0001660280-18-000017 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2018	Oct. 31, 2018
Document And Entity Information [Abstract]
Entity Registrant Name	TENABLE HOLDINGS, INC.
Entity Central Index Key	0001660280
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Common Stock, Shares Outstanding (in shares)		93,064,759
Entity Emerging Growth Company	true
Entity Small Business	false
Entity Ex Transition Period	true

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 253,026	$ 27,210
Short-term investments	34,125	0
Accounts receivable (net of allowance for doubtful accounts of $196 and $160 at September 30, 2018 and December 31, 2017, respectively)	59,035	50,881
Deferred commissions	20,401	17,170
Prepaid expenses and other current assets	14,718	15,994
Total current assets	381,305	111,255
Property and equipment, net	10,872	10,754
Construction in progress	23,546	2,252
Deferred commissions (net of current portion)	32,483	33,006
Intangible assets, net	578	1,031
Goodwill	265	265
Other assets	5,149	5,774
Total assets	454,198	164,337
Current liabilities:
Accounts payable	538	338
Accrued expenses	6,570	4,878
Accrued compensation	19,734	18,482
Deferred revenue	191,578	154,898
Other current liabilities	1,897	1,750
Total current liabilities	220,317	180,346
Deferred revenue (net of current portion)	74,120	70,920
Financing obligation	23,096	1,802
Other liabilities	4,104	5,199
Total liabilities	321,637	258,267
Commitments and contingencies (Note 5)
Stockholders’ equity (deficit):
Common stock (par value: $0.01; 500,000 and 93,855 shares authorized at September 30, 2018 and December 31, 2017; 93,040 and 24,472 shares issued and outstanding at September 30, 2018 and December 31, 2017)	930	246
Additional paid-in capital	578,125	20,676
Accumulated deficit	(446,494)	(392,587)
Total stockholders’ equity (deficit)	132,561	(371,665)
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit)	454,198	164,337
Series A Redeemable Convertible Preferred Stock
Current liabilities:
Redeemable convertible preferred stock	0	49,935
Series B Redeemable Convertible Preferred Stock
Current liabilities:
Redeemable convertible preferred stock	$ 0	$ 227,800

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Accounts receivable, allowance for doubtful accounts	$ 196	$ 160
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	500,000,000	93,855,000
Common stock, shares issued (in shares)	93,040,000	24,472,000
Common stock, shares outstanding (in shares)	93,040,000	24,472,000
Series A Redeemable Convertible Preferred Stock
Redeemable convertible preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Redeemable convertible preferred stock, shares authorized (in shares)	0	15,848,000
Redeemable convertible preferred stock, shares issued (in shares)	0	15,848,000
Redeemable convertible preferred stock, shares outstanding (in shares)	0	15,848,000
Redeemable convertible preferred stock, liquidation value	$ 50,000	$ 50,000
Series B Redeemable Convertible Preferred Stock
Redeemable convertible preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Redeemable convertible preferred stock, shares authorized (in shares)	0	42,000,000
Redeemable convertible preferred stock, shares issued (in shares)	0	39,538,000
Redeemable convertible preferred stock, shares outstanding (in shares)	0	39,538,000
Redeemable convertible preferred stock, liquidation value	$ 230,008	$ 230,008

Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Revenue	$ 69,440	$ 48,980	$ 192,139	$ 133,610
Cost of revenue	12,161	7,424	30,768	17,210
Gross profit	57,279	41,556	161,371	116,400
Operating expenses:
Sales and marketing	44,550	29,574	125,964	83,515
Research and development	20,553	15,869	55,529	42,040
General and administrative	13,272	7,275	32,868	19,982
Total operating expenses	78,375	52,718	214,361	145,537
Loss from operations	(21,096)	(11,162)	(52,990)	(29,137)
Other income (expense), net	709	(92)	240	(65)
Loss before income taxes	(20,387)	(11,254)	(52,750)	(29,202)
Provision for income taxes	482	59	1,157	151
Net loss and comprehensive loss	(20,869)	(11,313)	(53,907)	(29,353)
Accretion of Series A and B redeemable convertible preferred stock	(55)	(192)	(434)	(570)
Net loss attributable to common stockholders	$ (20,924)	$ (11,505)	$ (54,341)	$ (29,923)
Net loss per share attributable to common stockholders, basic and diluted (in usd per share)	$ (0.28)	$ (0.51)	$ (1.34)	$ (1.36)
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares)	74,261	22,679	40,688	22,004

Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - 9 months ended Sep. 30, 2018 - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Series A Redeemable Convertible Preferred Stock	Series B Redeemable Convertible Preferred Stock
Balance (in shares) at Dec. 31, 2017					15,848	39,538
Balance at Dec. 31, 2017					$ 49,935	$ 227,800
Redeemable Convertible Preferred Stock [Roll Forward]
Accretion of Series A and B redeemable convertible preferred stock					$ 13	$ 421
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares)					(15,848)	(39,538)
Conversion of redeemable convertible preferred stock to common stock upon initial public offering					$ (49,948)	$ (228,221)
Balance (in shares) at Sep. 30, 2018					0	0
Balance at Sep. 30, 2018					$ 0	$ 0
Balance (in shares) at Dec. 31, 2017	24,472	24,472
Balance at Dec. 31, 2017	$ (371,665)	$ 246	$ 20,676	$ (392,587)
Increase (Decrease) in Stockholders' Deficit [Roll Forward]
Accretion of Series A and B redeemable convertible preferred stock	$ (434)		(434)
Exercise of stock options (in shares)	654	654
Exercise of stock options	$ 1,415	$ 6	1,409
Repurchase of common stock (in shares)		(7)
Repurchase of common stock	(75)	$ (1)	(74)
Stock-based compensation	14,259		14,259
Issuance of common stock in connection with initial public offering, net of underwriting discounts and commissions and other offering expenses (in shares)		12,535
Issuance of common stock in connection with initial public offering, net of underwriting discounts and commissions and other offering expenses	264,799	$ 125	264,674
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares)		55,386
Conversion of redeemable convertible preferred stock to common stock upon initial public offering	278,169	$ 554	277,615
Net loss	$ (53,907)			(53,907)
Balance (in shares) at Sep. 30, 2018	93,040	93,040
Balance at Sep. 30, 2018	$ 132,561	$ 930	$ 578,125	$ (446,494)

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows from operating activities:
Net loss	$ (53,907)	$ (29,353)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	4,580	3,316
Stock-based compensation	14,206	5,503
Deferred income taxes	0	486
Other	771	23
Changes in operating assets and liabilities:
Accounts receivable	(8,190)	(8,435)
Prepaid expenses and other current assets	1,228	(540)
Deferred commissions	(2,708)	(11,275)
Other assets	564	(1,537)
Accounts payable and accrued expenses	1,930	2,485
Accrued compensation	1,252	(715)
Deferred revenue	39,880	40,066
Other current liabilities	36	(840)
Other liabilities	(647)	2
Net cash used in operating activities	(1,005)	(814)
Cash flows from investing activities:
Purchases of property and equipment	(4,140)	(1,628)
Purchases of short-term investments	(34,114)	0
Net cash used in investing activities	(38,254)	(1,628)
Cash flows from financing activities:
Proceeds from initial public offering, net of underwriting discounts and commissions	268,531	0
Payments of costs related to initial public offering	(3,732)	0
Principal payments under capital lease obligations	(389)	(173)
Credit facility issuance costs	0	(238)
Proceeds from the exercise of stock options	1,415	2,847
Repurchases of common stock	(75)	(385)
Net cash provided by financing activities	265,750	2,051
Effect of exchange rate changes on cash and cash equivalents and restricted cash	(675)	22
Net increase (decrease) in cash and cash equivalents and restricted cash	225,816	(369)
Cash and cash equivalents and restricted cash at beginning of period	27,472	34,470
Cash and cash equivalents and restricted cash at end of period	253,288	34,101
Supplemental disclosure of cash flow information:
Cash paid for interest	85	46
Cash paid for income taxes	920	510
Supplemental disclosure of non-cash investing and financing activities:
Assets acquired under capital leases	4	826
Asset retirement obligations	67	764
Construction in progress	$ 21,294	$ 0

Business and Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business and Summary of Significant Accounting Policies

Business Description

Tenable Holdings, Inc. (the “Company,” “we,” "us," or “our”) is a provider of Cyber Exposure solutions, which is a discipline for managing and measuring cybersecurity risk in the digital era. Our enterprise software platform enables broad visibility into an organization’s cyber exposure across the modern attack surface and deep insights that help organizations translate technical data into business insights to understand and reduce their cybersecurity risk.

Basis of Presentation

The accompanying consolidated financial statements include the accounts of Tenable Holdings, Inc. and our wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

The consolidated financial statements have been prepared in conformity with United States generally accepted accounting principles (“GAAP”) for interim financial information. The consolidated statements are unaudited and should be read in conjunction with the consolidated financial statements and related notes included in our final prospectus for our initial public offering ("IPO") dated as of July 25, 2018 and filed with the Securities and Exchange Commission pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, on July 26, 2018 ("Prospectus").

The consolidated financial statements have been prepared on a basis consistent with the audited annual consolidated financial statements included in the Prospectus and, in the opinion of management, include all adjustments of a normal recurring nature necessary to fairly state our financial position, our results of operations, and cash flows.

The results for the nine months ended September 30, 2018 are not necessarily indicative of the operating results expected for the year ending December 31, 2018.

Initial Public Offering

On July 30, 2018, we completed our IPO, in which we issued and sold 12,535,000 shares of common stock at a price to the public of $23.00 per share, including 1,635,000 shares of common stock purchased by our underwriters from the full exercise of their over-allotment option. All of the shares sold in the IPO were sold by the Company. We received net proceeds of $264.8 million after deducting underwriting discounts and commissions and other offering expenses.

Upon the completion of our IPO, all 15,847,500 shares of our Series A Redeemable Convertible Preferred Stock ("Series A") and 39,538,354 shares of our Series B Redeemable Convertible Preferred Stock ("Series B") automatically converted into an aggregate of 55,385,854 shares of our common stock. Our newly adopted Amended and Restated Certificate of Incorporation authorizes a total of 500,000,000 shares of common stock and 10,000,000 shares of preferred stock.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates include, but are not limited to, the determination of the estimated economic life of perpetual licenses for revenue recognition, the estimated period of benefit for deferred commissions, useful lives of long-lived assets, the valuation of stock-based compensation, including the estimated underlying fair value of our common stock prior to our IPO, and the valuation of deferred tax assets. We base these estimates on historical experience and on various other assumptions that we believe to be reasonable. Actual results could differ significantly from these estimates.

Investments

We currently invest in commercial paper, corporate bonds, and U.S. treasury and agency obligations. Our investments are classified as available-for-sale and recorded at fair value, with unrealized gains and losses reported in accumulated other comprehensive loss within stockholders’ equity (deficit). We review our investment portfolio to determine whether investments have indicators of possible impairment.

Revenue Recognition

We early adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue From Contracts With Customers (“ASC 606”), on January 1, 2017 using the modified retrospective method and applying the guidance to all contracts as of January 1, 2017. The most significant impact of adopting ASC 606 was the deferral of perpetual license revenue over an estimated economic life, including estimated maintenance renewal periods, whereas under the previous guidance we recognized perpetual license revenue upon delivery of the perpetual license. Additionally, the incremental costs of obtaining a contract with a customer are deferred, and will be amortized over a longer estimated period of benefit, whereas under previous guidance we amortized such costs over the contract term.

The core principle of ASC 606 is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve the core principle of ASC 606, we apply the following steps:

•Identify the contract with a customer

•Identify the performance obligations in the contract

•Determine the transaction price

•Allocate the transaction price to the performance obligations in the contract

•Recognize revenue when or as performance obligations are satisfied

We generate revenue from subscription arrangements for software and cloud-based solutions, perpetual licenses, maintenance associated with perpetual licenses, and professional services and other revenue. We begin to recognize revenue when control of our software or services is transferred to the customer, which for sales made through distributors is concurrent with the transfer to the end user.

The following table presents a summary of revenue:



	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2018		2017		2018		2017
Subscription revenue	$	53,511	$	34,932	$	146,568	$	93,478
Perpetual license and maintenance revenue	13,864		12,857		40,753		37,129
Professional services and other revenue	2,065		1,191		4,818		3,003
Revenue	$	69,440	$	48,980	$	192,139	$	133,610

Subscription Revenue

Subscription arrangements generally have annual or multi-year contractual terms and allow customers to use our software or cloud solutions, including ongoing software updates and the ability to identify the latest cybersecurity vulnerabilities. Revenue is recognized ratably over the subscription term given the critical utility provided by the ongoing updates that are released throughout the contract period.

Perpetual License and Maintenance Revenue

Our perpetual licenses are generally sold with one or more years of maintenance, which include ongoing software updates and the ongoing ability to identify the latest cybersecurity vulnerabilities. Given the critical utility provided by the

ongoing software updates and updated ability to identify network vulnerabilities included in maintenance, we combine the perpetual license and the maintenance into a single performance obligation. Perpetual license arrangements generally contain a material right related to the customer’s ability to renew maintenance at a price that is less than the initial license fee. We apply a practical alternative to allocating a portion of the transaction price to the material right performance obligation and estimate a hypothetical transaction price which includes fees for expected maintenance renewals based on the estimated economic life of the perpetual license contracts. We allocate the transaction price between the cybersecurity subscription provided in the initial contract and the material right related to expected contract renewals based on the hypothetical transaction price. We recognize the amount allocated to the combined license and maintenance performance obligation over the initial contractual period, which is generally one year. We recognize the amount allocated to the material right over the expected maintenance renewal period, which begins at the end of the initial contractual term and is generally four years. We have estimated the five-year economic life of perpetual license contracts based on historical contract attrition, expected renewal periods, the lifecycle of the our technology and other factors. While we believe that the estimates we have made are reasonable and appropriate, different assumptions and estimates could materially impact our reported financial results.

Professional Services and Other Revenue

Professional services and other revenue is primarily comprised of advisory services and training related to the deployment and optimization of our products. These services do not result in significant customization of our products. Professional services and other revenue is recognized as the services are performed.

Contracts with Multiple Performance Obligations

In cases where our contracts with customers contain multiple performance obligations, the contract transaction price is allocated on a relative standalone selling price basis. We typically determine standalone selling price based on observable selling prices of our products and services.

Variable Consideration

We record revenue from sales at the net sales price, which is the transaction price, including estimates of variable consideration when applicable. Certain of our customers may be entitled to receive credits and in certain circumstances, refunds, if service level commitments are not met. We have not historically experienced significant incidents affecting the ability to meet these service level commitments and any estimated refunds related to these agreements have not been material.

Sales through our channel network of distributors and resellers are generally discounted as compared to the price that we would sell to an end user. Revenue for sales through our channel network is recorded net of any distributor or reseller margin.

Concentrations

We sell our products and services through a channel network of distributors and resellers, along with our own sales teams. We derived 88%, 87%, 84% and 82% of revenue through our channel network in the three and nine months ended September 30, 2018 and 2017, respectively. One of our distributors accounted for 46%, 46%, 43% and 42% of revenue in the three and nine months ended September 30, 2018 and 2017, respectively. That same distributor accounted for 47% of accounts receivable at September 30, 2018.

Contract Balances

We generally bill our customers in advance and accounts receivable are recorded when we have the right to invoice the customer. Contract liabilities consist of deferred revenue and include customer billings and payments received in advance of performance under the contract. In the three and nine months ended September 30, 2018 and 2017, we recognized revenue of $62.5 million, $133.3 million, $43.6 million and $91.9 million, respectively, that was included in the deferred revenue balance at the beginning of each of the respective periods.

Remaining Performance Obligations

At September 30, 2018, the future estimated revenue related to unsatisfied performance obligations was $267.9 million, with 72% expected to be recognized as revenue over the succeeding twelve months, and the remainder expected to be recognized over the four years thereafter.

Deferred Commissions

Sales commissions, including related incremental fringe benefit costs, are considered to be incremental costs of obtaining a contract. Sales commissions on initial sales are not commensurate with sales commissions on contract renewals and therefore are recognized over an estimated period of benefit, which ranges between three and four years for subscription arrangements and five years for perpetual license arrangements. We estimated the period of benefit based on the expected contract term including renewal periods, the lifecycle of our technology, and other factors. Sales commissions on contract renewals are capitalized and amortized ratably over the contract term, with the exception of contracts with renewal periods that are one year or less, in which case the incremental costs are expensed as incurred.

The following summarizes the activity of deferred incremental costs of obtaining a contract in the periods presented:



	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2018			2017			2018			2017
Beginning balance	$	50,805		$	36,252		$	50,176		$	30,118
Capitalization of contract acquisition costs	7,138			9,032			16,985			21,194
Amortization of deferred contract acquisition costs	(5,059		)	(3,891		)	(14,277		)	(9,919		)
Ending balance	$	52,884		$	41,393		$	52,884		$	41,393

Amortization of deferred contract acquisition costs is included in sales and marketing expense in the consolidated statements of operations and comprehensive loss.

Construction in Progress

In October 2017, we entered into a lease for our new corporate headquarters, which is currently being constructed in Columbia, Maryland. The lease has an anticipated start date in the third quarter of 2019 with a 12-year initial term and $68.2 million of lease payments. Under current accounting guidance for build-to-suit lease arrangements, we concluded that we are the deemed owner of the building during the construction period. Accordingly, we recorded a construction-in-progress asset of $23.5 million and $2.3 million, for which there is a corresponding construction financing obligation of $23.1 million and $1.8 million, in each case net of a $0.5 million deposit, recorded in the consolidated balance sheets at September 30, 2018 and December 31, 2017, respectively. We will continue to increase the construction-in-progress asset and corresponding financing obligation as additional building costs are incurred by the landlord during the construction period. Upon completion of the construction, we will evaluate whether or not this arrangement meets the criteria for sale-leaseback accounting treatment.

Recent Accounting Pronouncements Not Yet Adopted

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02 - Leases (Topic 842), which will require, among other items, lessees to recognize a right-of-use asset and a lease liability for most leases. ASU 2016-02 will be effective for us beginning January 1, 2019, with early adoption permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842), Targeted Improvements, which provides an adoption method that would allow companies to apply the new guidance to the financial statements in the period of adoption and thereafter, and not apply the new guidance to comparative periods presented. While we are evaluating the impact of this standard, including the adoption methodology, to determine the impact on our consolidated financial statements, we believe the most significant impact will be the recognition of a material right-of-use asset and lease liability for our facility leases.

Fair Value Measurements

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

We measure certain financial instruments at fair value using a fair value hierarchy. In the hierarchy, assets are classified based on the lowest level inputs used in valuation into the following categories:


•	Level 1 — Quoted prices in active markets for identical assets and liabilities;


•	Level 2 — Observable inputs including quoted market prices for similar assets and liabilities in active markets, quoted prices for identical assets and liabilities in inactive markets, or inputs that are corroborated by observable market data; and


•	Level 3 — Unobservable inputs.

The following table summarizes assets that are measured at fair value on a recurring basis at September 30, 2018:



(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Money market funds	$	119,718	$	—	$	—	$	119,718

Short-term investments
Commercial paper	$	—	$	31,040	$	—	$	31,040
Corporate bonds	$	—	$	3,085	$	—	$	3,085

We did not have any liabilities measured and recorded at fair value at September 30, 2018, and we did not have any assets or liabilities measured at fair value at December 31, 2017.

- 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

Property and Equipment, Net

9 Months Ended

Sep. 30, 2018

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

Property and equipment, net consisted of the following:



(in thousands)	September 30, 2018			December 31, 2017
Computer software and equipment	$	11,625		$	9,089
Furniture and fixtures	2,299			2,102
Leasehold improvements	7,096			6,452
Equipment under capital leases	1,843			1,839
Total	22,863			19,482
Less: accumulated depreciation and amortization	(11,991		)	(8,728		)
Property and equipment, net	$	10,872		$	10,754

Depreciation and amortization related to property and equipment was $1.4 million, $4.1 million, $1.1 million and $2.9 million in the three and nine months ended September 30, 2018 and 2017, respectively.

Debt	9 Months Ended
Debt	Sep. 30, 2018
Debt Disclosure [Abstract]
Debt	Debt On May 4, 2017, we entered into a $25.0 million revolving credit facility (“Credit Facility”) with Silicon Valley Bank, which is available for use until May 4, 2020. The Credit Facility is intended to be used to fund working capital and to provide increased liquidity and financial flexibility and bears interest at either LIBOR plus 2%, or the lender's prime rate plus 1%. In addition, we pay quarterly in arrears 0.25% of the average unused portion. The Credit Facility is secured by a first priority security interest in all of our assets, with a negative pledge on our Intellectual Property, as defined in the credit agreement. The Credit Facility contains certain restrictive covenants customary for facilities of this type including restrictions on indebtedness, liens, acquisitions and investments, restricted payments and dispositions. If, as of the last day of any quarter, the outstanding balance of the Credit Facility exceeds $5.0 million, there are financial covenants that require us to maintain a minimum level of earnings before income taxes, interest, depreciation and amortization (“EBITDA”) adjusted to add changes in deferred revenue in the period, and a minimum current ratio level. There were no borrowings under the Credit Facility during the nine months ended September 30, 2018 or in 2017.

Commitments and Contingencies

9 Months Ended

Sep. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Operating and Capital Leases

We have entered into various non-cancelable operating leases, primarily related to office real estate, that expire through 2022 and generally contain renewal options for up to five years. Rent expense was $1.4 million, $3.8 million, $1.0 million and $2.6 million in the three and nine months ended September 30, 2018 and 2017, respectively.

We also lease computer and office equipment under non-cancelable capital leases that expire through 2022. The total obligations for capital lease arrangements were $1.1 million and $1.5 million at September 30, 2018 and December 31, 2017, respectively.

Future minimum non-cancelable lease payments for operating and capital leases at September 30, 2018 were as follows:



(in thousands)
Years ending December 31:
2018	$	1,404
2019	5,553
2020	4,197
2021	7,431
2022	6,183
Thereafter	58,294
Total future minimum lease payments	$	83,062

Total future minimum lease payments at September 30, 2018 includes $68.2 million of future lease payments related to the lease of our new headquarters, which is currently being constructed in Columbia, Maryland. These lease payments are expected to commence in the first quarter of 2021.

Redeemable Convertible Preferred Stock	9 Months Ended
Redeemable Convertible Preferred Stock	Sep. 30, 2018
Temporary Equity Disclosure [Abstract]
Redeemable Convertible Preferred Stock	Redeemable Convertible Preferred Stock In October 2012, Tenable Inc. (now a wholly owned subsidiary of Tenable Holdings, Inc.) issued 15,847,500 shares of Series A redeemable convertible preferred stock. In December 2015, we issued 15,847,500 shares, par value of $0.01, of Series A redeemable convertible preferred stock ("Series A") in exchange for Series A redeemable convertible preferred stock of Tenable, Inc. in connection with a recapitalization. This exchange was made on a one for one basis. In addition, we authorized 42,000,000 shares and issued 39,538,354 shares, par value of $0.01, of Series B redeemable convertible preferred stock ("Series B"). Upon completion of our IPO, Series A and Series B (together, the “Redeemable Convertible Preferred Stock”) automatically converted into an aggregate of 55,385,854 shares of our common stock. We accreted the Redeemable Convertible Preferred Stock to the redemption price at the redemption date using the effective interest method. Upon completion of our IPO, the accretion rights of the Redeemable Convertible Preferred Stock were terminated. Upon the completion of our IPO, we filed an Amended and Restated Certificate of Incorporation, authorizing a total of 500,000,000 shares of common stock and 10,000,000 shares of preferred stock. At September 30, 2018, no shares of preferred stock were issued or outstanding.

Stock-Based Compensation

9 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

We have various stock incentive plans under which we have issued stock-based awards. Stock options granted under our stock incentive plans have a maximum term of ten years, generally vest over a period of three to four years, and the exercise price cannot be less than the fair market value on the date of grant. Restricted stock units ("RSUs") granted under our stock incentive plans generally vest over a period of two to four years.

In the nine months ended September 30, 2018, our board of directors adopted, and our stockholders approved, our 2018 Equity Incentive Plan ("2018 Plan"), which reserves 9.9 million shares of our common stock that may be issued as stock-based awards. The 2018 Plan became effective upon the execution of the underwriting agreement related to our IPO, at which point no further grants were made under our 2016 Stock Incentive Plan ("2016 Plan"). Any shares subject to stock options or other stock awards granted under our 2016 Plan, 2012 Stock Incentive Plan or 2002 Stock Incentive Plan that would have otherwise returned to such plan (such as upon the expiration or termination of a stock award prior to vesting) were added to, and are available for issuance under, our 2018 Plan. There were 10,905,099 shares available for grant under the 2018 Plan at September 30, 2018.

Stock-based compensation expense included in the consolidated statements of operations and comprehensive loss was as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2018		2017		2018		2017
Cost of revenue	$	692	$	63	$	883	$	167
Sales and marketing	2,707		409		3,984		1,037
Research and development	2,427		510		3,594		1,356
General and administrative	2,957		1,046		5,745		2,943
Total stock-based compensation expense	$	8,783	$	2,028	$	14,206	$	5,503

At September 30, 2018, the total unrecognized stock-based compensation expense related to outstanding stock options was $52.9 million, which is expected to be recognized over an estimated remaining weighted average period of 3.2 years.

At September 30, 2018, the unrecognized stock-based compensation expense related to unvested awards of restricted stock was $3.8 million, which is expected to be recognized over an estimated remaining period of 2.3 years.

At September 30, 2018, the unrecognized stock-based compensation expense related to unvested restricted stock units was $15.9 million, which is expected to be recognized over an estimated remaining period of 2.3 years.

Stock Options

A summary of our stock option activity is presented below:



(in thousands, except for per share data and years)	Number of Shares	Weighted Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Outstanding at December 31, 2017	14,573	$	4.38	8.2	$	77,020
Granted	6,108	15.17
Exercised	(654)	2.16
Forfeited/canceled	(640)	6.81
Outstanding at September 30, 2018	19,387	7.77		8.2	603,127
Exercisable at September 30, 2018	5,855	3.55		6.7	206,850

At September 30, 2018, there were 19.4 million stock options that were vested and expected to vest.

In the nine months ended September 30, 2018, we granted stock options to employees that vest over three to four years and had a weighted average grant date fair value of $6.84 per share. Estimating the fair value of stock options using the Black-Scholes option-pricing model requires assumptions as to the fair value of our underlying common stock, the estimated term of the option, the risk-free interest rate, the expected volatility of the price of our common stock, and the expected dividend yield. The fair value of each stock option was estimated on the grant date based on the following assumptions:



	Nine Months Ended September 30, 2018
Expected term (in years)	6.3
Expected volatility	41.3% — 43.3%
Risk-free interest rate	2.7% — 2.9%
Expected dividend yield	—

Restricted Stock and Restricted Stock Units

A summary of our restricted stock and restricted stock units activity is presented below:



	Restricted Stock			Restricted Stock Units
(in thousands, except for per share data and years)	Number of Shares	Weighted Average Grant Date Fair Value		Number of Shares	Weighted Average Grant Date Fair Value
Unvested balance at December 31, 2017	1,583	$	4.25	—	$	—
Granted	—	—		1,097	17.82
Vested	(594)	4.25		—	—
Forfeited	—	—		(47)	16.22
Unvested balance at September 30, 2018	989	4.25		1,050	17.89

The grant date fair value was based on the estimated fair value of our common stock on the date of grant. RSUs granted before July 30, 2018 vest upon the satisfaction of both service-based and performance-based vesting conditions. The performance-based condition was satisfied upon the completion of our IPO. RSUs granted after July 30, 2018 vest upon the satisfaction of a service-based vesting condition.

Compensation expense for restricted stock and RSUs is recognized on a straight-line basis over the requisite service period, with the exception of RSUs that include performance-based vesting conditions, which are expensed using the accelerated attribution method.

2018 Employee Stock Purchase Plan

In the nine months ended September 30, 2018, our board of directors adopted, and our stockholders approved, our 2018 Employee Stock Purchase Plan ("2018 ESPP"). Our 2018 ESPP became effective upon the execution of the underwriting agreement related our IPO.

Under our 2018 ESPP, employees may set aside up to 15% of their gross earnings, on an after-tax basis, to purchase our common stock at a discounted price, which is calculated at 85% of the lower of the fair market value of our common stock on the first day of an offering or on the date of purchase. The 2018 ESPP permits offerings up to 27 months in duration, with one or more purchase periods in each offering. The initial offering period began on July 25, 2018 and is scheduled to end on September 1, 2020, with purchase periods ending on March 1, 2019, September 1, 2019, March 1, 2020 and September 1, 2020.

At September 30, 2018, there was $2.3 million of employee contributions to the 2018 ESPP included in accrued compensation, and no shares of our common stock have been purchased. The unrecognized stock-based compensation

expense related to our 2018 ESPP was $9.9 million, which is expected to be recognized over the remaining offering period of 1.9 years.

Net Loss Per Share Attributable to Common Stockholders

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Net Loss Per Share Attributable to Common Stockholders

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



	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share data)	2018			2017			2018			2017
Net loss attributable to common stockholders	$	(20,924	)	$	(11,505	)	$	(54,341	)	$	(29,923	)

Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted	74,261			22,679			40,688			22,004
Net loss per share attributable to common stockholders, basic and diluted	$	(0.28	)	$	(0.51	)	$	(1.34	)	$	(1.36	)

The following potentially dilutive securities have been excluded from the diluted per share calculations because they would have been antidilutive:



	Three and Nine Months Ended September 30,
(in thousands)	2018	2017
Stock options	19,387	13,826
Restricted stock units	1,050	—
Restricted shares	989	1,583
Shares to be issued under ESPP	118	—
Redeemable convertible preferred stock	—	55,386
Total	21,544	70,795

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act was enacted into law, which contains several significant changes, including reducing the corporate income tax rate from 35% to 21% effective January 1, 2018, imposing a one-time repatriation tax on accumulated foreign earnings (“transition tax”) and instituting the global intangible low taxed income (“GILTI”) regime and the base erosion anti-abuse tax. We are following the guidance in Securities and Exchange Commission Staff Accounting Bulletin 118, which provides a company with the ability to record provisional amounts based on reasonable estimates that are subject to a measurement period of up to one year. At December 31, 2017, we made a reasonable estimate of the effects on existing deferred tax balances and the one-time transition tax. In the nine months ended September 30, 2018, no changes were made to these provisional amounts. We will continue to evaluate the transition tax obligation and application of GILTI and have not yet made an election with regard to GILTI. Subsequent adjustments resulting from additional analysis may be recorded when our analysis is completed in the fourth quarter of 2018.

Geographic Information

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Geographic Information

We operate as one operating segment. Our chief executive officer, who is our chief operating decision maker, reviews financial information on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance.

Revenue by region, based on the address of the end user as specified in our subscription, license or service agreements, was as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2018		2017		2018		2017
Americas	$	49,391	$	36,408	$	137,868	$	99,974
Europe, Middle East and Africa	14,002		8,781		38,218		23,611
Asia Pacific	6,047		3,791		16,053		10,025
Revenue	$	69,440	$	48,980	$	192,139	$	133,610

Customers located in the United States accounted for 66%, 67%, 70% and 70% of revenue in the three and nine months ended September 30, 2018 and 2017, respectively. No other country accounted for 10% or more of revenue in the periods presented.

Our property and equipment, net by geographic area is summarized as follows:



(in thousands)	September 30, 2018		December 31, 2017
United States	$	6,822	$	6,581
International	4,050		4,173
Property and equipment, net	$	10,872	$	10,754

Business and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Consolidations	The accompanying consolidated financial statements include the accounts of Tenable Holdings, Inc. and our wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
Basis of Accounting	The consolidated financial statements have been prepared in conformity with United States generally accepted accounting principles (“GAAP”) for interim financial information. The consolidated statements are unaudited and should be read in conjunction with the consolidated financial statements and related notes included in our final prospectus for our initial public offering ("IPO") dated as of July 25, 2018 and filed with the Securities and Exchange Commission pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, on July 26, 2018 ("Prospectus").The consolidated financial statements have been prepared on a basis consistent with the audited annual consolidated financial statements included in the Prospectus and, in the opinion of management, include all adjustments of a normal recurring nature necessary to fairly state our financial position, our results of operations, and cash flows.
Use of Estimates	The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates include, but are not limited to, the determination of the estimated economic life of perpetual licenses for revenue recognition, the estimated period of benefit for deferred commissions, useful lives of long-lived assets, the valuation of stock-based compensation, including the estimated underlying fair value of our common stock prior to our IPO, and the valuation of deferred tax assets. We base these estimates on historical experience and on various other assumptions that we believe to be reasonable. Actual results could differ significantly from these estimates.
Investments	We currently invest in commercial paper, corporate bonds, and U.S. treasury and agency obligations. Our investments are classified as available-for-sale and recorded at fair value, with unrealized gains and losses reported in accumulated other comprehensive loss within stockholders’ equity (deficit). We review our investment portfolio to determine whether investments have indicators of possible impairment.
Revenue Recognition	Subscription Revenue Subscription arrangements generally have annual or multi-year contractual terms and allow customers to use our software or cloud solutions, including ongoing software updates and the ability to identify the latest cybersecurity vulnerabilities. Revenue is recognized ratably over the subscription term given the critical utility provided by the ongoing updates that are released throughout the contract period. Perpetual License and Maintenance Revenue Our perpetual licenses are generally sold with one or more years of maintenance, which include ongoing software updates and the ongoing ability to identify the latest cybersecurity vulnerabilities. Given the critical utility provided by the ongoing software updates and updated ability to identify network vulnerabilities included in maintenance, we combine the perpetual license and the maintenance into a single performance obligation. Perpetual license arrangements generally contain a material right related to the customer’s ability to renew maintenance at a price that is less than the initial license fee. We apply a practical alternative to allocating a portion of the transaction price to the material right performance obligation and estimate a hypothetical transaction price which includes fees for expected maintenance renewals based on the estimated economic life of the perpetual license contracts. We allocate the transaction price between the cybersecurity subscription provided in the initial contract and the material right related to expected contract renewals based on the hypothetical transaction price. We recognize the amount allocated to the combined license and maintenance performance obligation over the initial contractual period, which is generally one year. We recognize the amount allocated to the material right over the expected maintenance renewal period, which begins at the end of the initial contractual term and is generally four years. We have estimated the five-year economic life of perpetual license contracts based on historical contract attrition, expected renewal periods, the lifecycle of the our technology and other factors. While we believe that the estimates we have made are reasonable and appropriate, different assumptions and estimates could materially impact our reported financial results. Professional Services and Other Revenue Professional services and other revenue is primarily comprised of advisory services and training related to the deployment and optimization of our products. These services do not result in significant customization of our products. Professional services and other revenue is recognized as the services are performed. Contracts with Multiple Performance Obligations In cases where our contracts with customers contain multiple performance obligations, the contract transaction price is allocated on a relative standalone selling price basis. We typically determine standalone selling price based on observable selling prices of our products and services. Variable Consideration We record revenue from sales at the net sales price, which is the transaction price, including estimates of variable consideration when applicable. Certain of our customers may be entitled to receive credits and in certain circumstances, refunds, if service level commitments are not met. We have not historically experienced significant incidents affecting the ability to meet these service level commitments and any estimated refunds related to these agreements have not been material. Sales through our channel network of distributors and resellers are generally discounted as compared to the price that we would sell to an end user. Revenue for sales through our channel network is recorded net of any distributor or reseller margin. Concentrations We sell our products and services through a channel network of distributors and resellers, along with our own sales teams. We derived 88%, 87%, 84% and 82% of revenue through our channel network in the three and nine months ended September 30, 2018 and 2017, respectively. One of our distributors accounted for 46%, 46%, 43% and 42% of revenue in the three and nine months ended September 30, 2018 and 2017, respectively. That same distributor accounted for 47% of accounts receivable at September 30, 2018. Contract Balances We generally bill our customers in advance and accounts receivable are recorded when we have the right to invoice the customer. Contract liabilities consist of deferred revenue and include customer billings and payments received in advance of performance under the contract. In the three and nine months ended September 30, 2018 and 2017, we recognized revenue of $62.5 million, $133.3 million, $43.6 million and $91.9 million, respectively, that was included in the deferred revenue balance at the beginning of each of the respective periods. Remaining Performance Obligations At September 30, 2018, the future estimated revenue related to unsatisfied performance obligations was $267.9 million, with 72% expected to be recognized as revenue over the succeeding twelve months, and the remainder expected to be recognized over the four years thereafter. Deferred Commissions Sales commissions, including related incremental fringe benefit costs, are considered to be incremental costs of obtaining a contract. Sales commissions on initial sales are not commensurate with sales commissions on contract renewals and therefore are recognized over an estimated period of benefit, which ranges between three and four years for subscription arrangements and five years for perpetual license arrangements. We estimated the period of benefit based on the expected contract term including renewal periods, the lifecycle of our technology, and other factors. Sales commissions on contract renewals are capitalized and amortized ratably over the contract term, with the exception of contracts with renewal periods that are one year or less, in which case the incremental costs are expensed as incurred.Amortization of deferred contract acquisition costs is included in sales and marketing expense in the consolidated statements of operations and comprehensive loss.We early adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue From Contracts With Customers (“ASC 606”), on January 1, 2017 using the modified retrospective method and applying the guidance to all contracts as of January 1, 2017. The most significant impact of adopting ASC 606 was the deferral of perpetual license revenue over an estimated economic life, including estimated maintenance renewal periods, whereas under the previous guidance we recognized perpetual license revenue upon delivery of the perpetual license. Additionally, the incremental costs of obtaining a contract with a customer are deferred, and will be amortized over a longer estimated period of benefit, whereas under previous guidance we amortized such costs over the contract term. The core principle of ASC 606 is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve the core principle of ASC 606, we apply the following steps: •Identify the contract with a customer •Identify the performance obligations in the contract •Determine the transaction price •Allocate the transaction price to the performance obligations in the contract •Recognize revenue when or as performance obligations are satisfied We generate revenue from subscription arrangements for software and cloud-based solutions, perpetual licenses, maintenance associated with perpetual licenses, and professional services and other revenue. We begin to recognize revenue when control of our software or services is transferred to the customer, which for sales made through distributors is concurrent with the transfer to the end user.
Recent Accounting Pronouncements Not Yet Adopted	In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02 - Leases (Topic 842), which will require, among other items, lessees to recognize a right-of-use asset and a lease liability for most leases. ASU 2016-02 will be effective for us beginning January 1, 2019, with early adoption permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842), Targeted Improvements, which provides an adoption method that would allow companies to apply the new guidance to the financial statements in the period of adoption and thereafter, and not apply the new guidance to comparative periods presented. While we are evaluating the impact of this standard, including the adoption methodology, to determine the impact on our consolidated financial statements, we believe the most significant impact will be the recognition of a material right-of-use asset and lease liability for our facility leases.

- Definition

Disclosure of accounting policy for investments in financial assets, including marketable securities (debt and equity securities with readily determinable fair values), investments accounted for under the equity method and cost method, securities borrowed and loaned, and repurchase and resale agreements. For marketable securities, the disclosure may include the entity's accounting treatment for transfers between investment categories and how the fair values for such securities are determined. Also, for all investments, an entity may describe its policy for assessing, recognizing and measuring impairment of the investment.

+ References + Details

Business and Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of revenue

The following table presents a summary of revenue:



	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2018		2017		2018		2017
Subscription revenue	$	53,511	$	34,932	$	146,568	$	93,478
Perpetual license and maintenance revenue	13,864		12,857		40,753		37,129
Professional services and other revenue	2,065		1,191		4,818		3,003
Revenue	$	69,440	$	48,980	$	192,139	$	133,610

Activity of deferred contract costs

The following summarizes the activity of deferred incremental costs of obtaining a contract in the periods presented:



	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2018			2017			2018			2017
Beginning balance	$	50,805		$	36,252		$	50,176		$	30,118
Capitalization of contract acquisition costs	7,138			9,032			16,985			21,194
Amortization of deferred contract acquisition costs	(5,059		)	(3,891		)	(14,277		)	(9,919		)
Ending balance	$	52,884		$	41,393		$	52,884		$	41,393

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Schedule of assets measured at fair value on recurring basis

The following table summarizes assets that are measured at fair value on a recurring basis at September 30, 2018:



(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Money market funds	$	119,718	$	—	$	—	$	119,718

Short-term investments
Commercial paper	$	—	$	31,040	$	—	$	31,040
Corporate bonds	$	—	$	3,085	$	—	$	3,085

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

Property and Equipment, Net (Tables)

9 Months Ended

Sep. 30, 2018

Property, Plant and Equipment [Abstract]

Property and equipment, net

Property and equipment, net consisted of the following:



(in thousands)	September 30, 2018			December 31, 2017
Computer software and equipment	$	11,625		$	9,089
Furniture and fixtures	2,299			2,102
Leasehold improvements	7,096			6,452
Equipment under capital leases	1,843			1,839
Total	22,863			19,482
Less: accumulated depreciation and amortization	(11,991		)	(8,728		)
Property and equipment, net	$	10,872		$	10,754

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Minimum future non-cancelable payments for operating leases

Future minimum non-cancelable lease payments for operating and capital leases at September 30, 2018 were as follows:



(in thousands)
Years ending December 31:
2018	$	1,404
2019	5,553
2020	4,197
2021	7,431
2022	6,183
Thereafter	58,294
Total future minimum lease payments	$	83,062

Minimum future non-cancelable payments for capital leases

Future minimum non-cancelable lease payments for operating and capital leases at September 30, 2018 were as follows:



(in thousands)
Years ending December 31:
2018	$	1,404
2019	5,553
2020	4,197
2021	7,431
2022	6,183
Thereafter	58,294
Total future minimum lease payments	$	83,062

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based compensation expense

Stock-based compensation expense included in the consolidated statements of operations and comprehensive loss was as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2018		2017		2018		2017
Cost of revenue	$	692	$	63	$	883	$	167
Sales and marketing	2,707		409		3,984		1,037
Research and development	2,427		510		3,594		1,356
General and administrative	2,957		1,046		5,745		2,943
Total stock-based compensation expense	$	8,783	$	2,028	$	14,206	$	5,503

Stock option activity

A summary of our stock option activity is presented below:



(in thousands, except for per share data and years)	Number of Shares	Weighted Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Outstanding at December 31, 2017	14,573	$	4.38	8.2	$	77,020
Granted	6,108	15.17
Exercised	(654)	2.16
Forfeited/canceled	(640)	6.81
Outstanding at September 30, 2018	19,387	7.77		8.2	603,127
Exercisable at September 30, 2018	5,855	3.55		6.7	206,850

Stock option valuation assumptions

The fair value of each stock option was estimated on the grant date based on the following assumptions:



	Nine Months Ended September 30, 2018
Expected term (in years)	6.3
Expected volatility	41.3% — 43.3%
Risk-free interest rate	2.7% — 2.9%
Expected dividend yield	—

Summary of restricted stock and restricted stock units

A summary of our restricted stock and restricted stock units activity is presented below:



	Restricted Stock			Restricted Stock Units
(in thousands, except for per share data and years)	Number of Shares	Weighted Average Grant Date Fair Value		Number of Shares	Weighted Average Grant Date Fair Value
Unvested balance at December 31, 2017	1,583	$	4.25	—	$	—
Granted	—	—		1,097	17.82
Vested	(594)	4.25		—	—
Forfeited	—	—		(47)	16.22
Unvested balance at September 30, 2018	989	4.25		1,050	17.89

Net Loss Per Share Attributable to Common Stockholders (Tables)

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Computation of basic and diluted net loss per share

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



	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share data)	2018			2017			2018			2017
Net loss attributable to common stockholders	$	(20,924	)	$	(11,505	)	$	(54,341	)	$	(29,923	)

Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted	74,261			22,679			40,688			22,004
Net loss per share attributable to common stockholders, basic and diluted	$	(0.28	)	$	(0.51	)	$	(1.34	)	$	(1.36	)

Potentially dilutive securities

The following potentially dilutive securities have been excluded from the diluted per share calculations because they would have been antidilutive:



	Three and Nine Months Ended September 30,
(in thousands)	2018	2017
Stock options	19,387	13,826
Restricted stock units	1,050	—
Restricted shares	989	1,583
Shares to be issued under ESPP	118	—
Redeemable convertible preferred stock	—	55,386
Total	21,544	70,795

Geographic Information (Tables)

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Revenue by region

Revenue by region, based on the address of the end user as specified in our subscription, license or service agreements, was as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2018		2017		2018		2017
Americas	$	49,391	$	36,408	$	137,868	$	99,974
Europe, Middle East and Africa	14,002		8,781		38,218		23,611
Asia Pacific	6,047		3,791		16,053		10,025
Revenue	$	69,440	$	48,980	$	192,139	$	133,610

Property and equipment, net by geographic area

Our property and equipment, net by geographic area is summarized as follows:



(in thousands)	September 30, 2018		December 31, 2017
United States	$	6,822	$	6,581
International	4,050		4,173
Property and equipment, net	$	10,872	$	10,754

Business and Summary of Significant Accounting Policies - Initial Public Offering (Details) - USD ($) $ / shares in Units, $ in Millions		9 Months Ended
	Jul. 30, 2018	Sep. 30, 2018	Dec. 31, 2017
Subsidiary, Sale of Stock [Line Items]
Common stock, authorized (in shares)	500,000,000	500,000,000	93,855,000
Preferred stock, authorized (in shares)	10,000,000
IPO
Subsidiary, Sale of Stock [Line Items]
Stock sold, price per share (in usd per share)	$ 23.00
Net proceeds from sale of stock	$ 264.8
Common Stock
Subsidiary, Sale of Stock [Line Items]
Issuance of common stock upon conversion of redeemable convertible preferred stock (in shares)		55,386,000
Common Stock \| IPO
Subsidiary, Sale of Stock [Line Items]
Stock sold (in shares)	12,535,000
Issuance of common stock upon conversion of redeemable convertible preferred stock (in shares)	55,385,854
Common Stock \| Over-allotment option
Subsidiary, Sale of Stock [Line Items]
Stock sold (in shares)	1,635,000
Redeemable convertible Series A preferred stock \| IPO
Subsidiary, Sale of Stock [Line Items]
Issuance of common stock upon conversion of redeemable convertible preferred stock (in shares)	15,847,500
Redeemable convertible Series B preferred stock \| IPO
Subsidiary, Sale of Stock [Line Items]
Issuance of common stock upon conversion of redeemable convertible preferred stock (in shares)	39,538,354

Business and Summary of Significant Accounting Policies - Summary of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disaggregation of Revenue [Line Items]
Revenue	$ 69,440	$ 48,980	$ 192,139	$ 133,610
Subscription revenue
Disaggregation of Revenue [Line Items]
Revenue	53,511	34,932	146,568	93,478
Perpetual license and maintenance revenue
Disaggregation of Revenue [Line Items]
Revenue	13,864	12,857	40,753	37,129
Professional services and other revenue
Disaggregation of Revenue [Line Items]
Revenue	$ 2,065	$ 1,191	$ 4,818	$ 3,003

Business and Summary of Significant Accounting Policies - Perpetual License and Maintenance Revenue (Details) - Perpetual license and maintenance revenue	9 Months Ended
	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
License and maintenance period	1 year
Estimated maintenance renewal period	4 years
Economic life of perpetual license contracts	5 years

Business and Summary of Significant Accounting Policies - Concentrations (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
One distributor \| Revenue \| Customer concentration risk
Concentration Risk [Line Items]
Concentration risk, percentage	46.00%	43.00%	46.00%	42.00%
One distributor \| Accounts receivable \| Customer concentration risk
Concentration Risk [Line Items]
Concentration risk, percentage			47.00%
Channel network \| Revenue \| Sales method risk
Concentration Risk [Line Items]
Concentration risk, percentage	88.00%	84.00%	87.00%	82.00%

Business and Summary of Significant Accounting Policies - Contract Balances (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Revenue recognized that was included in deferred revenue	$ 62.5	$ 43.6	$ 133.3	$ 91.9

Business and Summary of Significant Accounting Policies - Remaining Performance Obligations (Details) $ in Millions	Sep. 30, 2018 USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Future estimated revenue	$ 267.9
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Expected recognized percentage over succeeding 12 months	72.00%
Expected timing of satisfaction	4 years

Business and Summary of Significant Accounting Policies - Deferred Commissions (Details)	Sep. 30, 2018
Perpetual license and maintenance revenue
Capitalized Contract Cost [Line Items]
Estimated period of benefit	5 years
Minimum \| Subscription revenue
Capitalized Contract Cost [Line Items]
Estimated period of benefit	3 years
Maximum \| Subscription revenue
Capitalized Contract Cost [Line Items]
Estimated period of benefit	4 years

Business and Summary of Significant Accounting Policies - Activity of Deferred Contract Costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Capitalized Contract Cost [Roll Forward]
Beginning balance	$ 50,805	$ 36,252	$ 50,176	$ 30,118
Capitalization of contract acquisition costs	7,138	9,032	16,985	21,194
Amortization of deferred contract acquisition costs	(5,059)	(3,891)	(14,277)	(9,919)
Ending balance	$ 52,884	$ 41,393	$ 52,884	$ 41,393

Business and Summary of Significant Accounting Policies - Construction in Progress (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Operating Leased Assets [Line Items]
Initial term of contract	5 years
Construction in progress	$ 23,546	$ 2,252
Financing obligation	23,096	1,802
Deposit	$ 500	$ 500
Building
Operating Leased Assets [Line Items]
Initial term of contract	12 years
Obligations for operating lease	$ 68,200

Fair Value Measurements (Details) - Fair Value, Measurements, Recurring $ in Thousands	Sep. 30, 2018 USD ($)
Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	$ 31,040
Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	3,085
Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	119,718
Level 1 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0
Level 1 \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0
Level 1 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	119,718
Level 2 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	31,040
Level 2 \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	3,085
Level 2 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	0
Level 3 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0
Level 3 \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0
Level 3 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	$ 0

Property and Equipment, Net - Property and Equipment, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Total	$ 22,863	$ 19,482
Less: accumulated depreciation and amortization	(11,991)	(8,728)
Property and equipment, net	10,872	10,754
Computer software and equipment
Property, Plant and Equipment [Line Items]
Total	11,625	9,089
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total	2,299	2,102
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total	7,096	6,452
Equipment under capital leases
Property, Plant and Equipment [Line Items]
Total	$ 1,843	$ 1,839

Property and Equipment, Net - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Property, Plant and Equipment [Abstract]
Depreciation and amortization	$ 1.4	$ 1.1	$ 4.1	$ 2.9

Debt (Details) - Line of Credit - Credit Facility - Revolving Credit Facility - USD ($)		9 Months Ended	12 Months Ended
	May 04, 2017	Sep. 30, 2018	Dec. 31, 2017
Line of Credit Facility [Line Items]
Revolving credit facility, maximum borrowing capacity	$ 25,000,000.0
Arrears paid on average unused portion	0.25%
Outstanding balance of credit facility, amount requiring covenant compliance	$ 5,000,000.0
Borrowings outstanding		$ 0	$ 0
LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate	2.00%
Prime Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate	1.00%

Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Operating Leased Assets [Line Items]
Initial term of contract	5 years		5 years
Operating lease, rent expense	$ 1.4	$ 1.0	$ 3.8	$ 2.6
Computer and office equipment
Operating Leased Assets [Line Items]
Obligations for capital lease	$ 1.1		$ 1.1		$ 1.5
Building
Operating Leased Assets [Line Items]
Initial term of contract	12 years		12 years
Obligations for operating lease	$ 68.2		$ 68.2

Commitments and Contingencies - Schedule of Future Non-Cancelable Lease Payments (Details) $ in Thousands	Sep. 30, 2018 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2018	$ 1,404
2019	5,553
2020	4,197
2021	7,431
2022	6,183
Thereafter	58,294
Total future minimum lease payments	$ 83,062

Redeemable Convertible Preferred Stock (Details) - $ / shares		1 Months Ended		9 Months Ended
	Jul. 30, 2018	Dec. 31, 2015	Oct. 31, 2012	Sep. 30, 2018	Dec. 31, 2017
Class of Stock [Line Items]
Common stock, authorized (in shares)	500,000,000			500,000,000	93,855,000
Preferred stock, authorized (in shares)	10,000,000
Preferred stock, issued (in shares)				0
Preferred stock, outstanding (in shares)				0
Series A Redeemable Convertible Preferred Stock
Class of Stock [Line Items]
Stock sold (in shares)		15,847,500	15,847,500
Redeemable convertible preferred stock, par value (in usd per share)		$ 0.01		$ 0.01	$ 0.01
Redeemable convertible preferred stock, shares authorized (in shares)				0	15,848,000
Series B Redeemable Convertible Preferred Stock
Class of Stock [Line Items]
Stock sold (in shares)		39,538,354
Redeemable convertible preferred stock, par value (in usd per share)		$ 0.01		$ 0.01	$ 0.01
Redeemable convertible preferred stock, shares authorized (in shares)		42,000,000		0	42,000,000
Common Stock
Class of Stock [Line Items]
Issuance of common stock upon conversion of redeemable convertible preferred stock (in shares)				55,386,000
Common Stock \| IPO
Class of Stock [Line Items]
Stock sold (in shares)	12,535,000
Issuance of common stock upon conversion of redeemable convertible preferred stock (in shares)	55,385,854

Stock-Based Compensation - Additional Information (Details) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2018 USD ($) shares	Sep. 30, 2018 USD ($) shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense, outstanding stock options \| $	$ 52.9	$ 52.9
Stock options vested and expected to vest (in shares) \| shares	19,400,000	19,400,000
2018 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant (in shares) \| shares	10,905,099	10,905,099
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, stock incentive plans, maximum term		10 years
Estimated remaining weighted average period		3 years 2 months 12 days
Stock options \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, stock incentive plan, vesting period		3 years
Stock options \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, stock incentive plan, vesting period		4 years
Stock-based awards \| 2018 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance (in shares) \| shares	9,900,000	9,900,000
Restricted shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated remaining weighted average period		2 years 3 months 18 days
Unrecognized stock-based compensation expense, unvested restricted stock or RSUs \| $	$ 3.8	$ 3.8
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated remaining weighted average period		2 years 3 months 18 days
Unrecognized stock-based compensation expense, unvested restricted stock or RSUs \| $	$ 15.9	$ 15.9
Restricted stock units \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, stock incentive plan, vesting period		2 years
Restricted stock units \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, stock incentive plan, vesting period		4 years
Employee stock purchase plan \| 2018 ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated remaining weighted average period	1 year 10 months 24 days

Stock-Based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation	$ 8,783	$ 2,028	$ 14,206	$ 5,503
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation	692	63	883	167
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation	2,707	409	3,984	1,037
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation	2,427	510	3,594	1,356
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation	$ 2,957	$ 1,046	$ 5,745	$ 2,943

Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Number of Shares
Number of shares outstanding, beginning of period (in shares)	14,573
Number of shares, granted (in shares)	6,108
Number of shares, exercised (in shares)	(654)
Number of shares, forfeited/canceled (in shares)	(640)
Number of shares outstanding, end of period (in shares)	19,387	14,573
Number of shares exercisable (in shares)	5,855
Weighted Average Exercise Price
Weighted average exercise price, outstanding, beginning of period (in USD per share)	$ 4.38
Weighted average exercise price, granted (in USD per share)	15.17
Weighted average exercise price, exercised (in USD per share)	2.16
Weighted average exercise price, forfeited/canceled (in USD per share)	6.81
Weighted average exercise price, outstanding, end of period (in USD per share)	7.77	$ 4.38
Weighted average exercise price, exercisable (in USD per share)	$ 3.55
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Weighted average remaining contractual term (in years), outstanding	8 years 2 months 12 days	8 years 2 months 12 days
Weighted average remaining contractual term (in years), exercisable	6 years 8 months 12 days
Aggregate intrinsic value, outstanding, beginning of period	$ 77,020
Aggregate intrinsic value, outstanding, end of period	603,127	$ 77,020
Aggregate intrinsic value, exercisable	$ 206,850

Stock-Based Compensation - Stock Option Activity (Narrative) (Details) shares in Millions	9 Months Ended
	Sep. 30, 2018 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options vested and expected to vest (in shares) \| shares	19.4
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options granted, weighted average grant date fair value (in usd per share) \| $ / shares	$ 6.84
Stock options \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, employees, vesting period	3 years
Stock options \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, employees, vesting period	4 years

Stock-Based Compensation - Fair Value of Stock Options Assumptions (Details) - Stock options	9 Months Ended
	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 3 months 18 days
Expected volatility, minimum	41.30%
Expected volatility, maximum	43.30%
Risk - free interest rate, minimum	2.70%
Risk - free interest rate, maximum	2.90%
Expected dividend yield	0.00%

Stock-Based Compensation - Restricted Stock and Restricted Stock Units (Details) shares in Thousands	9 Months Ended
	Sep. 30, 2018 $ / shares shares
Restricted shares
Number of Shares
Number of shares unvested, beginning of period (in shares) \| shares	1,583
Number of shares, granted (in shares) \| shares	0
Number of shares, vested (in shares) \| shares	(594)
Number of shares, forfeited (in shares) \| shares	0
Number of shares unvested, end of period (in shares) \| shares	989
Weighted Average Grant Date Fair Value
Weighted average grant date fair value, beginning of period (in USD per share) \| $ / shares	$ 4.25
Weighted average grant date fair value, granted (in USD per share) \| $ / shares	0
Weighted average grante date fair value, vested (in USD per share) \| $ / shares	4.25
Weighted average grant date fair value, forfeited (in USD per share) \| $ / shares	0
Weighted average grant date fair value, end of period (in USD per share) \| $ / shares	$ 4.25
Restricted stock units
Number of Shares
Number of shares unvested, beginning of period (in shares) \| shares	0
Number of shares, granted (in shares) \| shares	1,097
Number of shares, vested (in shares) \| shares	0
Number of shares, forfeited (in shares) \| shares	(47)
Number of shares unvested, end of period (in shares) \| shares	1,050
Weighted Average Grant Date Fair Value
Weighted average grant date fair value, beginning of period (in USD per share) \| $ / shares	$ 0
Weighted average grant date fair value, granted (in USD per share) \| $ / shares	17.82
Weighted average grante date fair value, vested (in USD per share) \| $ / shares	0
Weighted average grant date fair value, forfeited (in USD per share) \| $ / shares	16.22
Weighted average grant date fair value, end of period (in USD per share) \| $ / shares	$ 17.89

Stock-Based Compensation - 2018 Employee Stock Purchase Plan (Details) - Employee stock purchase plan $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2018 USD ($)	Sep. 30, 2018 USD ($) shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock purchased (in shares) \| shares		0
2018 ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of employee earnings allowed	15.00%	15.00%
Discount price percentage		85.00%
Offering period (up to)		27 months
Employee contributions	$ 2.3	$ 2.3
Unrecognized stock-based compensation expense	$ 9.9	$ 9.9
Remaining offering period	1 year 10 months 24 days

Net Loss Per Share Attributable to Common Stockholders - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Earnings Per Share [Abstract]
Net loss attributable to common stockholders	$ (20,924)	$ (11,505)	$ (54,341)	$ (29,923)
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares)	74,261	22,679	40,688	22,004
Net loss per share attributable to common stockholders, basic and diluted (in usd per share)	$ (0.28)	$ (0.51)	$ (1.34)	$ (1.36)

Net Loss Per Share Attributable to Common Stockholders - Schedule of Potentially Dilutive Securities (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	21,544	70,795	21,544	70,795
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	19,387	13,826	19,387	13,826
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	1,050	0	1,050	0
Restricted shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	989	1,583	989	1,583
ESPP
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	118	0	118	0
Redeemable convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	0	55,386	0	55,386

Geographic Information - Narrative (Details) - segment	3 Months Ended		9 Months Ended
Geographic Information - Narrative (Details) - segment	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Concentration Risk [Line Items]
Number of operating segments			1
United States \| Revenue \| Geographic concentration risk
Concentration Risk [Line Items]
Concentration risk, percentage	66.00%	70.00%	67.00%	70.00%

Geographic Information - Revenue by Geographic Region (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 69,440	$ 48,980	$ 192,139	$ 133,610
Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	49,391	36,408	137,868	99,974
Europe, Middle East and Africa
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	14,002	8,781	38,218	23,611
Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 6,047	$ 3,791	$ 16,053	$ 10,025

Geographic Information - Property And Equipment, Net By Geographic Area (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	$ 10,872	$ 10,754
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	6,822	6,581
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	$ 4,050	$ 4,173