preferred stock, net of issuance costs of $13 (in shares)	437,787
Issuance of Series E redeemable convertible preferred stock, net of issuance costs of $13	$ 12,073
Accretion of redeemable convertible preferred stock	$ 180,826			5,180	175,646
Redeemable convertible preferred stock, ending balance (in shares) at Dec. 31, 2019	0
Redeemable convertible preferred stock, ending balance at Dec. 31, 2019	$ 0
Common stock, beginning balance (in shares) at Dec. 31, 2018		4,779,356
Stockholders' equity (deficit), beginning balance at Dec. 31, 2018	(374,768)	$ 5		0	(374,772)	(1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of new stock (in shares)		189,959						8,050,000
Issuance of new stock							$ 190,039	$ 8	$ 190,031
Exercise of stock options (in shares)		373,292
Exercise of stock options	2,656	$ 1		2,655
Stock-based compensation	17,844			17,844
Issuance of common stock under employee stock purchase plan (in shares)		134,766
Issuance of common stock under employee stock purchase plan	$ 2,978			2,978
Conversion of Stock, Shares Converted	(23,151,481)	(23,151,481)
Conversion of Stock, Amount Converted	$ (602,744)	$ (23)		(602,721)
Net Loss	(60,096)				(60,096)
Other comprehensive gain	73					73
Common stock, ending balance (in shares) at Dec. 31, 2019		36,678,854
Stockholders' equity (deficit), ending balance at Dec. 31, 2019	$ 200,644	$ 37		$ 811,049	$ (610,514)	$ 72

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Issuance costs	$ 4,610	$ 0	$ 0
Shares of redeemable convertible preferred stock
Issuance costs	$ 115	$ 13	$ 53

Consolidated Statements of Cash Flows - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

Cash flows from operating activities

Net loss

$ (60,096)

$ (61,984)

$ (47,035)

Adjustments to reconcile net loss to net cash used in operating activities:

Loss on extinguishment of debt

^[1]

9,212

7,412

5,892

1,670

Amortization of debt discount and issuance costs

1,081

533

153

Investment discount and premium (accretion) amortization

(615)

(143)

Change in fair value of warrant liability

(34)

Gain on sale of property and equipment

(39)

(29)

(47)

Stock-based compensation expense

17,844

4,198

4,241

Deferred tax provision (benefit)

(163)

Other

(15)

Change in operating assets and liabilities:

Accounts receivable

127

(3,627)

4,442

Deferred costs

(288)

113

461

Prepaid expenses and other assets

(1,308)

(1,334)

(815)

Operating lease right-of-use assets

2,557

(3,942)

1,650

Accounts payable, accrued liabilities, and other liabilities

(86)

4,588

(6,289)

Deferred revenue

10,317

2,126

Operating lease liabilities

(2,345)

3,799

(1,741)

Net cash used in operating activities

(32,184)

(40,296)

(36,829)

Cash flows from investing activities

Purchases of property and equipment

(2,399)

(2,275)

(2,466)

Proceeds from the sale of property and equipment

Purchase of short-term investments

(256,007)

(13,993)

(46,422)

Proceeds from the sale and maturity of short-term investments

50,677

37,870

72,127

Purchase of intangible assets

(1,935)

(228)

(878)

Net cash (used in) provided by investing activities

(209,602)

21,403

22,408

Cash flows from financing activities

Proceeds from initial public offering, net of underwriters' discounts and commissions

194,649

Proceeds from the issuance of redeemable convertible preferred stock, net of issuance costs

12,073

33,987

23,787

Proceeds from exercise of stock options

2,656

3,045

Proceeds from employee stock purchase plan

2,978

Repurchase of common stock

(8,712)

Payment of SVB line of credit and mezzanine loan

(21,821)

Proceeds from credit facilities, net of debt issuance costs

47,169

9,950

9,787

Payments of acquisition-related consideration

(1,713)

(13,924)

(8,779)

Payments of deferred offering costs

(4,610)

Net cash provided by financing activities

231,381

24,346

24,871

Effect of exchange rate changes on cash and cash equivalents

Net (decrease) increase in cash and cash equivalents

(10,399)

5,453

10,450

Cash and cash equivalents at beginning of period

28,431

22,978

12,528

Cash and cash equivalents at end of period

18,032

28,431

22,978

Supplemental disclosures of cash flow information

Cash paid for income taxes

Cash paid for interest

5,557

3,937

1,032

Supplemental disclosures of non-cash investing and financing information

Redeemable convertible preferred stock accretion

180,826

52,037

11,745

Deferred offering costs included in accounts payable and accrued liabilities

100

Series E redeemable convertible preferred stock allocated to business combination

2,252

Purchase of intangible assets included in accounts payable and accrued liabilities

1,626

675

Purchase of property and equipment included in accounts payable and accrued liabilities

209

Supplemental disclosures of cash flow information related to leases

Cash paid for operating lease liabilities in operating cash flows

3,248

3,146

1,891

Operating lease right-of-use assets obtained in exchange for operating lease obligations

$ 581

$ 6,641

$ 0

[1]	Includes amounts attributable to related party transactions. See Note 18 for further details.

Description of Business and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Description of Business and Summary of Significant Accounting Policies

Nature of operations

Health Catalyst, Inc. (Health Catalyst) was incorporated under the laws of Delaware in September 2011. We are a leading provider of data and analytics technology and services to healthcare organizations. Our Solution comprises a cloud-based data platform, analytics software, and professional services expertise. Our customers, which are primarily healthcare providers, use our Solution to manage their data, derive analytical insights to operate their organizations, and produce measurable clinical, financial, and operational improvements.

Basis of presentation

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP). We have reclassified certain prior period amounts to conform to the current period presentation.

Initial Public Offering

On July 29, 2019, we closed our initial public offering of common stock (IPO) in which we issued and sold 8,050,000 shares (inclusive of the underwriters' over-allotment option to purchase 1,050,000 shares) of common stock at $26.00 per share. We received net proceeds of $194.6 million after deducting underwriting discounts and commissions and before deducting offering costs of $4.6 million. Upon the closing of our IPO, all shares of our outstanding redeemable convertible preferred stock converted into 23,151,481 shares of common stock on a one-for-one basis.

Stock Split

On July 10, 2019, we effected a 1-for-2 reverse stock split of our capital stock. We have adjusted all references to share and per share amounts in the accompanying consolidated financial statements and notes to reflect the reverse stock split.

Principles of consolidation

The consolidated financial statements include the accounts of Health Catalyst and its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated.

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates, including those related to revenue recognition, provisions for doubtful accounts, useful lives of property and equipment, capitalization and estimated useful life of internal-use software and other intangible assets, fair value of financial instruments, deferred tax assets, redeemable convertible preferred stock accretion, stock-based compensation, and tax uncertainties. Actual results could differ from those estimates.

Segment reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision maker (the CODM) in assessing performance and making decisions regarding resource allocation. We operate our business in two operating segments that also represent our reportable segments. Our segments are (1) technology and (2) professional services.

The CODM, the Chief Executive Officer, uses Adjusted Gross Profit (defined as revenue less cost of revenue that excludes depreciation, amortization, stock-based compensation expense, and certain other operating expenses) as the measure of our profit.

Net loss per share

Basic net loss per share is calculated by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding. Net loss attributable to common stockholders is computed as net loss less accretion of redeemable convertible preferred stock. Diluted net loss per share attributable to common stockholders is calculated by giving effect to all potentially dilutive common stock equivalents outstanding for the period. For purposes of this calculation, stock options, restricted stock units (RSUs), purchase rights committed under the employee stock purchase plan, and warrants to purchase common stock are considered to be common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as the effect is antidilutive.

Prior to our IPO, we computed basic and diluted net loss per share in conformity with the two-class method required for participating securities. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to holders of common stock. Redeemable convertible preferred stock and common stock were considered participating securities for purposes of this calculation. However, the two-class method did not impact the net loss per common share attributable to common stockholders as we were in a loss position for each of the periods presented and the redeemable convertible preferred stockholders did not have a contractual obligation to participate in losses.

Revenue recognition

We recognize revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606). We derive our revenues primarily from technology subscriptions and professional services. We determine revenue recognition by applying the following steps:


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


•	Identification of the performance obligations in the contract;


•	Determination of the transaction price;


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


•	Recognition of revenue when, or as, we satisfy the performance obligation.

We recognize revenue net of any taxes collected from customers and subsequently remitted to governmental authorities.

Technology revenue

Technology revenue primarily consists of subscription fees charged to customers for access to use our technology. We provide customers access to our technology through either an all-access or limited-access, modular subscription. The majority of our subscription arrangements are cloud-based and do not provide customers the right to take possession of the technology or contain a significant penalty if the customer were to take possession of the technology. Revenue from cloud-based subscriptions is recognized ratably over the contract term beginning on the date that the service is made available to the customer. Most of our subscription contracts have up to a three-year term, of which the vast majority are terminable after one year upon 90 days' notice.

Subscriptions that allow the customer to take software on-premise without significant penalty are treated as time-based licenses. These arrangements generally include access to technology, access to unspecified future products and maintenance and support. Revenue for upfront access to our technology library is recognized at a point in time when the technology is made available to the customer. Revenue for access to unspecified future products included in time-based license subscriptions is recognized ratably over the contract term beginning on the date that the access is made available to the customer.

We also have certain perpetual license arrangements. Revenue from these arrangements is recognized at a point in time upon delivery of the software.

Technology revenue also includes maintenance and support revenue which generally includes bug fixes, updates, and support services. Revenue related to maintenance and support is recognized over the contract term beginning on the date that the service is made available to the customer.

Professional services revenue

Professional services revenue primarily includes data and analytics services, domain expertise services, outsourcing services, and implementation services. Professional services arrangements typically include a fee for making full-time equivalent (FTE) services available to our customers on a monthly basis. FTE services generally consist of a blend of analytic engineers, analysts, and data scientists based on the domain expertise needed to best serve our customers. Professional services are typically considered distinct from the technology offerings and revenue is generally recognized as the service is provided using the “right to invoice” practical expedient.

Contracts with multiple performance obligations

Many of our contracts include multiple performance obligations. We account for performance obligations separately if they are capable of being distinct within the context of the contract. In these circumstances, the transaction price is allocated to separate performance obligations on a relative standalone selling price basis.

We determine standalone selling prices based on the observable price a good or service is sold for separately when available. In cases where standalone selling prices are not directly observable, based on information available, we utilize the expected cost plus a margin, adjusted market assessment, or residual estimation method. We consider all information available including our overall pricing objectives, market conditions, and other factors, which may include customer demographics and the types of users.

Standalone selling prices are not directly observable for our all-access and limited-access technology arrangements, which are composed of cloud-based subscriptions, time-based licenses, and perpetual licenses. For these technology arrangements, we use the residual estimation method due to a limited number of standalone transactions and/or prices that are highly variable.

Variable consideration

We have also entered into at-risk and shared savings arrangements with certain customers whereby we receive variable consideration based on the achievement of measurable improvements which may include cost savings or performance against metrics. For these arrangements, we estimate revenue using the most likely amount that we will receive. Estimates are based on our historical experience and best judgment at the time to the extent it is probable that a significant reversal of revenue recognized will not occur. Due to the nature of our arrangements, certain estimates may be constrained until the uncertainty is further resolved.

Contract balances

Contract assets resulting from services performed prior to invoicing customers are recorded as unbilled accounts receivable and are presented on the consolidated balance sheets in aggregate with accounts receivable. Unbilled accounts receivable generally become billable at contractually specified dates or upon the attainment of contractually defined milestones. As of December 31, 2019, 2018, and 2017, the unbilled accounts receivable included in accounts receivable on our consolidated balance sheets was $2.9 million, $3.4 million and $2.8 million, respectively.

We record contract liabilities as deferred revenue when cash payments are received or due in advance of performance. Deferred revenue primarily relates to the advance consideration received from the customer. As of December 31, 2019, 2018, and 2017, the total of current and non-current deferred revenue on our consolidated balance sheets was $32.1 million, $32.0 million, and $10.7 million, respectively.

Cost of revenue, excluding depreciation and amortization

Cost of technology revenue primarily consists of costs associated with hosting and supporting our technology, including third-party cloud computing and hosting costs, contractor costs, and salary and related personnel costs for our cloud services and support teams. Cost of professional services revenue primarily consists of salary and related personnel costs, travel-related costs, and independent contractor costs. Cost of revenue excludes costs related to depreciation and amortization.

We defer certain costs to fulfill a contract when the costs are expected to be recovered, are directly related to in-process contracts and enhance resources that will be used in satisfying performance obligations in the future. These deferred fulfillment costs primarily consist of employee compensation incurred as part of the implementation of new contracts. As of December 31, 2019 and 2018, we had deferred contract fulfillment costs of $0.9 million and $0.6 million, respectively.

Cash and cash equivalents

We consider all highly liquid investments purchased with a remaining maturity of three months or less at the time of acquisition to be cash equivalents.

Short-term investments

Our investment policy limits investments to highly-rated instruments that mature in less than 12 months. We classify our short-term investments as available for sale.

Accounts receivable

Accounts receivable are non-interest bearing and are recorded at the original invoiced amount less an allowance for doubtful accounts based on the probability of future collections. When we become aware of circumstances that may decrease the likelihood of collections, we record a specific allowance against amounts due, which reduces the receivable amount to the amount reasonably believed to be collected. For all other customers, we determine and periodically adjust the allowance based on historical loss patterns and current receivables aging. As of December 31, 2019 and 2018, we had an allowance for doubtful accounts of $0.4 million and $0.5 million, respectively.

Property and equipment

Property and equipment are stated at historical cost less accumulated depreciation. Repairs and maintenance costs that do not extend the useful life or improve the related assets are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful life of each asset category is as follows:



Computer equipment	2-3 years
Furniture and fixtures	3 years
Leasehold improvements	Lesser of lease term or estimated useful life
Computer software	2-3 years
Capitalized internal-use software costs	3 years

When there are indicators of potential impairment, we evaluate the recoverability of the carrying values by comparing the carrying amount of the applicable asset group to the estimated undiscounted future cash flows expected to be generated by the asset group over the remaining useful life of the primary asset in the asset group. If the carrying amount of the asset group exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized based on the amount by which the carrying value of the long-lived assets exceeds the fair value of the assets. We did not incur any long-lived impairment charges for the years ended December 31, 2019, 2018, and 2017.

Intangible assets

Intangible assets include developed technologies, customer relationships, customer contracts, and trademarks that were acquired in business combinations and asset acquisitions. Intangible assets also include the purchase of third-party computer software. The intangible assets are amortized using the straight-line method over the assets’ estimated useful lives. The estimated useful life of each asset category is as follows:



Developed technologies	2-10 years
Customer relationships and contracts	6 years
Computer software licenses	2-5 years
Trademarks	2 years

Goodwill

We record goodwill as the difference between the aggregate consideration paid for a business combination and the fair value of the identifiable net tangible and intangible assets acquired. Goodwill is assessed for impairment annually or more frequently if indicators of impairment are present or circumstances suggest that impairment may exist. The first step of the goodwill impairment test compares the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, the goodwill of the reporting unit is not considered impaired. If the carrying amount of the reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the affected reporting unit’s goodwill with the carrying value of that goodwill. There was no impairment of goodwill for the years ended December 31, 2019, 2018, and 2017.

Deferred offering costs

Deferred offering costs, which consist of legal, consulting, banking, and accounting fees directly attributable to the IPO, were capitalized and then offset against proceeds upon the consummation of the IPO. During the year ended December 31, 2019, we reclassified $4.6 million of offering costs into stockholders’ equity as a reduction of the net proceeds received from the IPO.

Common stock warrants

We account for freestanding warrants to purchase shares of our common stock that are not considered indexed to our own stock as warrant liabilities on our consolidated balance sheets until the point in time that they qualify for equity classification. We record liability-classified common stock warrants at their estimated fair value because they are free standing and the number of shares exercisable increases as we make advances on our credit facility.

At the end of each reporting period, we record the change in the estimated fair value of the warrants to purchase common stock as a change in fair value of warrant liability within interest and other expense, net in our consolidated statements of operations. We reclassify the warrants from liability-classified to equity-classified as exercise contingencies related to the warrants become resolved. In October 2018, all remaining contingencies were resolved and the remaining common stock warrant liability balance was marked to market and recorded in stockholders’ equity (deficit). During the year ended December 31, 2019, all outstanding warrants were exercised through a cashless exercise.

Business combinations

We account for an acquisition as a business combination if we obtain control of a business. Assets and liabilities acquired in a business combination generally are recorded at fair value and any associated acquisition costs are expensed as incurred in general and administrative expenses.

Advertising costs

All advertising costs are expensed as incurred. For the years ended December 31, 2019, 2018, and 2017, we incurred $4.9 million, $5.0 million, and $5.9 million in advertising costs, respectively.

Development costs and internal-use software

Our technology products are generally developed to be sold externally. We determined that technological feasibility for our technology products to be sold externally is reached shortly before the products are ready for general release. Any costs associated with software development between the time technological feasibility is reached and general release are inconsequential.

We capitalize certain development costs incurred in connection with our internal-use software. These capitalized costs are primarily related to the software platforms that are hosted by us and accessed by our customers on a subscription basis. Costs incurred in the preliminary stages of development are expensed as incurred as research and development costs. Once an application has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Capitalized costs are recorded as part of property and equipment. Maintenance and training costs are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life.

Stock-based compensation

Stock-based awards, including stock options and RSUs, are measured and recognized in the consolidated financial statements based on the fair value of the award on the grant date. For awards subject to performance conditions, we record expense when the performance condition becomes probable. We record forfeitures of stock-based awards as the actual forfeitures occur.

We estimate the fair value of stock option awards on the grant date using the Black-Scholes option pricing model. We have issued two types of employee stock-based awards, standard and two-tier. Our standard stock-based awards vest solely on a service-based condition. For these awards, we recognize stock-based compensation expense on a straight-line basis over the vesting period. Two-tier employee stock-based awards contain both a service-based condition and performance condition, defined as the earlier of (i) an acquisition or change in control of the company or (ii) upon the occurrence of an initial public offering by the Company. A change in control event and effective registration event are not deemed probable until consummated; accordingly, no expense is recorded related to two-tier stock options until the performance condition becomes probable of occurring. Awards that contain both service-based and performance conditions are recognized using the accelerated attribution method once the performance condition is probable of occurring. The service-based condition is generally a service period of four years. Upon closing our IPO, we recorded cumulative share-based compensation expense of approximately $6.0 million using the accumulated attribution method for two-tier employee stock-based awards for which the service condition had been satisfied at that date.

The compensation expense for non-employees is recognized, without changes in the fair value of the award, in the same period and in the same manner as though we had paid cash for the services, which is typically the vesting period of the respective award. The impact on our consolidated financial statements was immaterial.

Stock-based compensation expense related to purchase rights issued under the 2019 Health Catalyst Employee Stock Purchase Plan (ESPP) is based on the Black-Scholes option-pricing model fair value of the estimated number of awards as of the beginning of the offering period. Stock-based compensation expense is recognized using the straight-line method over the offering period.

Concentrations of credit risk

Financial instruments that potentially subject us to a concentration of credit risk consist principally of cash and cash equivalents, short-term investments, and accounts receivable. We deposit cash with high credit quality financial institutions which at times may exceed federally insured amounts. We have not experienced any losses on our deposits.

We perform ongoing credit evaluations of our customers’ financial condition and require no collateral from customers. We review the expected collectability of accounts receivable and record an allowance for doubtful accounts for amounts that we determine are not collectible.

The following table depicts the largest customers’ outstanding net accounts receivable balance as a percentage of the total outstanding net accounts receivable balance:



	As of December 31,
	2019	2018

Customer A	less than 10%	13%

There were no other customers with outstanding net accounts receivable balances as a percentage of total outstanding net accounts receivable balance greater than 10% as of December 31, 2019 and 2018.

We had one customer that accounted for 12% of our total revenues in 2017. There were no other customers with revenue as a percentage of total revenue greater than 10% for the years ended December 31, 2019, 2018, and 2017.

Income taxes

Deferred income tax balances are accounted for using the liability method and reflect the effects of temporary differences between the financial reporting and tax bases of our assets and liabilities using enacted tax rates expected to apply when taxes are actually paid or recovered. In addition, deferred tax assets and liabilities are recorded for net operating loss (NOL) and credit carryforwards.

On December 22, 2017, the 2017 Tax Cuts and Jobs Act (Tax Act) was enacted into law and the new legislation contains several key tax provisions that affect us, including the reduction of the corporate income tax rate to 21%, effective January 1, 2018. We were required to recognize the effect of the tax law changes in the period of enactment. As such, we remeasured our consolidated deferred tax assets and liabilities as of December 31, 2017 to reflect the lower rate and also reassessed the net realizability of those deferred tax assets and liabilities.

A valuation allowance is provided against deferred tax assets unless it is more likely than not that they will be realized based on all available positive and negative evidence. Such evidence includes, but is not limited to, recent cumulative earnings or losses, expectations of future taxable income by taxing jurisdiction, and the carry-forward periods available for the utilization of deferred tax assets.

We use a two-step approach to recognize and measure uncertain income tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained upon audit. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. We do not accrue interest and penalties related to unrecognized tax benefits within the provision for income taxes because we have net operating loss carryforwards. Significant judgment is required to evaluate uncertain tax positions.

Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We evaluate our uncertain tax positions on a regular basis and evaluations are based on a number of factors, including changes in facts and circumstances, changes in tax law, such as the Tax Act, correspondence with tax authorities during the course of an audit, and effective settlement of audit issues.

To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and results of operations.

Fair value of financial instruments

The carrying amounts reported in the consolidated balance sheets for cash, receivables, accounts payable, and current accrued expenses approximate fair values because of the immediate or short-term maturity of these financial instruments. The carrying value of acquisition-related consideration payable, operating lease liabilities, and long-term debt approximate fair value based on interest rates available for debt with similar terms at December 31, 2019 and 2018. Money market funds and short-term investments are measured at fair value on a recurring basis.

Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:


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


•	Level 2- Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.


•	Level 3- Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

Leases

We account for our leases in accordance with Accounting Standards Codification Topic 842, Leases. We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (ROU) assets, operating lease liabilities, and operating lease liabilities, net of current portion in our consolidated balance sheets. We have adopted the short-term lease recognition exemption policy. All of our leasing commitments are classified either as operating leases or otherwise qualify as short-term leases with lease terms of 12 months or less.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As our lease contracts do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date to determine the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease executory costs. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise the applicable option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

We do not have lease agreements that contain non-lease components, which generally would be accounted for separately.

Foreign Currency

The functional currency of our international subsidiaries is generally their local currency. We translate these subsidiaries’ financial statements into U.S. dollars using month-end exchange rates for assets and liabilities and average exchange rates for revenue and expenses. We record translation gains and losses in accumulated other comprehensive loss in stockholders’ equity (deficit). We record foreign exchange gains and losses in interest and other expense, net. Our net foreign exchange gains and losses were not material for the periods presented.

Accounting pronouncements adopted

In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (ASU 2018-07). ASU 2018-07 simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees, with certain exceptions. The new standard became effective for fiscal years beginning after December 15, 2018, and interim periods within those annual periods. We adopted ASU 2018-07 as of January 1, 2019 and applied the standard prospectively. The adoption of this standard did not have a material impact on our consolidated financial statements.

Recent accounting pronouncements

In June 2016, FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), which requires the measurement and recognition of expected credit losses for certain financial instruments, which includes our accounts receivable and available-for-sale debt securities. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. These changes will result in earlier recognition of credit losses. We will adopt ASU 2016-13 effective January 1, 2020. We are currently evaluating new credit loss models and updating our processes and controls in connection with the adoption of ASU 2016-13. Based on the current composition of our investment portfolio, current market conditions, and historical credit loss activity, we expect that the initial adoption of this ASU will not have a material impact on our consolidated financial statements and related disclosures.

In January 2017, FASB issued ASU 2017-04, Intangibles-Goodwill and Other - Simplifying the Test for Goodwill Impairment (Topic 350), that simplifies how an entity is required to test goodwill for impairment by eliminating the second step of the impairment test. The second step measures a goodwill impairment loss by comparing the fair value of a reporting unit to the carrying amount. Under the new standard, if the carrying amount of the reporting unit exceeds its fair value, the carrying amount of goodwill is reduced by the excess reporting unit carrying amount up to the carrying amount of the goodwill. We will adopt ASU 2017-04 for annual or interim goodwill impairment tests in reporting periods beginning after December 15, 2019. This ASU will apply to our reporting requirements in performing goodwill impairment testing; however, we expect that the initial adoption of this ASU will not have a material impact on our consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some disclosure requirements. The new guidance is effective for all entities for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years. We expect that the disclosure changes that result from the adoption of this ASU will not have a material impact on our consolidated financial statements.

Revenue

12 Months Ended

Dec. 31, 2019

Revenue from Contract with Customer [Abstract]

Goodwill and Intangible Assets Disclosure [Abstract]

Disaggregation of revenue

The following table represents Health Catalyst’s revenue disaggregated by type of arrangement (in thousands):



	Year Ended December 31,
	2019		2018		2017
Recurring technology	$	83,791	$	55,266	$	28,003
One-time technology (i.e., perpetual license)	184		1,958		3,690
Professional services	70,966		55,350		41,388
Total revenue	$	154,941	$	112,574	$	73,081

For the years ended December 31, 2019, 2018, and 2017, 99.7%, 99.4%, and 99.5% of revenue was related to contracts with customers located in the United States.

Deferred Revenue and Performance Obligations

Deferred revenue includes advance customer payments and billings in excess of revenue recognized. For the year ended December 31, 2019, approximately 15% of the revenue recognized was included in deferred revenue at the beginning of the period.

Transaction price allocated to the remaining performance obligations

Most of our technology and professional services contracts have up to a three-year term, of which the vast majority are terminable after one year upon 90 days' notice. For arrangements that do not allow the customer to cancel within one year or less, we expect to recognize $54.6 million of revenue on unsatisfied performance obligations as of December 31, 2019. We expect to recognize approximately 80% of the remaining performance obligations over the next 24 months, with the balance recognized thereafter.

Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets

We operate our business in two operating segments that also represent our reporting units. Our reporting units are organized based on our technology and professional services. We have not incurred any goodwill impairment charges.

Goodwill by reporting unit is as follows (in thousands):



	As of December 31,
	2019		2018

Technology	$	2,912	$	2,912
Professional services	782		782
Total goodwill	$	3,694	$	3,694

As of December 31, 2019, intangible assets consisted of the following (in thousands):



	Gross		Accumulated Amortization			Net
Developed technologies	$	36,129	$	(16,548	)	$	19,581
Customer relationships and contracts	4,164		(2,773		)	1,391
Computer software licenses	7,114		(2,576		)	4,538
Trademarks	100		(75		)	25
Total intangible assets	$	47,507	$	(21,972	)	$	25,535

As of December 31, 2018, intangible assets consisted of the following (in thousands):



	Gross		Accumulated Amortization			Net
Developed technologies	$	36,129	$	(12,720	)	$	23,409
Customer relationships and contracts	4,164		(2,080		)	2,084
Computer software licenses	3,554		(818		)	2,736
Trademarks	100		(25		)	75
Total intangible assets	$	43,947	$	(15,643	)	$	28,304

Amortization expense for intangible assets for the years ended December 31, 2019, 2018, and 2017 was $6.3 million, $5.1 million, and $4.5 million, respectively. Amortization expense for intangible assets is included in depreciation and amortization in the consolidated statements of operations.

The weighted-average remaining amortization period by type of intangible assets as of December 31, 2019 is as follows:



	Weighted-Average Remaining Amortization Period (years)
Developed technologies	5.4
Customer relationships and contracts	2.5
Computer software licenses	2.3
Trademarks	0.5

As of December 31, 2019, future amortization expense for finite-lived intangible assets is estimated to be as follows (in thousands):



Year Ending December 31,
2020	$	6,627
2021	5,945
2022	4,716
2023	3,171
2024	3,041
Thereafter	2,035
Total future amortization expense	$	25,535

Property and Equipment

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Property and equipment

Property and Equipment

Property and equipment consisted of the following (in thousands):



	As of December 31,
	2019			2018

Computer equipment	$	7,951		$	6,769
Leasehold improvements	2,234			1,704
Furniture and fixtures	1,030			1,406
Capitalized internal-use software costs	1,866			1,482
Computer software	972			972
Capital lease equipment	37			37
Total property and equipment	14,090			12,370
Less: accumulated depreciation	(9,795		)	(7,694		)
Property and equipment, net	$	4,295		$	4,676

Our long-lived assets are located in the United States. Depreciation expense for the years ended December 31, 2019, 2018, and 2017 was $2.9 million, $2.3 million, and $1.4 million, respectively. Depreciation expense includes amortization of assets recorded under a capital lease and the amortization of capitalized internal-use software costs.

We capitalized $0.4 million, $0.2 million, and $1.3 million of internal-use software costs for the years ended December 31, 2019, 2018, and 2017, respectively. We incurred $0.5 million, $0.4 million, and $0.1 million of capitalized internal-use software cost amortization expense for the years ended December 31, 2019, 2018, and 2017, respectively.

Short-term Investments

12 Months Ended

Dec. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Short-term Investments

Our investment policy limits investments to highly-rated instruments that mature in less than 12 months. We classify our short-term investments as available for sale. Available-for-sale securities are recorded on our consolidated balance sheets at fair market value and any unrealized gains or losses are reported as part of other comprehensive loss on the consolidated statements of comprehensive loss. We determine realized gains or losses on the sales of investments through the specific identification method and record such gains or losses as part of interest and other expense, net on the consolidated statements of operations. We did not have any material realized gains or losses on investments during the years ended December 31, 2019, 2018, and 2017. We measure the fair value of investments on a recurring basis.

The following table summarizes, by major security type, our cash equivalents and short-term investments (in thousands) as of December 31, 2019:



	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash equivalents		Short-term Investments
Money market funds	17,175		—		—			17,175		17,175		—
U.S. treasury notes	58,130		34		—			58,164		—		58,164
Commercial paper	46,973		—		—			46,973		—		46,973
Corporate bonds	64,978		27		(5		)	65,000		—		65,000
Asset-backed securities	40,090		18		—			40,108		—		40,108
Total	$	227,346	$	79	$	(5	)	$	227,420	$	17,175	$	210,245

The following table summarizes, by major security type, our cash equivalents and short-term investments (in thousands) as of December 31, 2018:



	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash equivalents		Short-term Investments
Money market funds	23,085		—		—			23,085		23,085		—
U.S. treasury notes	4,175		—		(1		)	4,174		1,396		2,778
Commercial paper	3,976		—		—			3,976		1,993		1,983
Corporate bonds	998		—		—			998		998		—
Total	$	32,234	$	—	$	(1	)	$	32,233	$	27,472	$	4,761

As we do not intend to sell investments that are in an unrealized loss position and it is not likely that we will be required to sell any investments before recovery of their amortized cost basis, we do not consider the investments with an unrealized loss to be other-than-temporarily impaired as of December 31, 2019.

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2019 were as follows (in thousands):



	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	17,175	$	—	$	—	$	17,175
U.S. Treasury notes	58,164		—		—		58,164
Commercial paper	—		46,973		—		46,973
Corporate bonds	—		65,000		—		65,000
Asset-backed securities	—		40,108		—		40,108
Total assets measured at fair value on a recurring basis	$	75,339	$	152,081	$	—	$	227,420

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2018 were as follows (in thousands):



	December 31, 2018
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	23,085	$	—	$	—	$	23,085
U.S. Treasury notes	4,174		—		—		4,174
Commercial paper	—		3,976		—		3,976
Corporate bonds	—		998		—		998
Total assets measured at fair value on a recurring basis	$	27,259	$	4,974	$	—	$	32,233

There were no transfers between Level 1 and Level 2 of the fair value measurement hierarchy during the years ended December 31, 2019 and 2018.

In October 2017, we issued common stock warrants which required fair value measurements. The fair value of the warrants was measured using an option pricing model. Inputs used to determine the estimated fair value of the warrants include the estimated value of the underlying common stock at the valuation measurement date, the term of the warrants, risk-free interest rates, and estimated volatility. Estimated volatility is based on the volatility of a peer group. In addition to the above, significant inputs include the likelihood of the exercise contingencies being met. In October 2018 all remaining contingencies were resolved and the remaining common stock warrant liability balance was marked to market and recorded in stockholders’ equity (deficit). See Note 12 for further information regarding the fair value of the warrants.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Accrued liabilities

12 Months Ended

Dec. 31, 2019

Payables and Accruals [Abstract]

Accrued liabilities

As of December 31, 2019 and 2018, accrued liabilities consisted of the following (in thousands):



	As of December 31,
	2019		2018

Accrued compensation and benefit expenses	$	4,278	$	5,888
Other accrued liabilities	4,666		3,315
Total accrued liabilities	$	8,944	$	9,203

Leases

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Leases

Operating leases

We lease office space and certain equipment under operating leases that expire between 2020 and 2024. The terms of the leases provide for rental payments on a graduated scale, options to renew the leases (one to five years), landlord incentives or allowances, and periods of free rent.

Our operating lease expense for the years ended December 31, 2019, 2018, and 2017, was $3.2 million, $2.2 million, and $1.8 million, respectively. In addition to those amounts, lease expense attributable to short-term leases with terms of 12 months or less for the years ended December 31, 2019, 2018, and 2017, was $0.2 million, $0.5 million, and $0.6 million, respectively.

Maturities of lease liabilities under operating leases at December 31, 2019 are as follows (in thousands):



Year ending December 31:
2020	$	3,000
2021	824
2022	399
2023	410
2024	152
Thereafter	—
Total lease payments	4,785
Less: Imputed interest	(325		)
Total lease liability	$	4,460

Supplemental balance sheet information related to leases as of December 31, 2019 and 2018 is as follows (in thousands other than weighted average amounts):



	As of December 31,
	2019			2018

Operating lease right-of-use assets	$	3,787		$	6,344
Operating lease liabilities, current	$	2,806		$	2,577
Operating lease liabilities, noncurrent	1,654			4,228
Total operating lease liabilities	$	4,460		$	6,805

Weighted-average remaining operating lease term (years)	2.2			2.6
Weighted-average operating lease discount rate	5.6		%	5.5		%

Acquisition-related consideration payable (Notes)

12 Months Ended

Dec. 31, 2019

Business Combinations [Abstract]

Future minimum cash commitments as part of prior-year asset acquisitions and business combinations as of December 31, 2019 are as follows (in thousands):



Year ending December 31:
2020	2,250
2021	2,000
Total cash commitments as part of acquisitions	4,250
Less: Imputed interest	(198		)
Total acquisition-related consideration payable	$	4,052

The remaining obligations from the acquisition-related consideration payable, net of imputed interest, are recorded as liabilities on our consolidated balance sheets.

Credit Facilities

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Credit Facilities

As of December 31, 2019, our term credit facilities consisted of the following, excluding debt discount and issue costs of $1.8 million (in thousands):



	Balance		Remaining Capacity		Interest Rate		Basis Rate
OrbiMed term loan	$	50,000	$	30,000	10.00	%	Higher of LIBOR plus 7.5% and 10.0%
SVB revolving line of credit	—		5,000		5.25	%	Prime plus 0.50%
Total credit facilities	50,000		$	35,000
Less: Current portion of credit facilities	—
Credit facilities, less current portion	$	50,000

As of December 31, 2018, our term credit facilities consisted of the following, excluding debt discount and issue costs of $1.2 million (in thousands):



	Balance			Remaining Capacity		Interest Rate		Basis Rate
SVB term loan	$	20,000		$	—	11.75	%	Prime plus 6.25%
SVB revolving line of credit	1,321			18,679		6.00	%	Prime plus 0.50%
Total credit facilities	21,321			$	18,679
Less: Current portion of credit facilities	(1,321		)
Credit facilities, less current portion	$	20,000

In June 2016, we signed a Loan and Security Agreement with Silicon Valley Bank (SVB) which established a revolving line of credit based on a formula amount and secured $1.3 million in advances from the revolving line of credit. In October 2017, we signed a Mezzanine Loan and Security Agreement with SVB which allows access to term loan borrowings of up to $20.0 million and drew $10.0 million at closing. As of December 31, 2018, the maturity date of any borrowings under the agreement was April 2021. We paid $0.2 million in fees related to the establishment of the term loan and were required to pay an additional commitment fee each time we draw funds based on a formula and the amount of funds borrowed. In October 2018, we drew an additional $10.0 million under the Mezzanine Loan and Security Agreement.

Amounts borrowed under the SVB Mezzanine Loan and Security Agreement were secured by a first priority security interest in substantially all of our assets other than intellectual property. In the event of default, SVB had the right to accelerate amounts outstanding, terminate the credit facility, and foreclose on the collateral. The agreement also includes a financial covenant requiring the achievement of minimum annual recurring revenue amounts in order to draw upon the remaining available credit. We were in compliance with this covenant under the terms of the credit facility as of December 31, 2018.

OrbiMed debt financing transaction

On February 6, 2019, we entered into a debt financing agreement with OrbiMed Royalty Opportunities II, LP (OrbiMed) where we obtained an $80.0 million senior term loan commitment, with $50.0 million available and up to an additional $30.0 million contingently available on or prior to March 31, 2020 (the Delayed Draw Commitment). We paid $2.4 million in fees related to the establishment of the OrbiMed term loan and incurred $0.3 million in debt issuance costs. The Delayed Draw Commitment is contingent upon our achievement of minimum levels of technology revenues ranging from technology revenues for the latest 12 months of at least $60.0 million to borrow up to $10.0 million, to a minimum of $80.0 million in technology revenues to borrow between $25.0 million and $30.0 million.

The contractual interest rate of the OrbiMed term loan is the higher of LIBOR plus 7.5% and 10.0%. Interest payments are required at the end of each month and monthly installment payments on principal begin in February 2023 and will be based on the then outstanding principal balance divided by 12. The maturity date of the OrbiMed term loan is February 6, 2024. Upon the payment of all or any portion of the principal amount on the OrbiMed term loan, we are required to pay an exit fee of 5% of the principal amount paid. This exit fee is being accreted as interest expense over the contractual term of the loan. If we elect to prepay portions

of the principal balance prior to the 48-month anniversary of the closing date we would be required to pay a repayment premium ranging from 1% to 12% of the principal balance prepaid depending on the period in which the prepayment is made.

Amounts borrowed under the OrbiMed term loan are secured by a first priority security interest in substantially all of our assets other than intellectual property. In the event of default, OrbiMed may accelerate amounts outstanding, terminate the credit facility, and foreclose on the collateral. The agreement also includes a financial covenant requiring the achievement of minimum trailing-twelve-month revenue amounts as well as certain other financial and non-financial covenants. We were in compliance with these covenants under the terms of the OrbiMed term loan as of December 31, 2019.

The use of proceeds from the senior term loan included an immediate repayment of our $20.0 million term loan from SVB that required a prepayment premium of $0.5 million and the write-off of deferred debt discount and issuance costs of $1.2 million, resulting in a $1.7 million loss on extinguishment of debt. In addition, we repaid in full the outstanding balance of $1.3 million under the SVB revolving line of credit.

On February 6, 2019, we amended the Loan and Security Agreement with SVB which reduced the revolving line of credit to a current maximum of $5.0 million with an obligation to maintain a minimum of $5.0 million cash or cash equivalents on deposit with SVB to maintain the assurance of future credit availability. The line may be increased to $10.0 million upon request and approval by SVB. The maturity date of the revolving line of credit was amended to be February 6, 2021.

Redeemable Convertible Preferred Stock	12 Months Ended
Redeemable Convertible Preferred Stock	Dec. 31, 2019
Equity [Abstract]
Redeemable Convertible Preferred Stock	Redeemable Convertible Preferred Stock We had 45,427,441 shares of $0.001 par value redeemable convertible preferred stock authorized, of which 22,713,694 shares were issued and outstanding, as of December 31, 2018. The issued and outstanding redeemable convertible preferred shares as of December 31, 2018 consisted of 3,587,499 designated Series A redeemable convertible preferred stock, 4,986,827 designated Series B redeemable convertible preferred stock, 4,794,007 designated Series C redeemable convertible preferred stock, 3,314,612 designated Series D redeemable convertible preferred stock, and 6,030,749 designated Series E redeemable convertible preferred stock. During the year ended December 31, 2019, we authorized 1,077,587 shares of Series F redeemable convertible preferred stock and issued 437,787 shares of Series F redeemable convertible preferred stock for total cash consideration of $12.1 million, net of offering costs of $0.1 million. Upon the closing of our IPO, the 23,151,481 shares of redeemable convertible preferred stock, then outstanding, were converted on a one-for-one basis into 23,151,481 shares of common stock.

Stockholders’ Equity (Deficit)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Stockholders’ Equity (Deficit)

Amendment and Restatement of Certificate of Incorporation

In connection with the IPO, the certificate of incorporation of Health Catalyst was amended and restated to, among other things, provide for the (i) authorization of 500,000,000 shares of common stock with a par value of $0.001 per share; (ii) authorization of 25,000,000 shares of undesignated preferred stock that may be issued from time to time; and (iii) establishment of a classified board of directors, divided into three classes, each of whose members will serve for staggered three-year terms.

Preferred Stock

Our board of directors has the authority, without further action by our stockholders, to issue up to 25,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, and privileges thereof, including voting rights. As of December 31, 2019 and 2018, no shares of this preferred stock were issued and outstanding.

Common stock

We had 500,000,000 and 72,565,312 shares of $0.001 par value common stock authorized, of which 36,731,632 and 4,832,134 shares were legally issued and outstanding as of December 31, 2019 and 2018, respectively. The shares legally issued and outstanding include 52,778 shares issued to former employees with notes determined to be substantively nonrecourse and, as such, for accounting purposes are not considered to be outstanding common stock shares. Each share of common stock has the right to one vote on all matters submitted to a vote of stockholders. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors, subject to prior rights of holders of all classes of stock outstanding having priority rights as to dividends. No dividends have been declared or paid on our common stock through December 31, 2019.

During 2018, as part of a tender offer we repurchased 798,372 shares of common stock from team members, which shares were received by the exercise of stock options or contractual arrangements, for cash consideration of $16.9 million. The estimated fair value of the repurchased common stock of $8.6 million and offering costs of $0.1 million were recorded as a reduction to common stock and additional paid-in capital. The excess of the repurchase price over the estimated fair value of the common stock redeemed from team members of $8.3 million was accounted for as compensation expense on the consolidated statement of operations.

The effects of the excess of the tender offer repurchase price over the estimated fair value of the common stock redeemed from team members on the statement of operations for the year ended December 31, 2018 are summarized in the following table (in thousands):



	2018
Cost of revenue	$	312
Sales and marketing	3,967
Research and development	906
General and administrative	3,133
Total compensation expense from repurchase	$	8,318

Common stock warrants

In October 2017, we issued warrants in connection with the Mezzanine Loan and Security Agreement with SVB for up to 255,336 shares of common stock with a ten-year term at an exercise price of $10.66 per share. The fair value of the warrants on the date of grant was $1.6 million and recorded as deferred financing costs. The deferred financing costs were reclassified to a discount on debt in proportion to the advances made on the credit facility. The deferred financing costs and the debt discount were scheduled to be recognized as interest expense over the term of the credit facility.

In October 2018, all remaining contingencies were resolved and the remaining common stock warrant liability balance was marked to market and recorded in stockholders’ equity (deficit). In February 2019, the term loan from the Mezzanine Loan and Security Agreement with SVB was paid off in full, resulting in the $1.0 million unamortized portion of the debt discount related to the warrants being included in the current year loss on debt extinguishment. Soon after effective date of our IPO, all 255,336 outstanding warrants were exercised through a cashless exercise, resulting in the issuance of 189,959 shares of common stock.

Net Loss Per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Net loss per share

Net Loss Per Share

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share amounts):



	Year Ended December 31,
	2019			2018			2017
Numerator:
Net loss attributable to common stockholders	$	(240,922	)	$	(114,021	)	$	(58,780	)
Denominator:
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted	18,741,119			4,798,363			4,846,511
Net loss per share attributable to common stockholders, basic and diluted	$	(12.86	)	$	(23.76	)	$	(12.13	)

During the years ended December 31, 2019, 2018 and 2017, we incurred net losses and, therefore, the effect of our common stock options, restricted stock units, common stock warrants, and redeemable convertible preferred stock (as converted) were not included in the calculation of diluted net loss per share attributable to common stockholders as the effect would be anti-dilutive. The following table contains share totals with a potentially dilutive impact:



	As of December 31,
	2019	2018	2017
Redeemable convertible preferred stock	—	22,713,694	21,109,771
Common stock options	7,847,716	7,237,417	4,705,171
Restricted stock units	503,861	—	—
Common stock warrants	—	255,336	255,336
Total potentially dilutive securities	8,351,577	30,206,447	26,070,278

Stock-Based Compensation

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Stock-based Compensation

Stock-Based Compensation

In 2011, our Board of Directors adopted the Health Catalyst, Inc. 2011 Stock Incentive Plan (2011 Plan), which provided for the direct award, sale of shares and granting of options for our common stock to our directors, team members, or consultants. In connection with our IPO, our board of directors adopted the 2019 Stock Option and Incentive Plan (2019 Plan). The 2019 Plan provides flexibility to our compensation committee to use various equity-based incentive awards as compensation tools to motivate our workforce, including the grant of incentive and nonstatutory stock options, restricted and unrestricted stock, RSUs, and stock appreciation rights to our directors, team members, or consultants.

We have initially reserved 2,756,607 shares of our common stock (2,500,000 under the 2019 Plan and 256,607 shares under the 2011 Plan that were available immediately prior to the IPO registration date). The 2019 Plan provides that the number of shares reserved available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2020, by 5% of the outstanding number of shares of our common stock on the immediately preceding December 31, or such lesser number of shares as determined by our compensation committee.

As of December 31, 2019 and 2018, there were 11,272,878 and 8,772,878 shares authorized for grant, respectively, and 2,309,370 and 1,296,793 shares available for grant, respectively, under the 2019 Plan and 2011 Plan (collectively the 'Stock Incentive Plan').

All options were granted with an exercise price determined by the board of directors that was equal to the estimated fair value of our common stock at the date of grant, based on the information known on the date of grant. Subject to certain exceptions defined in the Stock Incentive Plan related to an employee's termination, options generally expire on the tenth anniversary of the applicable grant date.

We have issued two types of employee stock-based awards, standard and two-tier. Our standard stock-based awards vest solely on a service-based condition. For these awards, we recognize stock-based compensation based on the grant date fair value of the awards and recognize that cost using the straight-line method over the requisite service period of the award. Two-tier employee stock-based awards contained both a service-based condition and performance condition, defined as the earlier of (i) an acquisition or change in control of the company or (ii) upon the occurrence of our initial public offering. A change in control event and effective registration event was not deemed probable until consummated; accordingly, no expense was recorded related to two-tier stock-based awards until the performance condition became probable of occurring. Awards that contained both service-based and performance conditions were recognized using the accelerated attribution method once the performance condition was probable of occurring. The service-based condition is generally a service period of four years. Upon closing our IPO, we recorded cumulative share-based compensation expense using the accumulated attribution method for two-tier employee stock-based awards for which the service condition had been satisfied at that date.

The fair value of options, which vest in accordance with service schedules, is estimated on the date of grant using the Black-Scholes option pricing model. The absence of an active market for our common stock requires us to estimate the fair value of our common stock for purposes of granting stock options and for determining stock-based compensation expense for the periods presented. We obtained contemporaneous third-party valuations to assist in determining the estimated fair value of our common stock. These contemporaneous third-party valuations used the methodologies, approaches, and assumptions consistent with the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. Expected volatilities are based on historical volatilities of comparable companies. The expected term of the options is based on the simplified method outlined in the SEC Staff accounting guidance, under which we estimate the term as the average of the option’s contractual term and the option’s weighted average vesting period. The risk-free rate represents the yield on U.S. Treasury bonds with maturity equal to the expected term of the granted option. We account for forfeitures as they occur. All standard stock options outstanding at December 31, 2019 and 2018 are expected to vest according to their specific schedules.

The fair value of our option grants is estimated at the grant date using the Black-Scholes option-pricing model based on the following weighted-average assumptions:



	Year Ended December 31,
	2019	2018	2017
Expected volatility	43.8%-44.5%	43.6%-47.6%	46.5%-48.4%
Expected term (in years)	6.3	6.3	6.3
Risk-free interest rate	2.4%-2.5%	2.5%-3.0%	2.0%-2.2%
Expected dividends	—	—	—

Prior to the adoption of ASU 2018-17, the fair value measurement date for non-employee awards was the date the performance of services was completed. Upon adoption of ASU 2018-07 on January 1, 2019, the measurement date for non-employee awards is the date of grant. The compensation expense for non-employees is recognized, without changes in the fair value of the award, in the same period and in the same manner as though we had paid cash for the services, which is typically the vesting period of the respective award.

The following two tables summarize our total stock-based compensation expense by award type and where the stock-based compensation expense was recorded in our consolidated statements of operations (in thousands):



	Year Ended December 31,
	2019		2018		2017
Options	$	14,837	$	4,037	$	4,241
Restricted stock units	2,034		—		—
Employee stock purchase plan	973		—		—
Other	—		161		—
Total stock-based compensation	$	17,844	$	4,198	$	4,241



	Year Ended December 31,
	2019		2018		2017
Cost of revenue	$	1,168	$	558	$	579
Sales and marketing	3,811		1,514		1,192
Research and development	4,841		787		707
General and administrative	8,024		1,339		1,763
Total stock-based compensation	$	17,844	$	4,198	$	4,241

The current year stock-based compensation includes a $6.0 million cumulative catch-up of compensation expense related to the two-tier employee stock-based awards that was recorded upon satisfaction of the performance condition on the closing date of our IPO. We did not capitalize any stock-based compensation expense to deferred costs for the years ended December 31, 2019, 2018, and 2017.

A summary of the share option activity under the Health Catalyst Stock Plan for the years ended December 31, 2019 and 2018, is as follows:



	Time-Based Option Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years	Aggregate Intrinsic Value
Outstanding at January 1, 2018	4,705,171		$	7.88
Options granted	3,352,644		10.84
Options exercised	(723,902	)	4.20
Options cancelled/forfeited	(96,496	)	9.32
Outstanding at December 31, 2018	7,237,417		$	9.60	7.9	$	45,159,058
Options granted	1,198,121		16.00
Options exercised	(373,292	)	7.11
Options cancelled/forfeited	(214,530	)	10.53
Outstanding at December 31, 2019	7,847,716		$	10.67	7.1	$	188,573,947
Vested and expected to vest as of December 31, 2019	7,847,716		$	10.67	7.1	$	188,573,947
Vested and exercisable as of December 31, 2019	4,248,921		$	9.10	5.8	$	108,735,716

The weighted-average grant-date fair value for stock options granted during the years ended December 31, 2019, 2018, and 2017 was $9.31, $5.30, and $5.14, respectively. The aggregate intrinsic value of stock options exercised was $6.5 million, $10.9 million, and $0.1 million for the years ended December 31, 2019, 2018, and 2017, respectively. The total grant-date fair value of stock options vested during the years ended December 31, 2019, 2018, and 2017 was $8.1 million, $3.3 million, and $3.6 million, respectively. As of December 31, 2019, approximately $16.2 million of unrecognized compensation expense related to our stock options is expected to be recognized over a weighted-average period of 2.3 years.

The options outstanding include 52,778 of shares issued to former employees with notes determined to be substantively nonrecourse and, as such, for accounting purposes are not considered to be exercised stock options.

Restricted Stock Units

The service-based condition for RSUs is satisfied over four years with a cliff vesting period of one year and quarterly vesting thereafter. The following table sets forth the outstanding RSUs and related activity for the year ended December 31, 2019:



	Restricted Stock Units		Weighted Average Grant Date Fair Value
Unvested and outstanding at January 1, 2019	—		$	—
RSUs granted	504,361		37.57
RSUs forfeited	(500	)	44.43
Unvested and outstanding at December 31, 2019	503,861		$	37.57

As of December 31, 2019, we had $16.9 million of unrecognized stock-based compensation expense related to outstanding RSUs expected to be recognized over a weighted-average period of 3.4 years.

Employee Stock Purchase Plan

In connection with our IPO in July 2019, our board of directors adopted the ESPP and a total of 750,000 shares of common stock were initially reserved for issuance under the ESPP. The number of shares of common stock available for issuance under the ESPP will be increased on the first day of each calendar year beginning January 1, 2020 and each year thereafter until the ESPP terminates. The number of shares of common stock reserved and available for issuance under the ESPP shall be cumulatively increased by the least of (i) 750,000 shares, (ii) 1% of the number of shares of common stock issued and outstanding on the immediately preceding December 31, and (iii) such lesser number of shares of common stock as determined by the ESPP Administrator.

The ESPP generally provides for six-month offering periods, the exception being the first offering period. The offering periods generally start on the first trading day after June 30 and December 31 of each year. The first offering period began on the IPO date and ended on December 31, 2019.

The ESPP permits participants to elect to purchase shares of common stock through fixed percentage contributions from eligible compensation during each offering period, not to exceed 15% of the eligible compensation a participant receives during an offering period and not to accrue at a rate which exceeds $25,000 of the fair value of the stock (determined on the option grant date(s)) for each calendar year. A participant may purchase the lowest of (a) a number of shares of common stock determined by dividing such participant’s accumulated payroll deductions on the exercise date by the option price, (b) 2,500 shares; or (c) such other lesser maximum number of shares as shall have been established by the Administrator in advance of the offering period.

Amounts deducted and accumulated by the participant will be used to purchase shares of common stock at the end of each offering period. The purchase price of the shares will be 85% of the lower of the fair value of common stock on the first trading day of each offering period or on the purchase date, except for the first offering period, for which the purchase price will be 85% of the lower of (i) the IPO price or (ii) the fair value of common stock on the purchase date. Participants may end their participation at any time during an offering period and will be paid their accumulated contributions that have not been used to purchase shares of common stock. Participation ends automatically upon termination of employment.

The fair value of the purchase right for the ESPP option is estimated on the date of grant using the Black-Scholes model with the following assumptions for the initial offering period:



Expected volatility	44.2%
Expected term (in years)	0.4
Risk-free interest rate	2.1%
Expected dividends	—

During the year ended December 31, 2019, we issued 134,766 shares under the ESPP, with a weighted-average purchase price per share of $22.10. Total cash proceeds from the purchase of shares under the ESPP in 2019 were $3.0 million. As of December 2019, 615,234 shares are reserved for future issuance under the ESPP.

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

For the years ended December 31, 2019, 2018, and 2017, the income tax provision (benefit) consisted of the following (in thousands):



	Year Ended December 31,
	2019		2018			2017
Current taxes:
Federal	$	11	$	—		$	—
Foreign	10		—			—
State	81		28			12
Total current tax provision	102		28			12
Deferred taxes:
Federal	33		(135		)	—
State	7		(28		)	14
Total deferred provision (benefit)	40		(163		)	14
Total income tax provision (benefit)	$	142	$	(135	)	$	26

A reconciliation of the statutory U.S. federal income tax rate to our effective income tax rate is as follows:



	Year Ended December 31,
	2019		2018		2017
Tax at U.S. statutory rates	21.0	%	21.0	%	34.0	%
State income tax, net of federal tax effect	(0.1	)	—		—
Federal research and development credits	17.2		0.7		1.0
Stock-based compensation	(1.5	)	(0.4	)	(2.0	)
Change in valuation allowance	(36.6	)	(20.9	)	23.8
U.S. tax reform	—		—		(56.7	)
Other, net	(0.2	)	(0.2	)	(0.2	)
Effective income tax rate	(0.2	)%	0.2	%	(0.1	)%

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities were as follows as of December 31, 2019 and 2018 (in thousands):



	As of December 31,
	2019			2018
Deferred income tax assets:
Net operating loss carryforwards	$	68,643		$	59,645
Research and development credits	16,348			2,372
Intangible assets	5,354			5,393
Stock-based compensation	4,562			1,398
Deferred revenue	1,779			1,500
Interest limitation carryforward	1,983			554
Operating lease liabilities	1,219			1,808
Property and equipment	511			120
Accrued expenses	556			512
Allowance for bad debt	106			122
Other	52			63
Total deferred income tax assets	101,113			73,487
Valuation allowance	(98,370		)	(70,258		)
Net deferred income tax assets	2,743			3,229
Deferred income tax liabilities:
Prepaid expenses	(1,537		)	(1,229		)
Operating lease right-of-use assets	(967		)	(1,618		)
Deferred contract costs	(239		)	(155		)
Indefinite-lived intangible assets	(41		)	(227		)
Total deferred income tax liabilities	(2,784		)	(3,229		)
Net deferred income tax liabilities	$	(41	)	$	—

We account for deferred taxes under ASC 740, Income Taxes, which requires a reduction of the carrying amounts of deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically based on the ASC 740 more-likely-than-not realization threshold criterion. This assessment considers matters such as future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, legislative developments, and results of recent operations. The evaluation of the recoverability of the deferred tax assets requires that we weigh all positive and negative evidence to reach a conclusion that it is more likely than not that all or some portion of the deferred tax assets will not be realized. The weight given to the evidence is commensurate with the extent to which it can be objectively verified.

We have provided a full valuation allowance for our net deferred tax assets at December 31, 2019 and 2018, due to the uncertainty surrounding the future realization of such assets and the cumulative losses we have generated. Therefore, no benefit has been recognized in the financial statements for the net operating loss carryforwards and other deferred tax assets. During the years ended December 31, 2019 and 2018, respectively, the valuation allowance increased by $28.1 million and $15.9 million, respectively.

On December 22, 2017, the Tax Act was enacted into law and the new legislation contains several key tax provisions that affect our consolidated financial statements, including the reduction of the corporate income tax rate to 21%, effective January 1, 2018. We are required to recognize the effect of the tax law changes in the period of enactment. As such, we have remeasured our consolidated deferred tax assets and liabilities to reflect the lower rate and has also reassessed the realizability of those deferred tax assets and liabilities.

In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. As of December 31, 2018, we consider the accounting of the deferred tax remeasurements and state tax conformity to be complete.

As of December 31, 2019, we had approximately $269.1 million of consolidated federal net operating loss carryforwards and 215.2 million of state net operating loss carryforwards available to offset future taxable income, respectively. If unused, the federal and state net operating loss carryforwards will begin to expire in 2032 and 2024, respectively. We have federal research and development credit carryforwards of $13.5 million and state research and development credit carryforwards of $5.9 million, which if not utilized will begin to expire in 2032 and 2025, respectively. To the extent we do not utilize our carryforwards within the applicable statutory carryforward periods, either because of ownership changes and limitations under Code Sections 382 and 383 and similar state laws or the lack of sufficient taxable income, the carryforwards will expire unused.

We file federal and state income tax returns in jurisdictions with varying statutes of limitations. With few exceptions, we are no longer subject to federal or state income tax examinations by tax authorities for tax years prior to 2016.

We recognize tax benefits from uncertain tax positions when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. The following table summarizes the activity related to unrecognized tax benefits for the years ended December 31, 2019 and 2018 (in thousands):



	Year Ended December 31,
	2019			2018		2017
Beginning balance	$	2,372		$	1,939	$	1,305
Decrease in unrecognized tax benefits taken in prior years	(957		)	—		—
Increase in unrecognized tax benefits related to the current year	401			433		634
Ending balance	$	1,816		$	2,372	$	1,939

The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate is zero due to the valuation allowance. We do not anticipate material changes in the total amount of our unrecognized tax benefits within 12 months of the reporting date. Our policy is to accrue interest and penalties related to unrecognized tax benefits within the provision for income taxes. However, as of December 31, 2019 and 2018, we have not accrued interest and penalties because we have net operating loss carryforwards.

Contingencies	12 Months Ended
Contingencies	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Contingencies	Contingencies Litigation Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. We are involved in legal proceedings from time to time that arise in the normal course of business. As of December 31, 2019, there were no significant outstanding claims against us.

Deferred Revenue and Performance Obligations

12 Months Ended

Dec. 31, 2019

Revenue Recognition and Deferred Revenue [Abstract]

Deferred Revenue and Performance Obligations

Revenue

Disaggregation of revenue

The following table represents Health Catalyst’s revenue disaggregated by type of arrangement (in thousands):



	Year Ended December 31,
	2019		2018		2017
Recurring technology	$	83,791	$	55,266	$	28,003
One-time technology (i.e., perpetual license)	184		1,958		3,690
Professional services	70,966		55,350		41,388
Total revenue	$	154,941	$	112,574	$	73,081

For the years ended December 31, 2019, 2018, and 2017, 99.7%, 99.4%, and 99.5% of revenue was related to contracts with customers located in the United States.

Deferred Revenue and Performance Obligations

Transaction price allocated to the remaining performance obligations

Related Parties	12 Months Ended
Related Parties	Dec. 31, 2019
Related Party Transactions [Abstract]
Related Parties	Related Parties We have entered into arrangements with customers where the customer’s management is currently or was previously a member of our board of directors. An executive officer at Allina Health served on our board of directors until December 31, 2017. The board seat vacated by the Allina Health executive officer was replaced in January 2018 by an executive of a Partners Healthcare affiliate. For the years ended December 31, 2019, 2018, and 2017, we recognized $3.0 million, $3.8 million, and $8.6 million in revenue from related parties, respectively. We also leased building space from a related party and recognized 0.6 million in rent expense related to this lease arrangement during the year ended December 31, 2017. As of December 31, 2019 and 2018, we had receivables from related parties of $0.6 million and $0.1 million, respectively, and deferred revenue with related parties of $0.5 million and $0.4 million, respectively. As of December 31, 2019 and 2018, we also had acquisition-related consideration payable to a related party for a prior year asset acquisition. This asset acquisition occurred prior to this entity becoming a related party. The acquisition-related consideration payable to this related party was $1.2 million and $3.3 million as of December 31, 2019 and 2018, respectively. We have also entered into revenue arrangements with customers that are also our investors. None of these customers hold a significant amount of ownership in our equity interests.

Employee Benefit Plans	12 Months Ended
Employee Benefit Plans	Dec. 31, 2019
Retirement Benefits [Abstract]
Employee Benefit Plans	Employee Benefit Plans We have a 401(k) defined contribution plan covering eligible employees. Our contributions were $5.3 million, $4.6 million, and $3.5 million for the years ended December 31, 2019, 2018, and 2017, respectively. We match 100% of the first 6% of an employees’ salary deferral.

Segments

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Segments

We operate our business in two operating segments that also represent our reportable segments. Our business is organized based on our technology offerings and professional services. Accordingly, our segments are:


•	Technology - Our technology segment (Technology) includes our data platform, analytics applications and support services. Technology generates revenues primarily from contracts that are cloud-based subscription arrangements, time-based license arrangements, and maintenance and support fees; and


•	Professional Services - Our professional services segment (Professional Services) is generally the combination of analytics, implementation, strategic advisory, outsource, and improvement services to deliver expertise to our customers to more fully configure and utilize the benefits of our Technology offerings.

Revenues and cost of revenues generally are directly attributed to our segments. All segment revenues are from our external customers. Asset and other balance sheet information at the segment level is not reported to our Chief Operating Decision Maker.

Segment revenue and Adjusted Gross Profit for the years ended December 31, 2019, 2018, and 2017 were as follows (in thousands):



	Year Ended December 31,
	2019		2018		2017
Revenue:
Technology	$	83,975	$	57,224	$	31,693
Professional Services	70,966		55,350		41,388
Total revenue	$	154,941	$	112,574	$	73,081



	Year Ended December 31,
	2019			2018			2017
Adjusted Gross Profit:
Technology	$	56,378		$	37,901		$	20,148
Professional Services	24,494			16,028			9,870
Total reportable segments Adjusted Gross Profit	80,872			53,929			30,018
Less Adjusted Gross Profit reconciling items:
Stock-based compensation	(1,168		)	(558		)	(579		)
Tender offer payments deemed compensation⁽¹⁾	—			(312		)	—
Post-acquisition restructuring costs⁽²⁾	(108		)	(337		)	—
Less other reconciling items:
Sales and marketing	(47,284		)	(44,123		)	(25,920		)
Research and development	(46,252		)	(38,592		)	(28,470		)
General and administrative	(31,713		)	(22,690		)	(14,697		)
Depreciation and amortization	(9,212		)	(7,412		)	(5,892		)
Debt extinguishment costs	(1,670		)	—			—
Interest and other expense, net	(3,419		)	(2,024		)	(1,469		)
Net loss before income taxes	$	(59,954	)	$	(62,119	)	$	(47,009	)

____________________


(1)	Tender offer payments deemed compensation included in the Adjusted Gross Profit reconciliation above relate to employee compensation from repurchases of common stock at a price in excess of its estimated fair value. For additional details refer to Note 12 in the consolidated financial statements.

(2)

Post-acquisition restructuring costs included in the Adjusted Gross Profit reconciliation above relate to severance charges following the acquisition of Medicity.

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2019
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events Acquisition of Able Health, Inc. On February 21, 2020, we completed a business combination by acquiring Able Health, Inc. (“Able Health”), a leading SaaS provider of quality and regulatory measurement tracking and reporting to healthcare providers and risk-bearing entities, pursuant to the Agreement and Plan of Reorganization (the “Acquisition Agreement”), dated February 13, 2020. We believe this acquisition will strengthen Health Catalyst’s existing Quality and Regulatory Measures capabilities. Pursuant to the Acquisition Agreement, we acquired all of the equity interests in Able Health for preliminary consideration of approximately $19 million, consisting of approximately $15 million in cash and 110,662 shares of our common stock issued on the closing date at $30.11 per share. The final purchase price consideration will also include an estimate for contingent consideration of up to an additional 145,036 shares of our common stock if certain incremental billing targets for Able Health are met during an earn-out period that ends on December 31, 2020. The fair value estimate of contingent consideration is in the early stages of analysis. The purchase price is also subject to certain working capital adjustments, which are expected to be finalized within 90 days of the closing date. Given the recent timing of the closing of this business combination, we are in the process of identifying and measuring the value of the assets acquired and liabilities assumed. We plan to disclose the preliminary purchase price allocation estimates and other related information in our Form 10-Q for the quarter ending March 31, 2020. An additional 179,392 shares of our common stock were issued pursuant to the terms of the Acquisition Agreement and are a stock-based compensation arrangement subject to a Restriction Agreement. The vesting of those shares is subject to one year of continuous service by the applicable team members and shall vest on the one-year anniversary of the acquisition closing date. We expect to recognize $5.4 million in stock-based compensation related to these restricted shares over the service period.

Description of Business and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Basis of presentation

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP).

Principles of consolidation

The consolidated financial statements include the accounts of Health Catalyst and its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated.

Use of estimates

Segment reporting

Net loss per share

Cash and cash equivalents

We consider all highly liquid investments purchased with a remaining maturity of three months or less at the time of acquisition to be cash equivalents.

Short-term investments

Our investment policy limits investments to highly-rated instruments that mature in less than 12 months. We classify our short-term investments as available for sale.

Accounts receivable

Property and Equipment

Property and equipment



Computer equipment	2-3 years
Furniture and fixtures	3 years
Leasehold improvements	Lesser of lease term or estimated useful life
Computer software	2-3 years
Capitalized internal-use software costs	3 years

Intangible assets



Developed technologies	2-10 years
Customer relationships and contracts	6 years
Computer software licenses	2-5 years
Trademarks	2 years

Goodwill

Deferred offering costs

Common stock warrants

Business combinations

Advertising cost

Advertising costs

All advertising costs are expensed as incurred.

Development cost and internal-use software

Development costs and internal-use software

Stock-based compensation

Concentration of credit risk

Concentrations of credit risk

Income taxes

Fair value of financial instruments


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


•	Level 2- Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•

Level 3- Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

Leases

We do not have lease agreements that contain non-lease components, which generally would be accounted for separately.

Foreign Currency

Accounting pronouncements

Accounting pronouncements adopted

Recent accounting pronouncements

Description of Business and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Schedule of property and equipment, useful life

The estimated useful life of each asset category is as follows:



Computer equipment	2-3 years
Furniture and fixtures	3 years
Leasehold improvements	Lesser of lease term or estimated useful life
Computer software	2-3 years
Capitalized internal-use software costs	3 years

Property and equipment consisted of the following (in thousands):



	As of December 31,
	2019			2018

Computer equipment	$	7,951		$	6,769
Leasehold improvements	2,234			1,704
Furniture and fixtures	1,030			1,406
Capitalized internal-use software costs	1,866			1,482
Computer software	972			972
Capital lease equipment	37			37
Total property and equipment	14,090			12,370
Less: accumulated depreciation	(9,795		)	(7,694		)
Property and equipment, net	$	4,295		$	4,676

Schedule of intangible asset, useful life

The estimated useful life of each asset category is as follows:



Developed technologies	2-10 years
Customer relationships and contracts	6 years
Computer software licenses	2-5 years
Trademarks	2 years

The weighted-average remaining amortization period by type of intangible assets as of December 31, 2019 is as follows:



	Weighted-Average Remaining Amortization Period (years)
Developed technologies	5.4
Customer relationships and contracts	2.5
Computer software licenses	2.3
Trademarks	0.5

As of December 31, 2019, intangible assets consisted of the following (in thousands):



	Gross		Accumulated Amortization			Net
Developed technologies	$	36,129	$	(16,548	)	$	19,581
Customer relationships and contracts	4,164		(2,773		)	1,391
Computer software licenses	7,114		(2,576		)	4,538
Trademarks	100		(75		)	25
Total intangible assets	$	47,507	$	(21,972	)	$	25,535

As of December 31, 2018, intangible assets consisted of the following (in thousands):



	Gross		Accumulated Amortization			Net
Developed technologies	$	36,129	$	(12,720	)	$	23,409
Customer relationships and contracts	4,164		(2,080		)	2,084
Computer software licenses	3,554		(818		)	2,736
Trademarks	100		(25		)	75
Total intangible assets	$	43,947	$	(15,643	)	$	28,304

Schedules of concentration of risk

The following table depicts the largest customers’ outstanding net accounts receivable balance as a percentage of the total outstanding net accounts receivable balance:



	As of December 31,
	2019	2018

Customer A	less than 10%	13%

There were no other customers with outstanding net accounts receivable balances as a percentage of total outstanding net accounts receivable balance greater than 10% as of December 31, 2019 and 2018.

Revenue (Tables)

12 Months Ended

Dec. 31, 2019

Revenue from Contract with Customer [Abstract]

Schedule of revenue disaggregated by type of arrangement

The following table represents Health Catalyst’s revenue disaggregated by type of arrangement (in thousands):



	Year Ended December 31,
	2019		2018		2017
Recurring technology	$	83,791	$	55,266	$	28,003
One-time technology (i.e., perpetual license)	184		1,958		3,690
Professional services	70,966		55,350		41,388
Total revenue	$	154,941	$	112,574	$	73,081

Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill by Reporting Unit

Goodwill by reporting unit is as follows (in thousands):



	As of December 31,
	2019		2018

Technology	$	2,912	$	2,912
Professional services	782		782
Total goodwill	$	3,694	$	3,694

Schedule of Intangible Assets

The estimated useful life of each asset category is as follows:



Developed technologies	2-10 years
Customer relationships and contracts	6 years
Computer software licenses	2-5 years
Trademarks	2 years

The weighted-average remaining amortization period by type of intangible assets as of December 31, 2019 is as follows:



	Weighted-Average Remaining Amortization Period (years)
Developed technologies	5.4
Customer relationships and contracts	2.5
Computer software licenses	2.3
Trademarks	0.5

As of December 31, 2019, intangible assets consisted of the following (in thousands):



	Gross		Accumulated Amortization			Net
Developed technologies	$	36,129	$	(16,548	)	$	19,581
Customer relationships and contracts	4,164		(2,773		)	1,391
Computer software licenses	7,114		(2,576		)	4,538
Trademarks	100		(75		)	25
Total intangible assets	$	47,507	$	(21,972	)	$	25,535

As of December 31, 2018, intangible assets consisted of the following (in thousands):



	Gross		Accumulated Amortization			Net
Developed technologies	$	36,129	$	(12,720	)	$	23,409
Customer relationships and contracts	4,164		(2,080		)	2,084
Computer software licenses	3,554		(818		)	2,736
Trademarks	100		(25		)	75
Total intangible assets	$	43,947	$	(15,643	)	$	28,304

Schedule of Future Amortization Expense

As of December 31, 2019, future amortization expense for finite-lived intangible assets is estimated to be as follows (in thousands):



Year Ending December 31,
2020	$	6,627
2021	5,945
2022	4,716
2023	3,171
2024	3,041
Thereafter	2,035
Total future amortization expense	$	25,535

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Property and equipment

The estimated useful life of each asset category is as follows:



Computer equipment	2-3 years
Furniture and fixtures	3 years
Leasehold improvements	Lesser of lease term or estimated useful life
Computer software	2-3 years
Capitalized internal-use software costs	3 years

Property and equipment consisted of the following (in thousands):



	As of December 31,
	2019			2018

Computer equipment	$	7,951		$	6,769
Leasehold improvements	2,234			1,704
Furniture and fixtures	1,030			1,406
Capitalized internal-use software costs	1,866			1,482
Computer software	972			972
Capital lease equipment	37			37
Total property and equipment	14,090			12,370
Less: accumulated depreciation	(9,795		)	(7,694		)
Property and equipment, net	$	4,295		$	4,676

Short-term Investments (Tables)

12 Months Ended

Dec. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Schedule of Cash Equivalents and Short-Term Investments Measured at Fair Value

The following table summarizes, by major security type, our cash equivalents and short-term investments (in thousands) as of December 31, 2019:



	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash equivalents		Short-term Investments
Money market funds	17,175		—		—			17,175		17,175		—
U.S. treasury notes	58,130		34		—			58,164		—		58,164
Commercial paper	46,973		—		—			46,973		—		46,973
Corporate bonds	64,978		27		(5		)	65,000		—		65,000
Asset-backed securities	40,090		18		—			40,108		—		40,108
Total	$	227,346	$	79	$	(5	)	$	227,420	$	17,175	$	210,245

The following table summarizes, by major security type, our cash equivalents and short-term investments (in thousands) as of December 31, 2018:



	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash equivalents		Short-term Investments
Money market funds	23,085		—		—			23,085		23,085		—
U.S. treasury notes	4,175		—		(1		)	4,174		1,396		2,778
Commercial paper	3,976		—		—			3,976		1,993		1,983
Corporate bonds	998		—		—			998		998		—
Total	$	32,234	$	—	$	(1	)	$	32,233	$	27,472	$	4,761

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Schedule of Fair Value Assets Measured on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2019 were as follows (in thousands):



	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	17,175	$	—	$	—	$	17,175
U.S. Treasury notes	58,164		—		—		58,164
Commercial paper	—		46,973		—		46,973
Corporate bonds	—		65,000		—		65,000
Asset-backed securities	—		40,108		—		40,108
Total assets measured at fair value on a recurring basis	$	75,339	$	152,081	$	—	$	227,420

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2018 were as follows (in thousands):



	December 31, 2018
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	23,085	$	—	$	—	$	23,085
U.S. Treasury notes	4,174		—		—		4,174
Commercial paper	—		3,976		—		3,976
Corporate bonds	—		998		—		998
Total assets measured at fair value on a recurring basis	$	27,259	$	4,974	$	—	$	32,233

Accrued liabilities (Tables)

12 Months Ended

Dec. 31, 2019

Payables and Accruals [Abstract]

Schedule of accrued liabilities

As of December 31, 2019 and 2018, accrued liabilities consisted of the following (in thousands):



	As of December 31,
	2019		2018

Accrued compensation and benefit expenses	$	4,278	$	5,888
Other accrued liabilities	4,666		3,315
Total accrued liabilities	$	8,944	$	9,203

Leases (Tables)

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Schedule of Operating Lease Maturities

Maturities of lease liabilities under operating leases at December 31, 2019 are as follows (in thousands):



Year ending December 31:
2020	$	3,000
2021	824
2022	399
2023	410
2024	152
Thereafter	—
Total lease payments	4,785
Less: Imputed interest	(325		)
Total lease liability	$	4,460

Schedule of Supplemental Balance Sheet Information

Supplemental balance sheet information related to leases as of December 31, 2019 and 2018 is as follows (in thousands other than weighted average amounts):



	As of December 31,
	2019			2018

Operating lease right-of-use assets	$	3,787		$	6,344
Operating lease liabilities, current	$	2,806		$	2,577
Operating lease liabilities, noncurrent	1,654			4,228
Total operating lease liabilities	$	4,460		$	6,805

Weighted-average remaining operating lease term (years)	2.2			2.6
Weighted-average operating lease discount rate	5.6		%	5.5		%

Acquisition-related consideration payable (Tables)

12 Months Ended

Dec. 31, 2019

Business Combinations [Abstract]

Schedule of Future Minimum Cash Commitments

Future minimum cash commitments as part of prior-year asset acquisitions and business combinations as of December 31, 2019 are as follows (in thousands):



Year ending December 31:
2020	2,250
2021	2,000
Total cash commitments as part of acquisitions	4,250
Less: Imputed interest	(198		)
Total acquisition-related consideration payable	$	4,052

Credit Facilities (Tables)

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Schedule of term credit facilities

As of December 31, 2019, our term credit facilities consisted of the following, excluding debt discount and issue costs of $1.8 million (in thousands):



	Balance		Remaining Capacity		Interest Rate		Basis Rate
OrbiMed term loan	$	50,000	$	30,000	10.00	%	Higher of LIBOR plus 7.5% and 10.0%
SVB revolving line of credit	—		5,000		5.25	%	Prime plus 0.50%
Total credit facilities	50,000		$	35,000
Less: Current portion of credit facilities	—
Credit facilities, less current portion	$	50,000

As of December 31, 2018, our term credit facilities consisted of the following, excluding debt discount and issue costs of $1.2 million (in thousands):



	Balance			Remaining Capacity		Interest Rate		Basis Rate
SVB term loan	$	20,000		$	—	11.75	%	Prime plus 6.25%
SVB revolving line of credit	1,321			18,679		6.00	%	Prime plus 0.50%
Total credit facilities	21,321			$	18,679
Less: Current portion of credit facilities	(1,321		)
Credit facilities, less current portion	$	20,000

Stockholders’ Equity (Deficit) (Tables)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Summary of the effects of the excess of the tender offer repurchase price over the estimated fair value of the common stock redeemed from team members



	2018
Cost of revenue	$	312
Sales and marketing	3,967
Research and development	906
General and administrative	3,133
Total compensation expense from repurchase	$	8,318

Net Loss Per Share (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Schedule of the calculation of basic and diluted net loss per share attributable to common stockholders

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share amounts):



	Year Ended December 31,
	2019			2018			2017
Numerator:
Net loss attributable to common stockholders	$	(240,922	)	$	(114,021	)	$	(58,780	)
Denominator:
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted	18,741,119			4,798,363			4,846,511
Net loss per share attributable to common stockholders, basic and diluted	$	(12.86	)	$	(23.76	)	$	(12.13	)

Schedule of share totals with a potentially dilutive impact

The following table contains share totals with a potentially dilutive impact:



	As of December 31,
	2019	2018	2017
Redeemable convertible preferred stock	—	22,713,694	21,109,771
Common stock options	7,847,716	7,237,417	4,705,171
Restricted stock units	503,861	—	—
Common stock warrants	—	255,336	255,336
Total potentially dilutive securities	8,351,577	30,206,447	26,070,278

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Schedule of Share-based Payment Award Valuation Assumptions

The fair value of our option grants is estimated at the grant date using the Black-Scholes option-pricing model based on the following weighted-average assumptions:



	Year Ended December 31,
	2019	2018	2017
Expected volatility	43.8%-44.5%	43.6%-47.6%	46.5%-48.4%
Expected term (in years)	6.3	6.3	6.3
Risk-free interest rate	2.4%-2.5%	2.5%-3.0%	2.0%-2.2%
Expected dividends	—	—	—

Schedule of Stock-based Compensation Expense



	Year Ended December 31,
	2019		2018		2017
Options	$	14,837	$	4,037	$	4,241
Restricted stock units	2,034		—		—
Employee stock purchase plan	973		—		—
Other	—		161		—
Total stock-based compensation	$	17,844	$	4,198	$	4,241



	Year Ended December 31,
	2019		2018		2017
Cost of revenue	$	1,168	$	558	$	579
Sales and marketing	3,811		1,514		1,192
Research and development	4,841		787		707
General and administrative	8,024		1,339		1,763
Total stock-based compensation	$	17,844	$	4,198	$	4,241

Schedule of Information Related to Stock Options

A summary of the share option activity under the Health Catalyst Stock Plan for the years ended December 31, 2019 and 2018, is as follows:



	Time-Based Option Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years	Aggregate Intrinsic Value
Outstanding at January 1, 2018	4,705,171		$	7.88
Options granted	3,352,644		10.84
Options exercised	(723,902	)	4.20
Options cancelled/forfeited	(96,496	)	9.32
Outstanding at December 31, 2018	7,237,417		$	9.60	7.9	$	45,159,058
Options granted	1,198,121		16.00
Options exercised	(373,292	)	7.11
Options cancelled/forfeited	(214,530	)	10.53
Outstanding at December 31, 2019	7,847,716		$	10.67	7.1	$	188,573,947
Vested and expected to vest as of December 31, 2019	7,847,716		$	10.67	7.1	$	188,573,947
Vested and exercisable as of December 31, 2019	4,248,921		$	9.10	5.8	$	108,735,716

Schedule of Restricted Stock Unit

The following table sets forth the outstanding RSUs and related activity for the year ended December 31, 2019:



	Restricted Stock Units		Weighted Average Grant Date Fair Value
Unvested and outstanding at January 1, 2019	—		$	—
RSUs granted	504,361		37.57
RSUs forfeited	(500	)	44.43
Unvested and outstanding at December 31, 2019	503,861		$	37.57

Schedule of Employee Stock Purchase Plan

The fair value of the purchase right for the ESPP option is estimated on the date of grant using the Black-Scholes model with the following assumptions for the initial offering period:



Expected volatility	44.2%
Expected term (in years)	0.4
Risk-free interest rate	2.1%
Expected dividends	—

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of Income Tax Expense (Benefit)

For the years ended December 31, 2019, 2018, and 2017, the income tax provision (benefit) consisted of the following (in thousands):



	Year Ended December 31,
	2019		2018			2017
Current taxes:
Federal	$	11	$	—		$	—
Foreign	10		—			—
State	81		28			12
Total current tax provision	102		28			12
Deferred taxes:
Federal	33		(135		)	—
State	7		(28		)	14
Total deferred provision (benefit)	40		(163		)	14
Total income tax provision (benefit)	$	142	$	(135	)	$	26

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the statutory U.S. federal income tax rate to our effective income tax rate is as follows:



	Year Ended December 31,
	2019		2018		2017
Tax at U.S. statutory rates	21.0	%	21.0	%	34.0	%
State income tax, net of federal tax effect	(0.1	)	—		—
Federal research and development credits	17.2		0.7		1.0
Stock-based compensation	(1.5	)	(0.4	)	(2.0	)
Change in valuation allowance	(36.6	)	(20.9	)	23.8
U.S. tax reform	—		—		(56.7	)
Other, net	(0.2	)	(0.2	)	(0.2	)
Effective income tax rate	(0.2	)%	0.2	%	(0.1	)%

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities were as follows as of December 31, 2019 and 2018 (in thousands):



	As of December 31,
	2019			2018
Deferred income tax assets:
Net operating loss carryforwards	$	68,643		$	59,645
Research and development credits	16,348			2,372
Intangible assets	5,354			5,393
Stock-based compensation	4,562			1,398
Deferred revenue	1,779			1,500
Interest limitation carryforward	1,983			554
Operating lease liabilities	1,219			1,808
Property and equipment	511			120
Accrued expenses	556			512
Allowance for bad debt	106			122
Other	52			63
Total deferred income tax assets	101,113			73,487
Valuation allowance	(98,370		)	(70,258		)
Net deferred income tax assets	2,743			3,229
Deferred income tax liabilities:
Prepaid expenses	(1,537		)	(1,229		)
Operating lease right-of-use assets	(967		)	(1,618		)
Deferred contract costs	(239		)	(155		)
Indefinite-lived intangible assets	(41		)	(227		)
Total deferred income tax liabilities	(2,784		)	(3,229		)
Net deferred income tax liabilities	$	(41	)	$	—

Summary of Unrecognized Tax Benefits



	Year Ended December 31,
	2019			2018		2017
Beginning balance	$	2,372		$	1,939	$	1,305
Decrease in unrecognized tax benefits taken in prior years	(957		)	—		—
Increase in unrecognized tax benefits related to the current year	401			433		634
Ending balance	$	1,816		$	2,372	$	1,939

Segments (Tables)

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Schedule of segment revenue

Segment revenue and Adjusted Gross Profit for the years ended December 31, 2019, 2018, and 2017 were as follows (in thousands):



	Year Ended December 31,
	2019		2018		2017
Revenue:
Technology	$	83,975	$	57,224	$	31,693
Professional Services	70,966		55,350		41,388
Total revenue	$	154,941	$	112,574	$	73,081

Schedule of segment adjusted gross profit



	Year Ended December 31,
	2019			2018			2017
Adjusted Gross Profit:
Technology	$	56,378		$	37,901		$	20,148
Professional Services	24,494			16,028			9,870
Total reportable segments Adjusted Gross Profit	80,872			53,929			30,018
Less Adjusted Gross Profit reconciling items:
Stock-based compensation	(1,168		)	(558		)	(579		)
Tender offer payments deemed compensation⁽¹⁾	—			(312		)	—
Post-acquisition restructuring costs⁽²⁾	(108		)	(337		)	—
Less other reconciling items:
Sales and marketing	(47,284		)	(44,123		)	(25,920		)
Research and development	(46,252		)	(38,592		)	(28,470		)
General and administrative	(31,713		)	(22,690		)	(14,697		)
Depreciation and amortization	(9,212		)	(7,412		)	(5,892		)
Debt extinguishment costs	(1,670		)	—			—
Interest and other expense, net	(3,419		)	(2,024		)	(1,469		)
Net loss before income taxes	$	(59,954	)	$	(62,119	)	$	(47,009	)

____________________


(1)	Tender offer payments deemed compensation included in the Adjusted Gross Profit reconciliation above relate to employee compensation from repurchases of common stock at a price in excess of its estimated fair value. For additional details refer to Note 12 in the consolidated financial statements.

(2)

Post-acquisition restructuring costs included in the Adjusted Gross Profit reconciliation above relate to severance charges following the acquisition of Medicity.

Description of Business and Summary of Significant Accounting Policies (Details)			9 Months Ended	12 Months Ended
	Jul. 29, 2019 USD ($) $ / shares shares	Jul. 10, 2019	Sep. 30, 2019 segment	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Subsidiary, Sale of Stock [Line Items]
Issuance costs				$ 4,610,000	$ 0	$ 0
Shares issued upon conversion (in shares) \| shares	23,151,481
Stock split conversion ratio		0.5
Number of operating segments (in segments) \| segment				2
Number of reportable segments (in segments) \| segment			2	2
Term for most subscription contracts				3 years
Allowed termination period for most subscription contracts				1 year
Notice required for termination for most subscription contracts				90 days
Unbilled accounts receivable				$ 2,900,000	3,400,000	2,800,000
Deferred revenue				32,100,000	32,000,000.0	10,700,000
Deferred contract fulfillment costs				900,000	600,000
Allowance for doubtful accounts				400,000	500,000
Goodwill impairment				0	0	0
Advertising expense				$ 4,900,000	$ 5,000,000.0	$ 5,900,000
Service period (in years)				4 years
Stock Incentive Plan \| Performance shares
Subsidiary, Sale of Stock [Line Items]
Service period (in years)				4 years
Cumulative catch-up compensation expense				$ 6,000,000.0
Capitalized internal-use software costs
Subsidiary, Sale of Stock [Line Items]
Property, plant and equipment, useful life (in years)				3 years
IPO
Subsidiary, Sale of Stock [Line Items]
Sale of stock, number of shares issued in transaction (in shares) \| shares	8,050,000
Sale of stock, price per share (in USD per share) \| $ / shares	$ 26.00
Proceeds from issuance of common stock	$ 194,600,000
Issuance costs	$ 4,600,000
Over-Allotment Option
Subsidiary, Sale of Stock [Line Items]
Sale of stock, number of shares issued in transaction (in shares) \| shares	1,050,000

Description of Business and Summary of Significant Accounting Policies - Schedule of Property and Equipment Useful Life (Details)	12 Months Ended
	Dec. 31, 2019
Computer equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life (in years)	2 years
Computer equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life (in years)	3 years
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life (in years)	3 years
Computer software \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life (in years)	2 years
Computer software \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life (in years)	3 years
Capitalized internal-use software costs
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life (in years)	3 years

Description of Business and Summary of Significant Accounting Policies - Schedule of Intangible Assets Useful Life (Details)	12 Months Ended
	Dec. 31, 2019
Customer relationships and contracts
Finite-Lived Intangible Assets [Line Items]
Estimated useful life (in years)	6 years
Trademarks
Finite-Lived Intangible Assets [Line Items]
Estimated useful life (in years)	2 years
Maximum \| Developed technologies
Finite-Lived Intangible Assets [Line Items]
Estimated useful life (in years)	10 years
Maximum \| Computer software licenses
Finite-Lived Intangible Assets [Line Items]
Estimated useful life (in years)	5 years
Minimum \| Developed technologies
Finite-Lived Intangible Assets [Line Items]
Estimated useful life (in years)	2 years
Minimum \| Computer software licenses
Finite-Lived Intangible Assets [Line Items]
Estimated useful life (in years)	2 years

Description of Business and Summary of Significant Accounting Policies - Schedule of concentration of risk (Details) - Customer A - Customer concentration risk	12 Months Ended
	Dec. 31, 2018
Accounts receivable
Product Information [Line Items]
Concentration risk (in percentage)	13.00%
Revenue
Product Information [Line Items]
Concentration risk (in percentage)	12.00%

Revenue - Schedule of Revenue Disaggregated by Type of Arrangement (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

^[1]

$ 154,941

$ 112,574

$ 73,081

Recurring technology

One-time technology (i.e., perpetual license)

83,791

55,266

28,003

184

1,958

3,690

Professional services

Total Compensation Expense from Repurchase [Line Items]

^[1]

$ 70,966

$ 55,350

$ 41,388

[1]	Includes amounts attributable to related party transactions. See Note 18 for further details.

Revenue - Narrative (Details)	12 Months Ended
Revenue - Narrative (Details)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Geographic Concentration Risk \| Revenue from contract with customer benchmark \| UNITED STATES
Disaggregation of Revenue [Line Items]
Revenue related to contracts with customers (percentage)	99.70%	99.40%	99.50%

Goodwill and Intangible Assets - Narrative (Details) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2019 segment	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Number of operating segments (in segments)		2
Number of reportable segments (in segments)	2	2
Amortization of intangible assets \| $		$ 6.3	$ 5.1	$ 4.5

Goodwill and Intangible Assets - Schedule of Goodwill by Reporting Unit (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Goodwill [Line Items]
Goodwill	$ 3,694	$ 3,694
Technology
Goodwill [Line Items]
Goodwill	2,912	2,912
Professional services
Goodwill [Line Items]
Goodwill	$ 782	$ 782

Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Gross	$ 47,507	$ 43,947
Accumulated Amortization	(21,972)	(15,643)
Total future amortization expense	25,535	28,304
Developed technologies
Finite-Lived Intangible Assets [Line Items]
Gross	36,129	36,129
Accumulated Amortization	(16,548)	(12,720)
Total future amortization expense	19,581	23,409
Customer relationships and contracts
Finite-Lived Intangible Assets [Line Items]
Gross	4,164	4,164
Accumulated Amortization	(2,773)	(2,080)
Total future amortization expense	1,391	2,084
Computer software licenses
Finite-Lived Intangible Assets [Line Items]
Gross	7,114	3,554
Accumulated Amortization	(2,576)	(818)
Total future amortization expense	4,538	2,736
Trademarks
Finite-Lived Intangible Assets [Line Items]
Gross	100	100
Accumulated Amortization	(75)	(25)
Total future amortization expense	$ 25	$ 75

Goodwill and Intangible Assets - Schedule of Remaining Amortization Period (Details)	12 Months Ended
	Dec. 31, 2019
Developed technologies
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period (years)	5 years 4 months 24 days
Customer relationships and contracts
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period (years)	2 years 6 months
Computer software licenses
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period (years)	2 years 3 months 18 days
Trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period (years)	6 months

Goodwill and Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
2020	$ 6,627
2021	5,945
2022	4,716
2023	3,171
2024	3,041
Thereafter	2,035
Total future amortization expense	$ 25,535	$ 28,304

Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 14,090	$ 12,370
Less: accumulated depreciation	(9,795)	(7,694)
Property and equipment, net	4,295	4,676
Computer equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	7,951	6,769
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment	2,234	1,704
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total property and equipment	1,030	1,406
Capitalized internal-use software costs
Property, Plant and Equipment [Line Items]
Total property and equipment	1,866	1,482
Computer software
Property, Plant and Equipment [Line Items]
Total property and equipment	972	972
Capital lease equipment
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 37	$ 37

Property and Equipment - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 2.9	$ 2.3	$ 1.4
Capitalized internal-use software	0.4	0.2	1.3
Capitalized internal use software cost amortization expense	$ 0.5	$ 0.4	$ 0.1

Short-term Investments (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 227,346	$ 32,234
Unrealized Gains	79	0
Unrealized Losses	(5)	(1)
Fair Value	227,420	32,233
Money market funds
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	17,175	23,085
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	17,175	23,085
U.S. treasury notes
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	58,130	4,175
Unrealized Gains	34	0
Unrealized Losses	0	(1)
Fair Value	58,164	4,174
Commercial paper
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	46,973	3,976
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	46,973	3,976
Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	64,978	998
Unrealized Gains	27	0
Unrealized Losses	(5)	0
Fair Value	65,000	998
Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	40,090
Unrealized Gains	18
Unrealized Losses	0
Fair Value	40,108
Cash equivalents
Debt Securities, Available-for-sale [Line Items]
Fair Value	17,175	27,472
Cash equivalents \| Money market funds
Debt Securities, Available-for-sale [Line Items]
Fair Value	17,175	23,085
Cash equivalents \| U.S. treasury notes
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	1,396
Cash equivalents \| Commercial paper
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	1,993
Cash equivalents \| Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	998
Cash equivalents \| Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Fair Value	0
Short-term Investments
Debt Securities, Available-for-sale [Line Items]
Fair Value	210,245	4,761
Short-term Investments \| Money market funds
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	0
Short-term Investments \| U.S. treasury notes
Debt Securities, Available-for-sale [Line Items]
Fair Value	58,164	2,778
Short-term Investments \| Commercial paper
Debt Securities, Available-for-sale [Line Items]
Fair Value	46,973	1,983
Short-term Investments \| Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Fair Value	65,000	$ 0
Short-term Investments \| Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Fair Value	$ 40,108

Accrued liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Accrued compensation and benefit expenses	$ 4,278	$ 5,888
Other accrued liabilities	4,666	3,315
Total accrued liabilities	$ 8,944	$ 9,203

Leases - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
Leases - Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Long-term leases with terms of greater than 12 months
Lessee, Lease, Description [Line Items]
Operating lease expense	$ 3.2	$ 2.2	$ 1.8
Short-term leases with terms of 12 months or less
Lessee, Lease, Description [Line Items]
Operating lease expense	$ 0.2	$ 0.5	$ 0.6
Minimum
Lessee, Lease, Description [Line Items]
Lessee, operating lease, renewal term	1 year
Maximum
Lessee, Lease, Description [Line Items]
Lessee, operating lease, renewal term	5 years

Leases - Schedule of Operating Lease Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
2020	$ 3,000
2021	824
2022	399
2023	410
2024	152
Thereafter	0
Total lease payments	4,785
Less: Imputed interest	(325)
Total lease liability	$ 4,460	$ 6,805

Leases - Schedule of Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
Operating lease right-of-use assets	$ (3,787)	$ (6,344)
Operating lease liabilities, current	(2,806)	(2,577)
Operating lease liabilities, noncurrent	(1,654)	(4,228)
Total operating lease liabilities	$ 4,460	$ 6,805
Weighted-average remaining operating lease term (years)	2 years 2 months 12 days	2 years 7 months 6 days
Weighted-average operating lease discount rate (in percentage)	5.60%	5.50%

Acquisition-related consideration payable (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Business Combinations [Abstract]
2020	$ 2,250
2021	2,000
Total cash commitments as part of acquisitions	4,250
Less: Imputed interest	(198)
Total acquisition-related consideration payable	$ 4,052

Credit Facilities - Narrative (Details) - USD ($)		1 Months Ended			12 Months Ended
Credit Facilities - Narrative (Details) - USD ($)	Feb. 06, 2019	Oct. 31, 2018	Oct. 31, 2017	Jun. 30, 2016	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Line of Credit Facility [Line Items]
Debt discount and issuance cost					$ 1,800,000	$ 1,200,000
Advances from line of credit					47,169,000	9,950,000	$ 9,787,000
Loss on extinguishment of debt					(1,670,000)	0	0
Repayments of lines of credit					21,821,000	$ 0	$ 0
Silicon Valley Bank \| Term loan
Line of Credit Facility [Line Items]
Prepayment premium	$ 500,000
Write off of deferred debt issuance cost	1,200,000
Loss on extinguishment of debt	1,700,000
Repayments of lines of credit	20,000,000.0
Silicon Valley Bank \| Revolving line of credit
Line of Credit Facility [Line Items]
Repayments of lines of credit	1,300,000
Silicon Valley Bank \| Loan and Security Agreement
Line of Credit Facility [Line Items]
Advances from line of credit				$ 1,300,000
Current borrowing capacity	5,000,000.0
Cash or cash equivalents on deposits	5,000,000.0
Option to increase the maximum borrowing capacity	10,000,000.0
Silicon Valley Bank \| Mezzanine Loan and Security Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity			$ 20,000,000.0
Payments of financing costs			200,000
Advances from line of credit		$ 10,000,000.0	$ 10,000,000.0
OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Payments of financing costs	2,400,000
Amount borrowed	80,000,000.0
Current borrowing capacity	50,000,000.0
Additional borrowing capacity available	30,000,000.0
Debt issuance costs	$ 300,000
Debt covenant on minimum requirement on technology revenue for 12 months to borrow 1					60,000,000.0
Debt covenant on minimum requirement on technology revenue for 12 months to borrow 2					$ 80,000,000.0
Exit fee	5.00%
Minimum \| Revolving line of credit
Line of Credit Facility [Line Items]
Basis rate (in percentage)					10.00%
Minimum \| OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Debt covenant borrowing capacity based on technology revenue					$ 25,000,000.0
Basis rate (in percentage)	10.00%
Repayment premium (in percentage)	1.00%
Maximum \| OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Debt covenant borrowing capacity based on technology revenue					10,000,000.0
Debt covenant borrowing capacity based on technology revenue					$ 30,000,000.0
Repayment premium (in percentage)	12.00%
LIBOR \| Revolving line of credit
Line of Credit Facility [Line Items]
Basis rate (in percentage)					7.50%
LIBOR \| OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Contractual interest rate- basis spread on variable rate (in percentage)	7.50%

Credit Facilities - Schedule of Term Credit Facilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Line of Credit Facility [Line Items]
Credit facilities	$ 50,000	$ 21,321
Less: current portion of credit facilities	0	(1,321)
Credit facilities, less current portion	50,000	20,000
Remaining capacity	35,000	18,679
Term loan
Line of Credit Facility [Line Items]
Credit facilities	50,000	20,000
Remaining capacity	$ 30,000	$ 0
Interest rate (in percentage)	10.00%	11.75%
Revolving line of credit
Line of Credit Facility [Line Items]
Credit facilities	$ 0	$ 1,321
Remaining capacity	$ 5,000	$ 18,679
Interest rate (in percentage)	5.25%	6.00%
LIBOR \| Revolving line of credit
Line of Credit Facility [Line Items]
Basis rate (in percentage)	7.50%
Prime rate \| Term loan
Line of Credit Facility [Line Items]
Basis rate (in percentage)		6.25%
Prime rate \| Revolving line of credit
Line of Credit Facility [Line Items]
Basis rate (in percentage)	0.50%	0.50%
Minimum \| Revolving line of credit
Line of Credit Facility [Line Items]
Basis rate (in percentage)	10.00%

Redeemable Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Jul. 29, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Class of Stock [Line Items]
Redeemable convertible preferred stock, shares authorized (in shares)		0	45,427,441
Redeemable convertible preferred stock, par value (in USD per share)		$ 0.001	$ 0.001
Redeemable convertible preferred stock shares issued (in shares)		0	22,713,694
Redeemable convertible preferred stock, additional shares authorized (in shares)		1,077,587
Issuance of redeemable convertible preferred stock, net of issuance costs (in shares)		437,787	1,603,923	1,124,632
Redeemable preferred stock issued during period		$ 12,073	$ 36,239	$ 23,787
Issuance costs		4,610	0	0
Accretion of redeemable convertible preferred stock		180,826	52,037	11,745
Temporary equity, carrying amount, attributable to parent	$ 602,700	$ 0	$ 409,845	$ 321,569	$ 286,037
Designated Series A redeemable convertible preferred stock
Class of Stock [Line Items]
Redeemable convertible preferred stock shares issued (in shares)			3,587,499
Designated Series B redeemable convertible preferred stock
Class of Stock [Line Items]
Redeemable convertible preferred stock shares issued (in shares)			4,986,827
Designated Series C redeemable convertible preferred stock
Class of Stock [Line Items]
Redeemable convertible preferred stock shares issued (in shares)			4,794,007
Designated Series D redeemable convertible preferred stock
Class of Stock [Line Items]
Redeemable convertible preferred stock shares issued (in shares)			3,314,612
Designated Series E redeemable convertible preferred stock
Class of Stock [Line Items]
Redeemable convertible preferred stock shares issued (in shares)			6,030,749
Designated Series F redeemable convertible preferred stock
Class of Stock [Line Items]
Issuance of redeemable convertible preferred stock, net of issuance costs (in shares)		437,787
Issuance costs		$ 100
Redeemable preferred stock
Class of Stock [Line Items]
Temporary equity, fair value			$ 409,800
IPO
Class of Stock [Line Items]
Redeemable convertible preferred stock shares issued (in shares)		23,151,481
Issuance costs	$ 4,600
Sale of stock, price per share (in USD per share)	$ 26.00

Stockholders’ Equity (Deficit) - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Mar. 31, 2019	Oct. 31, 2017	Dec. 31, 2016
Class of Stock [Line Items]
Common stock, shares authorized (in shares)		500,000,000	72,565,312
Common stock, par value (in USD per share)		$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)		25,000,000	0
Shares outstanding (in shares)					36,731,632
Preferred stock, shares issued (in shares)			4,832,134
Shares issued to former employees with notes determined to be nonrecourse (in shares)		52,778
Preferred stock issued (in shares)	0	0	0
Preferred stock outstanding (in shares)	0	0	0
Cash consideration of stocks repurchased		$ 0	$ 8,712	$ 0
Fair value of stocks repurchased			8,712
Board Of Directors, Term		3 years
Debt extinguishment costs		$ (1,670)	0	$ 0
Repurchase price over the estimated fair value of the common stock redeemed from team members
Class of Stock [Line Items]
Total compensation expense from repurchase			$ 8,300
Common stock
Class of Stock [Line Items]
Shares outstanding (in shares)		36,678,854	4,779,356	4,853,841			4,840,810
Fair value of stocks repurchased			$ 1
Mezzanine loan and security agreement \| Common stock warrants
Class of Stock [Line Items]
Shares of common stock (in shares)						255,336
Warrants and rights outstanding, term						10 years
Exercise price of warrants (in USD per share)						$ 10.66
Deferred financing costs						$ 1,600
Debt conversion, converted instrument, warrants or options issued (in shares)	255,336
Mezzanine loan and security agreement \| Unamortized portion of the debt discount
Class of Stock [Line Items]
Debt extinguishment costs		$ (1,000)
Mezzanine loan and security agreement \| Common stock
Class of Stock [Line Items]
Conversion of stock, shares issued (in shares)	189,959
Team member
Class of Stock [Line Items]
Tender Offer (in shares)			798,372
Cash consideration of stocks repurchased			$ 16,900
Fair value of stocks repurchased			8,600
Offering costs			$ 100

Stockholders’ Equity (Deficit) - Schedule of the Effects of the Tender Offer Repurchase Price Over the Estimated Fair Value of the Common Stock Redeemed (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

^[1]

$ 47,284

$ 44,123

$ 25,920

^[1]

46,252

38,592

28,470

Repurchase price over the estimated fair value of the common stock redeemed from team members

^[1]

$ 31,713

22,690

$ 14,697

Total Compensation Expense from Repurchase [Line Items]

Cost of revenue

312

3,967

906

Total compensation expense from repurchase

3,133

$ 8,318

[1]	Includes amounts attributable to related party transactions. See Note 18 for further details.

Net Loss Per Share - Schedule of the Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Numerator:
Net loss attributable to common stockholders	$ (240,922)	$ (114,021)	$ (58,780)
Denominator:
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted	18,741,119	4,798,363	4,846,511
Net loss per share attributable to common stockholders, basic and diluted (in USD per share)	$ (12.86)	$ (23.76)	$ (12.13)

Net Loss Per Share - Schedule of Share Totals with a Potentially Dilutive Impact (Details) - shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact (in shares)	8,351,577	30,206,447	26,070,278
Redeemable convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact (in shares)	0	22,713,694	21,109,771
Common stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact (in shares)	7,847,716	7,237,417	4,705,171
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact (in shares)	503,861	0	0
Common stock warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact (in shares)	0	255,336	255,336

Stock-Based Compensation - Narrative (Details) - USD ($)		9 Months Ended	12 Months Ended
	Jul. 23, 2019	Sep. 30, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant (in shares)			615,234
Service period (in years)			4 years
Weighted-average grant date fair value of option (in USD per share)			$ 9.31	$ 5.30	$ 5.14
Shares exercised in period (in shares)			$ 6,500,000	$ 10,900,000	$ 100,000
Total grant-date fair value of stock options vested			8,100,000	$ 3,300,000	3,600,000
Nonvested award options, unrecognized compensation expense			$ 16,200,000
Shares issued to former employees with notes determined to be nonrecourse (in shares)			52,778
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested awards, period for recognition			2 years 3 months 18 days
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)		4 years
Nonvested awards, period for recognition		3 years 4 months 24 days
Vesting period		1 year
Unrecognized stock-based compensation expense			$ 16,900,000
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for grant (in shares)			750,000
Percentage increase of the number of common stock shares (in percentage)			1.00%
Total grant-date fair value of stock options vested			$ 3,000,000.0
Amount of shares to be increased by (in shares)			750,000
Maximum employee subscription rate (in percentage)			15.00%
Maximum purchase value during offering Period per employee			$ 25,000
Maximum purchased shares allowed (in shares)			2,500
Purchase price of common stock (in percentage)			85.00%
Shares issued in period (in shares)			134,766
Per share weighted average price of shares purchased (in USD per share)			$ 22.10
Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for grant (in shares)	2,756,607		11,272,878	8,772,878
Shares available for grant (in shares)			2,309,370	1,296,793
Stock Incentive Plan \| Performance shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)			4 years
Cumulative catch-up compensation expense			$ 6,000,000.0
Shares exercised in period (in shares)				$ 100,000	$ 100,000
Stock Incentive Plan 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of additional shares authorized (in shares)	256,607
Percentage increase of the number of common stock shares (in percentage)	5.00%
Stock Incentive Plan 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for grant (in shares)	2,500,000

Stock-Based Compensation - Stock Option Assumptions (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 3 months 18 days	6 years 3 months 18 days	6 years 3 months 18 days
Expected dividends	0.00%	0.00%	0.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	43.80%	43.60%	46.50%
Risk-free interest rate (in percentage)	2.40%	2.50%	2.00%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	44.50%	47.60%	48.40%
Risk-free interest rate (in percentage)	2.50%	3.00%	2.20%

Stock-Based Compensation - Effect of Stock-based Compensation Expense on Statement of Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 17,844	$ 4,198	$ 4,241
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	1,168	558	579
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	3,811	1,514	1,192
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	4,841	787	707
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	8,024	1,339	1,763
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	14,837	4,037	4,241
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	2,034	0	0
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	973	0	0
Other
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 0	$ 161	$ 0

Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Time-Based Option Shares
Outstanding at beginning or period (in shares)	7,237,417	4,705,171
Options granted (in shares)	1,198,121	3,352,644
Options exercised (in shares)	(373,292)	(723,902)
Options cancelled/forfeited (in shares)	(214,530)	(96,496)
Outstanding at end of period (in shares)	7,847,716	7,237,417
Vested and expected to vest (in shares)	7,847,716
Vested and exercisable (in shares)	4,248,921
Weighted Average Exercise Price
Options outstanding, beginning balance, weighted-average exercise price, beginning balance (in USD per share)	$ 9.60	$ 7.88
Options granted, weighted-average exercise price (in USD per share)	16.00	10.84
Options exercised, weighted-average exercise price (in USD per share)	7.11	4.20
Options cancelled/forfeited, weighted-average exercise price, (in USD per share)	10.53	9.32
Options outstanding, ending balance, weighted-average exercise price, ending balance (in USD per share)	10.67	$ 9.60
Vested and expected to vest (in USD per share)	10.67
Vested and exercisable (in USD per share)	$ 9.10
Weighted Average Remaining Contractual Life in Years
Option shares outstanding, weighted average remaining contractual life	7 years 1 month 6 days	7 years 10 months 24 days
Vested and expected to vest, weighted average remaining contractual life	7 years 1 month 6 days
Vested and exercisable, weighted average remaining contractual life	5 years 9 months 18 days
Aggregate Intrinsic Value
Option shares outstanding, aggregate intrinsic value	$ 188,573,947	$ 45,159,058
Option shares vested and expected to vest, aggregate intrinsic value	188,573,947
Option shares vested and exercisable, aggregate intrinsic value	$ 108,735,716

Stock-Based Compensation - Restricted Stock Unit (Details) - Restricted stock units	12 Months Ended
	Dec. 31, 2019 $ / shares shares
Restricted Stock Units
Unvested and outstanding, beginning balance (in shares) \| shares	0
RSUs granted \| shares	504,361
RSUs forfeited \| shares	(500)
Unvested and outstanding, ending balance (in shares) \| shares	503,861
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested and outstanding, beginning balance (in USD per share) \| $ / shares	$ 0
RSUs granted \| $ / shares	37.57
RSUs forfeited \| $ / shares	44.43
Unvested and outstanding, ending balance (in USD per share) \| $ / shares	$ 37.57

Stock-Based Compensation - Schedule of the Purchase Right for the ESPP Option Assumptions (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 3 months 18 days	6 years 3 months 18 days	6 years 3 months 18 days
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility (in percentage)	44.20%
Expected term (in years)	12 days
Risk-free interest rate (in percentage)	2.10%
Expected dividends (in USD per share)	$ 0

Income Taxes - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Operating Loss Carryforwards [Line Items]
Change in valuation allowance	$ 28.1	$ 15.9
Federal research and development credit carryforwards	13.5
State research and development credit carryforwards	5.9
Federal
Operating Loss Carryforwards [Line Items]
Federal net operating loss carryforwards	269.1
State
Operating Loss Carryforwards [Line Items]
Federal net operating loss carryforwards	$ 215.2

Income Taxes - Schedule of Income Tax Expense Benefit (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Current taxes:
Federal	$ 11	$ 0	$ 0
Foreign	10	0	0
State	81	28	12
Total current tax provision	102	28	12
Deferred taxes:
Federal	33	(135)	0
State	7	(28)	14
Total deferred provision (benefit)	40	(163)	14
Total income tax provision (benefit)	$ 142	$ (135)	$ 26

Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Tax at U.S. statutory rates	21.00%	21.00%	34.00%
State income tax, net of federal tax effect	(0.10%)	0.00%	0.00%
Federal research and development credits	17.20%	0.70%	1.00%
Stock-based compensation	(1.50%)	(0.40%)	(2.00%)
Change in valuation allowance	(36.60%)	(20.90%)	23.80%
U.S. tax reform	0	0	(0.567)
Other, net	(0.20%)	(0.20%)	(0.20%)
Effective income tax rate	(0.20%)	0.20%	(0.10%)

Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Deferred income tax assets:
Net operating loss carryforwards	$ 68,643	$ 59,645
Research and development credits	16,348	2,372
Intangible assets	5,354	5,393
Stock-based compensation	4,562	1,398
Deferred revenue	1,779	1,500
Interest limitation carryforward	1,983	554
Operating lease liabilities	1,219	1,808
Property and equipment	511	120
Accrued expenses	556	512
Allowance for bad debt	106	122
Other	52	63
Total deferred income tax assets	101,113	73,487
Valuation allowance	(98,370)	(70,258)
Deferred income tax liabilities:	2,743	3,229
Deferred income tax liabilities:
Prepaid expenses	(1,537)	(1,229)
Indefinite-lived intangible assets	(967)	(1,618)
Deferred contract costs	239	155
Deferred contract costs	(41)	(227)
Total deferred income tax liabilities	(2,784)	(3,229)
Net deferred income tax liabilities	$ (41)	$ 0

Income Taxes - Summary of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Unrecognized Tax Benefits
Beginning balance	$ 2,372	$ 1,939	$ 1,305
Decrease in unrecognized tax benefits taken in prior years	(957)	0	0
Increase in unrecognized tax benefits related to the current year	401	433	634
Ending balance	$ 1,816	$ 2,372	$ 1,939

Deferred Revenue and Performance Obligations - Remaining Performance Obligation (Details)	Dec. 31, 2019
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation (in percentage)	80.00%

Deferred Revenue and Performance Obligations - Narrative (Details) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($)
Product Information [Line Items]
Percentage of revenue recognized was included in deferred revenue (in percentage)	15.00%
Revenue remaining performance obligation amount	$ 54.6
Revenue, remaining performance obligation, expected timing of satisfaction, period	24 months
Technology and professional services
Product Information [Line Items]
Service contract term	3 years
Allowed termination period	1 year
Notice required for termination	90 days

Related Parties (Details) - USD ($) $ in Millions	12 Months Ended
Related Parties (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Related Party Transaction [Line Items]
Rent expense			$ 0.6
Deferred revenue	$ 32.1	$ 32.0	10.7
Board member
Related Party Transaction [Line Items]
Revenue recognized from related party	3.0	3.8	$ 8.6
Receivables from related party	0.6	0.1
Deferred revenue	0.5	0.4
Acquisition-related consideration payable to related party	$ 1.2	$ 3.3

Employee Benefit Plans (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plans (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Defined contribution plan, contributions	$ 5.3	$ 4.6	$ 3.5
Defined contribution plan employer matching contribution percent of match (in percentage)	100.00%
Defined contribution plan employer matching contribution percent of employees' gross pay (in percentage)	6.00%

Segments - Narrative (Details) - segment	9 Months Ended	12 Months Ended
Segments - Narrative (Details) - segment	Sep. 30, 2019	Dec. 31, 2019
Segment Reporting [Abstract]
Number of operating segments (in segments)		2
Number of reportable segments (in segments)	2	2

Segments - Scheduled of Segment Revenue (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

Segment Reporting, Revenue Reconciling Item [Line Items]

Segment Reporting, Revenue Reconciling Item [Line Items]

^[1]

$ 154,941

$ 112,574

$ 73,081

Technology

Segment Reporting, Revenue Reconciling Item [Line Items]

83,975

57,224

31,693

Professional services

Less Adjusted Gross Profit reconciling items:

$ 70,966

$ 55,350

$ 41,388

[1]	Includes amounts attributable to related party transactions. See Note 18 for further details.

Segments - Schedule of Segment Adjusted Gross Profit (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

Stock-based compensation

$ (17,844)

$ (4,198)

$ (4,241)

Less other reconciling items:

^[1]

(47,284)

(44,123)

(25,920)

^[1]

(46,252)

(38,592)

(28,470)

^[1]

(31,713)

(22,690)

(14,697)

Debt extinguishment costs

^[1]

(9,212)

(7,412)

(5,892)

(1,670)

Interest and other expense, net

(3,419)

(2,024)

(1,469)

Loss before income taxes

(59,954)

(62,119)

(47,009)

Operating segments

Adjusted Gross Profit:

Gross profit

80,872

53,929

30,018

Operating segments | Technology

Adjusted Gross Profit:

Gross profit

56,378

37,901

20,148

Operating segments | Professional services

Adjusted Gross Profit:

Gross profit

24,494

16,028

9,870

Segment reconciling items

Less Adjusted Gross Profit reconciling items:

Stock-based compensation

(1,168)

(558)

(579)

Tender offer payments deemed compensation

(312)

Post-acquisition restructuring costs

(108)

(337)

Less other reconciling items:

(47,284)

(44,123)

(25,920)

(46,252)

(38,592)

(28,470)

(31,713)

(22,690)

(14,697)