View Filing Data

Print Document View Excel Document

DEI - shares	6 Months Ended
DEI - shares	Jun. 30, 2015	Jul. 27, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	Five9, Inc.
Trading Symbol	FIVN
Entity Central Index Key	0001288847
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus (Q1,Q2,Q3,FY)	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		50,253,758

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 65,333	$ 58,289
Short-term investments	0	20,000
Accounts receivable, net	8,250	8,335
Prepaid expenses and other current assets	4,228	1,960
Total current assets	77,811	88,584
Property and equipment, net	11,964	12,571
Intangible assets, net	2,297	2,553
Goodwill	11,798	11,798
Other assets	709	1,428
Total assets	104,579	116,934
Current liabilities:
Accounts payable	2,766	4,179
Accrued and other current liabilities	8,718	7,318
Accrued federal fees	5,658	7,215
Sales tax liability	863	297
Notes payable	5,081	3,146
Capital leases	4,365	4,849
Deferred revenue	5,525	5,346
Total current liabilities	32,976	32,350
Revolving line of credit	12,500	12,500
Sales tax liability — less current portion	2,063	2,582
Notes payable — less current portion	21,117	22,778
Capital leases — less current portion	4,676	4,423
Other long-term liabilities	672	548
Total liabilities	74,004	75,181
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, $0.001 par value; 5,000 shares authorized, no shares issued and outstanding at June 30, 2015 and December 31, 2014	0	0
Common stock, $0.001 par value; 450,000 shares authorized, 50,246 shares and 49,322 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively	50	49
Additional paid-in capital	175,379	170,286
Accumulated deficit	(144,854)	(128,582)
Total stockholders’ equity	30,575	41,753
Total liabilities and stockholders’ equity	$ 104,579	$ 116,934

Condensed Consolidated Balance Sheets - Parenthetical - $ / shares	Jun. 30, 2015	Dec. 31, 2014
Statement of Financial Position [Abstract]
Preferred Stock, par value	$ 0.001	$ 0.001
Preferred Stock, shares authorized	5,000,000	5,000,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	450,000,000	450,000,000
Common Stock, shares issued	50,245,859	49,322,000
Common Stock, shares outstanding	50,245,859	49,322,000

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Income Statement [Abstract]
Revenue	$ 30,274	$ 24,685	$ 60,548	$ 48,959
Cost of revenue	14,270	13,469	29,048	26,617
Gross profit	16,004	11,216	31,500	22,342
Operating expenses:
Research and development	5,568	5,554	11,606	10,779
Sales and marketing	10,594	9,674	20,525	18,696
General and administrative	6,027	3,515	13,302	9,686
Total operating expenses	22,189	18,743	45,433	39,161
Loss from operations	(6,185)	(7,527)	(13,933)	(16,819)
Other income (expense), net:
Change in fair value of convertible preferred and common stock warrant liabilities	0	0	0	1,745
Interest expense	(1,155)	(1,092)	(2,294)	(1,870)
Interest income and other	(49)	(28)	(47)	4
Total other income (expense), net	(1,204)	(1,120)	(2,341)	(121)
Loss before provision for (benefit from) income taxes	(7,389)	(8,647)	(16,274)	(16,940)
Provision for (benefit from) income taxes	(20)	12	(2)	39
Net loss	$ (7,369)	$ (8,659)	$ (16,272)	$ (16,979)
Net loss per share:
Basic and diluted (in USD per share)	$ (0.15)	$ (0.18)	$ (0.33)	$ (0.64)
Shares used in computing net loss per share:
Basic and diluted (in shares)	49,980	46,898	49,708	26,367
Comprehensive Loss:
Net loss	$ (7,369)	$ (8,659)	$ (16,272)	$ (16,979)
Other comprehensive loss:
Change in unrealized gain/loss on short-term investments, net of tax	1	0	0	0
Comprehensive loss	$ (7,368)	$ (8,659)	$ (16,272)	$ (16,979)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flows from operating activities:
Net loss	$ (16,272)	$ (16,979)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	3,685	3,291
Provision for doubtful accounts	134	39
Stock-based compensation	4,065	2,919
Loss on the disposal of property and equipment	9	0
Non-cash interest expense	171	129
Changes in fair value of convertible preferred and common stock warrant liabilities	0	(1,745)
Others	(1)	(2)
Changes in operating assets and liabilities:
Accounts receivable	(57)	(126)
Prepaid expenses and other current assets	(2,268)	(1,070)
Other assets	(87)	(55)
Accounts payable	(1,394)	(508)
Accrued and other current liabilities	2,035	1,985
Accrued federal fees and sales tax liability	165	(2,808)
Deferred revenue	163	634
Other liabilities	(58)	(102)
Net cash used in operating activities	(9,710)	(14,398)
Cash flows from investing activities:
Purchases of property and equipment	(414)	(336)
Decrease (increase) in restricted cash	806	(25)
Purchase of short-term investments	(20,000)	(29,993)
Proceeds from maturity of short-term investments	40,000	0
Net cash provided by (used in) investing activities	20,392	(30,354)
Cash flows from financing activities:
Net proceeds from initial public offering, net of payments for offering costs	0	71,459
Proceeds from exercise of common stock options and warrants	349	705
Proceeds from sale of common stock under ESPP	680	0
Proceeds from notes payable	0	19,561
Repayments of notes payable	(1,572)	(519)
Payments of capital leases	(3,095)	(2,625)
Net cash provided by (used in) financing activities	(3,638)	88,581
Net increase in cash and cash equivalents	7,044	43,829
Cash and cash equivalents:
Beginning of period	58,289	17,748
End of period	65,333	61,577
Non-cash investing and financing activities:
Equipment obtained under capital lease	2,394	2,598
Equipment purchased and unpaid at period-end	34	23
Reclass of deferred initial public offering costs to additional paid-in capital	0	2,179
Net cashless exercise of preferred stock warrants to Series A-2 convertible preferred stock	0	509
Vesting of early exercised stock options	0	57
Reclass of warrants liabilities to additional paid-in capital upon initial public offering	0	2,647
Conversion of convertible preferred stock to common stock upon initial public offering	$ 0	$ 54,244

Description of Business and Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business and Summary of Significant Accounting Policies	1. Description of Business and Summary of Significant Accounting Policies Five9, Inc. (together with its wholly-owned subsidiaries, the “Company”) is a provider of cloud contact center software. The Company was incorporated in Delaware in 2001 and is headquartered in San Ramon, California. The Company has offices in Europe and Asia, which primarily provide research, development and client support services. Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The significant estimates made by management affect revenue, the allowance for doubtful accounts, intangible assets, including goodwill, loss contingencies, including the Company’s accrual for federal fees and sales tax liability, accrued liabilities, stock-based compensation, fair value calculations of the convertible preferred and common stock warrant liabilities, provision for income taxes and uncertain tax positions. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. Actual results could differ from those estimates. Significant Accounting Policies The Company’s significant accounting policies are disclosed in its Annual Report on Form 10-K for the year ended December 31, 2014. During the six months ended June 30, 2015, there were no changes to the Company's significant accounting policies. Recent Accounting Pronouncements In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-05, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. The ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The ASU does not change the accounting for a customer’s accounting for service contracts. A company can elect to adopt the ASU either prospectively or retrospectively. This guidance is effective for the Company beginning in the first quarter of 2016. Early adoption is permitted. The Company does not expect this guidance to have a material effect on its consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by this ASU. Early adoption is permitted. This guidance is effective for the Company on a retrospective basis beginning in the first quarter of 2016 and is not expected to have a material effect on the Company's consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. The new guidance requires management of public and private companies to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. Management will also be required to evaluate and disclose whether its plans alleviate that doubt. The standard will be effective for the Company's annual period ending December 31, 2016 and interim and annual periods thereafter. Early adoption is permitted. The Company does not expect that the requirement will have an impact on its financial position, results of operations or cash flows. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company's annual and interim reporting periods beginning January 1, 2017. Early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. In July 2015, the FASB approved a proposed ASU to defer the effective date of ASU 2014-09 by one year. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

Fair Value Measurements

6 Months Ended

Jun. 30, 2015

Fair Value Disclosures [Abstract]

Fair Value Disclosures

2. Fair Value Measurements

The Company carries cash equivalents and short-term investments consisting of money market funds and marketable securities at fair value on a recurring basis. Fair value is based on the price that would be received from selling an asset in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 — Observable inputs which include unadjusted quoted prices in active markets for identical assets.

Level 2 — Observable inputs other than Level 1 inputs, such as quoted prices for similar assets, quoted prices for identical or similar assets in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined by using pricing models, discounted cash flow methodologies or similar techniques.

The fair value of assets carried at fair value was determined using the following inputs (in thousands):



	June 30, 2015
	Total		Level 1
Assets
Cash equivalents:
Money market funds	$	20,001	$	20,001

	December 31, 2014
	Total		Level 1
Assets
Short-term investments:
U.S. Treasury bills	$	20,000	$	20,000

- Definition

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

+ References + Details

Financial Statement Components

6 Months Ended

Jun. 30, 2015

Financial Statement Components [Abstract]

Financial Statement Components

3. Financial Statement Components

Cash and cash equivalents consisted of the following (in thousands):



	June 30, 2015		December 31, 2014
Cash	$	45,332	$	58,289
Money market funds	20,001		—
Cash and cash equivalents	$	65,333	$	58,289

Restricted Cash

As of June 30, 2015, the Company's restricted cash balance was not material. As of December 31, 2014, the Company had restricted cash of $0.8 million that included $0.7 million related to a letter of credit issued to the Company’s landlord with respect to its lease obligation and $0.1 million under letters of credit primarily related to an insurance policy. These letters of credit had been released during the first half of 2015. Restricted cash is included in 'Other assets' on the accompanying condensed consolidated balance sheets.

Accounts receivable, net consisted of the following (in thousands):



	June 30, 2015			December 31, 2014
Trade accounts receivable	$	7,553		$	7,482
Unbilled trade accounts receivable, net of advance client deposits	768			918
Allowance for doubtful accounts	(71		)	(65		)
Accounts receivable, net	$	8,250		$	8,335

Prepaid expenses and other current assets consisted of the following (in thousands):



	June 30, 2015		December 31, 2014
Prepaid expenses	$	2,323	$	1,721
Canadian value-added taxes receivable	1,646		—
Others	259		239
Prepaid expenses and other current assets	$	4,228	$	1,960

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



	June 30, 2015			December 31, 2014
Computer and network equipment	$	26,681		$	24,292
Computer software	2,662			2,264
Furniture and fixtures	1,039			1,030
Leasehold improvements	614			611
Property and equipment	30,996			28,197
Accumulated depreciation and amortization	(19,032		)	(15,626		)
Property and equipment, net	$	11,964		$	12,571

Depreciation and amortization expense associated with property and equipment was $1.8 million and $3.4 million for the three and six months ended June 30, 2015, respectively, and $1.6 million and $3.0 million for the three and six months ended June 30, 2014, respectively.

Property and equipment capitalized under capital lease obligations consist primarily of computer and network equipment and were as follows (in thousands):



	June 30, 2015			December 31, 2014
Gross	$	23,412		$	21,025
Less: accumulated depreciation and amortization	(13,058		)	(10,609		)
Total	$	10,354		$	10,416

Accrued and other current liabilities consisted of the following (in thousands):



	June 30, 2015		December 31, 2014
Accrued compensation and benefits	$	5,598	$	5,078
Accrued expenses	1,474		2,240
Canadian value-added taxes liability	1,646		—
Accrued and other current liabilities	$	8,718	$	7,318

Intangible Assets

6 Months Ended

Jun. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets Disclosure

4. Intangible Assets

The components of intangible assets, which were acquired in connection with the Company’s acquisition of Face It, Corp., which the Company refers to as SoCoCare, a social engagement and mobile customer care solution provider, in October 2013, were as follows (in thousands):



	June 30, 2015							December 31, 2014
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Developed technology	$	2,460	$	(599	)	$	1,861	$	2,460	$	(423	)	$	2,037
Customer relationships	520		(177		)	343		520		(125		)	395
Domain names	50		(17		)	33		50		(12		)	38
Non-compete agreements	140		(80		)	60		140		(57		)	83
Total	$	3,170	$	(873	)	$	2,297	$	3,170	$	(617	)	$	2,553

Amortization expense related to intangible assets was $0.1 million and $0.3 million for the three and six months ended June 30, 2015, respectively, and $0.1 million and $0.3 million for the three and six months ended June 30, 2014, respectively.

As of June 30, 2015, the expected future amortization expense for intangible assets was as follows (in thousands):



Period	Expected Future Amortization Expense
Remainder of 2015	$	256
2016	503
2017	465
2018	442
2019	351
2020	280
Total	$	2,297

Long-Term Debt

6 Months Ended

Jun. 30, 2015

Debt Disclosure [Abstract]

Long-Term Debt

5. Long-Term Debt

2013 Loan and Security Agreement

The Company has a revolving line of credit of up to $20.0 million ("Revolving Credit Facility") under a loan and security agreement with a lender, which was entered into in March 2013 and last amended in December 2014 (“2013 Loan and Security Agreement”). The Revolving Credit Facility carries a variable annual interest rate of the prime rate plus 0.50% and matures in December 1, 2016.

The 2013 Loan and Security Agreement is collateralized by substantially all the assets of the Company. The balance outstanding cannot exceed the lesser of (i) $20.0 million or (ii) an amount equal to the Company’s monthly recurring revenue for the three months prior multiplied by the average Dollar-Based Retention Rate over the prior twelve months, less the amount accrued for the Company’s Universal Service Fund ("USF") obligation (accrued federal fees). As of June 30, 2015, the outstanding principal balance under the Revolving Credit Facility was $12.5 million, which has been disclosed as a non-current liability, and the amount available for additional borrowings was $7.5 million.

In connection with its acquisition of SoCoCare, the Company also borrowed $5.0 million under a term loan (the “Term Loan”) under the 2013 Loan and Security Agreement in October 2013. Monthly interest-only payments were due on the advance at the prime rate plus 1.50% through September 2014. Principal and interest payments are due in equal monthly installments from October 2014 through the maturity of the Term Loan in March 2017. As of June 30, 2015 and December 31, 2014, approximately $3.5 million and $4.5 million, respectively, of this Term Loan was outstanding and is included as notes payable in the condensed consolidated balance sheets.

The 2013 Loan and Security Agreement contains certain covenants, including the requirement that the Company maintain $7.5 million of cash deposited with the lender for the term of the 2013 Loan and Security Agreement. The Company was in compliance with these covenants as of June 30, 2015. The 2013 Loan and Security Agreement remains senior to other debts, including the debt issued under the 2014 Loan and Security Agreement discussed below.

2014 Loan and Security Agreement

The Company has a term loan facility of $30.0 million with a syndicate of two lenders ("Lenders"), which was entered into in February 2014 and amended in December 2014 and February 2015 (the “2014 Loan and Security Agreement”). The term loan facility is available to the Company in tranches; the first tranche for $20.0 million was advanced upon the closing of the agreement and the remaining $10.0 million is available for drawdown by the Company until February 2016 in $1.0 million increments. The Company incurred $0.4 million in debt issuance costs in connection with borrowing the first tranche in February 2014. The term loan bears interest at a variable per annum rate equal to the greater of 10% or LIBOR plus 9%. Interest is due and payable on the last business day of each month during the term of the loan commencing in February 2014. Monthly principal payments are due beginning in February 2016 based on 1/60th of the outstanding balance at that time and will continue until all remaining principal outstanding under the term loan becomes due and payable in February 2019. All amounts outstanding under this loan facility have been disclosed as part of 'Notes payable - less current portion' in the condensed consolidated balance sheet as of June 30, 2015.

The term loan is secured by substantially all the assets of the Company and is subordinate to the 2013 Loan and Security Agreement. The 2014 Loan and Security Agreement contains certain covenants and includes the occurrence of a material adverse event, as defined in the agreement and determined by the Lenders, as an event of default. As of June 30, 2015, the Company was in compliance with these covenants.

In connection with entering into the 2014 Loan and Security Agreement, the Company issued to the Lenders warrants to purchase 177,865 shares of common stock at $10.12 per share, which vest and become exercisable over a ten year term from the date of issuance, based on amounts drawn under the $30.0 million term loan facility. Based on the drawdown of $20.0 million in February 2014, 118,577 shares of common stock issuable under the warrants vested and are exercisable by the Lenders. As of June 30, 2015, 59,288 shares of common stock issuable under the warrants pertaining to the undrawn $10.0 million remain unvested.

Promissory Note

In July 2013, the Company issued a promissory note to the Universal Service Administrative Company ("USAC") for $4.1 million in principal amount as a financing arrangement for that amount of accrued federal fees. The promissory note carries a fixed annual interest rate of 12.75% and is repayable in 42 equal monthly installments of principal and interest beginning in August 2013. As of June 30, 2015 and December 31, 2014, approximately $2.1 million and $2.6 million in principal amount, respectively, of this promissory note was outstanding and is included as notes payable in the accompanying condensed consolidated balance sheets.

FCC Civil Penalty

In June 2015, the Company entered into a consent decree with the Federal Communications Commission (“FCC”) Enforcement Bureau (Note 9), in which the Company agreed to pay a civil penalty of $2.0 million to the U.S. Treasury in twelve equal quarterly installments starting in July 2015 without interest. As a result, the Company discounted the $2.0 million liability, which was accrued in the third quarter of 2014 for the then tentative civil penalty, to its present value of $1.7 million to reflect the imputed interest and reclassified this discounted liability from 'Accrued federal fees' to 'Notes payable.' The $0.3 million discount was recorded as a reduction to general and administrative expense in the three months ended June 30, 2015 and will be recognized as interest expense over the payment term of the civil penalty. As of June 30, 2015, the net carrying value of the outstanding civil penalty payable was $1.7 million and is included as 'Notes payable' in the accompanying condensed consolidated balance sheets.

As of June 30, 2015 and December 31, 2014, the Company’s outstanding debt is summarized as follows (in thousands):



	June 30, 2015			December 31, 2014
Term loan under 2014 Loan and Security Agreement	$	20,000		$	20,000
Term loan under 2013 Loan and Security Agreement	3,500			4,500
Promissory note to USAC	2,068			2,640
FCC civil penalty	2,000			—
Total notes payable, gross	27,568			27,140
Less: discount	(1,370		)	(1,216		)
Total notes payable, net carrying value	26,198			25,924
Revolving line of credit, non-current	12,500			12,500
Total debt, net carrying value	$	38,698		$	38,424
Less: current portion of debt	(5,081		)	(3,146		)
Total debt, less current portion	33,617			35,278

Maturities of the Company’s outstanding debt as of June 30, 2015 are as follows (in thousands):



Period	Amount to Mature
Remainder of 2015	$	1,942
2016	20,173
2017	5,286
2018	4,334
2019	8,333
Total	$	40,068

Stockholders' Equity

6 Months Ended

Jun. 30, 2015

Equity [Abstract]

Stockholders' Equity

6. Stockholders’ Equity

Capital Structure

The Company is authorized to issue 450,000,000 shares of common stock with a par value of $0.001 per share. As of June 30, 2015, the Company had 50,245,859 shares of common stock issued and outstanding.

The Company is also authorized to designate and issue up to 5,000,000 shares of preferred stock with a par value of $0.001 per share in one or more series without stockholder approval and to fix the rights, preferences, privileges and restrictions thereof. As of June 30, 2015, the Company had no shares of preferred stock issued and outstanding.

Common Stock Subject to Forfeiture

In connection with employment and service agreements entered into in connection with the Company’s acquisition of SoCoCare in October 2013 ("Acquisition Date"), the Company issued 118,577 shares of unvested restricted common stock, the vesting of which was contingent upon continuing employment or services and subject to forfeiture. These shares were valued at $8.48 per share based on the Acquisition Date fair value of the Company’s common stock. This amount was being recorded as stock-based compensation on a straight-line basis over the requisite service periods. During October 2014, 50% of such shares vested. During the three months ended March 31, 2015, in accordance with the applicable stock issuance agreement, the vesting on 37,905 shares accelerated in connection with the termination of employment of a shareholder. During the three months ended June 30, 2015, the remaining 21,384 unvested shares were forfeited as a result of terminations of employment of the remaining employee-shareholders. As of December 31, 2014, the 59,289 shares that were subject to forfeiture were included in issued and outstanding shares of common stock.

Warrants

As of June 30, 2015 and December 31, 2014, the Company had outstanding warrants to purchase 359,596 shares of common stock with a weighted-average exercise price of $5.59 per share, which expire on various dates between February 2020 and February 2024.

Common Stock Reserved for Future Issuance

As of June 30, 2015, shares of common stock reserved for future issuance related to outstanding equity awards, common stock warrants, and employee equity incentive plans were as follows (in thousands):



		June 30, 2015
Stock options outstanding		6,775
Restricted stock units outstanding		1,526
Shares available for future grant under 2014 Plan		5,308
Shares available for future issuance under ESPP		1,058
Common stock warrants outstanding		360
Total shares of common stock reserved		15,027

Equity Incentive Plans

Prior to the Initial Public Offering ("IPO"), the Company granted stock options under its Amended and Restated 2004 Equity Incentive Plan, as amended (the “2004 Plan”).

In March 2014, the Company’s board of directors and stockholders approved the 2014 Equity Incentive Plan (“2014 Plan”) and 5,300,000 shares of common stock were reserved for issuance under the 2014 Plan. In addition, on the first day of each year beginning in 2015 and ending in 2024, the 2014 Plan provides for an annual automatic increase to the shares reserved for issuance in an amount equal to 5% of the total number of shares outstanding on December 31st of the preceding calendar year or a lesser number as determined by the Company’s board of directors. Pursuant to the automatic annual increase, 2,466,124 additional shares were reserved under the 2014 Plan on January 1, 2015.

Upon the effectiveness of the 2014 Plan on April 3, 2014, no future grants will be made under the 2004 Plan. All shares reserved under the 2004 Plan became available for grant under the 2014 Plan. Any forfeited or expired shares that would otherwise return to the 2004 Plan after the IPO instead return to the 2014 Plan. As of June 30, 2015, 5,307,614 shares of common stock were available for future grant under the 2014 Plan.

The 2004 Plan and the 2014 Plan are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

Stock Options

A summary of the Company’s stock option activities during the six months ended June 30, 2015 is as follows (in thousands, except years and per share data):



	Number of Shares Outstanding		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding as of December 31, 2014	7,164		$	4.34
Options granted (weighted average grant date fair value of $2.49 per share)	181		5.20
Options exercised	(411	)	0.85
Options forfeited or expired	(159	)	7.32
Outstanding as of June 30, 2015	6,775		$	4.51	7.0	$	13,332

The Company has computed the aggregate intrinsic value amounts disclosed in the above table based on the difference between the original exercise price of the options and the fair market value of the Company’s common stock of $5.23 as of June 30, 2015 for all in-the-money options outstanding.

Restricted Stock Units

A summary of the Company's restricted stock units ("RSU") activities during the six months ended June 30, 2015 is as follows (in thousands, except per share data):



	Number of Shares		Weighted Average Grant Date Fair Value Per Share
Outstanding as of December 31, 2014	1,370		$	5.21
RSUs granted	599		5.13
RSUs vested and released	(375	)	6.18
RSUs forfeited	(68	)	5.25
Outstanding as of June 30, 2015	1,526		$	4.94

Employee Stock Purchase Plan

The Company's 2014 Employee Stock Purchase Plan ("ESPP") became effective on April 3, 2014 and is described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. The number of shares of common stock originally reserved for issuance under the ESPP was 880,000 shares, which will increase automatically each year, beginning on January 1, 2015 and continuing through January 1, 2024, by the lesser of (i) 1% of the total number of shares of the Company’s common stock outstanding on December 31 of the preceding calendar year; (ii) 1,000,000 shares of common stock (subject to adjustment to reflect any split or combination of the Company’s common stock); or (iii) such lesser number as determined by the Company’s board of directors. Pursuant to the automatic annual increase, 493,224 additional shares were reserved under the ESPP on January 1, 2015. As of June 30, 2015, 1,058,251 shares of common stock were available for future issuance under the ESPP.

During the three and six months ended June 30, 2015, 158,842 shares were purchased on May 15, 2015 at a weighted-average price of $4.28 per share under the ESPP.

Stock-Based Compensation

Stock-based compensation expenses for the three and six months ended June 30, 2015 and 2014 are as follows (in thousands):



	Three Months Ended				Six Months Ended
	June 30, 2015		June 30, 2014		June 30, 2015		June 30, 2014
Cost of revenue	$	218	$	121	$	406	$	208
Research and development	340		471		914		821
Sales and marketing	458		368		982		694
General and administrative	814		763		1,763		1,196
Total stock-based compensation	$	1,830	$	1,723	$	4,065	$	2,919

As of June 30, 2015, unrecognized stock-based compensation expenses by award type, net of estimated forfeitures, and their expected weighted-average recognition periods are summarized in the following table (in thousands, except years).



	Stock Option		RSU		ESPP
Unrecognized stock-based compensation expense	$	8,891	$	6,293	$	188
Weighted-average amortization period	2.5 years		3.0 years		0.4 years

The Company recognizes stock-based compensation expense that is calculated based upon awards ultimately expected to vest and, thus, stock-based compensation expense is reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. All stock-based compensation for equity awards granted to employees and non-employee directors is measured based on the grant date fair value of the award.

The Company values RSUs at the closing market price of its common stock on the date of grant. The Company estimates the fair value of each stock option and purchase right under the ESPP granted to employees on the date of grant using the Black-Scholes option-pricing model and using the assumptions noted in the below table. The weighted-average assumptions used to value stock options granted during the three and six months ended June 30, 2015 and 2014 were as follows:



Stock Options	Three Months Ended		Six Months Ended
	June 30, 2015	June 30, 2014	June 30, 2015	June 30, 2014
Expected term (years)	6.1	6.1	6.1	6.1
Volatility	49%	56%	49%	56%
Risk-free interest rate	1.5%	1.9%	1.5%	1.8%
Dividend yield	—	—	—	—

Net Loss Per Share

6 Months Ended

Jun. 30, 2015

Earnings Per Share [Abstract]

Net Loss Per Share

7. Net Loss Per Share

Basic net loss per share is calculated by dividing net loss by the weighted average number of common shares outstanding during the period, and excludes any dilutive effects of employee stock-based awards and warrants. Diluted net income per share is computed giving effect to all potentially dilutive common shares, including common stock issuable upon exercise of stock options and warrants and vesting of restricted stock. As the Company had net losses for the three and six months ended June 30, 2015 and 2014, all potentially issuable common shares were determined to be anti-dilutive.

The following table presents the calculation of basic and diluted net loss per share (in thousands, except per share data).



	Three Months Ended						Six Months Ended
	June 30, 2015			June 30, 2014			June 30, 2015			June 30, 2014
Net loss	$	(7,369	)	$	(8,659	)	$	(16,272	)	$	(16,979	)
Weighted-average shares used in computing basic and diluted net loss per share	49,980			46,898			49,708			26,367
Basic and diluted net loss per share	$	(0.15	)	$	(0.18	)	$	(0.33	)	$	(0.64	)

The following securities were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (in thousands).



	June 30, 2015	June 30, 2014
Stock options	6,775	7,145
Restricted stock units	1,526	262
ESPP	178	474
Common stock warrants	360	360
Common stock subject to repurchase or forfeiture	—	138
Total	8,839	8,379

Income Taxes	6 Months Ended
Income Taxes	Jun. 30, 2015
Income Tax Disclosure [Abstract]
Income Tax Disclosure	8. Income Taxes The benefit from income taxes for the three and six months ended June 30, 2015 was approximately $20 thousand and $2 thousand, respectively. The provision for income taxes for the three and six months ended June 30, 2014 was approximately $12 thousand and $39 thousand, respectively. The provision for or benefit from income taxes consisted primarily of foreign income taxes. For the three and six months ended June 30, 2015 and 2014, the benefit from or provision for income taxes differed from the statutory amount primarily due to state and foreign taxes currently payable, and the Company realized no benefit for current year losses due to maintaining a full valuation allowance against its domestic and foreign net deferred tax assets. The realization of tax benefits of deferred tax assets is dependent upon future levels of taxable income, of an appropriate character, in the periods the items are expected to be deductible or taxable. Based on the available objective evidence, the Company does not believe it is more likely than not that the net deferred tax assets will be realizable. Accordingly, the Company has provided a full valuation allowance against the domestic and foreign net deferred tax assets as of June 30, 2015 and December 31, 2014. The Company intends to maintain the valuation allowance until sufficient positive evidence exists to support a reversal of, or decrease in, the valuation allowance. During the three and six months ended June 30, 2015, there were no material changes to the total amount of unrecognized tax benefits.

Commitments and Contingencies	6 Months Ended
Commitments and Contingencies	Jun. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies Disclosure	9. Commitments and Contingencies Commitments The Company’s principal commitments consist of obligations under operating lease agreements for offices, research and development, and sales and marketing facilities, capital leases to finance data centers and other computer and networking equipment purchases and agreements with third parties to provide co-location hosting and telecommunication usage services. These commitments as of December 31, 2014 are disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2014, and did not change materially during the six months ended June 30, 2015 except for the acquisition of certain additional data center and network equipment and software under multiple capital leases. As of June 30, 2015, total minimum future payment commitments under these capital leases were approximately $3.2 million, of which $0.6 million is due in 2015, with the remainder due over approximately 2.6 years thereafter. Universal Services Fund Liability During the third quarter of 2012, the Company determined that based on its business activities, it is classified as a telecommunications service provider for regulatory purposes and it should make direct contributions to the federal USF and related funds based on revenues it receives from the resale of interstate and international telecommunications services. Previously, the Company had believed that the telecommunications services were an integral part of an information service that the Company provides via its software and had instead made indirect USF contributions via payments to its wholesale telecommunications service providers. In order to comply with the obligation to make direct contributions, the Company made a voluntary self-disclosure to the FCC Enforcement Bureau and has registered with the USAC, which is charged by the FCC with administering the USF. The Company has filed exemption certificates with its wholesale telecommunications service providers in order to eliminate its obligation to reimburse such wholesale telecommunications service providers for their USF contributions calculated on services sold to the Company. The Company’s registration with USAC subjects it to assessments for unpaid USF contributions, as well as interest thereon and civil penalties, due to its late registration and past failure to recognize its obligation as a USF contributor and as an international carrier. The Company will be required to pay assessments for periods prior to the Company’s registration. As of December 31, 2012, the total past due USF contribution being imposed by USAC and accrued by the Company for the period from 2003 through 2012 was $8.1 million, of which $4.7 million was undisputed and $3.4 million, including $0.8 million that pertains to 2003 through 2007, was disputed. While the Company is in administrative proceedings before the FCC to limit such back assessments to the period 2008 through 2012, it is possible that it will be required to pay back assessments for the period from 2003 through 2007. In 2013, the Company began remitting required contributions on a prospective basis directly to USAC. In July 2013, the Company and USAC agreed to a financing arrangement for $4.1 million of the undisputed $4.7 million of the unpaid USF contributions whereby the Company issued to USAC a promissory note payable in the principal amount of the $4.1 million and paid off the remaining undisputed $0.6 million. The repayment terms of the promissory note payable are disclosed in Note 5. As of June 30, 2015 and December 31, 2014, the principal balance of the promissory note payable was $2.1 million and $2.6 million, respectively, and is included in the notes payable amounts on the condensed consolidated balance sheets. In addition to the promissory note payable, as of June 30, 2015 and December 31, 2014, the Company had an accrued liability for the disputed portion of the unpaid USF contributions and estimated interest and penalties of $4.4 million and $4.2 million, respectively, included in accrued federal fees on the condensed consolidated balance sheets. For the three and six months ended June 30, 2015, the Company recorded interest and penalty expenses of $0.1 million and $0.2 million, respectively, as a charge to general and administrative expense, which were related to its disputed unpaid USF obligations. In June 2015, in connection with the Company's late registration with the USAC and past failure to recognize its obligation as a USF contributor and as an international carrier from 2003 to 2012, the Company entered into a consent decree with the FCC Enforcement Bureau. In the consent decree, the Company agreed to pay a civil penalty of $2.0 million to the U.S. Treasury in twelve equal quarterly installments starting in July 2015 without interest (Note 5). In the third quarter of 2014, the Company had accrued a $2.0 million liability for the then tentative civil penalty. The consent decree also requires the Company to adopt certain internal regulatory compliance monitoring and training requirements, and to report on the status of those compliance efforts to the FCC’s Enforcement Bureau during a period of three years. State and Local Taxes and Surcharges In April 2012, the Company commenced collecting and remitting sales taxes on sales of subscription services in all the U.S. states in which it determined it was obligated to do so. During the first quarter of 2015, the Company conducted an updated sales tax review of the taxability of sales of its subscription services. As a result, the Company determined that it may be obligated to collect and remit sales taxes on such sales in four additional states. Based on its best estimate of the probable sales tax liability in those four states relating to its sales of subscription services during the period 2011 through 2014, for the three months ended March 31, 2015, the Company recorded a general and administrative expense of $0.6 million as an immaterial out of period adjustment to accrue for such taxes. During 2013, the Company analyzed its activities and determined it may be obligated to collect and remit various state and local taxes and surcharges on its usage-based fees. The Company had not remitted state and local taxes on usage-based fees in any of the periods prior to 2014 and therefore accrued a sales tax liability for this contingency. In January 2014, the Company commenced paying such taxes and surcharges to certain state authorities. In June 2014, the Company commenced collecting state and local taxes or surcharges on usage-based fees from its clients on a current basis and remitting such taxes to the applicable U.S. state taxing authorities. During the three and six months ended June 30, 2015, the Company has remitted $0.9 million for its contingent sales taxes on both usage-based fees and sales of subscription services. For the three and six months ended June 30, 2015, the Company recognized $0.3 million and $1.0 million, respectively, as general and administrative expense related to its estimated sales tax liability on both usage-based fees and sales of subscription services in the U.S. and Canada, which was not being collected from its clients. During 2015, the Company expects to commence collecting such sales taxes from its clients on a current basis and remitting such taxes to the applicable taxing authorities. As of June 30, 2015, the Company had total accrued liabilities of $2.7 million for such contingent sales taxes and surcharges that were not being collected from its clients but may be imposed by various taxing authorities, of which $0.6 million and $2.1 million was included in current and non-current "Sales tax liability" on the condensed consolidated balance sheets, respectively. As of December 31, 2014, the Company had total accrued liabilities of $2.6 million for such contingent sales taxes and surcharges, which was included in non-current "Sales tax liability" on the condensed consolidated balance sheets. The Company’s estimate of the probable loss incurred under this contingency is based on its analysis of the source location of its usage-based fees and the regulations and rules in each tax jurisdiction. Legal Matters The Company is involved in various legal and regulatory matters arising in the normal course of business. In management’s opinion, resolution of these matters is not expected to have a material impact on the Company’s consolidated results of operations, cash flows, or its financial position. However, depending on the nature and timing of any such dispute, an unfavorable resolution of a matter could materially affect the Company’s future consolidated results of operations, cash flows or financial position in a particular period. The Company is currently involved in the following lawsuits as a defendant. NobelBiz Litigation In April 2012, NobelBiz, Inc., a telecommunication solutions company, brought a patent infringement lawsuit in the U.S. District Court for the Eastern District of Texas against the Company seeking a permanent injunction, damages and attorneys' fees. The Company responded to the complaint and preliminary injunction request by asserting non-infringement and invalidity of the patent. In March 2013, the court granted the Company's motion to transfer the case to the U.S. District Court for the Northern District of California subsequent to which the complainant amended its claim to include another related patent. The Company has responded to this amended claim by continuing to assert non-infringement and invalidity of the patents. During December 2013, the court in California held a status conference and subsequently held a claim construction hearing regarding the patents on August 22, 2014. On January 16, 2015, the court issued an order regarding claim construction of the two patents-in-suit, and on April 6, 2015, the court held a case management conference setting further dates in the case. The court set a trial date of June 20, 2016, and set February 16, 2016 as the deadline to file motions for summary judgment. The Company has investigated the claims alleged in the complaint and believes that it has good defenses to the claims. Accordingly, the Company has not accrued a loss related to this matter as the Company does not believe that it is probable that a loss will be incurred. UHC Claim On January 29, 2015, Soneet Kapila, the Chapter 11 Trustee for the estate of Universal Health Care Group, Inc., which entity serves as the sole member of American Managed Care, LLC (“AMC”), filed an adversary complaint against the Company in the United States Bankruptcy Court for the Middle District of Florida. The adversary proceeding, Soneet Kapila v. Five9, Inc., Case No. 13-05952 (KRM), Adv. No. 15-00092 (KRM), sought to avoid and recover as preferential payments, actual fraudulent transfers and/or constructive fraudulent transfers certain payments that the Company allegedly received from AMC in return for services provided by the Company between May 3, 2011 and May 3, 2014. The matter has been settled, with Bankruptcy Court approval, for a cash payment by the Company of $99,000, which was recorded by the Company as a charge to general and administrative expense during the three months ended March 31, 2015. The Company recognizes general and administrative expense for legal fees in the period the services are provided. Indemnification Agreements In the ordinary course of business, the Company indemnifies various clients, vendors, lessors, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by the Company or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with its directors, officers and certain employees that require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. No demands have been made upon the Company to provide indemnification under such agreements and thus there are no claims that the Company is aware of that would have a material effect on the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations and comprehensive loss, or condensed consolidated statements of cash flows.

Geographical Information

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Geographical Information

10. Geographical Information

The following table is a summary of revenues by geographic region based on client billing address and has been estimated based on the amounts billed to clients during the periods (in thousands).



	Three Months Ended				Six Months Ended
	June 30, 2015		June 30, 2014		June 30, 2015		June 30, 2014
United States	$	28,088	$	22,816	$	56,367	$	45,250
International	2,186		1,869		4,181		3,709
Total revenue	$	30,274	$	24,685	$	60,548	$	48,959

The following table summarizes total property and equipment, net in the respective locations (in thousands).



	June 30, 2015		December 31, 2014
United States	$	9,875	$	10,625
International	2,089		1,946
Property and equipment, net	$	11,964	$	12,571

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8981-108599

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9038-108599

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 33
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8971-108599

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8595-108599

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8380-108599

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 26
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 35
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8984-108599

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9031-108599

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9054-108599

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8538-108599

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 29
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8864-108599

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8924-108599

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8906-108599

+ Details

Description of Business and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. All intercompany transactions and balances have been eliminated in consolidation.
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The significant estimates made by management affect revenue, the allowance for doubtful accounts, intangible assets, including goodwill, loss contingencies, including the Company’s accrual for federal fees and sales tax liability, accrued liabilities, stock-based compensation, fair value calculations of the convertible preferred and common stock warrant liabilities, provision for income taxes and uncertain tax positions. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. Actual results could differ from those estimates.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-05, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. The ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The ASU does not change the accounting for a customer’s accounting for service contracts. A company can elect to adopt the ASU either prospectively or retrospectively. This guidance is effective for the Company beginning in the first quarter of 2016. Early adoption is permitted. The Company does not expect this guidance to have a material effect on its consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by this ASU. Early adoption is permitted. This guidance is effective for the Company on a retrospective basis beginning in the first quarter of 2016 and is not expected to have a material effect on the Company's consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. The new guidance requires management of public and private companies to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. Management will also be required to evaluate and disclose whether its plans alleviate that doubt. The standard will be effective for the Company's annual period ending December 31, 2016 and interim and annual periods thereafter. Early adoption is permitted. The Company does not expect that the requirement will have an impact on its financial position, results of operations or cash flows. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company's annual and interim reporting periods beginning January 1, 2017. Early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. In July 2015, the FASB approved a proposed ASU to defer the effective date of ASU 2014-09 by one year. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2015

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Carried at Fair Value

The fair value of assets carried at fair value was determined using the following inputs (in thousands):



	June 30, 2015
	Total		Level 1
Assets
Cash equivalents:
Money market funds	$	20,001	$	20,001

	December 31, 2014
	Total		Level 1
Assets
Short-term investments:
U.S. Treasury bills	$	20,000	$	20,000

Financial Statement Components (Tables)

6 Months Ended

Jun. 30, 2015

Financial Statement Components [Abstract]

Schedule of Cash and Cash Equivalents

Cash and cash equivalents consisted of the following (in thousands):



	June 30, 2015		December 31, 2014
Cash	$	45,332	$	58,289
Money market funds	20,001		—
Cash and cash equivalents	$	65,333	$	58,289

Schedule of Accounts Receivable

Accounts receivable, net consisted of the following (in thousands):



	June 30, 2015			December 31, 2014
Trade accounts receivable	$	7,553		$	7,482
Unbilled trade accounts receivable, net of advance client deposits	768			918
Allowance for doubtful accounts	(71		)	(65		)
Accounts receivable, net	$	8,250		$	8,335

Schedule of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):



	June 30, 2015		December 31, 2014
Prepaid expenses	$	2,323	$	1,721
Canadian value-added taxes receivable	1,646		—
Others	259		239
Prepaid expenses and other current assets	$	4,228	$	1,960

Schedule of Property and Equipment

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



	June 30, 2015			December 31, 2014
Computer and network equipment	$	26,681		$	24,292
Computer software	2,662			2,264
Furniture and fixtures	1,039			1,030
Leasehold improvements	614			611
Property and equipment	30,996			28,197
Accumulated depreciation and amortization	(19,032		)	(15,626		)
Property and equipment, net	$	11,964		$	12,571

Schedule of Capital Leased Property and Equipment

Property and equipment capitalized under capital lease obligations consist primarily of computer and network equipment and were as follows (in thousands):



	June 30, 2015			December 31, 2014
Gross	$	23,412		$	21,025
Less: accumulated depreciation and amortization	(13,058		)	(10,609		)
Total	$	10,354		$	10,416

Schedule of Accrued and Other Current Liabilities

Accrued and other current liabilities consisted of the following (in thousands):



	June 30, 2015		December 31, 2014
Accrued compensation and benefits	$	5,598	$	5,078
Accrued expenses	1,474		2,240
Canadian value-added taxes liability	1,646		—
Accrued and other current liabilities	$	8,718	$	7,318

Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets



	June 30, 2015							December 31, 2014
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Developed technology	$	2,460	$	(599	)	$	1,861	$	2,460	$	(423	)	$	2,037
Customer relationships	520		(177		)	343		520		(125		)	395
Domain names	50		(17		)	33		50		(12		)	38
Non-compete agreements	140		(80		)	60		140		(57		)	83
Total	$	3,170	$	(873	)	$	2,297	$	3,170	$	(617	)	$	2,553

Schedule of Expected Future Amortization Expense of Intangible Assets

As of June 30, 2015, the expected future amortization expense for intangible assets was as follows (in thousands):



Period	Expected Future Amortization Expense
Remainder of 2015	$	256
2016	503
2017	465
2018	442
2019	351
2020	280
Total	$	2,297

Long-Term Debt (Tables)

6 Months Ended

Jun. 30, 2015

Debt Disclosure [Abstract]

Schedule of Debt

As of June 30, 2015 and December 31, 2014, the Company’s outstanding debt is summarized as follows (in thousands):



	June 30, 2015			December 31, 2014
Term loan under 2014 Loan and Security Agreement	$	20,000		$	20,000
Term loan under 2013 Loan and Security Agreement	3,500			4,500
Promissory note to USAC	2,068			2,640
FCC civil penalty	2,000			—
Total notes payable, gross	27,568			27,140
Less: discount	(1,370		)	(1,216		)
Total notes payable, net carrying value	26,198			25,924
Revolving line of credit, non-current	12,500			12,500
Total debt, net carrying value	$	38,698		$	38,424
Less: current portion of debt	(5,081		)	(3,146		)
Total debt, less current portion	33,617			35,278

Schedule of Maturities of Debt

Maturities of the Company’s outstanding debt as of June 30, 2015 are as follows (in thousands):



Period	Amount to Mature
Remainder of 2015	$	1,942
2016	20,173
2017	5,286
2018	4,334
2019	8,333
Total	$	40,068

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6479336&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=34725769&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28541-108399

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21521-112644

+ Details

Stockholders' Equity (Tables)

6 Months Ended

Jun. 30, 2015

Equity [Abstract]

Schedule of Common Stock Reserved for Future Issuance



		June 30, 2015
Stock options outstanding		6,775
Restricted stock units outstanding		1,526
Shares available for future grant under 2014 Plan		5,308
Shares available for future issuance under ESPP		1,058
Common stock warrants outstanding		360
Total shares of common stock reserved		15,027

Schedule of Stock Option Activities

A summary of the Company’s stock option activities during the six months ended June 30, 2015 is as follows (in thousands, except years and per share data):



	Number of Shares Outstanding		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value
Outstanding as of December 31, 2014	7,164		$	4.34
Options granted (weighted average grant date fair value of $2.49 per share)	181		5.20
Options exercised	(411	)	0.85
Options forfeited or expired	(159	)	7.32
Outstanding as of June 30, 2015	6,775		$	4.51	7.0	$	13,332

Schedule of RSU Activities

A summary of the Company's restricted stock units ("RSU") activities during the six months ended June 30, 2015 is as follows (in thousands, except per share data):



	Number of Shares		Weighted Average Grant Date Fair Value Per Share
Outstanding as of December 31, 2014	1,370		$	5.21
RSUs granted	599		5.13
RSUs vested and released	(375	)	6.18
RSUs forfeited	(68	)	5.25
Outstanding as of June 30, 2015	1,526		$	4.94

Schedule of Stock-based Compensation Expense

Stock-based compensation expenses for the three and six months ended June 30, 2015 and 2014 are as follows (in thousands):



	Three Months Ended				Six Months Ended
	June 30, 2015		June 30, 2014		June 30, 2015		June 30, 2014
Cost of revenue	$	218	$	121	$	406	$	208
Research and development	340		471		914		821
Sales and marketing	458		368		982		694
General and administrative	814		763		1,763		1,196
Total stock-based compensation	$	1,830	$	1,723	$	4,065	$	2,919



	Stock Option		RSU		ESPP
Unrecognized stock-based compensation expense	$	8,891	$	6,293	$	188
Weighted-average amortization period	2.5 years		3.0 years		0.4 years

Schedule of Weighted-Average Valuation Assumptions, Stock Option

The weighted-average assumptions used to value stock options granted during the three and six months ended June 30, 2015 and 2014 were as follows:



Stock Options	Three Months Ended		Six Months Ended
	June 30, 2015	June 30, 2014	June 30, 2015	June 30, 2014
Expected term (years)	6.1	6.1	6.1	6.1
Volatility	49%	56%	49%	56%
Risk-free interest rate	1.5%	1.9%	1.5%	1.8%
Dividend yield	—	—	—	—

Net Loss Per Share (Tables)

6 Months Ended

Jun. 30, 2015

Earnings Per Share [Abstract]

Basic and Diluted Net Loss Per Share

The following table presents the calculation of basic and diluted net loss per share (in thousands, except per share data).



	Three Months Ended						Six Months Ended
	June 30, 2015			June 30, 2014			June 30, 2015			June 30, 2014
Net loss	$	(7,369	)	$	(8,659	)	$	(16,272	)	$	(16,979	)
Weighted-average shares used in computing basic and diluted net loss per share	49,980			46,898			49,708			26,367
Basic and diluted net loss per share	$	(0.15	)	$	(0.18	)	$	(0.33	)	$	(0.64	)

Schedule of Antidilutive Securities Excluded from Computation of Net Loss Per Share

The following securities were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (in thousands).



	June 30, 2015	June 30, 2014
Stock options	6,775	7,145
Restricted stock units	1,526	262
ESPP	178	474
Common stock warrants	360	360
Common stock subject to repurchase or forfeiture	—	138
Total	8,839	8,379

Geographical Information (Tables)

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Schedule of Revenues and Property and Equipment by Geographic Region

The following table is a summary of revenues by geographic region based on client billing address and has been estimated based on the amounts billed to clients during the periods (in thousands).



	Three Months Ended				Six Months Ended
	June 30, 2015		June 30, 2014		June 30, 2015		June 30, 2014
United States	$	28,088	$	22,816	$	56,367	$	45,250
International	2,186		1,869		4,181		3,709
Total revenue	$	30,274	$	24,685	$	60,548	$	48,959

The following table summarizes total property and equipment, net in the respective locations (in thousands).



	June 30, 2015		December 31, 2014
United States	$	9,875	$	10,625
International	2,089		1,946
Property and equipment, net	$	11,964	$	12,571

Fair Value Measurements - Schedule of Assets Carried at Fair Value (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Money market funds
Assets
Cash equivalents	$ 20,001
Money market funds \| Level 1
Assets
Cash equivalents	$ 20,001
U.S. Treasury bills
Assets
Short-term investments		$ 20,000
U.S. Treasury bills \| Level 1
Assets
Short-term investments		$ 20,000

Financial Statement Components - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014	Jun. 30, 2014	Dec. 31, 2013
Financial Statement Components [Abstract]
Cash	$ 45,332	$ 58,289
Money market funds	20,001	0
Cash and cash equivalents	$ 65,333	$ 58,289	$ 61,577	$ 17,748

Financial Statement Components - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Accounts Receivable [Line Items]
Allowance for doubtful accounts	$ (71)	$ (65)
Accounts receivable, net	8,250	8,335
Billed Revenues
Accounts Receivable [Line Items]
Trade accounts receivable	7,553	7,482
Unbilled Revenues, net of advance client deposits
Accounts Receivable [Line Items]
Trade accounts receivable	$ 768	$ 918

Financial Statement Components - Schedule of Prepaid expenses and other current assets (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financial Statement Components [Abstract]
Prepaid expenses	$ 2,323	$ 1,721
Canadian value-added tax receivable	1,646	0
Others	259	239
Prepaid expenses and other current assets	$ 4,228	$ 1,960

Financial Statement Components - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Property, Plant and Equipment
Property and equipment	$ 30,996	$ 28,197
Accumulated depreciation and amortization	(19,032)	(15,626)
Property and equipment, net	11,964	12,571
Computer and Network Equipment
Property, Plant and Equipment
Property and equipment	26,681	24,292
Computer Software
Property, Plant and Equipment
Property and equipment	2,662	2,264
Furniture and Fixtures
Property, Plant and Equipment
Property and equipment	1,039	1,030
Leasehold Improvements
Property, Plant and Equipment
Property and equipment	$ 614	$ 611

Financial Statement Components - Schedule of Capital Leased Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financial Statement Components [Abstract]
Gross	$ 23,412	$ 21,025
Less: accumulated depreciation and amortization	(13,058)	(10,609)
Total	$ 10,354	$ 10,416

Financial Statement Components - Schedule of Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financial Statement Components [Abstract]
Accrued compensation and benefits	$ 5,598	$ 5,078
Accrued expenses	1,474	2,240
Canadian value-added taxes liability	1,646	0
Accrued and other current liabilities	$ 8,718	$ 7,318

Financial Statement Components - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Financial Statement Components [Abstract]
Depreciation and amortization expense	$ 1.8	$ 1.6	$ 3.4	$ 3.0
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash					$ 0.8
Letter of credit related to lease obligation
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash					0.7
Letter of credit related to insurance policy
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash					$ 0.1

Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	$ 3,170	$ 3,170
Accumulated Amortization	(873)	(617)
Total	2,297	2,553
Developed technology
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	2,460	2,460
Accumulated Amortization	(599)	(423)
Total	1,861	2,037
Customer relationships
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	520	520
Accumulated Amortization	(177)	(125)
Total	343	395
Domain names
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	50	50
Accumulated Amortization	(17)	(12)
Total	33	38
Non-compete agreements
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	140	140
Accumulated Amortization	(80)	(57)
Total	$ 60	$ 83

Intangible Assets - Schedule of Expected Future Amortization Expense of Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2015	$ 256
2016	503
2017	465
2018	442
2019	351
2020	280
Total	$ 2,297	$ 2,553

Intangible Assets Intangible Assets - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Amortization of Intangible Assets	$ 0.1	$ 0.1	$ 0.3	$ 0.3

Long-Term Debt - Narrative (Details)	1 Months Ended
Long-Term Debt - Narrative (Details)	Dec. 31, 2014 USD ($)	Feb. 28, 2014 USD ($) lender $ / shares shares	Oct. 31, 2013 USD ($)	Jul. 31, 2013 USD ($) installment	Jun. 30, 2015 USD ($) shares	Sep. 30, 2014 USD ($)
Debt Instrument
Revolving line of credit	$ 12,500,000				$ 12,500,000
Long-term debt, gross					40,068,000
Discount on debt					1,370,000
Net carrying value of debt	38,424,000				38,698,000
Loan and Security Agreement \| Revolving Credit Facility
Debt Instrument
Credit facility, maximum borrowing capacity	$ 20,000,000.0				20,000,000.0
Revolving line of credit					12,500,000
Credit facility, remaining borrowing capacity					7,500,000
Debt Instrument, Covenant Terms, Minimum Required Cash on Deposit at Lender					7,500,000.0
Loan and Security Agreement \| Revolving Credit Facility \| Prime Rate
Debt Instrument
Debt instrument, basis spread	0.50%
Loan and Security Agreement \| Term Loan
Debt Instrument
Credit facility, amount borrowed			$ 5,000,000.0
Loan and Security Agreement \| Term Loan \| Prime Rate
Debt Instrument
Debt instrument, basis spread			1.50%
2014 Loan and Security Agreement \| Term Loan
Debt Instrument
Credit facility, maximum borrowing capacity		$ 30,000,000.0
Credit facility, remaining borrowing capacity					10,000,000.0
Number of lenders \| lender		2
Credit facility, minimum incremental borrowing amount					1,000,000.0
Debt, payment terms		Monthly principal payments are due beginning in February 2016 based on 1/60th of the outstanding balance at that time and will continue until all remaining principal outstanding under the term loan becomes due and payable in February 2019.
2014 Loan and Security Agreement \| Term Loan \| Prime Rate
Debt Instrument
Term loan, minimum interest rate		10.00%
2014 Loan and Security Agreement \| Term Loan \| London Interbank Offered Rate (LIBOR)
Debt Instrument
Debt instrument, basis spread		9.00%
Tranche One \| Term Loan
Debt Instrument
Credit facility, maximum borrowing capacity		$ 20,000,000
Long-term debt, gross		20,000,000
Payments of debt issuance costs		$ 400,000
FCC civil penalty
Debt Instrument
Long-term debt, gross					2,000,000
Discount on debt					300,000
Common Stock \| 2014 Loan and Security Agreement \| Term Loan
Debt Instrument
Warrants issued \| shares		177,865
Warrants outstanding, exercise price (in USD per share) \| $ / shares		$ 10.12
Common Stock \| Tranche One \| Term Loan
Debt Instrument
Warrants vested, shares \| shares		118,577
Notes Payable
Debt Instrument
Long-term debt, gross	$ 27,140,000				27,568,000
Discount on debt	1,216,000
Net carrying value of debt	25,924,000				26,198,000
Notes Payable \| Loan and Security Agreement
Debt Instrument
Long-term debt, gross	4,500,000				3,500,000
Notes Payable \| 2014 Loan and Security Agreement
Debt Instrument
Long-term debt, gross	20,000,000				20,000,000
Notes Payable \| Promissory note to USAC
Debt Instrument
Long-term debt, gross	2,640,000				2,068,000
Promissory note issued				$ 4,100,000
Promissory note, stated interest rate				12.75%
Promissory note, number of monthly payments \| installment				42
Notes Payable \| FCC civil penalty
Debt Instrument
Long-term debt, gross	$ 0				2,000,000
Net carrying value of debt					$ 1,700,000
Common Stock Warrant \| 2014 Loan and Security Agreement \| Term Loan
Debt Instrument
Class of warrant or right, vesting period (in years)		10 years
Class of Warrant or Right, Number of Securities Called by Warrants or Rights, Unvested \| shares					59,288
FCC civil penalty
Debt Instrument
Accrued penalty						$ 2,000,000

Long-Term Debt - Schedule of Outstanding Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	$ 40,068
Less: discount	(1,370)
Long-term Debt	38,698	$ 38,424
Less: current portion of debt	(5,081)	(3,146)
Total debt, less current portion	33,617	35,278
Notes Payable
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	27,568	27,140
Less: discount		(1,216)
Long-term Debt	26,198	25,924
Line of Credit
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	12,500	12,500
2014 Loan and Security Agreement \| Notes Payable
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	20,000	20,000
2013 Loan and Security Agreement \| Notes Payable
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	3,500	4,500
Promissory note to USAC \| Notes Payable
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	2,068	2,640
FCC civil penalty
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	2,000
Less: discount	(300)
FCC civil penalty \| Notes Payable
Schedule of ST and LT Debt [Line Items]
Long-term debt, gross	2,000	$ 0
Long-term Debt	$ 1,700

Long-Term Debt - Schedule of Maturities of Debt (Details) $ in Thousands	Jun. 30, 2015 USD ($)
Debt Disclosure [Abstract]
Remainder of 2015	$ 1,942
2016	20,173
2017	5,286
2018	4,334
2019	8,333
Total	$ 40,068

Stockholders' Equity - Capital Structure Narrative (Details) - $ / shares	Jun. 30, 2015	Dec. 31, 2014
Equity [Abstract]
Common Stock, shares authorized	450,000,000	450,000,000
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares issued	50,245,859	49,322,000
Common Stock, shares outstanding	50,245,859	49,322,000
Preferred Stock, shares authorized	5,000,000	5,000,000
Preferred Stock, par value	$ 0.001	$ 0.001
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0

Stockholders' Equity - Common Stock Subject to Forfeiture Narrative (Details) - Restricted Stock [Member] - SoCoCare - $ / shares	1 Months Ended		3 Months Ended
	Oct. 31, 2014	Oct. 31, 2013	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014
Schedule of Restricted Stock [Line Items]
Restricted common stock issued in period, shares		118,577
Grant date fair value, per share		$ 8.48
Percentage of shares vested	50.00%
Restricted common stock outstanding, shares					59,289
Vesting period 1
Schedule of Restricted Stock [Line Items]
Number of shares vested				37,905
Vesting period 2
Schedule of Restricted Stock [Line Items]
Number of shares forfeited			21,384

Stockholders' Equity - Warrants (Details) - Common Stock - $ / shares	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Class of Warrant or Right
Warrants outstanding	359,596	359,596
Outstanding warrants exercise price, weighted-average	$ 5.59	$ 5.59
Minimum
Class of Warrant or Right
Warrant expiration date	2020-02
Maximum
Class of Warrant or Right
Warrant expiration date	2024-02

Stockholders' Equity - Common Stock Reserved for Future Issuance (Details) - shares	Jun. 30, 2015	Apr. 03, 2014
Class of Stock
Shares of common stock reserved for future issuance	15,027,000
Stock options
Class of Stock
Shares of common stock reserved for future issuance	6,775,000
Restricted Stock Units
Class of Stock
Shares of common stock reserved for future issuance	1,526,000
Warrant
Class of Stock
Shares of common stock reserved for future issuance	360,000
2014 Equity Incentive Plan
Class of Stock
Shares of common stock reserved for future grant	5,308,000
Employee Stock Purchase Plan
Class of Stock
Shares of common stock reserved for future issuance	1,058,251	880,000

Stockholders' Equity - Equity Incentive Plans (Details) - 2014 Equity Incentive Plan - shares	Jun. 30, 2015	Jan. 01, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award
Automatic annual increase in common stock reserved for issuance, percentage		5.00%
Automatic annual increase in common stock reserved for issuance, shares		2,466,124
Shares of common stock available for future grant	5,308,000
Common Stock
Share-based Compensation Arrangement by Share-based Payment Award
Shares of common stock authorized for issuance			5,300,000
Shares of common stock available for future grant	5,307,614

Stockholders' Equity - Stock Option Activities (Details) $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended
	Jun. 30, 2015 USD ($) $ / shares shares
Options Outstanding, Weighted Average Exercise Price [Roll Forward]
Fair market value of common stock	$ 5.23
Stock options
Options Outstanding [Roll Forward]
Outstanding, beginning balance \| shares	7,164
Options granted (weighted average grant date fair value of $2.49 per share) \| shares	181
Options exercised \| shares	(411)
Options forfeited or expired \| shares	(159)
Outstanding, ending balance \| shares	6,775
Options Outstanding, Weighted Average Exercise Price [Roll Forward]
Outstanding, beginning balance, weighted average exercise price (in USD per share)	$ 4.34
Options granted, weighted average exercise price (in USD per share)	5.20
Options exercised, weighted average exercise price (in USD per share)	0.85
Options forfeited or expired, weighted average exercise price (in USD per share)	7.32
Outstanding, ending balance, weighted average exercise price (in USD per share)	$ 4.51
Outstanding, ending balance, weighted average remaining contractual life	7 years 7 days
Outstanding, ending balance, aggregate intrinsic value \| $	$ 13,332
Weighted average grant date fair value (in USD per share)	$ 2.49

Stockholders' Equity - RSU Activities (Details) - Restricted stock units shares in Thousands	6 Months Ended
	Jun. 30, 2015 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award
Beginning Balance, Number of shares outstanding \| shares	1,370
RSUs granted, in shares \| shares	599
RSUs vested and released,in shares \| shares	(375)
RSUs forfeited, in shares \| shares	(68)
Ending Balance, Number of shares outstanding \| shares	1,526
Beginning Balance, Weighted Average Grant Date Fair Value Per Share \| $ / shares	$ 5.21
Weighted Average Grant Date Fair Value Per Share, RSUs granted \| $ / shares	5.13
Weighted Average Grant Date Fair Value Per Share, RSUs vested and released \| $ / shares	6.18
Weighted Average Grant Date Fair Value Per Share, RSUs forfeited \| $ / shares	5.25
Ending Balance, Weighted Average Grant Date Fair Value Per Share \| $ / shares	$ 4.94

Stockholders' Equity - ESPP (Details) - $ / shares	6 Months Ended
Stockholders' Equity - ESPP (Details) - $ / shares	Jun. 30, 2015	Jan. 01, 2015	Apr. 03, 2014
Share-based Compensation Arrangement by Share-based Payment Award
Shares of common stock reserved for future issuance	15,027,000
ESPP
Share-based Compensation Arrangement by Share-based Payment Award
Shares of common stock reserved for future issuance	1,058,251		880,000
Automatic annual increase in common stock reserved for issuance, percentage		1.00%
Maximum annual increase of shares reserved		1,000,000
Automatic annual increase in common stock reserved for issuance, shares		493,224
Shares purchased under the ESPP	158,842
Weighted average price per share of shares purchased under the ESPP	$ 4.28

Stockholders' Equity - Stock-based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Stock-based Compensation Expense
Stock-based compensation expense	$ 1,830	$ 1,723	$ 4,065	$ 2,919
Cost of Revenue
Stock-based Compensation Expense
Stock-based compensation expense	218	121	406	208
Research and Development
Stock-based Compensation Expense
Stock-based compensation expense	340	471	914	821
Selling and Marketing
Stock-based Compensation Expense
Stock-based compensation expense	458	368	982	694
General and Administrative
Stock-based Compensation Expense
Stock-based compensation expense	814	$ 763	1,763	$ 1,196
Stock options
Stock-based Compensation Expense
Unrecognized stock-based compensation expense	8,891		$ 8,891
Weighted-average amortization period			2 years 6 months 4 days
Restricted Stock Units
Stock-based Compensation Expense
Unrecognized stock-based compensation expense	6,293		$ 6,293
Weighted-average amortization period			2 years 11 months 16 days
ESPP
Stock-based Compensation Expense
Unrecognized stock-based compensation expense	$ 188		$ 188
Weighted-average amortization period			4 months 15 days

Stockholders' Equity - Option & ESPP Valuation Assumptions (Details) - Stock options	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Class of Stock
Expected term (years)	6 years 29 days	6 years 29 days	6 years 29 days	6 years 29 days
Volatility	49.00%	56.00%	49.00%	56.00%
Risk-free interest rate	1.50%	1.90%	1.50%	1.80%
Dividend yield	0.00%	0.00%	0.00%	0.00%

Net Loss Per Share - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Earnings Per Share [Abstract]
Net loss	$ (7,369)	$ (8,659)	$ (16,272)	$ (16,979)
Weighted-average shares used in computing basic and diluted net loss per share (in shares)	49,980	46,898	49,708	26,367
Basic and diluted net loss per share (in USD per share)	$ (0.15)	$ (0.18)	$ (0.33)	$ (0.64)

- Definition

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

+ References + Details

Net Loss Per Share - Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share (Details) - shares shares in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from EPS calculation	8,839	8,379
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from EPS calculation	6,775	7,145
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from EPS calculation	1,526	262
ESPP
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from EPS calculation	178	474
Warrants \| Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from EPS calculation	360	360
Common stock subject to repurchase or forfeiture
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from EPS calculation	0	138

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Income Tax Disclosure [Abstract]
Provision for (benefit from) income taxes	$ (20)	$ 12	$ (2)	$ 39

Commitments and Contingencies - Commitments (Details) - Capital Lease Obligations [Member] $ in Millions	6 Months Ended
	Jun. 30, 2015 USD ($)
Other Commitments [Line Items]
Capital lease future payment obligations incurred	$ 3.2
Capital lease future minimum payments, remainder of 2015	$ 0.6
Number of years remainder of minimum payments is due	2 years 7 months 2 days

Commitments and Contingencies - Contingencies (Details) - USD ($)	1 Months Ended	3 Months Ended			6 Months Ended
	Jul. 31, 2013	Jun. 30, 2015	Mar. 31, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014	Dec. 31, 2012
Universal Services Fund Liability [Abstract]
Accrued federal fees		$ 5,658,000			$ 5,658,000		$ 7,215,000
Notes payable		40,068,000			40,068,000
State and Local Taxes and Surcharges [Abstract]
General and administrative expense		6,027,000		$ 3,515,000	13,302,000	$ 9,686,000
Accrued sales tax liability, current		863,000			863,000		297,000
Accrued sales tax liability, noncurrent		2,063,000			2,063,000		2,582,000
FCC civil penalty
Universal Services Fund Liability [Abstract]
Notes payable		2,000,000			2,000,000
General and Administrative
Universal Services Fund Liability [Abstract]
Interest and penalty expense related to unpaid USF obligations		100,000			200,000
Soneet Kapila v. Five9, Inc. \| General and Administrative
Legal Matters
Litigation settlement					99,000
Notes Payable
Universal Services Fund Liability [Abstract]
Notes payable		27,568,000			27,568,000		27,140,000
Notes Payable \| Promissory note to USAC
Universal Services Fund Liability [Abstract]
Promissory note issued	$ 4,100,000
Notes payable		2,068,000			2,068,000		2,640,000
Notes Payable \| FCC civil penalty
Universal Services Fund Liability [Abstract]
Notes payable		2,000,000			2,000,000		0
USF obligations \| 2003 through 2012
Universal Services Fund Liability [Abstract]
Accrued federal fees								$ 8,100,000
USF obligations \| Promissory note to USAC
Universal Services Fund Liability [Abstract]
Promissory note issued	4,100,000
Contingent sales tax liabilities
Universal Services Fund Liability [Abstract]
Payments		900,000
State and Local Taxes and Surcharges [Abstract]
Accrued sales tax liability		2,700,000			2,700,000
General and administrative expense					300,000	$ 1,000,000
Payments		900,000
Accrued sales tax liability, current		600,000			600,000
Accrued sales tax liability, noncurrent		2,100,000			2,100,000		2,600,000
Contingent sales tax liabilities \| Immaterial out of period adjustment
State and Local Taxes and Surcharges [Abstract]
General and administrative expense			$ 600,000
Disputed portion \| USF obligations \| 2003 through 2012
Universal Services Fund Liability [Abstract]
Accrued federal fees		$ 4,400,000			$ 4,400,000		$ 4,200,000	3,400,000
Disputed portion \| USF obligations \| 2003 through 2007
Universal Services Fund Liability [Abstract]
Accrued federal fees								800,000
Undisputed portion \| USF obligations \| 2003 through 2012
Universal Services Fund Liability [Abstract]
Accrued federal fees								$ 4,700,000
Payments	600,000
State and Local Taxes and Surcharges [Abstract]
Payments	$ 600,000

Geographical Information - Schedule of Revenue and Property and Equipment by Geographic Region (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Revenues from External Customers and Long-Lived Assets
Revenue	$ 30,274	$ 24,685	$ 60,548	$ 48,959
Property and equipment, net	11,964		11,964		$ 12,571
United States
Revenues from External Customers and Long-Lived Assets
Revenue	28,088	22,816	56,367	45,250
Property and equipment, net	9,875		9,875		10,625
International
Revenues from External Customers and Long-Lived Assets
Revenue	2,186	$ 1,869	4,181	$ 3,709
Property and equipment, net	$ 2,089		$ 2,089		$ 1,946