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Delaware
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74-3064240
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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1099 Stewart Street, Suite 600
Seattle, Washington
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98101
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, $0.001 Par Value Per Share
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The Nasdaq Global Select Market
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Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☒ (Do not check if a smaller reporting company)
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Smaller reporting company
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☐
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Emerging growth company
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☒
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Class
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Outstanding at February 20, 2018
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Common stock, $0.001 par value per share
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81,778,130 shares
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Page
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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Item 16.
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•
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helped customers buy or sell more than 120,000 homes worth more than $60 billion through 2017;
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•
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drew more than 20 million monthly average visitors to our website and mobile application in 2017, 40% more than in 2016, making us the fastest-growing top-10 real estate website;
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•
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earned a Net Promoter Score, a measure of customer satisfaction, that is 52% higher than competing brokerages’, and a customer repeat rate that is 65% higher than competing brokerages’;
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•
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sold Redfin-listed homes for approximately $3,000 more on average compared to the list price than competing brokerages’ listings in 2017; and
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•
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employed lead agents who, in 2017, were on average three times more productive, and earned a median income that was twice as much as agents at competing brokerages; our lead agents were also 26% more likely to stay with us from 2016 to 2017 than agents at competing brokerages.
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•
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Search engine optimization
. Our engineering teams constantly upgrade our website content and performance so that top-trafficked search engines find and rank our results for properties, neighborhoods, and regions. We believe this improves the customer experience and our ranking on high-traffic search engines.
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•
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Targeted-email campaigns
. We run targeted-email campaigns to connect with customers. These email campaigns, powered by machine learning, recommend relevant new listings to homebuyers and home sellers at what we believe are key moments throughout their interactions with us.
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•
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Paid-search advertising
. We advertise with top-trafficked search engines, regularly adjusting our bidding on key words and phrases, and modifying campaigns based on results.
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•
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Social media marketing
. We purchase targeted ads on social media networks such as Facebook and Twitter to generate traffic for our listings and attract new customers.
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•
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Traditional media
. We market through a mix of traditional media, including TV, radio, billboard and display, and direct mailings. We’ve been advertising on TV since 2014, and we continue to invest in TV advertising.
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•
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access to timely, accurate data about homes for sale;
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•
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traffic to our website and mobile application;
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•
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the speed and quality of our service, including agent responsiveness and local knowledge;
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•
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our ability to hire and retain agents who deliver the best customer service;
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•
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the costs of delivering our service and the price of our service to consumers;
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•
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consumer awareness of our service and the effectiveness of our marketing efforts;
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•
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technological innovation; and
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•
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depth and breadth of local referral networks.
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•
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increased interest rates;
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•
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increased unemployment rates or stagnant or declining wages;
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•
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slow economic growth or recessionary conditions;
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•
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weak credit markets;
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•
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low consumer confidence in the economy or the U.S. residential real estate industry;
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•
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adverse changes in local or regional economic conditions in the markets that we serve;
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•
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fluctuations in local and regional home inventory levels;
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•
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constraints on the availability of mortgage financing, enhanced mortgage underwriting standards, or increased down payment requirements;
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•
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federal and state legislative, tax or regulatory changes that would adversely affect the U.S. residential real estate industry, including potential reform relating to Fannie Mae, Freddie Mac and other government sponsored entities that provide liquidity to the mortgage market, and limitations on the deductions of certain mortgage interest expenses and property taxes;
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•
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increases in the exchange rate for the U.S. dollar compared to foreign currencies, causing U.S. real estate to be more expensive for foreign purchasers;
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•
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foreign regulatory changes or capital controls that would make it more difficult for foreign purchasers to withdraw capital from their home countries or purchase and hold U.S. real estate;
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•
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strength of financial institutions;
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•
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high levels of foreclosure activity in particular markets;
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•
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a decrease in home ownership rates; or
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•
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political uncertainty in the United States.
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•
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our inability to grow market share;
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•
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increased competition in the U.S. residential real estate industry;
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•
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changes in our commission rates;
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•
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our failure to realize our anticipated efficiency through our technology and business model;
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•
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failure to execute our growth strategies;
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•
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declines in the U.S. residential real estate industry; and
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•
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unforeseen expenses, difficulties, complications and delays, and other unknown factors.
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•
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seasonal variances of home sales, which historically peak during the summer and are weaker during the first and fourth quarters of each year;
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•
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cyclical periods of slowdowns or recessions in the U.S. real estate market;
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•
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our ability to increase market share;
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•
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fluctuations in sale prices and transaction volumes in our top markets;
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•
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the price of homes bought or sold by Redfin homebuyers and home sellers;
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•
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price competition;
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•
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volume of transactions in markets with a higher than average mean home price;
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•
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mix of transactions;
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•
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impairment charges associated with goodwill and other intangible assets;
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•
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the timing and success of new offerings by us and our competitors;
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•
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changes in local market conditions;
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•
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changes in interest rates and the mortgage and credit markets;
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•
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the time it takes new lead agents to become fully productive;
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•
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changes in federal, state, or local laws or taxes that affect real estate transactions or residential brokerage, title insurance, and mortgage insurance industries;
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•
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changes in multiple listing services, or MLSs, or other rules and regulations affecting the residential real estate industry; and
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•
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any acquisitions of, or investments in, third-party technologies or businesses.
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•
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successfully expand and deepen our business and market share;
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•
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respond to seasonality and cyclicality in the real estate industry and the U.S. economy;
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•
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compete with the pricing and offerings of our competitors;
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attract more customers to our website and mobile application;
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successfully invest in developing technology, tools, features, and products;
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maintain high levels of customer service;
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maximize our lead agents’ productivity;
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attract and retain high-quality lead agents;
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successfully contract with high-quality partner agents; and
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increase our brand awareness.
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increased costs to develop, distribute, or maintain our mobile website or mobile application;
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changes to the terms of service or requirements of a mobile application store that requires us to change our mobile application development or features in an adverse manner; and
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changes in mobile operating systems, such as Apple’s iOS and Google’s Android, that disproportionately affect us, degrade the functionality of our mobile website or mobile application, require that we make costly upgrades to our offerings, or give preferential treatment to competitive websites or mobile applications.
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•
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violations of laws and regulations governing the residential brokerage, title, or mortgage industries;
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employment law claims, including claims regarding worker misclassification;
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compliance with wage and hour regulations;
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privacy, cybersecurity incidents, and data breach claims;
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intellectual property disputes;
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consumer protection and fraud matters;
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brokerage disputes such as the failure to disclose hidden property defects, as well as other claims associated with failure to meet our client legal obligations, or incomplete or inaccurate listings data;
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claims that our agents or brokerage engage in discriminatory behavior in violation of the FHA;
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liability based on the conduct of individuals or entities outside of our control, such as independent contractor partner agents or independent contractor associate agents;
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•
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disputes relating to our commercial relationships with third parties; and
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actions relating to claims alleging other violations of federal, state, or local laws and regulations.
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cease offering or using technologies that incorporate the challenged intellectual property;
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make substantial payments for judgments, legal fees, settlement payments, ongoing royalties, or other costs or damages;
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obtain a license, which may not be available on reasonable terms or at all, to use the relevant technology; or
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•
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redesign our technology to avoid infringement.
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•
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resulting in time-consuming and costly litigation;
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•
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diverting management’s time and attention from developing our business;
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requiring us to pay monetary damages or enter into royalty and licensing agreements that we would not normally find acceptable;
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requiring us to redesign certain components of our software using alternative non-infringing source technology or practices, which could require significant effort and expense;
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•
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disrupting our customer relationships if we are forced to cease offering certain services;
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•
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requiring us to waive certain intellectual property rights associated with our release of open source software, or contributions to third-party open source projects;
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requiring us to disclose our software source code; and
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requiring us to satisfy indemnification obligations.
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•
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diverting management time and focus from operating our business to acquisition integration;
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•
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disrupting our respective ongoing business operations;
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•
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customer and industry acceptance of the acquired company’s offerings;
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•
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our ability to implement or remediate the controls, procedures, and policies of the acquired company;
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•
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retaining and integrating acquired employees;
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•
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failing to maintain important business relationships and contracts;
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•
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liability for activities of the acquired company before the acquisition;
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•
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litigation or other claims arising in connection with the acquired company;
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•
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impairment charges associated with goodwill and other acquired intangible assets; and
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•
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other unforeseen operating difficulties and expenditures.
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•
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overall performance of the equity markets and the performance of technology or real estate companies in particular;
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•
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variations in our results of operations, cash flows, and other financial metrics and non-financial metrics, and how those results compare to analyst expectations;
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•
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changes in the financial projections we may provide to the public or our failure to meet those projections;
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failure of securities analysts to maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors;
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recruitment or departure of key personnel;
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variations in general market, financial markets, economic, and political conditions in the United States;
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changes in mortgage interest rates;
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•
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changes in federal, state, or local tax laws and policies;
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variations in the housing market, including seasonal trends and fluctuations;
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negative publicity related to the real or perceived quality of our website and mobile application, as well as the failure to timely launch new products and services that gain market acceptance;
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•
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rumors and market speculation involving us or other companies in our industry;
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•
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announcements by us or our competitors of significant technical innovations, new business models, or changes in pricing;
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acquisitions, strategic partnerships, joint ventures, or capital commitments;
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new laws, regulations, or executive orders, or new interpretations of existing laws or regulations applicable to our business;
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•
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changes in MLS or other broker rules and regulations, or new interpretations of rules and regulations applicable to our business;
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lawsuits threatened or filed against us, or unfavorable determinations or settlements in any such suits;
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developments or disputes concerning our intellectual property or our technology, or third- party proprietary rights;
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changes in accounting standards, policies, guidelines, interpretations, or principles;
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•
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other events or factors, including those resulting from war, incidents of terrorism, or responses to these events;
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•
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the expiration of any contractual lock-up or market standoff agreements; and
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sales of shares of our common stock by us or our stockholders.
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•
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establish a classified board of directors so that not all members of our board are elected at one time;
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•
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permit only the board of directors to establish the number of directors and fill vacancies on the board;
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provide that directors may only be removed “for cause” and only with the approval of two-thirds of our stockholders;
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require super-majority voting to amend some provisions in our restated certificate of incorporation and restated bylaws;
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authorize the issuance of “blank check” preferred stock that our board could use to implement a stockholder rights plan, also known as a “poison pill”;
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•
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eliminate the ability of our stockholders to call special meetings of stockholders;
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•
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prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders;
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prohibit cumulative voting; and
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•
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establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
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Fiscal Year 2017
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High
|
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Low
|
||||
Third Quarter (beginning July 28, 2017)
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$
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33.49
|
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$
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19.29
|
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Fourth Quarter
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$
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31.32
|
|
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$
|
19.50
|
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Year Ended December 31,
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||||||||||||||
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2014
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2015
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2016
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2017
|
||||||||
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||||||||
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(in thousands, except share and per share data)
|
||||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
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125,363
|
|
|
$
|
187,338
|
|
|
$
|
267,196
|
|
|
$
|
370,036
|
|
Cost of revenue
|
93,272
|
|
|
138,492
|
|
|
184,452
|
|
|
258,216
|
|
||||
Gross profit
|
32,091
|
|
|
48,846
|
|
|
82,744
|
|
|
111,820
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Technology and development
|
17,876
|
|
|
27,842
|
|
|
34,588
|
|
|
42,532
|
|
||||
Marketing
|
15,058
|
|
|
19,899
|
|
|
28,571
|
|
|
32,251
|
|
||||
General and administrative
|
24,240
|
|
|
31,394
|
|
|
42,369
|
|
|
53,009
|
|
||||
Total operating expenses
|
57,174
|
|
|
79,135
|
|
|
105,528
|
|
|
127,792
|
|
||||
Income (loss) from operations
|
(25,083
|
)
|
|
(30,289
|
)
|
|
(22,784
|
)
|
|
(15,972
|
)
|
||||
Interest income and other income, net:
|
|
|
|
|
|
|
|
||||||||
Interest income
|
—
|
|
|
46
|
|
|
173
|
|
|
882
|
|
||||
Other income, net
|
24
|
|
|
7
|
|
|
85
|
|
|
88
|
|
||||
Total interest income and other income, net
|
47
|
|
|
53
|
|
|
258
|
|
|
970
|
|
||||
Income (loss) before tax benefit (expense)
|
(25,036
|
)
|
|
(30,236
|
)
|
|
(22,526
|
)
|
|
(15,002
|
)
|
||||
Income tax benefit (expense)
|
306
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
(24,730
|
)
|
|
$
|
(30,236
|
)
|
|
$
|
(22,526
|
)
|
|
$
|
(15,002
|
)
|
Accretion of redeemable convertible preferred stock
|
$
|
(101,251
|
)
|
|
$
|
(102,224
|
)
|
|
$
|
(55,502
|
)
|
|
$
|
(175,915
|
)
|
Net income (loss) attributable to common stock—basic and diluted
|
$
|
(125,981
|
)
|
|
$
|
(132,460
|
)
|
|
$
|
(78,028
|
)
|
|
$
|
(190,917
|
)
|
Net income (loss) per share attributable to common stock—basic and diluted
|
$
|
(11.76
|
)
|
|
$
|
(9.87
|
)
|
|
$
|
(5.42
|
)
|
|
$
|
(4.47
|
)
|
Weighted average shares used to compute net income (loss) per share attributable to common stock—basic and diluted
|
10,716,557
|
|
|
13,416,411
|
|
|
14,395,067
|
|
|
42,722,114
|
|
(1)
|
Includes stock-based compensation as follows:
|
|
Year Ended December 31,
|
||||||||||||||
|
2014
|
|
2015
|
|
2016
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands)
|
||||||||||||||
Cost of revenue
|
$
|
1,280
|
|
|
$
|
1,440
|
|
|
$
|
2,266
|
|
|
$
|
2,902
|
|
Technology and development
|
962
|
|
|
1,375
|
|
|
2,383
|
|
|
3,325
|
|
||||
Marketing
|
237
|
|
|
298
|
|
|
469
|
|
|
487
|
|
||||
General and administrative
|
2,717
|
|
|
2,449
|
|
|
3,295
|
|
|
4,387
|
|
||||
Total
|
$
|
5,196
|
|
|
$
|
5,562
|
|
|
$
|
8,413
|
|
|
$
|
11,101
|
|
(2)
|
See Note 8 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for an explanation of the calculations of our net income (loss) per share attributable to common stock, basic and diluted.
|
|
As of December 31,
|
||||||||||||||
|
2014
|
|
2015
|
|
2016
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands)
|
||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
||||||||
Cash, cash equivalents, and short-term investments
|
$
|
112,127
|
|
|
$
|
87,341
|
|
|
$
|
65,779
|
|
|
$
|
208,342
|
|
Working capital
|
106,196
|
|
|
83,234
|
|
|
60,445
|
|
|
204,349
|
|
||||
Total assets
|
142,113
|
|
|
125,054
|
|
|
133,477
|
|
|
281,955
|
|
||||
Redeemable convertible preferred stock
|
497,699
|
|
|
599,914
|
|
|
655,416
|
|
|
—
|
|
||||
Total stockholders’ equity (deficit)
|
(370,595
|
)
|
|
(495,713
|
)
|
|
(563,734
|
)
|
|
235,430
|
|
•
|
Brokerage Revenue.
We earn brokerage revenue from commissions we receive from representing homebuyers. Traditional brokerage buy-side commissions typically range from 2.5% to 3% of a home’s sale price, depending on the market. We typically return a portion of this commission to our homebuyer through a commission refund or closing-cost reduction. We recognize the remaining commission amount as revenue. We also earn revenue from commissions we receive from representing home sellers. Typical traditional brokerage sell-side commissions range from 2.5% to 3% of a home’s sale price. Our sell-side commissions, which we recognize as revenue, are typically 1% to 1.5% of a home’s sale price, depending on the market and subject to market-by-market minimums.
|
•
|
Partner Revenue
. Through the Redfin Partner Program, we refer customers to partner agents when we do not have a lead agent available to serve the customer due to high demand or geographic limitations. Partner agents pay us a fee representing a portion of the commission they receive when they close a referred transaction. For the years ended December 31, 2015, 2016 and 2017, we gave a portion of this referral fee to the customer in certain circumstances and recognized the remaining amount as revenue. In December 2017, we stopped giving a portion of our referral fee to the customer.
|
•
|
Other Revenue
. We offer services beyond helping customers buy and sell homes. For example, we currently provide title and settlement services in ten states and mortgage services in three states. We also license data and analytics from Walk Score, our neighborhood walk-ability tool. We operate an experimental business, Redfin Now, where we buy homes directly from homeowners and resell them to homebuyers.
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Monthly average visitors (in thousands)
|
11,705
|
|
|
16,215
|
|
|
22,623
|
|
|||
Real estate transactions:
|
|
|
|
|
|
||||||
Brokerage
|
18,586
|
|
|
25,868
|
|
|
35,038
|
|
|||
Partner
|
8,906
|
|
|
9,482
|
|
|
10,755
|
|
|||
Total
|
27,492
|
|
|
35,350
|
|
|
45,793
|
|
|||
Real estate revenue per real estate transaction:
|
|
|
|
|
|
||||||
Brokerage
|
$
|
9,215
|
|
|
$
|
9,436
|
|
|
$
|
9,429
|
|
Partner
|
1,142
|
|
|
1,719
|
|
|
1,971
|
|
|||
Aggregate
|
6,600
|
|
|
7,366
|
|
|
7,677
|
|
|||
Aggregate home value of real estate transactions (in millions)
|
12,296
|
|
|
16,199
|
|
|
21,280
|
|
|||
U.S. market share by value
|
0.44
|
%
|
|
0.54
|
%
|
|
0.67
|
%
|
|||
Revenue from top-10 Redfin markets as a percentage of real estate revenue
|
76
|
%
|
|
72
|
%
|
|
69
|
%
|
|||
Average number of lead agents
|
591
|
|
|
763
|
|
|
1,023
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Revenue
|
$
|
187,338
|
|
|
$
|
267,196
|
|
|
$
|
370,036
|
|
Cost of revenue
(1)
|
138,492
|
|
|
184,452
|
|
|
258,216
|
|
|||
Gross profit
|
48,846
|
|
|
82,744
|
|
|
111,820
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Technology and development
(1)
|
27,842
|
|
|
34,588
|
|
|
42,532
|
|
|||
Marketing
(1)
|
19,899
|
|
|
28,571
|
|
|
32,251
|
|
|||
General and administrative
(1)
|
31,394
|
|
|
42,369
|
|
|
53,009
|
|
|||
Total operating expenses
|
79,135
|
|
|
105,528
|
|
|
127,792
|
|
|||
Income (loss) from operations
|
(30,289
|
)
|
|
(22,784
|
)
|
|
(15,972
|
)
|
|||
Interest income and other income, net
|
53
|
|
|
258
|
|
|
970
|
|
|||
Net income (loss)
|
$
|
(30,236
|
)
|
|
$
|
(22,526
|
)
|
|
$
|
(15,002
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Cost of revenue
|
$
|
1,440
|
|
|
$
|
2,266
|
|
|
$
|
2,902
|
|
Technology and development
|
1,375
|
|
|
2,383
|
|
|
3,325
|
|
|||
Marketing
|
298
|
|
|
469
|
|
|
487
|
|
|||
General and administrative
|
2,449
|
|
|
3,295
|
|
|
4,387
|
|
|||
Total
|
$
|
5,562
|
|
|
$
|
8,413
|
|
|
$
|
11,101
|
|
|
Year Ended December 31,
|
|||||||
|
2015
|
|
2016
|
|
2017
|
|||
|
|
|
|
|
|
|||
|
(as a percentage of revenue)
|
|||||||
Cost of revenue
|
0.8
|
%
|
|
0.8
|
%
|
|
0.8
|
%
|
Technology and development
|
0.7
|
|
|
0.9
|
|
|
0.9
|
|
Marketing
|
0.2
|
|
|
0.2
|
|
|
0.1
|
|
General and administrative
|
1.3
|
|
|
1.2
|
|
|
1.2
|
|
Total
|
3.0
|
%
|
|
3.1
|
%
|
|
3.0
|
%
|
|
Year Ended December 31,
|
|
Change
|
||||||||||
|
2016
|
|
2017
|
|
Dollars
|
|
Percentage
|
||||||
|
|
|
|
|
|
|
|
||||||
|
(in thousands, except percentages)
|
||||||||||||
Real estate revenue:
|
|
|
|
|
|
|
|
||||||
Brokerage revenue
|
$
|
244,079
|
|
|
330,372
|
|
|
$
|
86,293
|
|
|
35
|
%
|
Partner revenue
|
16,304
|
|
|
21,198
|
|
|
4,894
|
|
|
30
|
|
||
Total real estate revenue
|
260,383
|
|
|
351,570
|
|
|
91,187
|
|
|
35
|
|
||
Other revenue
|
6,813
|
|
|
18,466
|
|
|
11,653
|
|
|
171
|
|
||
Revenue
|
$
|
267,196
|
|
|
370,036
|
|
|
$
|
102,840
|
|
|
38
|
|
Percentage of revenue
|
|
|
|
|
|
|
|
||||||
Real estate revenue:
|
|
|
|
|
|
|
|
||||||
Brokerage
|
91.4
|
%
|
|
89.3
|
%
|
|
|
|
|
||||
Partner revenue
|
6.1
|
|
|
5.7
|
|
|
|
|
|
||||
Total real estate revenue
|
97.5
|
|
|
95.0
|
|
|
|
|
|
||||
Other revenue
|
2.5
|
|
|
5.0
|
|
|
|
|
|
||||
Revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
Year Ended December 31,
|
|
Change
|
|||||||||||
|
2016
|
|
2017
|
|
Dollars
|
|
Percentage
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Cost of revenue
|
|
|
|
|
|
|
|
|||||||
Real estate
|
$
|
176,408
|
|
|
$
|
237,832
|
|
|
$
|
61,424
|
|
|
35
|
%
|
Other
|
8,044
|
|
|
20,384
|
|
|
12,340
|
|
|
153
|
|
|||
Total cost of revenue
|
$
|
184,452
|
|
|
$
|
258,216
|
|
|
$
|
73,764
|
|
|
40
|
|
|
|
|
|
|
|
|
|
|||||||
Gross profit
|
|
|
|
|
|
|
|
|||||||
Real estate
|
$
|
83,975
|
|
|
$
|
113,738
|
|
|
$
|
29,763
|
|
|
35
|
%
|
Other
|
(1,231
|
)
|
|
(1,918
|
)
|
|
(687
|
)
|
|
56
|
|
|||
Total gross profit
|
$
|
82,744
|
|
|
$
|
111,820
|
|
|
$
|
29,076
|
|
|
35
|
|
|
|
|
|
|
|
|
|
|||||||
Gross margin (percentage of revenue)
|
|
|
|
|
|
|
|
|||||||
Real estate
|
32.3
|
%
|
|
32.4
|
%
|
|
|
|
|
|||||
Other
|
(18.1
|
)
|
|
(10.4
|
)
|
|
|
|
|
|||||
Total gross margin
|
31.0
|
|
|
30.2
|
|
|
|
|
|
|
Year Ended December 31,
|
|
Change
|
|||||||||||
|
2016
|
|
2017
|
|
Dollars
|
|
Percentage
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Technology and development
|
$
|
34,588
|
|
|
$
|
42,532
|
|
|
$
|
7,944
|
|
|
23
|
%
|
Marketing
|
28,571
|
|
|
32,251
|
|
|
3,680
|
|
|
13
|
|
|||
General and administrative
|
42,369
|
|
|
53,009
|
|
|
10,640
|
|
|
25
|
|
|||
Total operating expenses
|
$
|
105,528
|
|
|
$
|
127,792
|
|
|
$
|
22,264
|
|
|
21
|
|
Percentage of revenue
|
|
|
|
|
|
|
|
|||||||
Technology and development
|
12.9
|
%
|
|
11.6
|
%
|
|
|
|
|
|||||
Marketing
|
10.7
|
|
|
8.7
|
|
|
|
|
|
|||||
General and administrative
|
15.9
|
|
|
14.3
|
|
|
|
|
|
|||||
Total operating expenses
|
39.5
|
%
|
|
34.6
|
%
|
|
|
|
|
|
Year Ended December 31,
|
|
Change
|
|||||||||||
|
2015
|
|
2016
|
|
Dollars
|
|
Percentage
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Real estate revenue:
|
|
|
|
|
|
|
|
|||||||
Brokerage revenue
|
$
|
171,276
|
|
|
$
|
244,079
|
|
|
$
|
72,803
|
|
|
43
|
%
|
Partner revenue
|
10,170
|
|
|
16,304
|
|
|
6,134
|
|
|
60
|
|
|||
Total real estate revenue
|
181,446
|
|
|
260,383
|
|
|
78,937
|
|
|
44
|
|
|||
Other revenue
|
5,892
|
|
|
6,813
|
|
|
921
|
|
|
16
|
|
|||
Revenue
|
$
|
187,338
|
|
|
$
|
267,196
|
|
|
$
|
79,858
|
|
|
43
|
|
Percentage of revenue
|
|
|
|
|
|
|
|
|||||||
Real estate revenue:
|
|
|
|
|
|
|
|
|||||||
Brokerage revenue
|
91.5
|
%
|
|
91.4
|
%
|
|
|
|
|
|||||
Partner revenue
|
5.4
|
|
|
6.1
|
|
|
|
|
|
|||||
Total real estate revenue
|
96.9
|
|
|
97.5
|
|
|
|
|
|
|||||
Other revenue
|
3.1
|
|
|
2.5
|
|
|
|
|
|
|||||
Revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
Year Ended December 31,
|
|
Change
|
|||||||||||
|
2015
|
|
2016
|
|
Dollars
|
|
Percentage
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Cost of revenue
|
|
|
|
|
|
|
|
|||||||
Real estate
|
$
|
131,522
|
|
|
$
|
176,408
|
|
|
$
|
44,886
|
|
|
34
|
%
|
Other
|
6,970
|
|
|
8,044
|
|
|
1,074
|
|
|
15
|
|
|||
Total cost of revenue
|
$
|
138,492
|
|
|
$
|
184,452
|
|
|
$
|
45,960
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|||||||
Gross profit
|
|
|
|
|
|
|
|
|||||||
Real estate
|
$
|
49,924
|
|
|
$
|
83,975
|
|
|
$
|
34,051
|
|
|
68
|
%
|
Other
|
(1,078
|
)
|
|
(1,231
|
)
|
|
(153
|
)
|
|
14
|
|
|||
Total gross profit
|
$
|
48,846
|
|
|
$
|
82,744
|
|
|
$
|
33,898
|
|
|
69
|
|
|
|
|
|
|
|
|
|
|||||||
Gross margin (percentage of revenue)
|
|
|
|
|
|
|
|
|||||||
Real estate
|
27.5
|
%
|
|
32.3
|
%
|
|
|
|
|
|||||
Other
|
(18.3
|
)
|
|
(18.1
|
)
|
|
|
|
|
|||||
Total gross margin
|
26.1
|
|
|
31.0
|
|
|
|
|
|
|
Year Ended December 31,
|
|
Change
|
|||||||||||
|
2015
|
|
2016
|
|
Dollars
|
|
Percentage
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Technology and development
|
$
|
27,842
|
|
|
$
|
34,588
|
|
|
$
|
6,746
|
|
|
24
|
%
|
Marketing
|
19,899
|
|
|
28,571
|
|
|
8,672
|
|
|
44
|
|
|||
General and administrative
|
31,394
|
|
|
42,369
|
|
|
10,975
|
|
|
35
|
|
|||
Total operating expenses
|
$
|
79,135
|
|
|
$
|
105,528
|
|
|
$
|
26,393
|
|
|
33
|
|
Percentage of revenue
|
|
|
|
|
|
|
|
|||||||
Technology and development
|
14.9
|
%
|
|
12.9
|
%
|
|
|
|
|
|||||
Marketing
|
10.6
|
|
|
10.7
|
|
|
|
|
|
|||||
General and administrative
|
16.7
|
|
|
15.9
|
|
|
|
|
|
|||||
Total operating expenses
|
42.2
|
%
|
|
39.5
|
%
|
|
|
|
|
|
|
Three Months Ended
|
||||||||||||||||||||||||||||||||||
|
Dec. 31, 2015
|
|
Mar. 31, 2016
|
|
June 30, 2016
|
|
Sep. 30, 2016
|
|
Dec. 31, 2016
|
|
Mar. 31, 2017
|
|
June 30, 2017
|
|
Sep. 30, 2017
|
|
Dec. 31, 2017
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||||||||||
Revenue
|
$
|
45,733
|
|
|
$
|
41,636
|
|
|
$
|
77,714
|
|
|
$
|
81,064
|
|
|
$
|
66,782
|
|
|
$
|
59,868
|
|
|
$
|
104,935
|
|
|
$
|
109,479
|
|
|
$
|
95,754
|
|
Cost of revenue
(1)
|
35,018
|
|
|
38,505
|
|
|
50,303
|
|
|
50,147
|
|
|
45,497
|
|
|
53,492
|
|
|
67,975
|
|
|
70,166
|
|
|
66,583
|
|
|||||||||
Gross profit
|
10,715
|
|
|
3,131
|
|
|
27,411
|
|
|
30,917
|
|
|
21,285
|
|
|
6,376
|
|
|
36,960
|
|
|
39,313
|
|
|
29,171
|
|
|||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Technology and development
(1)
|
7,459
|
|
|
7,898
|
|
|
8,060
|
|
|
9,781
|
|
|
8,849
|
|
|
9,672
|
|
|
10,090
|
|
|
11,483
|
|
|
11,287
|
|
|||||||||
Marketing
(1)
|
4,888
|
|
|
9,211
|
|
|
8,486
|
|
|
5,436
|
|
|
5,438
|
|
|
10,459
|
|
|
10,132
|
|
|
5,588
|
|
|
6,072
|
|
|||||||||
General and administrative
(1)
|
7,157
|
|
|
10,385
|
|
|
9,526
|
|
|
10,037
|
|
|
12,421
|
|
|
14,367
|
|
|
12,466
|
|
|
11,995
|
|
|
14,181
|
|
|||||||||
Total
|
19,504
|
|
|
27,494
|
|
|
26,072
|
|
|
25,254
|
|
|
26,708
|
|
|
34,498
|
|
|
32,688
|
|
|
29,066
|
|
|
31,540
|
|
|||||||||
Income (loss) from operations
|
(8,789
|
)
|
|
(24,363
|
)
|
|
1,339
|
|
|
5,663
|
|
|
(5,423
|
)
|
|
(28,122
|
)
|
|
4,272
|
|
|
10,247
|
|
|
(2,369
|
)
|
|||||||||
Interest income and other income, net
|
18
|
|
|
84
|
|
|
49
|
|
|
37
|
|
|
88
|
|
|
56
|
|
|
32
|
|
|
311
|
|
|
571
|
|
|||||||||
Net income (loss)
|
$
|
(8,771
|
)
|
|
$
|
(24,279
|
)
|
|
$
|
1,388
|
|
|
$
|
5,700
|
|
|
$
|
(5,335
|
)
|
|
$
|
(28,066
|
)
|
|
$
|
4,304
|
|
|
$
|
10,558
|
|
|
$
|
(1,798
|
)
|
|
Three Months Ended
|
||||||||||||||||||||||||||||||||||
|
Dec. 31, 2015
|
|
Mar. 31, 2016
|
|
June 30, 2016
|
|
Sep. 30, 2016
|
|
Dec. 31, 2016
|
|
Mar. 31, 2017
|
|
June 30, 2017
|
|
Sep. 30, 2017
|
|
Dec. 31, 2017
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||||||||||
Cost of revenue
|
$
|
455
|
|
|
$
|
518
|
|
|
$
|
525
|
|
|
$
|
546
|
|
|
$
|
677
|
|
|
$
|
714
|
|
|
$
|
699
|
|
|
$
|
715
|
|
|
$
|
774
|
|
Technology and development
|
404
|
|
|
539
|
|
|
559
|
|
|
555
|
|
|
730
|
|
|
731
|
|
|
751
|
|
|
819
|
|
|
1,024
|
|
|||||||||
Marketing
|
90
|
|
|
110
|
|
|
112
|
|
|
114
|
|
|
133
|
|
|
119
|
|
|
123
|
|
|
121
|
|
|
124
|
|
|||||||||
General and administrative
|
568
|
|
|
654
|
|
|
718
|
|
|
940
|
|
|
983
|
|
|
1,117
|
|
|
1,065
|
|
|
1,054
|
|
|
1,151
|
|
|||||||||
Total
|
$
|
1,517
|
|
|
$
|
1,821
|
|
|
$
|
1,914
|
|
|
$
|
2,155
|
|
|
$
|
2,523
|
|
|
$
|
2,681
|
|
|
$
|
2,638
|
|
|
$
|
2,709
|
|
|
$
|
3,073
|
|
|
Three Months Ended
|
|||||||||||||||||||||||||
|
Dec. 31, 2015
|
|
Mar. 31, 2016
|
|
June 30, 2016
|
|
Sep. 30, 2016
|
|
Dec. 31, 2016
|
|
Mar. 31, 2017
|
|
June 30, 2017
|
|
Sep. 30, 2017
|
|
Dec. 31, 2017
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
(as a percentage of revenue)
|
|||||||||||||||||||||||||
Revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of revenue(1)
|
76.6
|
|
|
92.5
|
|
|
64.7
|
|
|
61.9
|
|
|
68.1
|
|
|
89.3
|
|
|
64.8
|
|
|
64.1
|
|
|
69.5
|
|
Gross profit
|
23.4
|
|
|
7.5
|
|
|
35.3
|
|
|
38.1
|
|
|
31.9
|
|
|
10.7
|
|
|
35.2
|
|
|
35.9
|
|
|
30.5
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Technology and development(1)
|
16.3
|
|
|
19.0
|
|
|
10.4
|
|
|
12.1
|
|
|
13.3
|
|
|
16.2
|
|
|
9.6
|
|
|
10.5
|
|
|
11.8
|
|
Marketing(1)
|
10.7
|
|
|
22.1
|
|
|
10.9
|
|
|
6.7
|
|
|
8.1
|
|
|
17.5
|
|
|
9.7
|
|
|
5.1
|
|
|
6.3
|
|
General and administrative(1)
|
15.6
|
|
|
24.9
|
|
|
12.3
|
|
|
12.3
|
|
|
18.6
|
|
|
24.0
|
|
|
11.8
|
|
|
11.0
|
|
|
14.9
|
|
Total
|
42.6
|
|
|
66.0
|
|
|
33.6
|
|
|
31.1
|
|
|
40.0
|
|
|
57.7
|
|
|
31.1
|
|
|
26.6
|
|
|
33.0
|
|
Income (loss) from operations
|
(19.2
|
)
|
|
(58.5
|
)
|
|
1.7
|
|
|
7.0
|
|
|
(8.1
|
)
|
|
(47.0
|
)
|
|
4.1
|
|
|
9.3
|
|
|
(2.5
|
)
|
Interest income and other income, net
|
—
|
|
|
0.2
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
0.3
|
|
|
0.6
|
|
Net income (loss)
|
(19.2
|
)%
|
|
(58.3
|
)%
|
|
1.8
|
%
|
|
7.0
|
%
|
|
(8.0
|
)%
|
|
(46.9
|
)%
|
|
4.1
|
%
|
|
9.6
|
%
|
|
(1.9
|
)%
|
|
Three Months Ended
|
|||||||||||||||||||||||||
|
Dec. 31, 2015
|
|
Mar. 31, 2016
|
|
June 30, 2016
|
|
Sep. 30, 2016
|
|
Dec. 31, 2016
|
|
Mar. 31, 2017
|
|
June 30, 2017
|
|
Sep. 30, 2017
|
|
Dec. 31, 2017
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
(as a percentage of revenue)
|
|||||||||||||||||||||||||
Cost of revenue
|
1.0
|
%
|
|
1.2
|
%
|
|
0.7
|
%
|
|
0.7
|
%
|
|
1.0
|
%
|
|
1.2
|
%
|
|
0.7
|
%
|
|
0.7
|
%
|
|
0.8
|
%
|
Technology and development
|
0.9
|
|
|
1.3
|
|
|
0.7
|
|
|
0.7
|
|
|
1.1
|
|
|
1.2
|
|
|
0.7
|
|
|
0.7
|
|
|
1.1
|
|
Marketing
|
0.2
|
|
|
0.3
|
|
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
General and administrative
|
1.2
|
|
|
1.6
|
|
|
0.9
|
|
|
1.2
|
|
|
1.5
|
|
|
1.9
|
|
|
1.0
|
|
|
1.0
|
|
|
1.2
|
|
Total
|
3.3
|
%
|
|
4.4
|
%
|
|
2.4
|
%
|
|
2.7
|
%
|
|
3.8
|
%
|
|
4.5
|
%
|
|
2.5
|
%
|
|
2.5
|
%
|
|
3.2
|
%
|
|
Three Months Ended
|
||||||||||||||||||||||||||||||||||
|
Dec. 31, 2015
|
|
Mar. 31, 2016
|
|
June 30, 2016
|
|
Sep. 30, 2016
|
|
Dec. 31, 2016
|
|
Mar. 31, 2017
|
|
June 30, 2017
|
|
Sep. 30, 2017
|
|
Dec. 31, 2017
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Monthly average visitors (in thousands)
|
11,142
|
|
|
13,987
|
|
|
17,021
|
|
|
17,795
|
|
|
16,058
|
|
|
20,162
|
|
|
24,400
|
|
|
24,518
|
|
|
21,377
|
|
|||||||||
Real estate transactions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Brokerage
|
4,510
|
|
|
4,005
|
|
|
7,497
|
|
|
7,934
|
|
|
6,432
|
|
|
5,692
|
|
|
10,221
|
|
|
10,527
|
|
|
8,598
|
|
|||||||||
Partner
|
2,273
|
|
|
1,936
|
|
|
2,602
|
|
|
2,663
|
|
|
2,281
|
|
|
2,041
|
|
|
2,874
|
|
|
3,101
|
|
|
2,739
|
|
|||||||||
Total
|
6,783
|
|
|
5,941
|
|
|
10,099
|
|
|
10,597
|
|
|
8,713
|
|
|
7,733
|
|
|
13,095
|
|
|
13,628
|
|
|
11,337
|
|
|||||||||
Real estate revenue per real estate transaction:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Brokerage
|
$
|
9,242
|
|
|
$
|
9,485
|
|
|
$
|
9,524
|
|
|
$
|
9,333
|
|
|
$
|
9,428
|
|
|
$
|
9,570
|
|
|
$
|
9,301
|
|
|
$
|
9,289
|
|
|
$
|
9,659
|
|
Partner
|
1,177
|
|
|
1,224
|
|
|
1,633
|
|
|
1,932
|
|
|
1,991
|
|
|
1,911
|
|
|
1,945
|
|
|
1,960
|
|
|
2,056
|
|
|||||||||
Aggregate
|
$
|
6,539
|
|
|
$
|
6,793
|
|
|
$
|
7,491
|
|
|
$
|
7,474
|
|
|
$
|
7,481
|
|
|
$
|
7,548
|
|
|
$
|
7,687
|
|
|
$
|
7,621
|
|
|
$
|
7,822
|
|
Aggregate home value of real estate transactions (in millions)
|
$
|
2,984
|
|
|
$
|
2,599
|
|
|
$
|
4,684
|
|
|
$
|
4,898
|
|
|
$
|
4,018
|
|
|
$
|
3,470
|
|
|
$
|
6,119
|
|
|
$
|
6,341
|
|
|
$
|
5,350
|
|
U.S. market share by value
|
0.46
|
%
|
|
0.48
|
%
|
|
0.53
|
%
|
|
0.57
|
%
|
|
0.56
|
%
|
|
0.58
|
%
|
|
0.64
|
%
|
|
0.71
|
%
|
|
0.71
|
%
|
|||||||||
Revenue from top-10 Redfin markets as a percentage of real
estate revenue |
73
|
%
|
|
71
|
%
|
|
74
|
%
|
|
72
|
%
|
|
71
|
%
|
|
68
|
%
|
|
69
|
%
|
|
69
|
%
|
|
69
|
%
|
|||||||||
Average number of lead agents
|
667
|
|
|
743
|
|
|
756
|
|
|
756
|
|
|
796
|
|
|
935
|
|
|
1,010
|
|
|
1,028
|
|
|
1,118
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
(22,221
|
)
|
|
$
|
(9,352
|
)
|
|
$
|
5,355
|
|
Net cash used in investing activities
|
(4,567
|
)
|
|
(13,567
|
)
|
|
(10,364
|
)
|
|||
Net cash provided by financing activities
|
$
|
3,545
|
|
|
$
|
1,744
|
|
|
$
|
149,822
|
|
|
Payments Due by Period:
|
||||||||||||||||||
|
Total
|
|
Less than 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than 5 Years
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Operating leases
|
$
|
58,740
|
|
|
$
|
7,595
|
|
|
$
|
15,282
|
|
|
$
|
13,453
|
|
|
$
|
22,410
|
|
Purchase obligations
|
5,106
|
|
|
3,003
|
|
|
2,103
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
63,846
|
|
|
$
|
10,598
|
|
|
$
|
17,385
|
|
|
$
|
13,453
|
|
|
$
|
22,410
|
|
•
|
Fair Value of Our Common Stock.
Prior to our IPO, the fair value of the shares of our common stock underlying stock options was established by our board of directors with the assistance of an independent third-party valuation firm. Because there was no public market for our common stock, our board of directors has relied on this independent valuation and other factors to establish the fair value of our common stock at the time of grant of the option.
|
•
|
Expected Life
. The expected term was estimated using the simplified method allowed under SEC guidance.
|
•
|
Volatility
. Prior to our IPO, the expected stock price volatility for our common stock was estimated by taking the average historical price volatility for industry peers based on daily price observations. Industry peers consist of several public companies in the real estate brokerage and technology industries. In 2015, we changed the group of industry peers due to external mergers and acquisitions in the real estate industry.
|
•
|
Risk-Free Rate
. The risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the options for each option group.
|
•
|
Dividend Yield
. We have never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future. Consequently, we used an expected dividend yield of zero.
|
•
|
contemporaneous unrelated third-party valuations of our common stock;
|
•
|
the prices at which we sold shares of our redeemable convertible preferred stock to outside investors in arm’s-length transactions;
|
•
|
the rights, preferences, and privileges of our redeemable convertible preferred stock relative to those of our common stock;
|
•
|
our results of operations, financial position and capital resources;
|
•
|
current business conditions and projections;
|
•
|
the lack of marketability of our common stock;
|
•
|
the hiring of key personnel and the experience of our management;
|
•
|
the fact that the option grants involve illiquid securities in a private company;
|
•
|
the likelihood of achieving a liquidity event, such as an initial public offering or a sale of our company, given the prevailing market conditions;
|
•
|
industry trends and competitive environment;
|
•
|
trends in the U.S. residential real estate market; and
|
•
|
overall economic indicators, including gross domestic product, employment, inflation, and interest rates.
|
•
|
The market approach estimates value based on a comparison of the subject company to comparable public companies in a similar line of business. To determine our peer group of companies, we considered a combination of public enterprises using Internet-based technology and incurring similar costs to deliver services and selected those that are similar in business operations, products, size, growth, financial performance, and geographic location. From the comparable companies, a representative market value multiple is determined, which is applied to the subject company’s operating results to estimate the value of the subject company. The market value multiple was determined based on consideration of revenue multiples and earnings before interest, taxes, depreciation and amortization, or EBITDA, and gross margin to each of the companies’ last 12-month revenue and the next fiscal year 12-month revenue. The multiples are calculated and then applied to the business being valued. The estimated value is then discounted by a non-marketability factor (discount for lack of marketability) due to the fact that stockholders of private companies do not have access to trading markets similar to those enjoyed by stockholders of public companies, which affects liquidity.
|
•
|
The income approach estimates value based on the expectation of future cash flows that a company will generate over a discrete projection period, as well as for the terminal period. The projected free cash flows include earnings before interest and taxes, less taxes, plus depreciation and amortization, less capital expenditures plus an increase or decrease in working capital. These future cash flows are discounted to their present values using a discount rate derived from an analysis of the cost of capital of comparable publicly traded companies in similar lines of business as of each calculations date and is adjusted to reflect the risks inherent in our cash flows. In addition, we also consider an appropriate discount adjustment to recognize the lack of marketability due to being a private company.
|
•
|
The prior sale of company stock approach estimates value by considering any prior arm’s length sales of our equity. When considering prior sales of our equity, the valuation considers the size of the equity sale, the relationship of the parties involved in the transaction, the timing of the equity sale, and our financial condition at the time of the sale.
|
|
Page
|
|
|
|
December 31,
|
||||||
|
2016
|
|
2017
|
||||
|
|
|
|
||||
Assets:
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
64,030
|
|
|
$
|
208,342
|
|
Restricted cash
|
3,815
|
|
|
4,316
|
|
||
Short-term investments
|
1,749
|
|
|
—
|
|
||
Prepaid expenses
|
4,388
|
|
|
8,613
|
|
||
Accrued revenue, net
|
10,625
|
|
|
13,334
|
|
||
Other current assets
|
8,781
|
|
|
3,710
|
|
||
Loans held for sale
|
—
|
|
|
1,891
|
|
||
Total current assets
|
93,388
|
|
|
240,206
|
|
||
Property and equipment, net
|
19,226
|
|
|
22,318
|
|
||
Intangible assets, net
|
3,782
|
|
|
3,294
|
|
||
Goodwill
|
9,186
|
|
|
9,186
|
|
||
Deferred offering costs
|
720
|
|
|
—
|
|
||
Other assets
|
7,175
|
|
|
6,951
|
|
||
Total assets:
|
$
|
133,477
|
|
|
$
|
281,955
|
|
Liabilities, redeemable convertible preferred stock and stockholders' equity/(deficit):
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
5,385
|
|
|
$
|
1,901
|
|
Accrued liabilities
|
22,253
|
|
|
26,605
|
|
||
Other payables
|
3,793
|
|
|
4,068
|
|
||
Loan facility
|
—
|
|
|
2,016
|
|
||
Current portion of deferred rent
|
1,512
|
|
|
1,267
|
|
||
Total current liabilities
|
32,943
|
|
|
35,857
|
|
||
Deferred rent, net of current portion
|
8,852
|
|
|
10,668
|
|
||
Total liabilities
|
41,795
|
|
|
46,525
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
||||
Redeemable convertible preferred stock—par value $0.001 per share; As of December 31, 2016: 166,266,114 shares authorized; 55,422,002 issued and outstanding; and aggregate liquidation preference of $167,488. As of December 31, 2017: no shares authorized, issued, and outstanding.
|
655,416
|
|
|
—
|
|
||
Stockholders’ equity/(deficit):
|
|
|
|
||||
Common stock—par value $0.001 per share; 290,081,638 and 500,000,000 shares authorized, respectively; 14,687,024 and 81,468,891 shares issued and outstanding, respectively
|
15
|
|
|
81
|
|
||
Preferred stock—par value $0.001 per share; As of December 31, 2016: no shares authorized, issued and outstanding. As of December 31, 2017: 10,000,000 shares authorized and no shares issued and outstanding.
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
—
|
|
|
364,352
|
|
||
Accumulated deficit
|
(563,749
|
)
|
|
(129,003
|
)
|
||
Total stockholders’ equity/(deficit)
|
(563,734
|
)
|
|
235,430
|
|
||
Total liabilities, redeemable convertible preferred stock and stockholders’ equity/(deficit):
|
$
|
133,477
|
|
|
$
|
281,955
|
|
|
Year End December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Revenue
|
$
|
187,338
|
|
|
$
|
267,196
|
|
|
$
|
370,036
|
|
Cost of revenue
|
138,492
|
|
|
184,452
|
|
|
258,216
|
|
|||
Gross profit
|
48,846
|
|
|
82,744
|
|
|
111,820
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Technology and development
|
27,842
|
|
|
34,588
|
|
|
42,532
|
|
|||
Marketing
|
19,899
|
|
|
28,571
|
|
|
32,251
|
|
|||
General and administrative
|
31,394
|
|
|
42,369
|
|
|
53,009
|
|
|||
Total operating expenses
|
79,135
|
|
|
105,528
|
|
|
127,792
|
|
|||
Income (loss) from operations
|
(30,289
|
)
|
|
(22,784
|
)
|
|
(15,972
|
)
|
|||
Interest income and other income, net:
|
|
|
|
|
|
||||||
Interest income
|
46
|
|
|
173
|
|
|
882
|
|
|||
Other income, net
|
7
|
|
|
85
|
|
|
88
|
|
|||
Total interest income and other income, net
|
53
|
|
|
258
|
|
|
970
|
|
|||
Net income (loss)
|
$
|
(30,236
|
)
|
|
$
|
(22,526
|
)
|
|
$
|
(15,002
|
)
|
Accretion of redeemable convertible preferred stock
|
$
|
(102,224
|
)
|
|
$
|
(55,502
|
)
|
|
$
|
(175,915
|
)
|
Net income (loss) attributable to common stock—basic and diluted
|
$
|
(132,460
|
)
|
|
$
|
(78,028
|
)
|
|
$
|
(190,917
|
)
|
Net income (loss) per share attributable to common stock—basic and diluted
|
$
|
(9.87
|
)
|
|
$
|
(5.42
|
)
|
|
$
|
(4.47
|
)
|
Weighted average shares used to compute net income (loss) per share attributable to common stock—basic and diluted
|
13,416,411
|
|
|
14,395,067
|
|
|
42,722,114
|
|
|
Year End December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(30,236
|
)
|
|
$
|
(22,526
|
)
|
|
$
|
(15,002
|
)
|
Adjustments to reconcile net income (loss) to net cash used in operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
4,395
|
|
|
6,293
|
|
|
7,176
|
|
|||
Stock-based compensation.
|
5,562
|
|
|
8,413
|
|
|
11,101
|
|
|||
Change in assets and liabilities:
|
|
|
|
|
|
||||||
Prepaid expenses
|
(3,963
|
)
|
|
2,244
|
|
|
(4,225
|
)
|
|||
Accrued revenue
|
(2,685
|
)
|
|
(5,021
|
)
|
|
(2,709
|
)
|
|||
Other current assets
|
721
|
|
|
(8,778
|
)
|
|
5,070
|
|
|||
Other long-term assets
|
(36
|
)
|
|
(5,964
|
)
|
|
223
|
|
|||
Accounts payable
|
152
|
|
|
638
|
|
|
(252
|
)
|
|||
Accrued expenses
|
3,890
|
|
|
6,581
|
|
|
5,115
|
|
|||
Deferred lease liability
|
(21
|
)
|
|
8,768
|
|
|
749
|
|
|||
Origination of loans held for sale
|
—
|
|
|
—
|
|
|
(11,008
|
)
|
|||
Proceeds from sale of loans held for sale
|
—
|
|
|
—
|
|
|
9,117
|
|
|||
Net cash provided by (used in) operating activities
|
(22,221
|
)
|
|
(9,352
|
)
|
|
5,355
|
|
|||
Investing activities
|
|
|
|
|
|
||||||
Sales and maturities of short-term investments
|
1,590
|
|
|
1,744
|
|
|
2,741
|
|
|||
Purchases of short-term investments
|
(1,550
|
)
|
|
(1,744
|
)
|
|
(992
|
)
|
|||
Purchases of property and equipment
|
(4,607
|
)
|
|
(13,567
|
)
|
|
(12,113
|
)
|
|||
Net cash used in investing activities
|
(4,567
|
)
|
|
(13,567
|
)
|
|
(10,364
|
)
|
|||
Financing activities
|
|
|
|
|
|
||||||
Issuance costs of redeemable convertible preferred stock
|
(9
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from tender offer
|
2,659
|
|
|
—
|
|
|
—
|
|
|||
In-substance dividend paid in relation to tender offer
|
(2,659
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from exercise of stock options
|
1,732
|
|
|
1,495
|
|
|
3,003
|
|
|||
Payment of initial public offering costs
|
—
|
|
|
(150
|
)
|
|
(3,558
|
)
|
|||
Proceeds from initial public offering, net of underwriting discounts
|
—
|
|
|
—
|
|
|
148,088
|
|
|||
Borrowings from warehouse credit facilities
|
—
|
|
|
—
|
|
|
10,746
|
|
|||
Repayments of warehouse credit facilities
|
—
|
|
|
—
|
|
|
(8,730
|
)
|
|||
Other payables - customer escrow deposits related to title services
|
1,822
|
|
|
399
|
|
|
273
|
|
|||
Net cash provided by financing activities
|
3,545
|
|
|
1,744
|
|
|
149,822
|
|
|||
Net change in cash, cash equivalents, and restricted cash
|
(23,243
|
)
|
|
(21,175
|
)
|
|
144,813
|
|
|||
Cash, cash equivalents, and restricted cash:
|
|
|
|
|
|
||||||
Beginning of period
|
112,263
|
|
|
89,020
|
|
|
67,845
|
|
|||
End of period
|
$
|
89,020
|
|
|
$
|
67,845
|
|
|
$
|
212,658
|
|
Supplemental disclosure of non-cash investing and financing activities
|
|
|
|
|
|
||||||
Conversion of redeemable convertible preferred stock to common stock
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
831,331
|
|
Accretion of redeemable convertible preferred stock
|
$
|
(102,224
|
)
|
|
$
|
(55,502
|
)
|
|
$
|
(175,915
|
)
|
Stock-based compensation capitalized in property and equipment
|
$
|
(49
|
)
|
|
$
|
(100
|
)
|
|
$
|
(268
|
)
|
Deferred initial public offering cost accruals
|
$
|
—
|
|
|
$
|
(570
|
)
|
|
$
|
—
|
|
Property and equipment additions in accounts payable and accrued expenses
|
$
|
—
|
|
|
$
|
(3,466
|
)
|
|
$
|
(31
|
)
|
Leasehold improvements paid directly by lessor
|
$
|
—
|
|
|
$
|
(520
|
)
|
|
$
|
(822
|
)
|
|
Redeemable Convertible
Preferred Stock |
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Accumulated Deficit
|
|
Total Stockholders' Deficit
|
||||||||||||||||
|
Shares
|
|
Amount
|
|
|
Shares
|
|
Amount
|
|
|
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance, January 1, 2015
|
55,422,002
|
|
|
$
|
497,699
|
|
|
|
12,629,479
|
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
(370,608
|
)
|
|
$
|
(370,595
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
|
1,430,122
|
|
|
1
|
|
|
1,730
|
|
|
—
|
|
|
1,731
|
|
|||||
Redeemable convertible preferred stock issuance costs
|
—
|
|
|
(9
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
|
|
|
—
|
|
|
5,611
|
|
|
—
|
|
|
5,611
|
|
||||||
In-substance dividend issued in tender offer
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2,659
|
|
|
(2,659
|
)
|
|
—
|
|
|||||
Accretion of redeemable convertible preferred stock
|
—
|
|
|
102,224
|
|
|
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
|
(92,224
|
)
|
|
(102,224
|
)
|
|||||
Net income (loss)
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30,236
|
)
|
|
(30,236
|
)
|
|||||
Balance, December 31, 2015
|
55,422,002
|
|
|
$
|
599,914
|
|
|
|
14,059,601
|
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
(495,727
|
)
|
|
$
|
(495,713
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
|
627,423
|
|
|
1
|
|
|
1,494
|
|
|
—
|
|
|
1,495
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
8,512
|
|
|
—
|
|
|
8,512
|
|
|||||
Accretion of redeemable convertible preferred stock
|
—
|
|
|
55,502
|
|
|
|
—
|
|
|
—
|
|
|
(10,006
|
)
|
|
(45,496
|
)
|
|
(55,502
|
)
|
|||||
Net income (loss) (unaudited)
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22,526
|
)
|
|
(22,526
|
)
|
|||||
Balance, December 31, 2016
|
55,422,002
|
|
|
$
|
655,416
|
|
|
|
14,687,024
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
(563,749
|
)
|
|
$
|
(563,734
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cumulative stock-based compensation adjustment
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
522
|
|
|
(522
|
)
|
|
—
|
|
|||||
Proceeds from initial public offering, net of underwriters' discounts
|
—
|
|
|
—
|
|
|
|
10,615,650
|
|
|
10
|
|
|
148,078
|
|
|
—
|
|
|
148,088
|
|
|||||
Initial public offering costs
|
—
|
|
|
—
|
|
|
|
|
|
|
|
(3,708
|
)
|
|
—
|
|
|
(3,708
|
)
|
|||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
|
744,215
|
|
|
1
|
|
|
3,000
|
|
|
—
|
|
|
3,001
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
|
|
|
|
|
11,369
|
|
|
—
|
|
|
11,369
|
|
|||||||
Accretion of redeemable convertible preferred stock
|
|
|
175,915
|
|
|
|
|
|
|
|
(8,690
|
)
|
|
(167,225
|
)
|
|
(175,915
|
)
|
||||||||
Conversion of redeemable convertible preferred stock to common stock
|
(55,422,002
|
)
|
|
(831,331
|
)
|
|
|
55,422,002
|
|
|
55
|
|
|
213,781
|
|
|
617,495
|
|
|
831,331
|
|
|||||
Net income (loss)
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,002
|
)
|
|
(15,002
|
)
|
|||||
Balance, December 31, 2017
|
—
|
|
|
$
|
—
|
|
|
|
81,468,891
|
|
|
$
|
81
|
|
|
$
|
364,352
|
|
|
$
|
(129,003
|
)
|
|
$
|
235,430
|
|
|
Previously reported
|
|
Adjustments
|
|
As revised
|
||||||
|
|
|
|
|
|
||||||
Year Ended December 31, 2015
|
|
|
|
|
|
||||||
Operating activities
|
$
|
(22,160
|
)
|
|
$
|
(61
|
)
|
|
$
|
(22,221
|
)
|
Financing activities
|
1,723
|
|
|
1,822
|
|
|
3,545
|
|
|||
Net change in cash, cash equivalents, and restricted cash (1)
|
$
|
(25,004
|
)
|
|
$
|
(1,761
|
)
|
|
$
|
(23,243
|
)
|
|
|
|
|
|
|
||||||
Year Ended December 31, 2016
|
|
|
|
|
|
||||||
Operating activities
|
$
|
(9,345
|
)
|
|
$
|
(7
|
)
|
|
$
|
(9,352
|
)
|
Financing activities
|
1,345
|
|
|
399
|
|
|
1,744
|
|
|||
Net change in cash, cash equivalents, and restricted cash (1)
|
$
|
(21,567
|
)
|
|
$
|
(392
|
)
|
|
$
|
(21,175
|
)
|
|
|
|
|
|
|
||||||
(1) Previously titled: net change in cash and cash equivalents
|
|
|
|
|
|
|
Year Ended
December 31,
|
||
|
2015
|
|
2016
|
|
|
|
|
Valuation Methodology:
|
|
|
|
Income approach (private company)
|
12.5%
|
|
12.5%-15.0%
|
Market approach (private company)
|
12.5%
|
|
12.5%-15.0%
|
PWERM (IPO)
|
56.3%
|
|
52.5%-60.0%
|
PWERM (M&A)
|
18.8%
|
|
15.0%-17.5%
|
IPO revenue multiple
|
4.0x-5.0x
|
|
3.0x-4.5x
|
Forecasted revenue growth rate
|
30.0%-50.3%
|
|
28.0%-41.80%
|
Discount rate
|
20.0%-30.0%
|
|
20.0%-30.0%
|
Financial Instrument
|
Fair Value Hierarchy
|
|
Fair Value
|
||||
|
December 31,
|
||||||
|
2016
|
|
2017
|
||||
|
|
|
|
|
|
||
Money market funds (included in cash and cash equivalents)
|
Level I
|
|
46,357
|
|
|
177,235
|
|
Certificates of deposit (included in short-term investments)
|
Level II
|
|
1,749
|
|
|
—
|
|
Interest rate lock commitments
|
Level II
|
|
—
|
|
|
29
|
|
Forward loan commitments
|
Level II
|
|
—
|
|
|
(4
|
)
|
Redeemable convertible preferred stock (mezzanine equity)
|
Level III
|
|
(655,416
|
)
|
|
—
|
|
|
Useful Lives
|
|
December 31,
|
||||||
|
(years)
|
|
2016
|
|
2017
|
||||
|
|
|
|
|
|
||||
Leasehold improvements
|
Shorter of lease term or economic life
|
|
$
|
4,911
|
|
|
$
|
16,039
|
|
Website and software development costs
|
1-3
|
|
10,114
|
|
|
14,501
|
|
||
Computer and office equipment
|
3
|
|
2,846
|
|
|
2,192
|
|
||
Software
|
3
|
|
1,367
|
|
|
685
|
|
||
Furniture
|
7
|
|
2,406
|
|
|
3,039
|
|
||
Construction in progress
|
|
|
10,856
|
|
|
—
|
|
||
|
|
|
32,500
|
|
|
36,456
|
|
||
Accumulated depreciation and amortization
|
|
|
(13,274
|
)
|
|
(14,138
|
)
|
||
Property and equipment, net
|
|
|
$
|
19,226
|
|
|
$
|
22,318
|
|
|
|
|
December 31, 2016
|
|
December 31, 2017
|
||||||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||||
|
Useful
Live (years) |
|
Gross
|
|
Accumulated
Amortization |
|
Net
|
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade Names
|
10
|
|
$
|
1,040
|
|
|
$
|
(234
|
)
|
|
$
|
806
|
|
|
$
|
1,040
|
|
|
$
|
(338
|
)
|
|
$
|
702
|
|
Developed technology
|
10
|
|
2,980
|
|
|
(670
|
)
|
|
2,310
|
|
|
2,980
|
|
|
(968
|
)
|
|
2,012
|
|
||||||
Customer relationships
|
10
|
|
860
|
|
|
(194
|
)
|
|
666
|
|
|
860
|
|
|
(280
|
)
|
|
580
|
|
||||||
|
|
|
$
|
4,880
|
|
|
$
|
(1,098
|
)
|
|
$
|
3,782
|
|
|
$
|
4,880
|
|
|
$
|
(1,586
|
)
|
|
$
|
3,294
|
|
|
Year End December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Real estate
|
|
|
|
|
|
||||||
Revenue
|
$
|
181,446
|
|
|
$
|
260,383
|
|
|
$
|
351,570
|
|
Cost of revenue
|
131,522
|
|
|
176,408
|
|
|
237,832
|
|
|||
Gross profit
|
$
|
49,924
|
|
|
$
|
83,975
|
|
|
$
|
113,738
|
|
Other
|
|
|
|
|
|
||||||
Revenue
|
5,892
|
|
|
6,813
|
|
|
18,466
|
|
|||
Cost of revenue
|
6,970
|
|
|
8,044
|
|
|
20,384
|
|
|||
Gross profit
|
$
|
(1,078
|
)
|
|
$
|
(1,231
|
)
|
|
$
|
(1,918
|
)
|
Consolidated
|
|
|
|
|
|
||||||
Revenue
|
187,338
|
|
|
267,196
|
|
|
370,036
|
|
|||
Cost of revenue
|
138,492
|
|
|
184,452
|
|
|
258,216
|
|
|||
Gross profit
|
$
|
48,846
|
|
|
$
|
82,744
|
|
|
$
|
111,820
|
|
Operating expenses
|
79,135
|
|
|
105,528
|
|
|
127,792
|
|
|||
Net income (loss)
|
$
|
(30,236
|
)
|
|
$
|
(22,526
|
)
|
|
$
|
(15,002
|
)
|
|
Year End December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Real estate revenue
|
|
|
|
|
|
||||||
Brokerage revenue
|
$
|
171,276
|
|
|
$
|
244,079
|
|
|
$
|
330,372
|
|
Partner revenue
|
10,170
|
|
|
16,304
|
|
|
21,198
|
|
|||
Total real estate revenue
|
$
|
181,446
|
|
|
$
|
260,383
|
|
|
$
|
351,570
|
|
|
As of December 31, 2016
|
||||||||||
|
Shares Authorized
|
|
Shares Issued and Outstanding
|
|
Aggregate Liquidation Preference
|
|
Proceeds, Net of Issuance Costs
|
||||
|
|
|
|
|
|
|
|
||||
Series A-1
|
4,378,284
|
|
1,459,427
|
|
$
|
500
|
|
|
$
|
462
|
|
Series A-2
|
109,552
|
|
36,517
|
|
11
|
|
|
11
|
|
||
Series A-3
|
9,099,610
|
|
3,033,202
|
|
259
|
|
|
241
|
|
||
Series B
|
36,338,577
|
|
12,112,853
|
|
7,998
|
|
|
7,952
|
|
||
Series C
|
33,388,982
|
|
11,129,656
|
|
12,000
|
|
|
11,950
|
|
||
Series D
|
28,574,005
|
|
9,524,665
|
|
10,269
|
|
|
10,201
|
|
||
Series E
|
12,041,148
|
|
4,013,712
|
|
14,924
|
|
|
14,841
|
|
||
Series F
|
20,808,580
|
|
6,936,186
|
|
50,536
|
|
|
50,453
|
|
||
Series G
|
21,527,376
|
|
7,175,784
|
|
70,991
|
|
|
68,062
|
|
||
Total
|
166,266,114
|
|
55,422,002
|
|
$
|
167,488
|
|
|
$
|
164,173
|
|
|
December 31,
|
||||
|
2016
|
|
2017
|
||
|
|
|
|
||
Redeemable convertible preferred stock outstanding
|
55,422,002
|
|
|
—
|
|
Stock options issued and outstanding
|
13,291,684
|
|
|
13,180,950
|
|
Restricted stock units outstanding
|
—
|
|
|
981,276
|
|
Shares available for future equity grants
|
4,941,504
|
|
|
7,026,071
|
|
Total
|
73,655,190
|
|
|
21,188,297
|
|
|
Year End December 31,
|
||||
|
2015
|
|
2016
|
|
2017
|
|
|
|
|
|
|
Expected life
|
7 years
|
|
7 years
|
|
7 years
|
Volatility
|
42.51%-49.62%
|
|
38.15%-41.36%
|
|
37.88%-40.97%
|
Risk-free interest rate
|
1.71%-2.01%
|
|
1.39%-2.32%
|
|
1.96%-2.26%
|
Dividend yield
|
—%
|
|
—%
|
|
—%
|
Weighted-average grant date fair value
|
$3.99
|
|
$4.11
|
|
$4.86
|
|
Number Of Options |
|
Weighted- Average Exercise Price
|
|
Weighted Average Remaining Contractual Life (years)
|
|
Aggregate Intrinsic Value |
|||||
|
|
|
|
|
|
|
|
|||||
Outstanding at January 1, 2017
|
13,291,684
|
|
|
$
|
5.85
|
|
|
7.74
|
|
$
|
61,774
|
|
Options granted
|
1,137,046
|
|
|
10.78
|
|
|
|
|
|
|||
Options exercised
|
(744,215
|
)
|
|
4.03
|
|
|
|
|
20,308
|
|
||
Options forfeited or canceled
|
(503,565
|
)
|
|
7.95
|
|
|
|
|
|
|||
Outstanding at December 31, 2017
|
13,180,950
|
|
|
6.30
|
|
|
7.02
|
|
329,786
|
|
||
Options exercisable at December 31, 2017
|
8,754,523
|
|
|
4.94
|
|
|
6.25
|
|
230,914
|
|
|
Restricted Stock Units
|
|
Weighted Average Grant-Date Fair Value
|
|||
|
|
|
|
|||
Unvested outstanding at January 1, 2017
|
—
|
|
|
$
|
—
|
|
Granted
|
981,929
|
|
|
22.78
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited or canceled
|
(653
|
)
|
|
22.78
|
|
|
Unvested outstanding at December 31, 2017
|
981,276
|
|
|
$
|
22.78
|
|
|
Year End December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Cost of revenue
|
$
|
1,440
|
|
|
$
|
2,266
|
|
|
$
|
2,902
|
|
Technology and development
|
1,375
|
|
|
2,383
|
|
|
3,325
|
|
|||
Marketing
|
298
|
|
|
469
|
|
|
487
|
|
|||
General and administrative
|
2,449
|
|
|
3,295
|
|
|
4,387
|
|
|||
Total stock-based compensation
|
$
|
5,562
|
|
|
$
|
8,413
|
|
|
$
|
11,101
|
|
|
Year End December 31,
|
||||||||||
|
2015
|
|
2016
|
|
2017
|
||||||
|
|
|
|
|
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(30,236
|
)
|
|
$
|
(22,526
|
)
|
|
$
|
(15,002
|
)
|
Accretion of preferred stock
|
(102,224
|
)
|
|
(55,502
|
)
|
|
(175,915
|
)
|
|||
Net income (loss) attributable to common stock—basic and diluted
|
$
|
(132,460
|
)
|
|
$
|
(78,028
|
)
|
|
$
|
(190,917
|
)
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
||||||
Weighted average shares used to compute net income (loss) per share attributable to common stock—basic and diluted
|
13,416,411
|
|
|
14,395,067
|
|
|
42,722,114
|
|
|||
Net income (loss) per share attributable to common stock—basic and diluted
|
$
|
(9.87
|
)
|
|
$
|
(5.42
|
)
|
|
$
|
(4.47
|
)
|
|
Year End December 31,
|
|||||||
|
2015
|
|
2016
|
|
2017
|
|||
|
|
|
|
|
|
|||
Redeemable convertible preferred stock
|
55,422,002
|
|
55,422,002
|
|
—
|
|
||
Options outstanding
|
10,406,277
|
|
13,291,684
|
|
13,180,950
|
|
||
Restricted stock units
|
—
|
|
|
—
|
|
|
981,276
|
|
Total
|
65,828,279
|
|
68,713,686
|
|
14,162,226
|
|
|
December 31,
|
||||||
|
2016
|
|
2017
|
||||
|
|
|
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
31,618
|
|
|
$
|
21,627
|
|
Credit carryforwards
|
3,200
|
|
|
4,230
|
|
||
Stock-based compensation
|
1,801
|
|
|
2,806
|
|
||
Accruals and reserves
|
4,588
|
|
|
3,953
|
|
||
Gross deferred tax assets
|
41,207
|
|
|
32,616
|
|
||
Valuation allowance
|
(38,307
|
)
|
|
(29,818
|
)
|
||
Total deferred tax assets, net of valuation allowance
|
2,900
|
|
|
2,798
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Intangible assets
|
(1,419
|
)
|
|
(847
|
)
|
||
Prepaid expenses
|
(1,481
|
)
|
|
(1,951
|
)
|
||
Total deferred tax liabilities
|
(2,900
|
)
|
|
(2,798
|
)
|
||
Net deferred tax assets and liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
December 31,
|
|||||||
|
2015
|
|
2016
|
|
2017
|
|||
|
|
|
|
|
|
|||
U.S. federal income tax at statutory rate
|
34.00
|
%
|
|
34.00
|
%
|
|
34.00
|
%
|
State taxes (net of federal benefit)
|
3.86
|
|
|
2.49
|
|
|
2.40
|
|
Permanent differences
|
(2.94
|
)
|
|
(8.21
|
)
|
|
(15.03
|
)
|
Federal research and development credit
|
2.42
|
|
|
2.06
|
|
|
7.08
|
|
Change in valuation allowance
|
(37.36
|
)
|
|
(30.19
|
)
|
|
(27.79
|
)
|
Nondeductible expenses and others
|
0.02
|
|
|
(0.15
|
)
|
|
(0.66
|
)
|
Change in valuation allowance for Tax Act impact
|
—
|
|
|
—
|
|
|
84.37
|
|
Change in deferred balance before valuation allowance for Tax Reform impact
|
—
|
|
|
—
|
|
|
(84.37
|
)
|
Effective income tax rate
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
December 31,
|
||||||
|
2016
|
|
2017
|
||||
|
|
|
|
||||
Unrecognized benefit—beginning of year
|
$
|
684
|
|
|
$
|
800
|
|
Gross increases (decreases)—prior year tax positions
|
—
|
|
|
(7
|
)
|
||
Gross increases (decreases)—current year tax positions
|
116
|
|
|
264
|
|
||
Unrecognized benefit—end of year
|
$
|
800
|
|
|
$
|
1,057
|
|
|
December 31, 2017
|
||||||
|
Facility Leases
|
|
Other Commitments
|
||||
|
|
|
|
||||
2018
|
$
|
7,595
|
|
|
$
|
3,003
|
|
2019
|
8,100
|
|
|
2,028
|
|
||
2020
|
7,181
|
|
|
75
|
|
||
2021
|
6,790
|
|
|
—
|
|
||
2022 and thereafter
|
29,074
|
|
|
—
|
|
||
Total
|
$
|
58,740
|
|
|
$
|
5,106
|
|
|
December 31,
|
||||||
|
2016
|
|
2017
|
||||
|
|
|
|
||||
Accrued compensation and benefits
|
$
|
16,659
|
|
|
$
|
19,543
|
|
Legal fees and settlements
|
2,795
|
|
|
2,230
|
|
||
Miscellaneous accrued liabilities
|
2,799
|
|
|
4,832
|
|
||
Total accrued liabilities:
|
$
|
22,253
|
|
|
$
|
26,605
|
|
(a)
|
The following documents are filed as part of this Annual Report on Form 10-K.
|
1.
|
Consolidated Financial Statements
|
2.
|
Financial Statement Schedules
|
3.
|
Exhibits
|
|
|
|
|
Incorporated by Reference
|
|
|
||||||
Exhibit Number
|
|
Exhibit Description
|
|
Form
|
|
File No.
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Exhibit
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Filing Date
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Filed Herewith
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3.1
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10-Q
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001-38160
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3.1
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Sept. 8, 2017
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3.2
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10-Q
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001-38160
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3.2
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Sept. 8, 2017
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4.1
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S-1/A
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333-219093
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4.1
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July 26, 2017
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4.2
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S-1
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333-219093
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4.2
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June 30, 2017
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10.1#
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S-1/A
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333-219093
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10.1
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July 17, 2017
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10.2#
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S-1
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333-219093
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10.2
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June 30, 2017
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10.3#
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X
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10.4#
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X
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10.5#
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S-1
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333-219093
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10.4
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June 30, 2017
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10.6#
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X
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10.7#
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S-1
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333-219093
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10.5
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June 30, 2017
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10.8#
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S-1
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333-219093
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10.6
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June 30, 2017
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10.9
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S-1
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333-219093
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10.7
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June 30, 2017
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10.10#
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S-1/A
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333-219093
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10.12
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July 17, 2017
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21.1
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X
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23.1
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X
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24.1
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Power of Attorney
(included on page
87
).
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X
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31.1
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X
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31.2
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X
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32.1*
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X
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32.2*
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X
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101.INS
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XBRL Instance Document.
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X
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101.SCH
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XBRL Taxonomy Extension Schema Document.
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X
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document.
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X
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document.
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X
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101.LAB
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XBRL Taxonomy Extension Labels Linkbase Document.
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X
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase document.
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X
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REDFIN CORPORATION
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||
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By:
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/s/ Glenn Kelman
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Glenn Kelman
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President and Chief Executive Officer
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Name
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Title
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Date
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/s/ Glenn Kelman
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President, Chief Executive Officer and Director (Principal Executive Officer)
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February 22, 2018
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Glenn Kelman
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|||
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/s/ Chris Nielsen
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Chief Financial Officer (Principal Financial and Accounting Officer)
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February 22, 2018
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Chris Nielsen
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/s/ Robert Mylod, Jr.
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Chairman of the Board of Directors
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February 22, 2018
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Robert Mylod, Jr.
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/s/ Robert Bass
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Director
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February 22, 2018
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Robert Bass
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/s/ Julie Bornstein
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Director
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February 22, 2018
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Julie Bornstein
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/s/ James Slavet
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Director
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February 22, 2018
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James Slavet
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/s/ Austin Ligon
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Director
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February 22, 2018
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Austin Ligon
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/s/ Selina Tobaccowala
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Director
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February 22, 2018
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Selina Tobaccowala
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PARTICIPANT
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REDFIN CORPORATION
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Signature:
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By:
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Print Name:
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Its:
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Expiration Date:
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The earlier to occur of: (a) the date on which settlement of all RSUs granted hereunder occurs and (b) the tenth anniversary of the Date of Grant. This RSU expires earlier if Participant’s Service terminates earlier, as described in the Agreement.
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Vesting Schedule:
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[Insert applicable vesting schedule]
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PARTICIPANT
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REDFIN CORPORATION
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Signature:
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By:
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Print Name:
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Its:
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(i)
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withholding from Participant’s wages or other cash compensation paid to Participant by Redfin and/or the Employer; or
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(ii)
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withholding from proceeds of the sale of Shares acquired upon settlement of the RSUs either through a voluntary sale or through a mandatory sale arranged by Redfin
(on Participant’s behalf pursuant to this authorization); or
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(iii)
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withholding in Shares to be issued upon settlement of the RSUs, provided Redfin only withholds the number of Shares necessary to satisfy no more than the maximum applicable statutory withholding amounts; or
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(iv)
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Participant’s payment of a cash amount (including by check representing readily available funds or a wire transfer); or
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(v)
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any other arrangement approved by the Committee and permitted by applicable law;
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(i)
|
the RSUs and the Shares subject to the RSUs are not part of normal or expected compensation or salary for any purpose;
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(ii)
|
Participant acknowledges and agrees that neither Redfin, the Employer nor any Parent or Subsidiary or Affiliate will be liable for any foreign exchange rate fluctuation between Participant’s local currency and the United States Dollar that may affect the value of the RSUs or of any amounts due to Participant pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement.
|
REDFIN CORPORATION (“
REDFIN
”)
2017 EMPLOYEE STOCK PURCHASE PLAN
|
ENROLLMENT/CHANGE FORM
|
SECTION 1:
ACTIONS
|
CHECK DESIRED ACTION
:
AND COMPLETE SECTIONS
:
o Enroll in the ESPP 2 + 3 + 4 + 16
o Elect / Change Contribution Percentage 2 + 4 + 16
o Withdraw from Plan 2 + 5 + 16
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SECTION 2:
PERSONAL DATA
|
Name:
_______________________________________________
Home Address:
________________________________________
_____________________________________________________
Work Email:
___________________________________________
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Employee ID:
_____________
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SECTION 3:
ENROLL
|
o I hereby elect to participate in the 2017 Employee Stock Purchase Plan, together with any sub-plan thereto for my country of residence (if any) (the “
Sub-Plan
”) (together, the “
ESPP
”), effective at the beginning of the next Offering Period (as defined in the ESPP). I elect to purchase shares of Redfin’s Common Stock pursuant to the ESPP, this Enrollment/Change Form and any appendix to this Enrollment/Change Form for my country (if any) (the “
Appendix
”). I understand that the shares purchased on my behalf will be issued in street name and deposited directly into my brokerage account at Redfin’s captive broker (the “
ESPP Broker
”). I hereby agree to take all steps, and sign all forms, required to establish an account with Redfin’s ESPP Broker for this purpose. I understand and agree that I will be required to utilize the ESPP Broker with respect to the shares purchased under this ESPP until the end of the time period described in Section 6 below.
My participation will continue as long as I remain eligible, unless I withdraw from the ESPP by filing a new Enrollment/Change Form with Redfin or the Third Party Administrator (as defined in the ESPP). I understand that, if I am subject to tax in the U.S., I must notify Redfin of any disposition of shares purchased under the ESPP.
|
|
SECTION 4:
ELECT/CHANGE CONTRIBUTION PERCENTAGE
|
I hereby authorize Redfin or the Parent, Subsidiary or Affiliate employing me (the “
Employer
”) to withhold from each of my paychecks such amount as is necessary to equal at the end of the applicable Offering Period the percentage of my Compensation (as defined in the ESPP) paid to me during such Offering Period as indicated below, so long as I continue to participate in the ESPP.
The percentage must be a whole number (from 1%, up to a maximum of 15%, with respect to enrollment or an increase in contribution percentage; and from 0%, up to a maximum of 14%, for a decrease in contribution percentage).
Designated contribution percentage: _____%
If this is a change to my current enrollment, this represents an o increase o decrease to my contribution percentage.
Note:
You may not increase your contributions at any time within an on-going Offering Period. An increase in your contribution percentage can only take effect with the next Offering Period. You may decrease your previously elected contribution percentage only once within an on-going Offering Period to be effective during that Offering Period. If you decrease your percentage to 0%, any previously accumulated contributions will be used to purchase shares on the next Purchase Date pursuant to Section 9 of the ESPP. A change will become effective as soon as reasonably practicable after the form is received by Redfin.
|
|
SECTION 5:
WITHDRAW FROM PLAN
|
o I hereby elect to
withdraw from, and discontinue my participation in, the ESPP
, effective as soon as reasonably practicable after this form is received by Redfin. Accumulated contributions will be returned to me without interest (except to the extent required due to local legal requirements outside the United States), pursuant to Section 11 of the ESPP.
|
|
SECTION 6:
ESPP BROKER
|
I hereby agree the shares issued to me under the ESPP shall be deposited into an account established in my name at the ESPP Broker. I shall be free to undertake a disposition (as that term is defined in Section 424(c) of the Internal Revenue Code of 1986, as amended (the “
Code
”) of the shares in my ESPP Broker account at any time, whether by sale, exchange, gift, or other transfer of legal title, but in the absence of such a disposition of the shares, the shares must remain in my ESPP Broker account until the holding period set forth in Section 423(a) of the Code has been satisfied. With respect to shares for which the Section 423(a) holding period has been satisfied, I may move those shares to another brokerage account of my choosing. Notwithstanding the above, if I am not subject to income taxation under the Code, I may move my shares to another brokerage account of my choosing at any time, without regard to the satisfaction of the Section 423(a) holding period.
|
SECTION 7:
NATURE OF GRANT
|
By enrolling in the ESPP, I understand, acknowledge and agree that (a) the ESPP is established voluntarily by Redfin, it is discretionary in nature and it may be amended, terminated or modified at any time, to the extent permitted by the ESPP; (b) the grant of the right to purchase shares of Common Stock under the ESPP is voluntary and does not create any contractual or other right to receive future rights to purchase shares of Common Stock, or benefits in lieu of rights to purchase shares, even if rights to purchase shares have been granted in the past; (c) all decisions with respect to future grants of rights to purchase shares of Common Stock under the ESPP, if any, will be at the sole discretion of Redfin; (d) the grant of rights to purchase shares of Common Stock under the ESPP and my participation in the ESPP will not create a right to employment or be interpreted as forming an employment or service agreement with Redfin; (e) the grant of rights to purchase shares of Common Stock under the ESPP and my participation in the ESPP will not interfere with the ability of the Employer to terminate my employment relationship at any time with or without cause; (f) I am voluntarily participating in the ESPP; (g) the rights to purchase shares of Common Stock and the shares purchased under the ESPP, and the income and value of same, are not intended to replace any pension rights or compensation; (h) the rights to purchase shares of Common Stock and the shares purchased under the ESPP, and the income and value of same, are not part of normal or expected compensation for purposes of, including, but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; (i) unless otherwise agreed with Redfin, the rights to purchase shares of Common Stock and the shares purchased under the ESPP, and the income and value of same, are not granted as consideration for, or in connection with, any service I may provide as a director of the Subsidiary or Affiliate; (j) the future value of the underlying shares purchased or to be purchased under the ESPP is unknown, indeterminable and cannot be predicted with certainty, and the value of the shares of Common Stock purchased under the ESPP may increase or decrease in the future, even below the Purchase Price; (k) no claim or entitlement to compensation or damages will arise from termination of the right to purchase shares of Common Stock under the ESPP resulting from termination of my employment (for any reason whatsoever and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where I am employed or the terms of my employment agreement, if any) and in consideration of the grant of rights to purchase shares of Common Stock under the ESPP, I irrevocably agree never to institute any claim against Redfin, the Parent, the Employer or any other Subsidiary or Affiliate, I hereby waive my ability, if any, to bring any such claim, and I release Redfin, the Parent, the Employer or any other Subsidiary or Affiliate from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by enrolling in the ESPP, I will be deemed irrevocably to have agreed not to pursue such claim and agree to execute any and all documents necessary to request dismissal or withdrawal of such claims; (l) in the event of termination of my employment (for any reason whatsoever, whether or not later found to be invalid or in breach of employment laws in the jurisdiction where I am employed or the terms of my employment agreement, if any), my right to participate in the ESPP and my right to purchase shares of Common Stock, if any, will terminate effective as of the date I cease to actively provide services and will not be extended by any notice period (
e.g.
, employment would not include any contractual notice or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where I am employed or the terms of my employment agreement, if any); the Committee will have exclusive discretion to determine when I am no longer actively employed for purposes of my participation in the ESPP (including whether I may still be considered to be providing services while on a leave of absence); (m) unless otherwise provided in the ESPP or by Redfin in its discretion, the right to purchase shares of Common Stock and the benefits evidenced by this Enrollment/Change Form do not create any entitlement to have the ESPP or any such benefits granted thereunder transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any Corporate Transaction affecting the Common Stock; and (n) if I am providing services outside the United States: (1) the rights to purchase shares of Common Stock and the shares purchased under the ESPP, and the income and value of same, are not part of normal or expected compensation or salary for any purpose, and (2) neither Redfin, the Parent, the Employer nor any other Subsidiary or Affiliate will be liable for any foreign exchange rate fluctuation between my local currency and the United States Dollar that may affect the value of the rights to purchase shares of Common Stock, the shares purchased under the ESPP or any amounts due to me pursuant to the sale of any shares of Common Stock acquired under the ESPP.
|
SECTION 8:
DATA PRIVACY
|
I hereby explicitly, voluntarily and unambiguously consent to the collection, use and transfer, in electronic or other form, of my personal data as described in this Enrollment/Change Form and any other ESPP grant materials by and among, as applicable, the Employer, Redfin, the Parent and any of its other Subsidiaries or Affiliates or any third parties assisting in the implementation, administration and management of my participation in the ESPP.
I understand that Redfin and the Employer may hold certain personal information about me, including, but not limited to, my name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in Redfin, the fact and conditions of my participation in the ESPP, details of all rights to purchase shares or any other entitlement to shares of Common Stock awarded, cancelled, exercised, vested, unvested or outstanding in my favor (“Data”), for the exclusive purpose of implementing, administering and managing the ESPP.
I also authorize any transfer of Data, as may be required, to the stock plan service provider that may be designated by Redfin from time to time, which is assisting Redfin with the implementation, administration and management of the ESPP and/or with whom any shares of Common Stock acquired under the ESPP are deposited. I acknowledge that these recipients may be located in my country or elsewhere, and that the recipient’s country (
e.g.
, the United States) may have different data privacy laws and protections to my country, which may not give the same level of protection to Data. I understand that, if I reside outside the United States, I may request a list with the names and addresses of any potential recipients of Data by contacting my local human resources representative. I authorize Redfin, the designated broker and any other possible recipients which may assist Redfin (presently or in the future) with implementing, administering and managing my participation in the ESPP to receive, possess, use, retain and transfer Data, in electronic or other form, for the sole purpose of implementing, administering and managing my participation in the ESPP. I understand that Data will be held only as long as is necessary to implement, administer and manage my participation in the ESPP. I understand that, if I reside outside the United States, I may at any time view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case, without cost, by contacting in writing my local human resources representative. Further, I understand that I am providing the consents herein on a purely voluntary basis. If I do not consent, or if I later seek to revoke my consent, my employment status or service and career with Redfin and/or the Employer will not be adversely affected; the only adverse consequence of refusing or withdrawing my consent is that Redfin would not be able to grant future rights to purchase shares of Common Stock or other equity awards to me or administer or maintain such awards. Therefore, I understand that refusing or withdrawing my consent may affect my ability to participate in the ESPP. For more information on the consequences of my refusal to consent or withdrawal of consent, I understand that I may contact my local human resources representative.
|
SECTION 9:
RESPONSIBILITY FOR TAXES
|
I acknowledge that, regardless of any action taken by Redfin or the Employer, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to my participation in the ESPP and legally applicable to me (“
Tax-Related Items
”) is and remains my responsibility and may exceed the amount actually withheld by Redfin
or the Employer. I further acknowledge that Redfin and/or the Employer (1) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the ESPP, including, but not limited to, my enrollment in the ESPP, the grant of rights to purchase shares of Common Stock, the purchase of shares of Common Stock, the issuance of Common Stock purchased, the sale of shares of Common Stock purchased under the ESPP or the receipt of any dividends; and (2) do not commit to and are under no obligation to structure the terms of the ESPP to reduce or eliminate my liability for Tax-Related Items or achieve any particular tax result. Further, if I am subject to Tax-Related Items in more than one jurisdiction, I acknowledge that
Redfin and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
Prior to any relevant taxable or tax withholding event, as applicable, I agree to make adequate arrangements satisfactory to Redfin and/or the Employer to satisfy all Tax-Related Items. In this regard, I authorize Redfin and/or the Employer to satisfy their withholding obligations with regard to all Tax-Related Items by one or a combination of the following: (a) withholding from my wages or other cash compensation payable to me by Redfin and/or the Employer, (b) withholding from proceeds of the sale of shares of Common Stock purchased under the ESPP, either through a voluntary sale or through a mandatory sale arranged by Redfin (on my behalf pursuant to this authorization without further consent), and (c) withholding in shares to be issued upon purchase under the ESPP.
Depending on the withholding method, Redfin may withhold or account for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including up to the maximum applicable rates, in which case I will receive a refund of any over-withheld amount in cash and will have no entitlement to the Common Stock equivalent. If the obligation for Tax-Related Items is satisfied by withholding in shares of Common Stock, for tax purposes, I am deemed to have been issued the full number of shares of Common Stock, notwithstanding that a number of the shares of Common Stock are held back solely for the purpose of paying the Tax-Related Items.
Finally, I agree to pay to Redfin or the Employer any amount of Tax-Related Items that Redfin or the Employer may be required to withhold or account for as a result of my participation in the ESPP that cannot be satisfied by the means previously described. Redfin may refuse to purchase or deliver the shares or the proceeds from the sale of shares of Common Stock, if I fail to comply with my obligations in connection with the Tax-Related Items.
|
|
SECTION 10:
GOVERNING LAW & LANGUAGE
|
The rights to purchase shares and the provisions of this Enrollment/Change Form are governed by, and subject to, the laws of the State of Delaware, without regard to any conflict of law provisions.
If I have received this or any other document related to the ESPP translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
|
|
SECTION 11:
APPENDIX & IMPOSITION OF OTHER REQUIREMENTS
|
Notwithstanding any provision herein, my participation in the ESPP will be subject to any special terms and conditions as set forth in the Appendix for my country, if any. Moreover, if I relocate to one of the countries included in the Appendix, the special terms and conditions for such country will apply to me, to the extent Redfin determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. The Appendix constitutes part of this Enrollment/Change Form.
Redfin reserves the right to impose other requirements on my participation in the ESPP or on any shares of Common Stock purchased under the ESPP, to the extent Redfin determines it is necessary or advisable for legal or administrative reasons, and to require me to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
|
|
SECTION 12:
ELECTRONIC DELIVERY AND ACCEPTANCE
|
Redfin may, in its sole discretion, decide to deliver any documents related to current or future participation in the ESPP by electronic means. I hereby consent to receive such documents by electronic delivery and agree to participate in the ESPP through an on-line or electronic system established and maintained by Redfin or a third party designated by Redfin.
|
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Name of Subsidiary
|
|
Jurisdiction
|
|
|
Walk Score Management, LLC
|
|
Washington
|
|
|
Redfin Mortgage, LLC
|
|
Delaware
|
|
|
Forward Settlement Solutions, Inc. dba Title Forward
|
|
Delaware
|
|
|
Forward Settlement Solutions of Texas, LLC
|
|
Texas
|
|
|
RDFN Ventures, Inc.
|
|
Delaware
|
|
Date:
February 22, 2018
|
|
/s/ Glenn Kelman
|
|
|
Glenn Kelman
President, Chief Executive Officer, and Director
(Principal Executive Officer)
|
Date: February 22, 2018
|
|
/s/ Chris Nielsen
|
|
|
Chris Nielsen
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
l
|
the Annual Report on Form 10-K of Redfin Corporation for the year ended December 31, 2017 (Annual Report), as filed with the Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
l
|
the information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of Redfin Corporation.
|
Date: February 22, 2018
|
By:
|
/s/ Glenn Kelman
|
|
|
Glenn Kelman
|
|
|
President, Chief Executive Officer, and Director
(Principal Executive Officer)
|
l
|
the Annual Report on Form 10-K of Redfin Corporation for the year ended December 31, 2017 (Annual Report), as filed with the Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
l
|
the information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of Redfin Corporation.
|
Date: February 22, 2018
|
By:
|
/s/ Chris Nielsen
|
|
|
Chris Nielsen
|
|
|
Chief Financial Officer
(Principal Financial and Accounting Officer)
|