0001627475-20-000006 | 10-K | XBRL Viewer

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Organization and Description of Business (Details) $ / shares in Units, $ in Millions	1 Months Ended	12 Months Ended
	Oct. 31, 2018 USD ($) $ / shares shares	Dec. 31, 2016 platform
Subsidiary, Sale of Stock [Line Items]
Number of operating platforms consolidated \| platform		2
Consideration received on stock transaction \| $	$ 109.4
IPO
Subsidiary, Sale of Stock [Line Items]
Number of shares issued in stock transaction (in shares) \| shares	7,840,908
Price per share of stock transaction (in dollars per share) \| $ / shares	$ 15.00
Underwriters' Option
Subsidiary, Sale of Stock [Line Items]
Number of shares issued in stock transaction (in shares) \| shares	1,022,727
Price per share of stock transaction (in dollars per share) \| $ / shares	$ 1.05

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets
Cash and cash equivalents	$ 48,392	$ 129,128
Marketable securities	85,481	0
Funds held in escrow, including funds in transit	108,721	98,186
Trade and client receivables – net of allowance of $2,215 and $2,832 as of December 31, 2019 and 2018, respectively	30,156	22,315
Prepaid expenses and other current assets	7,885	6,253
Total current assets	280,635	255,882
Property and equipment, net	21,454	10,815
Goodwill	118,219	118,219
Intangible assets, net	3,335	6,004
Operating lease asset	21,908
Other assets, noncurrent	829	653
Total assets	446,380	391,573
Current liabilities
Accounts payable	652	2,073
Escrow funds payable	108,721	98,186
Debt, current	7,584	5,671
Accrued expenses and other current liabilities	18,342	20,948
Deferred revenue	13,799	722
Total current liabilities	149,098	127,600
Debt, noncurrent	10,699	18,239
Operating lease liability, noncurrent	21,186
Other liabilities, noncurrent	5,973	1,989
Total liabilities	186,956	147,828
Commitments and contingencies (Note 6)
Stockholders’ equity
Common stock, $0.0001 par value; 490,000,000 shares authorized as of December 31, 2019 and 2018; 113,604,398 and 106,454,321 shares issued and outstanding as of December 31, 2019 and 2018, respectively	11	11
Additional paid-in capital	431,370	387,233
Accumulated deficit	(171,957)	(143,499)
Total stockholders’ equity	259,424	243,745
Total liabilities and stockholders’ equity	$ 446,380	$ 391,573

CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) $ in Thousands	Total	Redeemable Convertible Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Deficit
Redeemable convertible preferred stock, beginning balance at Dec. 31, 2016		$ 178,785
Redeemable convertible preferred stock, beginning balance (in shares) at Dec. 31, 2016		65,464,387
Increase (Decrease) in Temporary Equity [Roll Forward]
Exercise of warrant on redeemable convertible preferred stock and related reclassification of redeemable convertible preferred stock warrant liability		$ 404
Exercise of warrant on redeemable convertible preferred stock and related reclassification of redeemable convertible preferred stock warrant liability (in shares)		83,181
Repurchase and retirement of redeemable convertible preferred stock		$ (12,703)
Repurchase and retirement of redeemable convertible preferred stock (in shares)		(4,268,489)
Conversion of redeemable convertible preferred stock in connection with the initial public offering	$ 0
Redeemable convertible preferred stock, ending balance (in shares) at Dec. 31, 2017		61,279,079
Redeemable convertible preferred stock, ending balance at Dec. 31, 2017	166,486	$ 166,486
Beginning balance at Dec. 31, 2016	(30,131)		$ 3	$ 89,335	$ (119,469)
Beginning balance (in shares) at Dec. 31, 2016			32,178,236
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock upon exercise of stock options and common stock warrants	2,547			2,547
Issuance of common stock upon exercise of stock options (in shares)			1,554,944
Issuance of common stock to consultants (in shares)			7,143
Repurchase and retirement of redeemable convertible preferred stock	(6,506)			(6,506)
Stock-based compensation expense	6,846			6,846
Conversion of redeemable convertible preferred stock warrant in connection with the initial public offering	0
Net loss	(4,123)				(4,123)
Ending balance at Dec. 31, 2017	(31,367)		$ 3	92,222	(123,592)
Ending balance (in shares) at Dec. 31, 2017			33,740,323
Increase (Decrease) in Temporary Equity [Roll Forward]
Repurchase and retirement of redeemable convertible preferred stock	(12,700)
Conversion of redeemable convertible preferred stock in connection with the initial public offering	(166,486)	$ (166,486)
Conversion of redeemable convertible preferred stock in connection with the initial public offering (in shares)		(61,279,079)
Redeemable convertible preferred stock, ending balance (in shares) at Dec. 31, 2018		0
Redeemable convertible preferred stock, ending balance at Dec. 31, 2018		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock upon exercise of stock options and common stock warrants	8,160		$ 1	8,159
Issuance of common stock upon exercise of stock options (in shares)			3,567,917
Repurchase and retirement of redeemable convertible preferred stock	(6,500)			(6,500)
Stock-based compensation expense	10,361			10,361
Issuance of common stock in connection with the initial public offering, net of discounts and commissions	109,381		$ 1	109,380
Issuance of common stock in connection with the initial public offering, net of discounts and commissions (in shares)			7,840,908
Costs related to the initial public offering	(6,282)			(6,282)
Conversion of redeemable convertible preferred stock warrant in connection with the initial public offering	7,160			7,160
Conversion of redeemable convertible preferred stock in connection with the initial public offering	166,486		$ 6	166,480
Conversion of redeemable convertible preferred stock in connection with the initial public offering (in shares)			61,279,079
Shares withheld related to net share settlement of RSUs	(247)			(247)
Shares withheld related to net share settlement of RSUs (in shares)			(12,648)
Issuance of common stock for settlement of RSUs (in shares)			38,742
Net loss	(19,907)				(19,907)
Ending balance at Dec. 31, 2018	243,745		$ 11	387,233	(143,499)
Ending balance (in shares) at Dec. 31, 2018			106,454,321
Increase (Decrease) in Temporary Equity [Roll Forward]
Conversion of redeemable convertible preferred stock in connection with the initial public offering	0
Redeemable convertible preferred stock, ending balance (in shares) at Dec. 31, 2019		0
Redeemable convertible preferred stock, ending balance at Dec. 31, 2019		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock upon exercise of stock options and common stock warrants	$ 18,155			18,155
Issuance of common stock upon exercise of stock options (in shares)	6,045,823		6,429,471
Stock-based compensation expense	$ 18,616			18,616
Conversion of redeemable convertible preferred stock warrant in connection with the initial public offering	0
Tides Foundation common stock warrant expense and other	975			975
Issuance of common stock for settlement of RSUs (in shares)			163,943
Issuance of common stock in connection with employee stock purchase plan (in shares)			556,663
Issuance of common stock in connection with employee stock purchase plan	6,391			6,391
Net loss	(16,659)				(16,659)
Ending balance at Dec. 31, 2019	259,424		$ 11	$ 431,370	(171,957)
Ending balance (in shares) at Dec. 31, 2019			113,604,398
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cumulative effect adjustment from adoption of new accounting pronouncement (Note 2)	$ (11,799)				$ (11,799)

Balance Sheet Components - Schedule of Operating Lease Liability Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019
Balance Sheet Related Disclosures [Abstract]
2020	$ 3,313
2021	3,919
2022	5,391
2023	5,796
2024	4,838
Thereafter	6,954
Total lease payments	30,211
Adjustment for discount to present value	(5,811)
Total	$ 24,400	$ 17,800

Income Taxes - Effective Tax Rate (Details)	12 Months Ended
Income Taxes - Effective Tax Rate (Details)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Tax at federal statutory rate	21.00%	21.00%	34.00%
State tax, net of federal benefit	(0.27%)	1.88%	1.03%
Stock-based compensation	51.45%	(5.84%)	(38.63%)
Warrant expense	0.00%	(6.98%)	(1.00%)
Other items	(4.34%)	(1.46%)	(1.10%)
Research and development credits	13.74%	10.54%	102.35%
Net operating loss expiration	(18.33%)	0.00%	(9.29%)
Change in valuation allowance	(63.42%)	(19.21%)	458.55%
Rate differential impact of Tax Cuts and Jobs Act of 2017	0.00%	0.00%	(545.38%)
Effective tax rate	(0.17%)	(0.07%)	0.53%

Basis of Presentation and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and include the accounts of Upwork Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Certain amounts for prior years have been reclassified to conform to the financial statement presentation as of and for the year ended December 31, 2019.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the periods presented. Such estimates include, but are not limited to, the useful lives of assets; assessment of the recoverability of long-lived assets; goodwill impairment; standalone selling price of material right; allowance for doubtful accounts; liabilities relating to transaction losses; the valuation of warrants; stock-based compensation; and accounting for income taxes. Management bases its estimates on historical experience and on various other assumptions that management believes to be reasonable under the circumstances. The Company evaluates its estimates, assumptions, and judgments on an ongoing basis using historical experience and other factors and revises them when facts and circumstances dictate. Actual results could materially differ from these estimates.

Cash and Cash Equivalents

The Company holds its cash in checking and interest-bearing accounts and investments in money market funds with maturities of 90 days or less from the date of purchase.

Restricted Cash

As of December 31, 2019 and 2018, the Company maintained restricted cash of $2.5 million and $2.7 million, respectively, related to cash reserve requirements under the California Department of Business Oversight’s escrow laws and regulations and collateral for letters of credit issued in conjunction with operating leases. Short-term restricted cash included in prepaid expenses and other current assets was $1.7 million and $2.2 million as of December 31, 2019 and 2018, respectively, and long-term restricted cash included in other assets, noncurrent was $0.8 million and $0.5 million as of December 31, 2019 and 2018, respectively.

Funds Held in Escrow, Including Funds in Transit

The Company maintains its users’ funds held in escrow in demand or checking accounts at U.S. financial institutions, as well as five California licensed money transmitters. The balance in these accounts was in excess of federally insured limits as of December 31, 2019 and 2018. Users’ funds held in escrow are denominated exclusively in U.S. dollars.

The Company is an internet escrow agent and is therefore required to hold its users’ escrowed funds and escrow funds in transit in trust as an asset and record a corresponding liability for escrow funds payable on its consolidated balance sheets. For this reason, funds held in escrow, including funds in transit, are restricted cash. Escrow funds in transit arise due to the time it takes to clear transactions through external payment networks. When clients fund their escrow account using credit cards, there is a clearing period before the cash is received and settled. Accordingly, the funds are treated as escrow funds in transit until the transaction is settled to the escrow trust bank account or, in the case of international credit card settlements, to the Company’s bank accounts. Escrow regulations require the Company to fund the trust with its own operating cash if there is ever a shortage due to the timing of cash receipts from clients for completed hourly billings. As of December 31, 2019 and 2018, the Company recorded $108.7 million and $98.2 million, respectively, as funds held in escrow, including funds in transit.

The below table reconciles cash, cash equivalents, and restricted cash as reported in the consolidated balance sheets to the total of the same amounts shown in the consolidated statements of cash flows for the years ended December 31, 2019, 2018, and 2017 (in thousands):


	2019		2018		2017
Cash and cash equivalents	$	48,392	$	129,128	$	21,595
Restricted cash	2,490		2,753		2,309
Funds held in escrow, including funds in transit	108,721		98,186		87,195
Total cash, cash equivalents, and restricted cash as shown in the consolidated statement of cash flows	$	159,603	$	230,067	$	111,099

Marketable Securities

Beginning in 2019, the Company purchased various marketable securities consisting of commercial paper, treasury bills, and U.S. government securities, all of which have contractual maturities within 24 months from the date of purchase. The marketable securities are available for current operations and are classified as available-for-sale. These marketable securities are carried at estimated fair value with unrealized gains and losses, net of taxes, included within the stockholders’ equity section of the Company’s consolidated balance sheet. The Company periodically reviews its available-for-sale marketable securities for other-than-temporary impairments. The Company considers factors such as the duration, severity, and the reason for any decline in value, the potential recovery period, and its intent to sell. For debt securities, the Company also considers whether (i) it is more likely than not that the Company will be required to sell the debt securities before recovery of their amortized cost basis and (ii) the amortized cost basis cannot be recovered as a result of credit losses. Unrealized losses are charged against other (income) expense, net when a decline in fair value is determined to be other-than-temporary. The Company determines realized gains or losses from the sale of marketable securities on a specific identification method and records such gains or losses as other (income) expense, net within the Company’s consolidated statements of operations.

For the year ended December 31, 2019, the gross unrealized gains and losses on the Company’s marketable securities were immaterial. As of December 31, 2019, the Company considered any decreases in market value to be temporary in nature and did not consider any of the Company’s marketable securities to be other-than-temporarily impaired. As such, the Company did not record any impairment charges with respect to its marketable securities during the year ended December 31, 2019.

Escrow Funds Payable

Escrow funds payable represent user funds that are held in escrow by the Company on behalf of both freelancers and clients. Escrow funds payable to freelancers are comprised primarily of funds available to be withdrawn by freelancers for work performed and paid by clients. Escrow funds payable to clients primarily represent deposits received from certain clients to set up an account or to apply toward future payments to freelancers upon completion of the project defined and agreed between the client and the freelancer.

Concentration of Risk

Financial instruments that subject the Company to concentration of risk consist primarily of cash, restricted cash, funds held in escrow, including funds in transit, and trade and client receivables. The Company maintains its cash balances with large, high-credit quality financial institutions and other payment companies. At times, such deposits may be in excess of federally insured limits. The Company has not experienced any losses on its deposits. Credit risk on trade receivables is limited as a result of the large size of the Company’s client base as well as a large portion of payments made using pre-authorized credit cards. The Company performs ongoing credit evaluations of its clients and maintains allowances for potential credit losses. For any receivables that are deemed not collectible, losses are recorded when probable and estimable. These losses, when incurred, have been within the range of the Company’s expectations.

Two clients each accounted for more than 10% of trade and client receivables as of December 31, 2019 and 2018. For the years ended December 31, 2019 and 2018, the Company generated $32.0 million and $29.5 million, respectively, in revenue from one of these clients, which accounted for more than 10% of revenue for each period.

The Company is dependent upon third parties, such as Amazon Web Services, in order to meet the uptime and performance needs of its users.

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, restricted cash, funds held in escrow, including funds in transit, marketable securities, trade and client receivables, prepaid and other current assets, escrow funds payable, debt, and the redeemable convertible preferred stock warrant liability. Prior to the IPO, the redeemable convertible preferred stock warrant liability was remeasured at the end of every period and was carried at fair value. Upon the IPO, the redeemable convertible preferred stock warrant was converted to a common stock warrant and is no longer remeasured.

The Company believes that the carrying values of the remaining financial instruments approximate their fair values.

Trade and Client Receivables and Related Allowance for Doubtful Accounts

Trade and client receivables are primarily comprised of receivables from the Company’s managed services offering and amounts receivable from clients for completed work, including amounts in transit. It also includes unbilled amounts due from clients. Trade and client receivables are recorded and stated at realizable value, net of an allowance for doubtful accounts. Credit is extended generally without collateral to the Company’s managed services client and marketplace clients with Upwork Enterprise offerings based on an initial and ongoing evaluation of their financial condition and other factors. In aggregate, gross trade receivables were $10.3 million and $9.1 million and gross client receivables were $22.1 million and $16.0 million as of December 31, 2019 and 2018, respectively.

The allowance for doubtful accounts is the Company’s estimate of the probable credit losses. The Company periodically assesses the collectability of the accounts and determines the allowance recognized by taking into consideration the aging of its receivable balances, historical write-off experience, probability of collection, and other relevant data. Trade and client receivables are written off against the allowance when management determines a balance is uncollectible and no longer actively pursues collection of the receivable.

The following table presents the changes in the allowance for doubtful accounts as of December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Allowance for doubtful accounts, beginning balance	$	2,832	$	1,577	$	2,473
Provision for doubtful accounts	3,193		4,940		2,646
Amounts written off	(3,810)		(3,685)		(3,542)
Allowance for doubtful accounts, ending balance	$	2,215	$	2,832	$	1,577

Derivative Instruments

The Company uses derivative financial instruments not designated as hedges, such as foreign currency forward contracts, to minimize the short-term impact of foreign currency exchange rate fluctuations on certain foreign currency denominated assets and liabilities, as well as certain foreign currency denominated expenses, hedging the gains or losses generated by the re-measurement of significant foreign currency denominated monetary assets and liabilities. The Company does not enter into derivative instruments for speculative or trading purposes and these instruments generally have maturities within 12 months.

The foreign currency forward contracts are recorded at fair value and, when in gain positions, are reported within prepaid expenses and other current assets. When in loss positions, the foreign currency forward contracts are recorded within accrued expenses and other current liabilities in the consolidated balance sheets. Gains or losses from changes in the fair value of these

foreign currency forward contracts not designated as hedging instruments are recorded in other (income) expense, net to offset the changes in the fair value of the underlying assets or liabilities being hedged.

The notional amounts associated with the Company’s foreign currency forward contracts at December 31, 2019 and 2018 were $5.4 million and $4.8 million, respectively, none of which were designated as cash flow hedges. The carrying values of the foreign currency forward contracts approximated their fair values due to their relatively short settlement durations. The fair values of the Company’s outstanding foreign currency forward contracts not designated as hedging instruments as of December 31, 2019 and 2018 were not material. Gains on foreign currency forward contracts not designated as hedging instruments were $0.9 million for the year ended December 31, 2019. Losses on foreign currency forward contracts not designated as hedging instruments were $0.4 million for the year ended December 31, 2018.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets, which are generally two to five years. Leasehold improvements are amortized on a straight-line basis over the shorter of the remaining lease term or their estimated useful lives. Repair and maintenance costs are charged to expense as incurred.

Internal-Use Software and Platform Development Costs

The Company’s policy is to capitalize certain costs to develop its internal-use software and platform when (i) preliminary project planning is completed, (ii) the Company has committed project resourcing, and (iii) it is probable that the project will be completed and the software will be used as intended. Costs incurred for enhancements that are expected to result in additional significant functionality are also capitalized. Such costs are generally amortized on a straight-line basis over two years, beginning when the asset is ready for its intended use. Costs incurred prior to meeting these criteria, together with costs incurred for training and maintenance, are expensed as incurred. Amortization of capitalized internal-use software is allocated to each functional expense category based on headcount. Amortization of capitalized platform development costs are included in cost of revenue.

Segment Information

The Company has one reportable segment. The Company’s chief operating decision maker is its President and Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance.

Goodwill, Acquired Intangible Assets, and Other Long-Lived Assets

Goodwill represents the excess of the aggregate fair value of the consideration transferred over the fair value of the net tangible and identifiable intangible assets acquired in the Elance-oDesk Combination. Goodwill is not amortized, but rather is assessed for impairment at least annually, or more frequently if events and changes in circumstances indicate that its carrying amount may not be recoverable. The Company conducts its annual assessment during the fourth quarter of each calendar year based on a single reporting unit structure. The Company may elect to utilize a qualitative assessment to determine if any events or circumstances exist, such as an adverse change in business climate or a decline in the overall industry demand, that could indicate that it would more likely than not reduce the fair value of the reporting unit below its carrying amount, including goodwill. If it is more likely than not that the fair value of the reporting unit is at or above its carrying amount, then goodwill is not considered to be impaired and no further testing is required. A two-step quantitative assessment is performed if the qualitative assessment indicates that it is more likely than not that the fair value of the reporting unit is below its carrying amount or if a qualitative assessment is not performed. The first step involves comparing the fair value of the reporting unit to its carrying value, including goodwill. If the carrying value of the reporting unit exceeds its fair value, the second step of the process is performed by comparing the carrying value of the goodwill in the reporting unit to its implied fair value. If the carrying value of the goodwill is greater than its implied fair value, an impairment charge is recognized for the excess. There has been no impairment of goodwill for any of the periods presented.

The Company’s long-lived assets consist of property and equipment and acquired identifiable, finite-lived intangible assets, namely developed technology, user relationships, trade names, and domain names. The finite-lived intangible assets are carried at cost, less accumulated amortization. The Company amortizes the finite-lived intangible assets over their estimated useful lives ranging from two to seven years based on the pattern in which the economic benefits of the intangible assets are consumed, or the straight-line method when the pattern cannot be reliably determined. The Company periodically reviews the remaining estimated useful lives of its long-lived tangible and amortizable intangible assets. If the estimated useful life assumption for any asset is changed, the remaining unamortized balance would be depreciated or amortized over the revised estimated useful life, on a prospective basis. Intangible amortization expense related to developed technology and trade names is recorded as cost of revenue. Intangible amortization expense related to user relationships and domain names is included in operating expenses.

The Company evaluates the recoverability of its long-lived assets, including finite-lived intangible assets, for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of these assets is measured by comparing the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If it is determined that the asset group is not recoverable, an impairment loss is recorded in the amount by which the carrying amount of the asset group exceeds the aggregate future undiscounted cash flows. When an impairment loss is recognized, the carrying amount of such assets is reduced to fair value.

For 2019, the Company conducted its goodwill impairment testing by performing the first step of the two-step impairment model. The fair value was determined by the Company using quoted market prices of the Company’s common stock. The Company determined that the fair value of its reporting unit exceeded the carrying value, and, as such, the Company concluded that there was no impairment of goodwill at the impairment testing date.

There was no impairment of long-lived assets in any of the periods presented.

Deferred Offering Costs

Deferred offering costs, consisting of legal, accounting, and filing fees directly relating to the Company’s IPO, were capitalized and offset against the IPO proceeds upon the completion of the offering. Upon completion of the Company’s IPO, approximately $6.3 million of deferred offering costs were offset against the IPO proceeds in additional paid-in capital.

Revenue Recognition

The Company operates an online talent solution that enables clients to find and work with freelancers. The Company primarily generates revenue from clients and freelancers from marketplace and managed service offerings. The Company accounts for revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606), which the Company adopted on December 31, 2019 effective as of January 1, 2019 using the modified retrospective method. Revenue is recognized upon transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services.

In the ordinary course of business, the Company makes payments to customers when those customers provide services in their capacity as vendors. These payments are for distinct services and are at fair value. These transactions are primarily with certain financial institutions that the Company uses as payment processors on the Upwork platform. The Company accounts for the consideration payable to these customers in their capacity as vendors as a purchase of services from a vendor and records such payments in either cost of revenue or sales and marketing within the consolidated statements of operations.

Marketplace

The Company’s marketplace revenue is derived from Upwork Basic, Plus, Business, Enterprise, and other premium offerings.

Upwork Basic and Plus

The Company earns fees from freelancers under the Upwork Basic and Plus offerings, which represent a single promise to provide continuous access (i.e. stand-ready performance obligation) to the Company’s platform and site services. As each day of providing access to the platform and site services (including, but not limited to, communication, invoicing, reporting, dispute resolution, and payment services) is substantially the same and the freelancer simultaneously receives and consumes the benefits as access is provided, the Company’s single promise under its Upwork Basic and Plus offerings is comprised of a series of distinct service periods. The Company allocates variable consideration received to each distinct service period within the series and recognizes revenue as each distinct service period is performed. The Company’s Upwork Basic and Plus arrangements may include fixed and variable consideration, or a combination of the two comprised of the following:

Service fees. Freelancers are provided access to the Upwork platform to market their businesses, send proposals to and communicate with prospective clients, and, if engaged by a client, to perform specified services agreed between freelancers and clients (“freelancer services”). Freelancers charge clients on an hourly or a milestone basis for services rendered to clients through the Upwork platform (“freelancer billings”); billings charged on an hourly basis are variable consideration; and billings on a milestone basis represent fixed consideration. The Company charges freelancers a service fee as a percentage of freelancer billings using a tiered service fee model based on cumulative lifetime billings by the freelancer to each client. The arrangements subject to tiered service fees also include contract renewal options that represent a material right. The Company takes no responsibility for the freelancer services, and therefore, does not control the freelancer services. Additionally, freelancers and clients negotiate and agree upon the scope and the price for freelancer services directly with each other, and the Company is not a party to those agreements. Accordingly, for these tiered service fee arrangements, the Company presents revenue on a net basis, as an agent. The Company recognizes the service fee as services are rendered for each distinct time increment in the series.

Withdrawal fees. The Company charges withdrawal fees to freelancers when the freelancers withdraw their escrow funds held by the Company. A withdrawal fee is charged for each withdrawal transaction, which represents variable consideration. The Company recognizes the withdrawal fees when transactions are processed for each distinct time increment in the series.

Membership fees. The Company charges membership fees to freelancers. These fees are fixed consideration and are charged monthly. The Company recognizes the revenue over the period of the membership consistent with the common measure of progress for the entire performance obligation.

Connects fees. The Company charges fees to freelancers for the purchase of Connects, which are virtual tokens that are required for freelancers to bid on projects on the Company’s platform. These fees represent variable consideration, and the Company recognizes revenue as Connects are used in each distinct time increment in the series.

The Company earns fees from clients under the Upwork Basic and Plus offerings, which represent a single promise to provide continuous access (i.e. stand-ready performance obligation) to the Company’s platform and site services. As each day of providing access to the platform and site services is substantially the same and the client simultaneously receives and consumes the benefits as access is provided, the Company’s single promise under its Upwork Basic and Plus offerings is comprised of a series of distinct service periods. The Company allocates variable consideration received to each distinct service period within the series and recognizes revenue as each distinct service period is performed. The Company’s Upwork Basic and Plus arrangements may include fixed consideration, variable consideration, or a combination of the two comprised of the following:

Client payment processing and administration fees. The Company charges clients for payment processing services at the time the client is charged for the amounts due from the client. This fee is charged on a per-transaction basis and is variable consideration. Per-transaction payment processing fees are recognized when the client is charged for the amount due and fees charged on a monthly basis are recognized over the month that payment processing services are provided. For client payment processing fees, the Company presents revenue on a gross basis as a principal and not net of the third-party payment processing costs incurred because the Company controls the payment processing and administration services prior to providing to the Company’s clients. The Company recognizes the revenue when a payment from a client is processed in each distinct time increment in the series.

Foreign currency exchange fees. The Company charges clients a fixed mark-up above foreign currency exchange rates that are charged to the Company when the Company collects amounts denominated in foreign currency. Foreign currency exchange fees are variable consideration and recognized as they are earned for each transaction processed in each distinct time increment in the series.

Membership fees. The Company charges membership fees to clients. These fees are charged monthly, are fixed consideration, and are recognized over the period of the membership, which is generally monthly consistent with the common measure of progress for the entire performance obligation.

Upwork Payroll service fees. The Company charges clients using the Upwork Payroll offering when their freelancers are classified as employees for engagements on the Upwork platform. The client enters into an Upwork Payroll agreement with the Company, and Upwork separately contracts with unrelated third-party staffing providers that provide employment services to such clients. In such arrangements, freelancers providing freelancer services to clients become employees of third-party staffing providers. In arrangements where clients enter into Upwork Payroll agreements, the Company charges Upwork Payroll service fees to clients and does not charge service fees to the freelancers who are employees of the third-party staffing providers. Such service fees are variable consideration and charged as a fixed percentage of the total freelancer billings. Under an Upwork Payroll agreement, the Company provides the client access to the Upwork platform to procure and manage freelancer services, as well as access to employment services provided by the third-party staffing providers. The Company presents Upwork Payroll service fees revenue on a net basis as an agent of the client for providing access to employment services provided by the third-party staffing provider. The Company does not control these employment services performed by the third-party on behalf of the client or for the services performed by the freelancers that are employed by the third-party staffing provider. Therefore, the Company is not considered the principal for these services. The Company recognizes the Upwork payroll service fee as revenue as the services are provided for each distinct time increment in the series.

Upwork Enterprise, Business, and Other Premium Offerings

The Company earns fees from freelancers under Upwork Enterprise, Business, and other premium offerings, which represent a single promise to provide continuous access (i.e. stand-ready performance obligation) to the Company’s platform and site services. As each day of providing access to the platform and site services is substantially the same and the freelancer simultaneously receives and consumes the benefits as access is provided, the Company’s single promise under its Upwork Enterprise, Business and other premium offerings is comprised of a series of distinct service periods. The Company allocates

variable consideration received to each distinct service period within the series and recognizes revenue as each distinct service period is performed. These arrangements include variable consideration as follows:

Service fees. The Company provides freelancers access to the Upwork platform to perform freelancer services for clients. The Company charges freelancers a service fee as a percentage of freelancer billings. The Company earns service fees based on a fixed percentage of freelancer billings. For service fees charged to freelancers, the Company presents revenue on a net basis, as an agent, for providing access to the Upwork platform as it does not control the freelancer services provided to clients, and therefore the Company is not considered the principal for the freelancer services. Additionally, freelancers and clients negotiate and agree upon the scope and the price for freelancer services directly with each other, and the Company is not a party to their agreement. The Company recognizes the service fee as services are rendered for each distinct time increment in the series.

The Company earns fees from clients under Upwork Enterprise, Business and other premium offerings, each of which represent a single promise to provide continuous access (i.e. stand-ready performance obligation) to the Company’s platform and site services. As each day of providing access to the platform and site services is substantially the same and the client simultaneously receives and consumes the benefits as access is provided, the Company’s single promise under its Upwork Enterprise, Business and other premium offerings is comprised of a series of distinct service periods. The Company allocates variable consideration received to each distinct service period within the series and recognizes revenue as each distinct service period is performed. These arrangements may include fixed consideration, variable consideration, or a combination of the two comprised of the following:

Client service fees. The Company offers clients access to the Company’s platform to source freelancers in exchange for a client service fee calculated as a percentage of freelancer billings; these fees represent variable consideration. The Company recognizes the service fee as services are rendered for each distinct time increment in the series.

Enterprise compliance service fees. The Company charges fees to its enterprise compliance service clients that engage the Company to provide services to determine whether a freelancer should be classified as an employee or an independent contractor based on the scope of freelancer services agreed between the client and freelancer and other factors. The Company charges enterprise compliance service fees as a percentage of freelancer billings; these fees represent variable consideration. The Company recognizes the compliance service fee as services are rendered for each distinct time increment in the series.

Subscription fees. The Company charges monthly or annual subscription fees to clients for subscription services. These subscription fees are fixed consideration and are recognized over the period of the subscription consistent with the common measure of progress for the entire performance obligation.

Upwork Payroll service fees. Upwork Payroll service fees are recognized on the same basis as described under the Upwork Basic and Plus offerings and are variable consideration.

Revenue sharing arrangements

Certain of the Company’s offerings include revenue sharing arrangements under which the Company generates a revenue share as a percentage of the fees charged by certain financial institutions to the freelancers for payment withdrawals. These arrangements are considered a single performance obligation comprised of variable consideration and are recognized over time based on transactions processed.

Managed Services

Under a managed services arrangement, the Company is responsible for providing services and engaging freelancers directly or as employees of third-party staffing providers to perform the services for clients on the Company’s behalf. These arrangements are generally time- and materials-based, and are invoiced on a monthly basis. These fees represent variable consideration. The Company controls and directs the services performed on behalf of the freelancers and presents revenue on a gross basis as principal. As each day of providing managed services is substantially the same and the client simultaneously receives and consumes the benefits as services are provided, the Company’s single promise under its managed services is comprised of a series of distinct service periods. For managed services arrangements with clients, the Company allocates the variable amounts to each distinct service period within the series and recognizes revenue as each distinct service period is performed.

Arrangements with Multiple Performance Obligations

Certain of the Company’s contracts with customers contain multiple performance obligations in the event the Company determines a material right exists. Specifically, the arrangements with freelancers subject to tiered service fees also include contract renewal options that represent a material right. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price by applying the portfolio approach practical expedient under Topic 606. Standalone selling prices for offerings subject to tiered service fees are estimated based on observable

transactions when these services are sold on a standalone basis. Standalone selling price for a material right is estimated by determining the discount that the freelancer would obtain when exercising the option, adjusted for the likelihood that the option will be exercised. Significant judgment is applied in the application of the portfolio approach practical expedient, which includes estimating the standalone selling price of the material rights and the period of time over which to defer and recognize the consideration allocated to the material rights. Specifically, management applied significant judgment in determining an appropriate model for the estimates, which includes selecting the appropriate methodology and relevant data inputs to estimate the likelihood and the period of time over which to defer and recognize the consideration allocated to the material rights. The Company utilized historical client-freelancer transaction data in developing the estimates. The Company recognizes revenue related to the material rights based on the Company’s estimate of when the material rights are exercised.

Deferred Revenue

Deferred revenue consists of subscription, membership, and Connects fees collected in advance of performing the service. The Company also recognizes deferred revenue for amounts attributable to unexercised material rights related to arrangements with freelancers that are subject to tiered service fees.

Cost of Revenue

Cost of revenue consists primarily of the cost of payment processing fees, costs of freelancers to deliver services under the Company’s managed services offering, personnel-related costs for the Company’s services and support personnel, third-party hosting fees, and the amortization expense associated with acquired intangibles and capitalized internal-use software. The Company defines personnel-related costs as salaries, bonuses, benefits, and stock-based compensation costs for employees, and costs related to other service providers the Company engages to provide internal services to the Company.

Research and Development

Research and development expense primarily consists of personnel-related costs and third-party hosting costs related to development. Research and development costs are expensed as incurred, except to the extent that such costs are associated with platform development that qualify for capitalization.

Advertising Expense

The Company expenses advertising costs as incurred. The Company incurred $37.4 million, $23.6 million, and $14.6 million in advertising expenses during the years ended December 31, 2019, 2018 and 2017, respectively.

Provision for Transaction Losses

Provision for transaction losses consists primarily of losses resulting from fraud on the platform and bad debt expense associated with the Company’s trade and client receivables balance and transaction losses expense related to chargebacks. Provision for these items represent estimates of losses based on the Company’s actual historical incurred losses and other factors.

Redeemable Convertible Preferred Stock Warrant Liability

The Company accounts for freestanding warrants to purchase shares of its redeemable convertible preferred stock as a liability as the underlying shares of convertible preferred stock are contingently redeemable and, therefore, may obligate the Company to transfer assets at some point in the future. The redeemable convertible preferred stock warrants are recorded as other liabilities, noncurrent in the consolidated balance sheets at their estimated fair values and are subject to remeasurement at each balance sheet date. Any change in fair value from remeasurement is recognized as a component of other (income) expense, net in the consolidated statements of operations.

The Company adjusted the liability for changes in fair value through the completion of its IPO in October 2018, at which time the outstanding redeemable convertible preferred stock warrant converted to a common stock warrant and was reclassified to additional paid-in capital.

Stock-Based Compensation

The Company accounts for stock options, restricted stock units (“RSUs”) and purchase rights granted under the 2018 Employee Stock Purchase Plan (“2018 ESPP”) to employees and directors based on their estimated fair value on the date of grant. The fair value of each stock option and purchase rights granted under the 2018 ESPP is estimated using the Black-Scholes valuation model. The model requires the Company to make a number of assumptions, including the value of the Company’s common stock, expected volatility, expected term, risk-free interest rate, and expected dividends. The Company evaluates the assumptions used to value option awards upon each grant of stock options. The fair value of RSUs awarded to employees is based on the closing price of the Company’s common stock, as reported on The Nasdaq Global Select Market on the date of grant.

The Company generally recognizes stock-based compensation expense for stock options and RSUs on a straight-line basis over the vesting term. Stock-based compensation for purchase rights granted under the 2018 ESPP is recognized over the offering period. The Company accounts for forfeitures as they occur.

Foreign Currency

The functional currency of the Company and its subsidiaries is the U.S. dollar. Transactions with users denominated in currencies other than the U.S. dollar are remeasured at the exchange rate in effect on the date of the transaction. At the end of each reporting period, monetary assets and liabilities are remeasured using exchange rates in effect at the balance sheet date. Foreign currency transaction gains and losses are included in other (income) expense, net in the consolidated statements of operations. The Company recorded net foreign currency transaction gains of $0.9 million for the year ended December 31, 2019 and net foreign currency transaction losses of $0.4 million for the year ended December 31, 2018. Foreign currency transaction gains and losses for the year ended December 31, 2017 were immaterial.

Comprehensive Loss

For the year ended December 31, 2019, net unrealized gains from the Company’s marketable securities were immaterial. Comprehensive loss approximates net loss for all periods presented. Accordingly, the consolidated statements of comprehensive loss have been omitted from the consolidated financial statements.

Income Taxes

The Company accounts for income taxes in accordance with the liability method. Under the liability method, deferred assets and liabilities are recognized based upon anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases. The provision for income taxes is comprised of the current tax liability and the change in deferred tax assets and liabilities. The Company establishes a valuation allowance to the extent that it is more likely than not that deferred tax assets will not be recoverable against future taxable income.

Deferred tax assets and liabilities are measured using the enacted tax rates that will be in effect for the years in which those tax assets are expected to be realized or settled. The Company regularly assesses the likelihood that its deferred tax assets will be realized from recoverable income taxes or recovered from future taxable income based on the realization criteria set forth in the relevant authoritative guidance. To the extent that the Company believes any amounts are not more likely than not to be realized, the Company records a valuation allowance to reduce its deferred tax assets. The realization of deferred tax assets is dependent upon future earnings, if any, the timing and amount of which are uncertain. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. If the Company subsequently realizes deferred tax assets that were previously determined to be unrealizable, the respective valuation allowance would be reversed, resulting in an adjustment to earnings in the period such determination is made.

In addition, the calculation of tax liabilities involved dealing with uncertainties in the application of complex tax regulations. The Company recognized potential liabilities based on its estimate of whether, and the extent to which, additional taxes will be due. The Company accounts for uncertain tax positions in accordance with the relevant guidance, which prescribes a recognition threshold and measurement approach for uncertain tax positions taken or expected to be taken in a company’s income tax return, and also provides guidance on recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The guidance utilized a two-step approach for evaluation uncertain tax positions. Step one, Recognition, requires a company to determine if the weight of available evidence indicates a tax position is more likely than not to be sustained upon audit. Step two, Measurement, is based on the largest amount of benefit, which is more likely than not to be realized on ultimate settlement. A liability is reported for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. Any interest and penalties related to unrecognized tax benefits are recorded as income tax expense.

Net Loss per Share Attributable to Common Stockholders

Prior to its IPO, the Company followed the two-class method when computing net loss per share as the Company had issued shares that met the definition of participating securities. The two-class method determined net loss per share for each class of common stock and participating securities according to accumulated and participation rights in undistributed earnings. The two-class method required income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The Company’s redeemable convertible preferred stock contractually entitled the holders of such shares to participate in dividends, but did not contractually require the holders of such shares to participate in losses of the Company. Accordingly, the two-class method did not apply for periods in which the Company reported a net loss or a net loss attributable to common stockholders

Upon the closing of the IPO in October 2018, all outstanding shares of redeemable convertible preferred stock were converted into shares of common stock. As such, the two-class method is no longer applicable.

Basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted net loss attributable to common stockholders is computed by adjusting net loss attributable to common stockholders to reallocate undistributed earnings based on the potential impact of dilutive securities, including outstanding common stock options, convertible preferred stock and warrants to purchase common stock and convertible preferred stock. For periods in which the Company has reported net losses, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders, because dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Recent Accounting Pronouncements Not Yet Adopted

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016–13, Financial Instruments—Credit Losses (Topic 326). This standard changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. In April 2019, the FASB issued ASU No. 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments. The amendments in this update represent changes to clarify, correct errors in, or improve the Codification. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments—Credit Losses (Topic 326). The amendments in this update provide entities that have certain instruments within the scope of Subtopic 326-20, Financial Instruments—Credit Losses—Measured at Amortized Cost, with an option to irrevocably elect the fair value option in Subtopic 825-10, Financial Instruments—Overall, applied on an instrument-by-instrument basis for eligible instruments, upon adoption of Topic 326. This guidance is effective January 1, 2020 with early adoption permitted. The standard requires a modified retrospective method of adoption. The new standard is not expected to have a material impact on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Others (Topic 350): Simplifying the Test for Goodwill Impairment. ASU No. 2017-04 eliminates Step 2 from the goodwill impairment test, which measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under ASU No. 2017-04, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount and recognize an impairment loss for the amount by which the carrying amount exceeds the reporting unit’s fair value, with the loss not exceeding the total amount of goodwill allocated to that reporting unit. The guidance becomes effective for the Company on January 1, 2020 on a prospective basis for its annual or any interim goodwill impairment tests during the 2020 fiscal year. The new standard is not expected to have a material impact on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosure requirements on fair value measurements. ASU No. 2018-13 is effective for the Company beginning January 1, 2020. The standard is not expected to have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (“Subtopic 350-40”): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. ASU No. 2018-15 aligns the requirements for capitalizing implementation costs in a cloud computing arrangement service contract with the requirements for capitalizing implementation costs incurred for an internal-use software license. ASU No. 2018-15 is effective for the Company beginning January 1, 2020. The new standard is not expected to have a material impact on the Company’s consolidated financial statements and related disclosures.

In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). This ASU simplifies accounting for income taxes by removing certain exceptions to the general principles and amending existing guidance to improve consistent application. The Company is required to adopt this guidance in fiscal year 2021 with early adoption permitted. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.

The Company has reviewed all other recently issued accounting pronouncements and concluded they were either not applicable or not expected to have a material impact on the Company’s consolidated financial statements.

Recently Adopted Accounting Pronouncements

On December 31, 2019, the Company adopted Topic 606 effective as of January 1, 2019, which replaced most existing revenue recognition guidance. The core principle of Topic 606 is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. Topic 606 has been applied to contracts that were not completed as of January 1, 2019. Results for reporting periods beginning after January 1, 2019 are presented under Topic 606 (and therefore differ from amounts previously reported on the Company’s quarterly reports on Form 10-Q for periods beginning after January 1, 2019), while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historic accounting.

The Company adopted Topic 606 using the modified retrospective method, which required an adjustment to accumulated deficit and deferred revenue for the cumulative effect of applying Topic 606 to active contracts as of the adoption date. The impacts to the consolidated financial statements for the year ended December 31, 2019 included additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including judgments and changes in estimates.

On December 31, 2019, the Company adopted FASB ASU No. 2016-02, Leases (Topic 842) effective as of January 1, 2019, and related updates, using the effective date method. Prior period amounts were not adjusted. The primary impact of adoption is the requirement for lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by both operating and finance leases. Enhanced quantitative and qualitative disclosures about leasing arrangements are also required. The Company elected the package of practical expedients which does not require reassessment of prior conclusions related to identifying leases, lease classification or initial direct costs. The Company also elected the practical expedient to combine lease and non-lease components, accounting for the combined components as a single lease component. Additionally, the Company elected the short-term lease exemption, and are only applying the requirements of Topic 842 to long-term leases (leases greater than 1 year).

The adoption of Topic 606 resulted in an $11.8 million deferral of revenue with a corresponding increase to accumulated deficit as of January 1, 2019. Topic 606 did not have a material impact on the consolidated statements of cash flows. The adoption of Topic 842 resulted in the recognition of $17.3 million of operating lease assets and $17.8 million of operating lease liabilities on the consolidated balance sheet as of January 1, 2019. Topic 842 does not have a material impact on the consolidated statements of operations or consolidated statements of redeemable convertible preferred stock and stockholders’ equity (deficit) or consolidated statements of cash flows. See Note 5 for additional information.

The following tables summarize the impacts of adopting Topic 606 and Topic 842 on the Company’s consolidated financial statements as of and for the year ended December 31, 2019 (in thousands):


	December 31, 2019
	Balances, without Adoption of Topics 606 and 842		Adjustments due to Topic 606		Adjustments due to Topic 842 ⁽¹⁾		Balances, as Reported
Consolidated Balance Sheet
Current assets—Trade and client receivables, net	$	36,487	$	(6,331)	$	—	$	30,156
Noncurrent assets
Operating lease asset	—		—		21,908		21,908
Other assets, noncurrent	904		—		(75)		829
Current liabilities
Accrued expenses and other current liabilities	21,027		(5,817)		3,132		18,342
Deferred revenue	2,280		11,519		—		13,799
Noncurrent liabilities
Operating lease liability, noncurrent	—		—		21,186		21,186
Other liabilities, noncurrent	6,740		1,850		(2,617)		5,973
Total stockholders’ equity	273,141		(13,883)		166		259,424

Consolidated Statement of Operations
Revenue	$	302,647	$	(2,085)	$	—	$	300,562
Operating expense—General and administrative	67,493		—		(166)		67,327
Net loss attributable to common stockholders	(14,740)		(2,085)		166		(16,659)
Net loss per share attributable to common stockholders, basic and diluted	(0.13)		(0.02)		—		(0.15)

⁽¹⁾ Amounts include other adjustments made in conjunction with the adoption of Topic 842.

In 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, that requires the classification and presentation of changes in restricted cash and cash equivalents in the statement of cash flows. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning and ending balances shown on the statement of cash flows. The guidance was required to be applied retrospectively after adoption. The Company adopted the standard on December 31, 2019 on a retrospective basis. The beginning and ending balances of cash and cash equivalents on the consolidated statement of cash

flows now include restricted cash and restricted cash equivalents, such as cash and cash equivalents underlying funds held in escrow and restricted cash.

In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Non-employee Share-Based Payment Accounting. ASU No. 2018-07 expands the scope of Topic 718, Compensation-Stock Compensation to include share-based payment transactions for acquiring goods and services from non-employees. These awards are measured at the grant-date fair value of the equity instruments that an entity is obligated to issue when the good has been delivered or the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. The Company adopted the standard on December 31, 2019 on a modified retrospective basis. The standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU No. 2016-01 makes targeted improvements to U.S. GAAP regarding financial instruments. ASU No. 2016-01 eliminates the requirement to classify investments in equity securities with readily determinable fair values into trading or available-for-sale categories and requires those equity securities to be measured at fair value with changes in fair value recognized in net earnings rather than in other comprehensive income. ASU No. 2016-01 also revises certain presentation and disclosure requirements. Under ASU No. 2016-01, accounting for investments in debt securities remains essentially unchanged. The Company adopted the standard on December 31, 2019. The standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payment, to clarify how certain cash receipts and payments are presented and classified in the statement of cash flows. The Company adopted the new standard on December 31, 2019. The new standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

Stock-Based Compensation - Summary of Activity under Restricted Stock Unit Plans (Details) - RSUs issued and outstanding	12 Months Ended
	Dec. 31, 2019 $ / shares shares
Number of RSUs Outstanding
Unvested balance - beginning balance (in shares) \| shares	288,460
Granted (in shares) \| shares	2,566,600
Vested (in shares) \| shares	(163,943)
Forfeited/canceled (in shares) \| shares	(187,935)
Unvested balance - ending balance (in shares) \| shares	2,503,182
Weighted-Average Grant Date Fair Value
Unvested balance - beginning balance (in dollars per share) \| $ / shares	$ 15.00
Granted (in dollars per share) \| $ / shares	16.15
Vested (in dollars per share) \| $ / shares	15.85
Forfeited/canceled (in dollars per share) \| $ / shares	19.09
Unvested balance - ending balance (in dollars per share) \| $ / shares	$ 15.82

Segment and Geographical Information - Revenue by Type (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Disaggregation of Revenue [Line Items]
Revenue	$ 300,562	$ 253,354	$ 202,552
Marketplace
Disaggregation of Revenue [Line Items]
Revenue	268,284	223,831	178,046
Managed services
Disaggregation of Revenue [Line Items]
Revenue	$ 32,278	$ 29,523	$ 24,506

Balance Sheet Components - Future Amortization Expense (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
2020	$ 2,668
2021	667
Net Carrying Amount	$ 3,335	$ 6,004

Preferred and Common Stock Warrants

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Preferred and Common Stock Warrants

Redeemable Convertible Preferred Stock Warrants

As a result of the Elance-oDesk Combination, a redeemable convertible preferred stock warrant that was originally issued by Elance prior to the Elance-oDesk Combination became exercisable to purchase up to 26,000 and 57,181 shares of the Company’s Series A-1 and Series A-2 redeemable convertible preferred stock, respectively, at an exercise price of $3.13 per share. In 2017, the warrant was exercised in full for cash.

Further, as a result of the Elance-oDesk Combination, another redeemable convertible preferred stock warrant that was originally issued by Elance prior to the Elance-oDesk Combination became exercisable to purchase up to 124,506 and 273,825 shares of the Company’s Series A-1 and Series A-2 redeemable convertible preferred stock, respectively, at an exercise price of $3.13 per share. Upon completion of the IPO, this warrant converted to a common stock warrant exercisable for the same number of shares and was reclassified to additional paid-in capital. The common stock warrant was outstanding and exercisable as of December 31, 2018. In April 2019, this common stock warrant was exercised in full at a total cost of $1.2 million. In lieu of a cash payment, the holder of the warrant surrendered 64,646 shares of common stock to cover the exercise price. The Company issued 333,685 shares of common stock upon the exercise of this common stock warrant.

Prior to the IPO, the Company estimated the fair value of each redeemable convertible preferred stock warrant using the Black-Scholes valuation model. For the years ended December 31, 2018 and 2017, the Company recorded $6.1 million and $0.1 million, respectively, related to the revaluation of its redeemable convertible preferred stock warrant liability, which is included in other (income) expense, net in the Company’s consolidated statement of operations. The following assumptions were used to calculate the estimated fair value of the then-outstanding warrants until the closing date of the Company’s IPO:



Dividend yield	0	%
Expected term (in years)	2.75
Risk-free interest rates	1.8	%
Expected volatility	34.6	%

Common Stock Warrant

As a result of the Elance-oDesk Combination, a common stock warrant that was originally issued by oDesk prior to the Elance-oDesk Combination became exercisable to purchase up to 45,286 shares of common stock at an exercise price of $0.06 per share. In 2018, the Company issued 45,286 shares of common stock upon the exercise of this common stock warrant.

In 2018, the Company established The Upwork Foundation initiative. The program includes a donor-advised fund created through the Tides Foundation. In May 2018, the Company issued a warrant to purchase 500,000 shares of its common stock at an exercise price of $0.01 per share to the Tides Foundation. The vesting and exercisability provisions of the warrant became

effective upon the Company’s IPO in October 2018. This warrant is exercisable as to 1/10th of the shares on each anniversary of the IPO, with proceeds from the sale of such shares to be donated in accordance with the Company’s directive.

In 2019, this warrant was exercised as to all 50,000 of the then-vested and exercisable shares. In lieu of a cash payment, the holder of the warrant surrendered 37 shares of common stock to cover the exercise price. The Company issued 49,963 shares of common stock upon the exercise of this common stock warrant.

For the years ended December 31, 2019 and 2018, the Company recorded $0.7 million and $0.2 million of expense related to this warrant, which is included in general and administrative expense in the Company’s consolidated statement of operations.

Stock-Based Compensation - Fair Value Assumptions (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Transition Agreement
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Transition Agreement \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	3 months 18 days
Risk-free interest rates	1.50%
Expected volatility	38.00%
Transition Agreement \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	1 year 3 months 18 days
Risk-free interest rates	1.60%
Expected volatility	39.00%
2018 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%	0.00%	0.00%
2018 Equity Incentive Plan \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)		5 years 2 months 12 days	5 years 3 months 18 days
Risk-free interest rates		2.50%	1.90%
Expected volatility		38.00%	39.00%
2018 Equity Incentive Plan \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)		6 years 1 month 6 days	6 years 3 months 18 days
Risk-free interest rates		2.90%	2.20%
Expected volatility		45.00%	43.00%
2018 Employee Stock Purchase Plan \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Expected term (in years)		6 months	6 months
Risk-free interest rates		1.50%	2.40%
Expected volatility		38.00%
2018 Employee Stock Purchase Plan \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield		0.00%
Expected term (in years)		2 years	2 months 12 days
Risk-free interest rates		2.40%	2.90%
Expected volatility		47.00%

Balance Sheet Components - Schedule of Future Aggregate Minimum Lease Payments under Operating Leases (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Balance Sheet Related Disclosures [Abstract]
2019	$ 3,569
2020	4,683
2021	4,914
2022	5,052
2023	5,194
Thereafter	4,890
Less: rental payments from subleases	(363)
Total	$ 27,939

Net Loss Per Share Attributable to Common Stockholders - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Numerator:
Net loss	$ (16,659)	$ (19,907)	$ (4,123)
Less: Premium on repurchase of redeemable convertible preferred stock	0	0	(6,506)
Net loss attributable to common stockholders	$ (16,659)	$ (19,907)	$ (10,629)
Denominator:
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares)	109,814,604	52,327,518	32,944,714
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.15)	$ (0.38)	$ (0.32)

- Definition

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

+ References + Details

Revenue (Tables)

12 Months Ended

Dec. 31, 2019

Revenue from Contract with Customer [Abstract]

Contract balances

The following table provides information about the balances of the Company’s trade and client receivables and contract liabilities (deferred revenue):


	As of December 31, 2019		As of January 1, 2019 (As Adjusted)
Trade and client receivables, net of allowance	$	30,156	$	20,327
Contract liabilities
Deferred revenue	$	13,799	$	10,834
Deferred revenue (component of other liabilities, noncurrent)	$	3,153	$	1,690

Fair Value Measurements - Redeemable Convertible Preferred Stock Warrants (Details) - Cash equivalents—money market funds - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value, beginning balance	$ 1,104	$ 1,130
Change in fair value	6,056	118
Conversion to common stock warrant in connection with the initial public offering	(7,160)	(144)
Fair value, ending balance	$ 0	$ 1,104

Stock-Based Compensation - Summary of Activity under Stock Option Plans (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Number of Shares Underlying Outstanding Options
Beginning Balance (in shares)	23,774,279
Exercised (in shares)	(6,045,823)
Forfeited and canceled (in shares)	(2,587,877)
Ending Balance (in shares)	15,140,579	23,774,279
Vested and exercisable (in shares)	11,260,129
Vested and expected to vest (in shares)	15,140,579
Weighted-Average Exercise Price
Beginning Balance (in dollars per share)	$ 3.71
Exercised (in dollars per share)	3.00
Forfeited and canceled (in dollars per share)	6.01
Ending Balance (in dollars per share)	3.61	$ 3.71
Vested and exercisable (in dollars per share)	3.47
Vested and expected to vest (in dollars per share)	$ 3.61
Weighted-Average Remaining Contractual Term (Years)	6 years 2 months 8 days	7 years 1 month 6 days
Weighted-Average Remaining Contractual Term (Years), Vested and exercisable	5 years 8 months 19 days
Weighted-Average Remaining Contractual Term (Years), Vested and expected to vest	6 years 2 months 8 days
Aggregate Intrinsic Value (in thousands), Vested and exercisable	$ 81,087
Aggregate Intrinsic Value (in thousands), Vested and expected to vest	106,967
Aggregate Intrinsic Value (in thousands)	$ 106,967	$ 342,262

Basis of Presentation and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Schedule of Cash and Cash Equivalents


	2019		2018		2017
Cash and cash equivalents	$	48,392	$	129,128	$	21,595
Restricted cash	2,490		2,753		2,309
Funds held in escrow, including funds in transit	108,721		98,186		87,195
Total cash, cash equivalents, and restricted cash as shown in the consolidated statement of cash flows	$	159,603	$	230,067	$	111,099

Schedule of allowance for doubtful accounts

The following table presents the changes in the allowance for doubtful accounts as of December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Allowance for doubtful accounts, beginning balance	$	2,832	$	1,577	$	2,473
Provision for doubtful accounts	3,193		4,940		2,646
Amounts written off	(3,810)		(3,685)		(3,542)
Allowance for doubtful accounts, ending balance	$	2,215	$	2,832	$	1,577

Schedule of New Accounting Pronouncements and Changes in Accounting Principles

The following tables summarize the impacts of adopting Topic 606 and Topic 842 on the Company’s consolidated financial statements as of and for the year ended December 31, 2019 (in thousands):


	December 31, 2019
	Balances, without Adoption of Topics 606 and 842		Adjustments due to Topic 606		Adjustments due to Topic 842 ⁽¹⁾		Balances, as Reported
Consolidated Balance Sheet
Current assets—Trade and client receivables, net	$	36,487	$	(6,331)	$	—	$	30,156
Noncurrent assets
Operating lease asset	—		—		21,908		21,908
Other assets, noncurrent	904		—		(75)		829
Current liabilities
Accrued expenses and other current liabilities	21,027		(5,817)		3,132		18,342
Deferred revenue	2,280		11,519		—		13,799
Noncurrent liabilities
Operating lease liability, noncurrent	—		—		21,186		21,186
Other liabilities, noncurrent	6,740		1,850		(2,617)		5,973
Total stockholders’ equity	273,141		(13,883)		166		259,424

Consolidated Statement of Operations
Revenue	$	302,647	$	(2,085)	$	—	$	300,562
Operating expense—General and administrative	67,493		—		(166)		67,327
Net loss attributable to common stockholders	(14,740)		(2,085)		166		(16,659)
Net loss per share attributable to common stockholders, basic and diluted	(0.13)		(0.02)		—		(0.15)

⁽¹⁾ Amounts include other adjustments made in conjunction with the adoption of Topic 842.

Balance Sheet Components - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Accrued Liabilities and Other Liabilities [Abstract]
Accrued compensation and related benefits	$ 5,344	$ 9,314
Accrued freelancer costs	622	2,465
Accrued indirect taxes	2,401	1,630
Accrued vendor expenses	5,485	6,002
Accrued payment processing fees	832	715
Operating lease liability, current	3,214	0
Other	444	822
Total accrued expenses and other current liabilities	$ 18,342	$ 20,948

Debt - Summary of Carrying Value of Debt (Details) $ in Thousands	1 Months Ended		8 Months Ended	12 Months Ended
	Oct. 31, 2018	Sep. 30, 2018	Aug. 31, 2018	Dec. 31, 2019 USD ($) installment	Dec. 31, 2018 USD ($)
Debt Instrument [Line Items]
Total debt				$ 18,321	$ 24,000
Less: Unamortized debt discount issuance costs				(38)	(90)
Balance				18,283	23,910
Debt, current				(7,584)	(5,671)
Debt, noncurrent				$ 10,699	$ 18,239
Weighted-average interest rate				6.93%	6.89%
First term loan—18 months of interest-only payments ended in March 2019 followed by 36 equal monthly installments of principal plus interest, maturing March 2022; interest at prime plus 0.25% per annum
Debt Instrument [Line Items]
Total debt				$ 11,250	$ 15,000
Interest only payments term				18 months
Number of equal monthly installments of principal and interest \| installment				36
First term loan—18 months of interest-only payments ended in March 2019 followed by 36 equal monthly installments of principal plus interest, maturing March 2022; interest at prime plus 0.25% per annum \| Prime Rate
Debt Instrument [Line Items]
Debt, variable rate				0.25%
Second term loan—17 months of interest-only payments ended in March 2019 followed by 42 equal monthly installments of principal plus interest, maturing September 2022; interest at prime plus 0.25% per annum
Debt Instrument [Line Items]
Total debt				$ 7,071	$ 9,000
Interest only payments term				17 months
Number of equal monthly installments of principal and interest \| installment				42
Second term loan—17 months of interest-only payments ended in March 2019 followed by 42 equal monthly installments of principal plus interest, maturing September 2022; interest at prime plus 0.25% per annum \| Prime Rate
Debt Instrument [Line Items]
Debt, variable rate	0.25%	0.25%	5.25%

Debt - Narrative (Details)		1 Months Ended					8 Months Ended	12 Months Ended
Debt - Narrative (Details)	Feb. 28, 2019	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Oct. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2017 USD ($)	Aug. 31, 2018	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity						$ 49,000,000.0
Proceeds from borrowings					$ 15,000,000.0
Adjusted liquidity ratio	1.30		1.75			0.0175
Net proceeds					$ 50,000,000.0
Debt Covenant, Reduction In Frequency Of Providing Financial Information, Adjusted Quick Ratio To Maintain			2.50
Proceeds from Lines of Credit		$ 25,000,000.0	$ 25,000,000.0
Repayments of Debt								$ 55,679,000	$ 25,000,000	$ 17,000,000
Revolving Line of Credit
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity						$ 25,000,000.0
First Term Loan
Debt Instrument [Line Items]
Debt instrument, face amount						15,000,000.0
Repayments of Debt								$ 3,800,000
First Term Loan \| Prime Rate
Debt Instrument [Line Items]
Debt, variable rate								0.25%
Second Term Loan
Debt Instrument [Line Items]
Debt instrument, face amount						$ 9,000,000.0
Repayments of Debt								$ 1,900,000
Second Term Loan \| Prime Rate
Debt Instrument [Line Items]
Debt, variable rate				0.25%	0.25%		5.25%
Loan Agreement
Debt Instrument [Line Items]
Repayment of debt owed				$ 10,000,000.0
Minimum
Debt Instrument [Line Items]
EBITDA, trailing period						3 months
Maximum
Debt Instrument [Line Items]
EBITDA, trailing period						12 months

Balance Sheet Components - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 2,800,000	$ 2,200,000	$ 1,500,000
Capitalized costs	6,400,000	4,000,000.0	500,000
Internal-use software and platform development costs capitalized, amortization expense	1,200,000	100,000	$ 0
Cost of Revenue	900,000
Amortization of intangible assets		2,700,000
Carrying amount	3,335,000	6,004,000
Operating lease liability	5,900,000
Sublease income	400,000
Variable lease cost	600,000
Operating lease payments	3,300,000
Operating lease asset in exchange for a new lease obligation	$ 8,600,000
Long-term purchase commitment, period	5 years
Net Operating Lease Commitments	$ 2,200,000
Operating lease, lease not yet commenced, renewal term	5 years
Weighted average remaining lease term	6 years 2 months 12 days
Operating lease, weighted average discount rate	5.86%
Minimum
Property, Plant and Equipment [Line Items]
Intangible asset, useful life	2 years
Operating lease, term	1 year
Maximum
Property, Plant and Equipment [Line Items]
Intangible asset, useful life	7 years
Operating lease, term	9 years
Developed technology
Property, Plant and Equipment [Line Items]
Carrying amount	$ 0	0
User relationships
Property, Plant and Equipment [Line Items]
Intangible asset, useful life	1 year 3 months 18 days
Carrying amount	$ 3,335,000	$ 6,004,000

Common Stock - Narrative (Details)	Dec. 31, 2019 vote $ / shares shares	Dec. 31, 2018 shares
Equity [Abstract]
Preferred stock (in shares)	10,000,000
Preferred stock (in dollars per share) \| $ / shares	$ 0.0001
Common Stock, votes per share (in votes) \| vote	1
Common stock, shares authorized (in shares)	490,000,000	490,000,000

Income Taxes - Components of Income Tax Benefit (Provision) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Current:
Federal	$ 0	$ 0	$ 0
State	(26)	(11)	1
Foreign	(2)	(4)	21
Total current	(28)	(15)	22
Deferred:
Federal	0	0	0
State	0	0	0
Foreign	0	0	0
Total deferred	0	0	0
Total income tax benefit (provision)	$ (28)	$ (15)	$ 22

Net Loss Per Share Attributable to Common Stockholders

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Net Loss Per Share Attributable to Common Stockholders

Net Loss per Share Attributable to Common Stockholders

The following table sets forth the computation of the Company’s basic and diluted net loss per share attributable to common stockholders for the years ended December 31, 2019, 2018 and 2017 (in thousands, except share and per share data):


	2019		2018		2017
Numerator:
Net loss	$	(16,659)	$	(19,907)	$	(4,123)
Less: Premium on repurchase of redeemable convertible preferred stock	—		—		(6,506)

Net loss attributable to common stockholders	$	(16,659)	$	(19,907)	$	(10,629)
Denominator:
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted	109,814,604		52,327,518		32,944,714
Net loss per share attributable to common stockholders, basic and diluted	$	(0.15)	$	(0.38)	$	(0.32)

For the years ended December 31, 2019, 2018 and 2017, the following potentially dilutive shares were excluded from the computation of diluted net loss per share attributable to common stockholders because including them would have been anti-dilutive:


	2019	2018	2017
Options to purchase common stock	15,140,579	23,774,279	23,607,746
Common stock issuable upon conversion of redeemable convertible preferred stock	—	—	61,279,079
Common stock issuable upon exercise of common stock warrants	450,000	898,331	45,286
Common stock issuable upon exercise and redeemable conversion of preferred stock warrants	—	—	398,331
Common stock issuable upon vesting of restricted stock units	2,503,182	288,460	—
Common stock issuable in connection with employee stock purchase plan	1,651,263	—	—
Total	19,745,024	24,961,070	85,330,442

Balance Sheet Components - Intangible Assets, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 31,856	$ 31,856
Accumulated Amortization	28,521	25,852
Net Carrying Amount	3,335	6,004
Trade names
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	2,293	2,293
Accumulated Amortization	2,293	2,293
Net Carrying Amount	0	0
User relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	18,678	18,678
Accumulated Amortization	15,343	12,674
Net Carrying Amount	3,335	6,004
Developed technology
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	10,356	10,356
Accumulated Amortization	10,356	10,356
Net Carrying Amount	0	0
Domain names
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	529	529
Accumulated Amortization	529	529
Net Carrying Amount	$ 0	$ 0

Debt

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Debt

The following table presents the carrying value of the Company’s debt obligations as of December 31, 2019 and 2018 (in thousands):


	2019			2018
First term loan—18 months of interest-only payments ended in March 2019 followed by 36 equal monthly installments of principal plus interest, maturing March 2022; interest at prime plus 0.25% per annum	$	11,250		$	15,000
Second term loan—17 months of interest-only payments ended in March 2019 followed by 42 equal monthly installments of principal plus interest, maturing September 2022; interest at prime plus 0.25% per annum	7,071			9,000

Total debt	18,321			24,000
Less: Unamortized debt discount issuance costs	(38)			(90)
Balance	18,283			23,910
Debt, current	(7,584)			(5,671)
Debt, noncurrent	$	10,699		$	18,239
Weighted-average interest rate	6.93		%	6.89		%

In September 2017, the Company entered into a Loan and Security Agreement, which was subsequently amended in November 2017, September 2018, and March 2019. Under the Company’s Loan and Security Agreement, as amended (the “Loan Agreement”), the aggregate amount of the facility is up to $49.0 million, consisting of a term loan in the original principal amount of $15.0 million (the “First Term Loan”), a term loan in the original principal amount of $9.0 million (the “Second Term Loan” and, together with the First Term Loan, the “Term Loans”) and a revolving line of credit, which permits borrowings of up to $25.0 million subject to customary conditions. Among other things, the Company may only borrow funds under the revolving line of credit if, after giving effect thereto, total borrowings under the line of credit do not exceed a specified percentage of eligible trade and client accounts receivable. The Company has granted its lender first-priority liens against substantially all of its assets, as collateral, excluding the Company’s intellectual property (but including proceeds therefrom) and the funds and assets held by the Company’s subsidiary, Upwork Escrow Inc. The Company has also agreed to a negative pledge on its intellectual property. The Loan Agreement is also subject to the Company maintaining an adjusted quick ratio of 1.75 and achieving minimum EBITDA levels over trailing periods ranging from three to 12 months. The Loan Agreement also includes a restrictive covenant on dividend payments other than dividends paid solely in common stock.

In September 2018, the Company entered into a second amendment (the “Second Amendment”) to the Loan Agreement, which expanded the types of eligible trade and client accounts receivable considered for the determination of the borrowing base of the revolving line of credit. The Second Amendment also provided for a reduction in the interest rate for the Second Term Loan, from the prime rate plus 5.25% per annum to the prime rate plus 0.25% per annum, from and after the occurrence of an initial public offering by the Company with net proceeds of more than $50.0 million; this reduction became effective following the completion of the Company’s IPO in October 2018.

In March 2019, the Company entered into a third amendment (the “Third Amendment”) to the Loan Agreement, which, among other changes, (i) amended the adjusted quick ratio financial covenant to provide that the Company will maintain an adjusted quick ratio of 1.75 to 1.00 (previously 1.30 to 1.00), (ii) reduced the frequency with which the Company is required to provide certain financial information to the lender during periods in which it maintains an adjusted quick ratio of 2.50 to 1.00, and (iii) eliminated the minimum EBITDA covenant with which the Company was required to comply. The Company was in compliance with its covenants under the Loan Agreement as of December 31, 2019 and 2018.

To the extent the Company has not yet collected funds for hourly billings from clients that are in-transit due to timing differences in receipt of cash from clients, the Company may utilize the revolving line of credit to satisfy customary escrow funding requirements. The Company drew down $25.0 million under the revolving line of credit for such purpose in each of March and June 2019, which the Company subsequently repaid in April and July 2019, respectively. The Company also drew down $15.0 million under the revolving line of credit for such purpose in September 2018, which the Company subsequently repaid in October 2018. Additionally, in October 2018, the Company used part of the net proceeds from the IPO to repay $10.0 million of indebtedness owed under the revolving line of credit.

Pursuant to the terms of the Loan Agreement, in April 2019, the Company commenced repayment on the Term Loans. During the year ended December 31, 2019, the Company repaid $3.8 million and $1.9 million related to the First Term Loan and the Second Term Loan, respectively.

Amortization expense related to the debt discount was immaterial for the years ended December 31, 2019, 2018, and 2017.

Future maturities of principal payments, excluding potential early payments, as of December 31, 2019, were expected to be as follows (in thousands):


Year Ended December 31,	Principal Payments
2020	$	7,571
2021	7,571
2022	3,179



Total	$	18,321

401(k) Plan (Details) - USD ($)	12 Months Ended
401(k) Plan (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Company matching cash contributions	50.00%
Maximum annual contributions per employee	$ 5,000
Expense for matching contributions	$ 2,000,000.0	$ 1,700,000	$ 1,200,000

401(k) Plan	12 Months Ended
401(k) Plan	Dec. 31, 2019
Retirement Benefits [Abstract]
401(k) Plan	401(k) PlanThe Company offers the Upwork Retirement Savings Plan (the “Retirement Plan”), a defined contribution plan that allows employees to contribute a portion of their salary, subject to the annual limits. Under the Retirement Plan, eligible employees may defer a portion of their pretax salaries, but not more than the statutory limits. The Retirement Plan provides for a discretionary employer cash matching contribution. The Company makes matching cash contributions equal to 50% of each dollar contributed, subject to a maximum contribution of $5,000 annually per participant. The Company’s total expense for the matching contributions was $2.0 million, $1.7 million and $1.2 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Redeemable Convertible Preferred Stock

12 Months Ended

Dec. 31, 2019

Temporary Equity Disclosure [Abstract]

Redeemable Convertible Preferred Stock

Prior to the IPO, the Company financed its operations and capital expenditures primarily through sales of convertible preferred stock, bank borrowings, and utilization of cash generated from operations in the periods in which the Company generated cash flows from operations.

The Company completed its IPO in October 2018, in which the Company issued and sold 7,840,908 shares of common stock at a public offering price of $15.00 per share, before deducting underwriting discounts and commissions and offering expenses payable by the Company. As a result, all of the Company’s 61,279,079 shares of then-outstanding redeemable convertible preferred stock automatically converted into shares of common stock on a one-for-one basis. Therefore, there were no issued or outstanding shares of redeemable convertible preferred stock as of December 31, 2019 and 2018.

Redeemable convertible preferred stock as of December 31, 2017 consisted of the following (in thousands, except share data):


	Shares Authorized	Shares Issued and Outstanding	Net Carrying Value		Aggregate Liquidation Preference
Series A-1	10,141,345	9,142,770	$	72,181	$	91,427
Series A-2	60,000,000	47,124,931	65,853		5
Series B-1	5,854,982	4,866,360	27,628		27,787
Series B-2	145,018	145,018	824		828
Total redeemable convertible preferred stock	76,141,345	61,279,079	$	166,486	$	120,047

Shares of redeemable convertible preferred stock were not mandatorily redeemable. However, a liquidation or winding up of the Company, a greater than 50% change in control, or a sale of substantially all of the Company’s assets would constitute a redemption event that is outside of the Company’s control. As such, all shares of redeemable convertible preferred stock were presented outside of permanent equity. The Company did not adjust the carrying values of the redeemable convertible preferred stock to the deemed liquidation values of such shares since a liquidation event was not probable as of December 31, 2017. No subsequent adjustments to increase or decrease the carrying values were made between December 31, 2017 and the date of the Company’s IPO. As a result of the Elance-oDesk Combination, holders of preferred stock of Elance and holders of preferred stock of oDesk each received as consideration for such shares a combination of shares of Series A-1 and Series A-2 redeemable convertible preferred stock. As a result, no stockholder held shares of Series A-1 redeemable convertible preferred stock without also holding shares of Series A-2 redeemable convertible preferred stock, nor did any stockholder hold shares of Series A-2 redeemable convertible preferred stock without also holding shares of Series A-1 redeemable convertible preferred stock. The rights, privileges, and preferences of the Series A-1, Series A-2, Series B-1, and Series B-2 redeemable convertible preferred stock (“Preferred Stock”) were as follows:

Dividends

Holders of the Series A-1, Series A-2, Series B-1, and Series B-2 redeemable convertible preferred stock were each entitled to non-cumulative dividends of $0.80, $0.000008, $0.4568, and $0.4568 per share, respectively. Dividends on the Preferred Stock were payable only when, and if, declared by the board of directors. No dividends on the Preferred Stock were declared by the Company’s board of directors, or were paid, as of December 31, 2017 and as of the date of the Company’s IPO.

Voting Rights

The holders of each share of Preferred Stock were entitled to the number of votes equal to the number of shares of common stock into which their respective shares were convertible, provided, however, that the holders of Series B-2 redeemable convertible preferred stock, or common stock issued upon conversion thereof, were not entitled to cast votes in connection with the election of members of the board of directors. The holders of Preferred Stock had certain protective provisions so long as an aggregate of 15.1 million shares of Preferred Stock were outstanding. Under these provisions, the Company could not, without the approval of greater than 50% of the then-outstanding shares of Preferred Stock (i) alter or change the rights, powers, or preferences of the Preferred Stock set forth in the Company’s certificate of incorporation or bylaws, (ii) authorize or create any new class of stock having rights, powers or preferences that were senior to or on parity with any series of Preferred Stock, or obligate itself to authorize or create any security convertible into or exercisable for such class of stock, (iii) redeem or repurchase any shares of common stock or Preferred Stock (other than shares subject to the Company’s right of repurchase, through the exercise of any right of first refusal, or otherwise approved by the board of directors), (iv) declare or pay a dividend or otherwise make a distribution to holders of Preferred Stock or common stock (other than a dividend on the common stock payable solely in shares of common stock or a repurchase approved by the board of directors), (v) voluntarily liquidate, dissolve, or wind-up the business or effect a deemed liquidation event (as defined in the certificate of incorporation), or (vi) increase or decrease the authorized number of directors constituting the board of directors.

In addition, so long as any shares of any series of Preferred Stock were outstanding, the Company could not, without the approval of greater than 50% of the then-outstanding shares of such series of Preferred Stock, alter or change the rights, powers, or preferences of such series of Preferred Stock set forth in the Company’s certificate of incorporation or bylaws in a way that adversely affected such series of Preferred Stock in a manner different from other series of Preferred Stock (other than (a) the authorization, creation, or issuance of any new class or series of capital stock having rights, powers, or preferences that were senior to, on parity with, or junior to any series of Preferred Stock and (b) an amendment or other change of the rights, powers, or preferences of any series of preferred stock that was proportional to the amendments or other changes similarly made to other series of Preferred Stock that had a similar right, power, or preference).

Conversion

The holders of each share of Preferred Stock had the option to convert each share of Preferred Stock at any time into a number of shares of common stock determined by dividing the original issue price per share by the then-current conversion price for such series. The original issue prices per share for the Series A-1, Series A-2, Series B-1, and Series B-2 redeemable convertible preferred stock were $10.00, $0.0001, $5.71, and $5.71, respectively, and, subject to adjustments for certain dilutive issuances, splits, and combinations, and other recapitalizations or reorganizations, the conversion price for each series of Preferred Stock was equal to the original issue price for such series. In the event that any holder of Series A-1 or Series A-2 redeemable convertible preferred stock elected to voluntarily convert shares of such Preferred Stock into shares of common stock, the election was deemed to be an election of such holder to convert shares of Series A-1 and Series A-2 redeemable convertible preferred stock held by such holder into shares of common stock at the same ratio and in the same proportions. In addition, the Preferred Stock would automatically be converted into common stock upon the earlier of (i) the written consent of the holders of at least a majority of the then-outstanding shares of Preferred Stock, voting together as a single class on an as-converted basis or (ii) an IPO that resulted in aggregate gross proceeds to the Company of at least $50.0 million. As of December 31, 2017, the conversion ratio was 1:1 for each series of Preferred Stock.

Liquidation Preference

In the event of liquidation, dissolution, or winding up or any deemed liquidation event of the Company, the holders of Preferred Stock were entitled to receive the greater of (i) their full preferential amounts plus any declared but unpaid dividends and (ii) such amount per share as would have been payable had all shares of such series of Preferred Stock been converted into common stock, prior to any distribution to the holders of common stock. If the assets available for distribution were insufficient to pay such amounts, then the entire assets available for distribution would have been distributed ratably among the holders of Preferred Stock in proportion to the full amount each holder was otherwise entitled to receive. After payment to the holders of Preferred Stock of their full preferential amounts specified above, the Company’s remaining assets available for distribution to stockholders would be distributed among the holders of common stock pro rata based upon the number of shares of common stock held by each holder. The preferential amounts per share of the Series A-1, Series A-2, Series B-1, and Series B-2 redeemable convertible preferred stock were $10.00, $0.0001, $5.71, and $5.71, respectively, as of December 31, 2017.

A deemed liquidation event would be deemed to have occurred upon (a) a merger or consolidation of the Company into another entity (except where the merger or combination results in the holders of the Company’s capital stock prior to the merger or consolidation continuing to hold at least 50% of the voting power of the surviving or acquiring entity) or (b) a sale, lease, transfer, exclusive license, or other disposition, in a single transaction or a series of related transactions, of all or substantially all of the Company’s assets (or in the case of an exclusive license, of all or substantially all of the Company’s intellectual property). The holders of Preferred Stock could waive the treatment of any transaction as a deemed liquidation event by a vote of the holders of a majority of the then-outstanding shares of Preferred Stock.

Redemption

The holders of Preferred Stock had no voluntary rights to redeem shares.

Repurchase of Redeemable Convertible Preferred Stock in Connection with Secondary Market Transaction

In November 2017, the Company’s board of directors approved the repurchase of 874,069 shares of Series A-1 redeemable convertible preferred stock, 3,151,858 shares of Series A-2 redeemable convertible preferred stock, and 242,562 shares of Series B-1 redeemable convertible preferred stock, from one stockholder at the purchase price of $4.50 per share, for a total consideration of $19.2 million, which exceeded the carrying value of $12.7 million on the date of repurchase. The redeemable convertible preferred stock repurchased was retired immediately thereafter. The repurchase price in excess of the carrying value of redeemable convertible preferred stock of $6.5 million was recorded as a reduction to additional paid-in capital, while the carrying value of the shares repurchased was recorded as a reduction to redeemable convertible preferred stock. For the computation of earnings per share for the year ended December 31, 2017, the repurchase price in excess of the carrying value of the redeemable convertible preferred stock of $6.5 million is reflected as an increase to net loss attributable to common stockholders (see Note 12).

Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Gross unrecognized tax benefits—beginning balance	$ 10,973	$ 10,200	$ 17,370
Increase related to tax positions taken during prior year	0	108	0
Decrease related to tax positions taken during prior year	(164)	(2)	(7,739)
Increase related to tax positions taken during current year	1,973	667	569
Gross unrecognized tax benefits—ending balance	$ 12,782	$ 10,973	$ 10,200

Commitments and Contingencies - Narrative (Details) $ in Millions	Dec. 31, 2019 USD ($) letter	Dec. 31, 2018 USD ($) letter
Commitments and Contingencies Disclosure [Abstract]
Letters of credit (in letter) \| letter	3	3
Letters of credit outstanding, amount \| $	$ 0.8	$ 0.8

Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Financial Statements (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2019	Dec. 31, 2016
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Current assets—Trade and client receivables, net	$ 30,156	$ 22,315		$ 20,327
Prepaid expenses and other current assets	7,885	6,253
Operating lease asset	21,908			17,300
Other assets, noncurrent	829	653
Accrued expenses and other current liabilities	18,342	20,948
Deferred revenue	13,799	722		$ 10,834
Operating lease liability, noncurrent	21,186
Other liabilities, noncurrent	5,973	1,989
Stockholders' Equity Attributable to Parent	259,424	243,745	$ (31,367)		$ (30,131)
Revenue	300,562	253,354	202,552
General and administrative	67,327	49,336	37,334
Net loss	$ (16,659)	$ (19,907)	$ (4,123)
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.15)	$ (0.38)	$ (0.32)
Net Income (Loss) Available to Common Stockholders, Basic	$ (16,659)	$ (19,907)	$ (10,629)
Previously Reported
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Current assets—Trade and client receivables, net	36,487
Operating lease asset	0
Other assets, noncurrent	904
Accrued expenses and other current liabilities	21,027
Deferred revenue	2,280
Operating lease liability, noncurrent	0
Other liabilities, noncurrent	6,740
Stockholders' Equity Attributable to Parent	273,141
Revenue	302,647
General and administrative	$ 67,493
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.13)
Net Income (Loss) Available to Common Stockholders, Basic	$ (14,740)
Adjustments due to Topic 606 \| Restatement Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Current assets—Trade and client receivables, net	(6,331)
Operating lease asset	0
Other assets, noncurrent	0
Accrued expenses and other current liabilities	(5,817)
Deferred revenue	11,519
Operating lease liability, noncurrent	0
Other liabilities, noncurrent	1,850
Stockholders' Equity Attributable to Parent	(13,883)
Revenue	(2,085)
General and administrative	$ 0
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.02)
Net Income (Loss) Available to Common Stockholders, Basic	$ (2,085)
Adjustments due to Topic 842 (1) \| Restatement Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Current assets—Trade and client receivables, net	0
Operating lease asset	21,908
Other assets, noncurrent	(75)
Accrued expenses and other current liabilities	3,132
Deferred revenue	0
Operating lease liability, noncurrent	21,186
Other liabilities, noncurrent	(2,617)
Stockholders' Equity Attributable to Parent	166
Revenue	0
General and administrative	$ (166)
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ 0
Net Income (Loss) Available to Common Stockholders, Basic	$ 166

Segment and Geographical Information (Tables)

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Revenue by Type of Service

The following table sets forth total revenue by type of service for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Marketplace	$	268,284	$	223,831	$	178,046
Managed services	32,278		29,523		24,506
Total	$	300,562	$	253,354	$	202,552

Revenue by Geographic Area Based on Billing Address of Freelancers and Clients

The following table sets forth total revenue by geographic area based on the billing address of its freelancers and clients for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Freelancers:
United States	$	50,154	$	40,313	$	26,596
India	27,369		25,485		21,880
Philippines	19,660		17,057		14,761
Rest of world	90,259		80,387		68,829
Total freelancers	187,442		163,242		132,066
Clients:
United States	87,241		65,578		55,179
Rest of world	25,879		24,534		15,307
Total clients	113,120		90,112		70,486
Total	$	300,562	$	253,354	$	202,552

Revenue - Contract Balances (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Disaggregation of Revenue [Line Items]
Current assets—Trade and client receivables, net	$ 30,156	$ 20,327	$ 22,315
Deferred revenue	13,799	10,834	$ 722
Deferred revenue (component of other liabilities, noncurrent)	3,153	$ 1,690
Balances, as Reported
Disaggregation of Revenue [Line Items]
Current assets—Trade and client receivables, net	$ 30,156

Cover Page - USD ($)	12 Months Ended
Cover Page - USD ($)	Dec. 31, 2019	Feb. 28, 2020	Jun. 28, 2019
Cover page.
Document Type	10-K
Amendment Flag	false
Document Annual Report	true
Document Period End Date	Dec. 31, 2019
Document Transition Report	false
Entity File Number	001-38678
Entity Registrant Name	UPWORK INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-4337682
Entity Address, Address Line One	2625 Augustine Drive, Suite 601
Entity Address, City or Town	Santa Clara,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95054
City Area Code	650
Local Phone Number	316-7500
Title of 12(b) Security	Common Stock, $0.0001 par value per share
Trading Symbol	UPWK
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Entity Shell Company	false
Entity Public Float			$ 1,174,421,292
Entity Common Stock, Shares Outstanding		113,931,825
Entity Central Index Key	0001627475
Current Fiscal Year End Date	--12-31
Documents Incorporated by Reference	Portions of the registrant’s definitive proxy statement for its 2020 Annual Meeting of Stockholders, or Proxy Statement, to be filed within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, are incorporated by reference in Part III. Except with respect to information specifically incorporated by reference in this Annual Report, the Proxy Statement shall not be deemed to be filed as part hereof.

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Summary of Fair Value Assumptions on Stock Options Granted

The fair values of the awards modified by the Transition Agreement were estimated using the Black-Scholes valuation model with the following assumptions:


Dividend yield						0%
Expected term (in years)						0.3 - 1.3
Risk-free interest rates						1.5% - 1.6%
Expected volatility						38% - 39%

For the years ended December 31, 2018 and 2017, the fair value of stock options granted to employees was estimated on the grant date using the Black-Scholes valuation model with the following assumptions:


	2018	2017
Dividend yield	0%	0%
Expected term (in years)	5.2 - 6.1	5.3 - 6.3
Risk-free interest rates	2.5% - 2.9%	1.9% - 2.2%
Expected volatility	38% - 45%	39% - 43%

Summary of Activity under Stock Option Plans

The following table summarizes activity under the Company’s stock option plans:


	Number of Shares Underlying Outstanding Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in thousands)








Balances at December 31, 2018	23,774,279	$	3.71	7.10	$	342,262

Exercised	(6,045,823)	3.00
Forfeited and canceled	(2,587,877)	6.01
Balances at December 31, 2019	15,140,579	3.61		6.19	106,967
Vested and exercisable as of December 31, 2019	11,260,129	3.47		5.72	81,087
Vested and expected to vest as of December 31, 2019	15,140,579	3.61		6.19	106,967

Summary of Activity under RSU Plans

The following table summarizes the RSU activity and related information under the 2018 EIP:


	Number of RSUs Outstanding	Weighted-Average Grant Date Fair Value
Unvested balance - January 1, 2019	288,460	$	15.00
Granted	2,566,600	16.15
Vested	(163,943)	15.85
Forfeited/canceled	(187,935)	19.09
Unvested balance - December 31, 2019	2,503,182	$	15.82

Summary of Fair Value Assumptions on Employee Stock Purchas Plans

For the years ended December 31, 2019 and 2018, the assumptions used to determine the fair value of the shares to be awarded was estimated on the grant date using the Black-Scholes valuation model with the following assumptions:


	2019	2018
Dividend yield	0%	0%
Expected term (in years)	0.5 - 2.0	0.5 - 2.0
Risk-free interest rates	1.5% - 2.4%	2.4% - 2.9%
Expected volatility	38% - 47%	37%

Summary of Components of Stock-Based Compensation Expense Recognized

The following table summarizes the components of stock-based compensation expense recognized in the consolidated statements of operations for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Cost of revenue	$	456	$	282	$	290
Research and development	6,471		3,258		1,797
Sales and marketing	2,609		1,637		1,299
General and administrative	9,262		5,184		3,460
Total	$	18,798	$	10,361	$	6,846

Segment and Geographical Information

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Segment and Geographical Information

The Company operates as one operating and reportable segment for purposes of allocating resources and evaluating financial performance.

The following table sets forth total revenue by type of service for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Marketplace	$	268,284	$	223,831	$	178,046
Managed services	32,278		29,523		24,506
Total	$	300,562	$	253,354	$	202,552

The Company generates its revenue from freelancers and clients. The following table sets forth total revenue by geographic area based on the billing address of its freelancers and clients for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	2019		2018		2017
Freelancers:
United States	$	50,154	$	40,313	$	26,596
India	27,369		25,485		21,880
Philippines	19,660		17,057		14,761
Rest of world	90,259		80,387		68,829
Total freelancers	187,442		163,242		132,066
Clients:
United States	87,241		65,578		55,179
Rest of world	25,879		24,534		15,307
Total clients	113,120		90,112		70,486
Total	$	300,562	$	253,354	$	202,552

Substantially all of the Company’s long-lived assets were located in the United States as of December 31, 2019 and 2018.

Segment and Geographical Information - Narrative (Details)	12 Months Ended
	Dec. 31, 2019 segment
Segment Reporting [Abstract]
Number of operating segments	1
Number of reportable segments	1

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Common stock, shares authorized (in shares)	490,000,000	490,000,000
Common stock, shares issued (in shares)	113,604,398	106,454,321
Common stock, shares outstanding (in shares)	113,604,398	106,454,321
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Allowance for doubtful accounts	$ 2,215	$ 2,832

Organization and Description of Business	12 Months Ended
Organization and Description of Business	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Description of Business	Organization and Description of Business Upwork Inc. (the “Company” or “Upwork”) operates an online talent solution that enables businesses (“clients”) to find and work with highly-skilled independent professionals (“freelancers,” and, together with clients, “users”). The Company was originally incorporated in the state of Delaware in December 2013 prior to and in connection with the combination (the “Elance-oDesk Combination”) of Elance, Inc. (“Elance”) and oDesk Corporation (“oDesk”). The Company changed its name to Elance-oDesk, Inc. shortly before the Elance-oDesk Combination in March 2014, and later to Upwork Inc. In May 2015, the Company relaunched under the brand name Upwork and commenced consolidation of its two operating platforms. In 2016, following completion of the platform consolidation, the Company began operating under a single platform. The Company is currently headquartered in Santa Clara, California. Unless otherwise expressly stated or the context otherwise requires, the terms “Upwork” and the “Company” in these notes to the consolidated financial statements refer to Upwork and its wholly-owned subsidiaries. Initial Public Offering In October 2018, the Company completed its initial public offering (“IPO”), in which the Company issued and sold an aggregate of 7,840,908 of the Company’s common stock, including 1,022,727 shares pursuant to the exercise of the underwriters’ option to purchase additional shares. The shares were sold to the underwriters at the IPO price of $15.00 per share less an underwriting discount of $1.05 per share. The Company received aggregate net proceeds of $109.4 million from the IPO after deducting underwriting discounts and commissions but before deducting offering expenses payable by the Company.

Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 48,392	$ 129,128	$ 21,595
Restricted cash	2,490	2,753	2,309
Funds held in escrow, including funds in transit	108,721	98,186	87,195
Total cash, cash equivalents, and restricted cash as shown in the consolidated statement of cash flows	$ 159,603	$ 230,067	$ 111,099	$ 89,676

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Financial Instruments Measured at Fair Value on a Recurring Basis

The following tables set forth the fair value of the Company’s financial assets measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands):


	December 31, 2019
	Level I		Level II		Level III		Total


Cash equivalents—money market funds	$	35,286	$	—	$	—	$	35,286

Marketable securities
Commercial paper	—		50,794		—		50,794
U.S. government securities	34,687		—		—		34,687
Total financial assets	$	69,973	$	50,794	$	—	$	120,767


	December 31, 2018
	Level I		Level II		Level III		Total

Cash equivalents—money market funds	$	117,138	$	—	$	—	$	117,138
Total financial assets	$	117,138	$	—	$	—	$	117,138

Summary of Changes in Fair Value of Redeemable Convertible Preferred Stock Warrants

The following table sets forth a summary of the changes in the fair value of the redeemable convertible preferred stock warrant liability (in thousands):




Fair value at December 31, 2016	$	1,130
Change in fair value	118
Reclassification to redeemable convertible preferred stock due to warrant exercise	(144)
Fair value at December 31, 2017	1,104
Change in fair value	6,056
Conversion to common stock warrant in connection with the initial public offering	(7,160)
Fair value at December 31, 2018	$	—

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of Income before Income Tax

For the years ended December 31, 2019, 2018, and 2017, the loss before income taxes consisted of the following (in thousands):


	2019		2018		2017
Domestic	$	(16,658)	$	(19,925)	$	(4,153)
Foreign	27		33		8
Total loss before income taxes	$	(16,631)	$	(19,892)	$	(4,145)

Schedule of Components of Income Tax Expense

For the years ended December 31, 2019, 2018 and 2017, the components of the income tax benefit (provision) were as follows (in thousands):


	2019		2018		2017
Current:
Federal	$	—	$	—	$	—
State	(26)		(11)		1
Foreign	(2)		(4)		21
Total current	$	(28)	$	(15)	$	22
Deferred:
Federal	$	—	$	—	$	—
State	—		—		—
Foreign	—		—		—
Total deferred	$	—	$	—	$	—
Total income tax benefit (provision)	$	(28)	$	(15)	$	22

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of the statutory federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2019, 2018 and 2017 were as follows:


	2019		2018		2017
Tax at federal statutory rate	21.00	%	21.00	%	34.00	%
State tax, net of federal benefit	(0.27)		1.88		1.03
Stock-based compensation	51.45		(5.84)		(38.63)
Warrant expense	—		(6.98)		(1.00)
Other items	(4.34)		(1.46)		(1.10)
Research and development credits	13.74		10.54		102.35
Net operating loss expiration	(18.33)		—		(9.29)
Change in valuation allowance	(63.42)		(19.21)		458.55
Rate differential impact of Tax Cuts and Jobs Act of 2017	—		—		(545.38)
Effective tax rate	(0.17)	%	(0.07)	%	0.53	%

Schedule of Deferred Tax Assets and Liabilities

As of December 31, 2019 and 2018, the significant components of the Company’s deferred tax assets and liabilities were as follows (in thousands):


	2019		2018
Deferred tax assets:
Net operating loss carryforwards	$	48,988	$	38,895
Stock-based compensation	4,192		3,096
Operating lease liability	10,248		—
Non-deductible accrued expenses, reserves and other	2,596		2,916
Research and development credits	8,762		6,724
Gross deferred tax assets	74,786		51,631
Deferred tax liabilities:
Acquired intangible assets	(693)		(1,298)
Operating lease asset	(9,202)		—
Depreciation and amortization	(1,349)		(894)
Net deferred tax assets prior to valuation allowance	63,542		49,439
Valuation allowance	(63,542)		(49,439)
Net deferred tax assets	$	—	$	—

Summary of Unrecognized Tax Benefits

For the years ended December 31, 2019, 2018 and 2017, the activity related to the unrecognized tax benefits were as follows (in thousands):


	2019		2018		2017
Gross unrecognized tax benefits—beginning balance	$	10,973	$	10,200	$	17,370
Increase related to tax positions taken during prior year	—		108		—
Decrease related to tax positions taken during prior year	(164)		(2)		(7,739)
Increase related to tax positions taken during current year	1,973		667		569
Gross unrecognized tax benefits—ending balance	$	12,782	$	10,973	$	10,200

Stock-Based Compensation

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

Equity Incentive Plans

Assumed Awards

In connection with the Elance-oDesk Combination, the Company assumed substantially all stock options outstanding under the Elance 1999 Stock Option Plan (the “Elance 1999 Plan”) and the Elance 2009 Stock Option Plan (the “Elance 2009 Plan”). Such assumed options were converted into options to purchase the Company’s common stock. In addition, all stock options outstanding under the oDesk Corporation 2004 Stock Plan (the “oDesk Plan”) were converted into options to purchase shares of the Company’s common stock, with the number of shares that could be purchased under each option reduced by approximately 16.14%. The exercise price of all options was simultaneously increased such that the then-aggregate exercise price payable by holders did not change. These options generally vest over a four-year period from the original date of grant and expire ten years from the original grant date.

2014 Equity Incentive Plan

In March 2014, the Company’s board of directors and, in June 2014, the Company’s stockholders approved the 2014 Equity Incentive Plan (the “2014 EIP”). The total number of shares of common stock reserved and available for grant and issuance pursuant to such plan was originally 12,462,985 plus (i) shares that were then subject to outstanding option grants under the oDesk Plan, the Elance 1999 Plan, and the Elance 2009 Plan (collectively, the “Prior Plans”) but subsequently ceased to be subject to an award for any reason other than exercise of a stock option, (ii) shares that had been reserved but not subject to any outstanding awards under the Prior Plans and (iii) shares issued under the Prior Plans that were repurchased, forfeited, or used to pay employee withholding or exercise price obligations. The number of shares available for grant under the 2014 EIP was increased by 3,001,091 shares, 4,500,000 shares and 100,000 shares in August 2014, October 2017 and August 2018, respectively. Under the terms of the 2014 EIP, incentive stock options may be granted at prices not less than 100% of the fair value of the Company’s common stock on the date of grant unless determined in writing by the Company’s board of directors.

The options granted under the 2014 EIP generally vest over a four-year period from the original date of grant and expire ten years from the original grant date.

2018 Equity Incentive Plan

In 2018, the Company’s board of directors and stockholders each adopted the 2018 Equity Incentive Plan (the “2018 EIP”), which became effective on the date immediately prior to the date of the IPO. A total of 10,701,505 shares of common stock were initially reserved for issuance pursuant to future awards under the 2018 EIP. On January 1 of each year, shares available for issuance are increased based on the provisions of the 2018 EIP. Any shares subject to outstanding awards under the 2014 EIP that are canceled or repurchased subsequent to the 2018 EIP’s effective date are returned to the pool of shares reserved for issuance under the 2018 EIP. Awards granted under the 2018 EIP may be (i) incentive stock options, (ii) nonqualified stock options, (iii) restricted stock units (“RSUs”), (iv) restricted stock awards, or (v) stock appreciation rights, as determined by the Company’s board of directors or compensation committee at the time of grant.

Pursuant to the terms of the 2018 EIP, the number of shares available for grant was increased by 5,322,716 shares in January 2019.

In February 2019, the Company’s board of directors approved the omnibus Performance Bonus Plan along with the performance criteria and bonus pool for 2019 (the “Bonus Plan”), which provides for the payment of bonus compensation to selected employees of the Company, including the Company’s executive officers, upon the achievement of certain performance criteria. In lieu of a cash payment, bonus payments to certain of the Company’s management team were made in the form of fully vested RSUs issued from the 2018 EIP. The number of fully vested RSUs granted was determined by dividing (i) the total dollar value of the bonus that would have otherwise been delivered in cash by (ii) the closing stock price on the day prior to the award grant date, which occurred in the first quarter of 2020. The payment of the bonus in fully vested RSUs requires accounting as a stock-based award under U.S. GAAP. Because the number of fully vested RSUs to be granted was dependent upon the future closing price of the Company’s common stock, the Company has classified this award as a liability within its consolidated balance sheet as of December 31, 2019. Each reporting period, the Company assesses the probability that the performance criteria will be met and records expense for those shares that are probable of vesting. For the year ended December 31, 2019, stock-based compensation expense related to the Bonus Plan was immaterial.

On December 8, 2019 (the “Modification Date”), the Company entered into a transition agreement (the “Transition Agreement”) with Mr. Kasriel pursuant to which Mr. Kasriel tendered his resignation as the Company’s President and Chief Executive Officer effective as of December 31, 2019 (the “Resignation Date”). The Transition Agreement provides that Mr. Kasriel will be entitled to any amounts that Mr. Kasriel has earned under the Bonus Plan and that Mr. Kasriel will become a special advisor to the Board through April 30, 2021 pursuant to an advisory services agreement (the “Advisory Agreement”). Among other terms, the Advisory Agreement provides that while he is providing advisory services, (i) the Company will pay Mr. Kasriel a fee of $40,000 per calendar month, beginning January 1, 2020 and ending December 31, 2020, (ii) the vesting terms of certain of Mr. Kasriel’s outstanding stock options was modified to allow for vesting to continue through the term of the Advisory Agreement, and (iii) the period of time over which Mr. Kasriel can exercise certain of his outstanding stock options was extended to the later of December 31, 2020 or three months following such date as he ceases to provide services to the Company. The Company accounted for the modification of any vested non-qualified options as a Type I (probable-to-probable) modification given that the options were already vested. The incremental fair value, recognized as of the Modification Date, was measured by taking the difference between the fair value of the options immediately before and after the Modification Date. Additionally, the Company accounted for the modification of any unvested options as a Type III (improbable-to-probable) modification. Accordingly, the Company reversed the cumulative compensation cost recognized for the original award, and immediately recognized the fair value of the modified award as the Company concluded the services to be provided by Mr. Kasriel beyond December 31, 2019 were nonsubstantive. As a result, for the year ended December 31, 2019, the Company recorded $3.5 million of additional stock-based compensation expense related to the Transition Agreement.

The fair values of the awards modified by the Transition Agreement were estimated using the Black-Scholes valuation model with the following assumptions:


Dividend yield						0%
Expected term (in years)						0.3 - 1.3
Risk-free interest rates						1.5% - 1.6%
Expected volatility						38% - 39%

Determination of Fair Value

The Company did not grant any stock option awards during the year ended December 31, 2019. For the years ended December 31, 2018 and 2017, the fair value of stock options granted to employees was estimated on the grant date using the Black-Scholes valuation model with the following assumptions:


	2018	2017
Dividend yield	0%	0%
Expected term (in years)	5.2 - 6.1	5.3 - 6.3
Risk-free interest rates	2.5% - 2.9%	1.9% - 2.2%
Expected volatility	38% - 45%	39% - 43%

Dividend Yield —The dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to do so.

Expected Term —The expected term represents the period that the Company’s stock-based awards are expected to be outstanding. For awards containing only service conditions, the Company determines the expected term using the simplified method as the Company does not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. The simplified method deems the term to be the average of the time-to-vesting and the contractual life of the options. The Company uses relevant data, including past exercise patterns, if available, to determine the expected term for performance-based awards.

Risk-Free Interest Rate —The risk-free interest rate is based on the United States Treasury yield curve in effect at the time of grant for zero-coupon U.S. Treasury notes with maturities approximately equal to the option’s expected term.

Expected Volatility —Since the Company does not have a sufficient trading history of its common stock, the expected volatility is derived from the average historical stock volatilities of several unrelated public companies within the Company’s industry that the Company considers to be comparable to its business over a period equivalent to the expected term of the stock option grants.

Fair Value of Common Stock —Given the absence of a public trading market prior to the IPO, the Company’s board of directors considered numerous objective and subjective factors to determine the fair value of its common stock at each grant date. These factors included, but were not limited to: (i) independent contemporaneous third-party valuations of common stock; (ii) the prices for the Company’s redeemable convertible preferred stock sold to outside investors; (iii) the rights and preferences of redeemable convertible preferred stock relative to common stock; (iv) the lack of marketability of its common stock; (v) developments in the business; and (vi) the likelihood of achieving a liquidity event, such as an IPO or sale of the Company, given prevailing market conditions. Subsequent to the IPO, the fair value of common stock is based on the closing price of the Company’s common stock, as reported on The Nasdaq Global Select Market on the date of grant.

The following table summarizes activity under the Company’s stock option plans:


	Number of Shares Underlying Outstanding Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in thousands)








Balances at December 31, 2018	23,774,279	$	3.71	7.10	$	342,262

Exercised	(6,045,823)	3.00
Forfeited and canceled	(2,587,877)	6.01
Balances at December 31, 2019	15,140,579	3.61		6.19	106,967
Vested and exercisable as of December 31, 2019	11,260,129	3.47		5.72	81,087
Vested and expected to vest as of December 31, 2019	15,140,579	3.61		6.19	106,967

Before the IPO, the aggregate intrinsic value represented the difference between the exercise price of the options and the estimated fair value of the Company’s common stock as determined by its board of directors. Following the IPO, the aggregate intrinsic value represented the difference between the exercise price of the options and the closing price of the Company’s common stock on The Nasdaq Global Select Market on the day prior to the date of exercise. The intrinsic value of options exercised was $73.0 million, $18.0 million and $2.9 million for the years ended December 31, 2019, 2018 and 2017, respectively.

The weighted-average grant-date fair value of options granted was $3.65 and $1.54 for the years ended December 31, 2018 and 2017, respectively. As of December 31, 2019, total unrecognized stock-based compensation cost was $6.8 million, which is expected to be generally recognized on a straight-line basis over a weighted-average period of 2.2 years.

The fair value of RSUs awarded to employees is based on the closing price of the Company’s common stock, as reported on The Nasdaq Global Select Market on the date of grant.

The following table summarizes the RSU activity and related information under the 2018 EIP:


	Number of RSUs Outstanding	Weighted-Average Grant Date Fair Value
Unvested balance - January 1, 2019	288,460	$	15.00
Granted	2,566,600	16.15
Vested	(163,943)	15.85
Forfeited/canceled	(187,935)	19.09
Unvested balance - December 31, 2019	2,503,182	$	15.82

During 2018, 35,494 fully vested RSUs were granted to a consultant of the Company, which totaled $0.5 million. The consultant’s estimated tax liability associated with this vesting was $0.2 million. To satisfy this tax liability, the consultant surrendered 12,648 shares of common stock to the Company. The associated tax liability was paid in full prior to December 31, 2018.

As of December 31, 2019, there was $34.2 million of unrecognized stock-based compensation expense related to outstanding RSUs to employees that is expected to be recognized over a weighted-average period of 3.4 years.

2018 Employee Stock Purchase Plan

In August 2018, the Company’s board of directors and stockholders each adopted the 2018 Employee Stock Purchase Plan (the “2018 ESPP”), which became effective prior to the completion of the IPO. A total of 1,700,000 shares of common stock was initially reserved for issuance under the 2018 ESPP. On January 1 of each year, shares available for issuance are increased based on the provisions of the 2018 ESPP. The 2018 ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount of up to 15% through payroll deductions of their eligible compensation, subject to any plan limitations. Except for the initial offering period, the 2018 ESPP provides for 24-month offering periods beginning November 15 and May 15 of each year, and each offering period consists of four 6-month purchase periods. Pursuant to the terms of the 2018 ESPP, in January 2019, the number of shares of common stock available for issuance was increased by 851,634 shares.


	2019	2018
Dividend yield	0%	0%
Expected term (in years)	0.5 - 2.0	0.5 - 2.0
Risk-free interest rates	1.5% - 2.4%	2.4% - 2.9%
Expected volatility	38% - 47%	37%

On each purchase date, eligible employees may purchase the Company’s common stock at a price per share equal to 85% of the lesser of (1) the fair market value of the Company’s common stock on the offering date or (2) the fair market value of the Company’s common stock on the purchase date. In the event the price is lower on the last day of any purchase period, that price is used as the purchase price for that purchase period.

Additionally, in the event the fair market value of the Company’s common stock on the first day of a subsequent offering period is less than the fair market value of the Company’s common stock on the offering date of the current offering period, the offering period resets, and the new lower price becomes the new offering price for a new 24 month offering period. During the year ended December 31, 2019, the Company issued 556,663 shares of common stock under the 2018 ESPP.

As of December 31, 2019, there was $5.1 million of unrecognized stock-based compensation expense that is expected to be recognized over the remaining term of the respective offering periods.

Stock-Based Compensation


	2019		2018		2017
Cost of revenue	$	456	$	282	$	290
Research and development	6,471		3,258		1,797
Sales and marketing	2,609		1,637		1,299
General and administrative	9,262		5,184		3,460
Total	$	18,798	$	10,361	$	6,846

Stock-Based Compensation to Employees

Stock-based compensation expense related to employees for the year ended December 31, 2019 was $8.5 million, $7.9 million and $2.6 million related to stock option grants, RSU grants, and the 2018 ESPP, respectively. Stock-based compensation expense related to employees for the year ended December 31, 2018 was $8.6 million, $1.1 million, and $0.6 million related to stock option grants, RSUs, and the 2018 ESPP, respectively. Stock-based compensation expense related to employees for the year ended December 31, 2017 was $6.3 million related to stock option grants. The amount of stock-based compensation capitalized to internal-use software and platform development costs was immaterial for the years ended December 31, 2019, 2018 and 2017.

Certain common stockholders (who were employees or former employees of the Company) sold the Company’s common stock in secondary market transactions to third parties in 2017. They sold an aggregate of 488,484 shares of common stock for $2.3 million at an average price of $4.72 per share for the year ended December 31, 2017. The incremental value between the sale price and the fair value of the common stock at each date of sale resulted in aggregate stock-based compensation expense of $0.4 million for the year ended December 31, 2017. There was an immaterial secondary market transaction during the year ended December 31, 2018.

Balance Sheet Components (Tables)

12 Months Ended

Dec. 31, 2019

Balance Sheet Related Disclosures [Abstract]

Property and Equipment, Net

Property and equipment, net consisted of the following as of December 31, 2019 and 2018 (in thousands):


	2019		2018
Computer equipment and software	$	3,613	$	3,189
Internal-use software and platform development costs	12,726		6,287
Leasehold improvements	10,576		5,783
Office furniture and fixtures	2,454		2,545
Total property and equipment	29,369		17,804
Less: Accumulated depreciation	(7,915)		(6,989)
Property and equipment, net	$	21,454	$	10,815

Schedule of Finite Lived Intangible Assets

All of the Company’s identifiable intangible assets were acquired in March 2014 from the Elance-oDesk Combination. Intangible assets, net consisted of the following (in thousands):


	As of December 31, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trade names	$	2,293	$	2,293	$	—
User relationships	18,678		15,343		3,335
Developed technology	10,356		10,356		—
Domain names	529		529		—
Total	$	31,856	$	28,521	$	3,335


	As of December 31, 2018
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trade names	$	2,293	$	2,293	$	—
User relationships	18,678		12,674		6,004
Developed technology	10,356		10,356		—
Domain names	529		529		—
Total	$	31,856	$	25,852	$	6,004

Schedule of Indefinite-Lived Intangible Assets

All of the Company’s identifiable intangible assets were acquired in March 2014 from the Elance-oDesk Combination. Intangible assets, net consisted of the following (in thousands):


	As of December 31, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trade names	$	2,293	$	2,293	$	—
User relationships	18,678		15,343		3,335
Developed technology	10,356		10,356		—
Domain names	529		529		—
Total	$	31,856	$	28,521	$	3,335


	As of December 31, 2018
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trade names	$	2,293	$	2,293	$	—
User relationships	18,678		12,674		6,004
Developed technology	10,356		10,356		—
Domain names	529		529		—
Total	$	31,856	$	25,852	$	6,004

Estimated Future Amortization Expense for Acquired Intangible Assets

As of December 31, 2019, the estimated future amortization expense for the acquired intangible assets is as follows (in thousands):


Year Ended December 31,	Estimated Amortization Expense
2020	$	2,668
2021	667

Total	$	3,335

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following as of December 31, 2019 and 2018 (in thousands):


	2019		2018
Accrued compensation and related benefits	$	5,344	$	9,314
Accrued freelancer costs	622		2,465
Accrued indirect taxes	2,401		1,630
Accrued vendor expenses	5,485		6,002
Accrued payment processing fees	832		715
Operating lease liability, current	3,214		—
Other	444		822
Total accrued expenses and other current liabilities	$	18,342	$	20,948

Lessee, Operating Lease, Disclosure

The following table summarizes the Company’s operating lease assets and lease liabilities as of December 31, 2019 (in thousands):


Balance Sheet Classification		As of December 31, 2019
Assets
Operating—noncurrent	Operating lease asset	$	21,908
Liabilities
Operating—current	Accrued expenses and other current liabilities	3,214
Operating—noncurrent	Operating lease liability, noncurrent	21,186
Total lease liabilities		$	24,400

Lessee, Operating Lease, Liability, Maturity

The following table shows the Company’s future lease commitments due in each of the next five years and thereafter for operating leases (in thousands):


Year Ended December 31,	Leases
2020	$	3,313
2021	3,919
2022	5,391
2023	5,796
2024	4,838
Thereafter	6,954

Total lease payments	30,211
Adjustment for discount to present value	(5,811)
Total	$	24,400

Schedule of Future Aggregate Minimum Lease Payments Under Non-Cancelable Operating Leases

As of December 31, 2018, future aggregate minimum lease payments under the non-cancellable operating leases were as follows (in thousands):


Year Ended December 31,	Leases⁽¹⁾
2019	$	3,569
2020	4,683
2021	4,914
2022	5,052
2023	5,194
Thereafter	4,890
Less: rental payments from subleases	(363)
Total	$	27,939

⁽¹⁾ Amounts are based on Topic 840 that were superseded upon adoption of Topic 842 as of January 1, 2019.

Common Stock

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Common Stock

Preferred and Common Stock

Preferred Stock

As of December 31, 2019, the Company was authorized to issue up to 10,000,000 shares of undesignated preferred stock, $0.0001 par value per share. The Company did not have any outstanding shares of preferred stock as of December 31, 2019 and 2018.

Common Stock

Holders of common stock are entitled to one vote per share and are entitled to receive dividends, if any, on a pro rata basis whenever funds are legally available and when, as, and if declared by the Company’s board of directors.

As of December 31, 2019 and 2018, the Company was authorized to issue 490,000,000 shares of common stock. As of December 31, 2019 and 2018, the Company had reserved shares of common stock for future issuance as follows:


	2019	2018
Options issued and outstanding	15,140,579	23,774,279
RSUs issued and outstanding	2,503,182	288,460

Warrant to purchase common stock	450,000	898,331


Remaining shares reserved for future issuances under 2018 Equity Incentive Plan	16,091,801	10,558,306
Remaining shares reserved for future issuances under 2018 Employee Stock Purchase Plan	1,994,971	1,700,000
Total	36,180,533	37,219,376

Basis of Presentation and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Basis of Presentation and Principles of Consolidation

Certain amounts for prior years have been reclassified to conform to the financial statement presentation as of and for the year ended December 31, 2019.

Use of Estimates

Cash and Cash Equivalents

Cash and Cash EquivalentsThe Company holds its cash in checking and interest-bearing accounts and investments in money market funds with maturities of 90 days or less from the date of purchase.

Funds Held in Escrow, Including Funds in Transit and Escrow Funds Payable

Funds Held in Escrow, Including Funds in Transit

Marketable Securities

Concentration of Risk

The Company is dependent upon third parties, such as Amazon Web Services, in order to meet the uptime and performance needs of its users.

Fair Value of Financial Instruments

The Company believes that the carrying values of the remaining financial instruments approximate their fair values.

Trade and Client Receivables and Related Allowance for Doubtful Accounts

Derivatives Instruments

Derivative Instruments

Property and Equipment

Internal-Use Software and Platform Development Costs

Segment Information

Goodwill, Acquired Intangible Assets, and Other Long-Lived Assets

There was no impairment of long-lived assets in any of the periods presented.

Deferred Offering Costs

Revenue Recognition

Marketplace

The Company’s marketplace revenue is derived from Upwork Basic, Plus, Business, Enterprise, and other premium offerings.

Upwork Basic and Plus

Upwork Enterprise, Business, and Other Premium Offerings

Upwork Payroll service fees. Upwork Payroll service fees are recognized on the same basis as described under the Upwork Basic and Plus offerings and are variable consideration.

Revenue sharing arrangements

Managed Services

Arrangements with Multiple Performance Obligations

Deferred Revenue

Cost of Revenue

Research and Development

Advertising Expense

Advertising ExpenseThe Company expenses advertising costs as incurred.

Provisions for Transactions Losses

Provision for Transaction Losses

Redeemable Convertible Preferred Stock Warrant Liability

Stock-Based Compensation

Foreign Currency

Foreign CurrencyThe functional currency of the Company and its subsidiaries is the U.S. dollar. Transactions with users denominated in currencies other than the U.S. dollar are remeasured at the exchange rate in effect on the date of the transaction. At the end of each reporting period, monetary assets and liabilities are remeasured using exchange rates in effect at the balance sheet date. Foreign currency transaction gains and losses are included in other (income) expense, net in the consolidated statements of operations.

Comprehensive Loss

Income Taxes

Net Loss per Share Attributable to Common Stockholders

Recent Accounting Pronouncements Not Yet Adopted and Recently Adopted Accounting Pronouncements

Recent Accounting Pronouncements Not Yet Adopted

Recently Adopted Accounting Pronouncements

The following tables summarize the impacts of adopting Topic 606 and Topic 842 on the Company’s consolidated financial statements as of and for the year ended December 31, 2019 (in thousands):


	December 31, 2019
	Balances, without Adoption of Topics 606 and 842		Adjustments due to Topic 606		Adjustments due to Topic 842 ⁽¹⁾		Balances, as Reported
Consolidated Balance Sheet
Current assets—Trade and client receivables, net	$	36,487	$	(6,331)	$	—	$	30,156
Noncurrent assets
Operating lease asset	—		—		21,908		21,908
Other assets, noncurrent	904		—		(75)		829
Current liabilities
Accrued expenses and other current liabilities	21,027		(5,817)		3,132		18,342
Deferred revenue	2,280		11,519		—		13,799
Noncurrent liabilities
Operating lease liability, noncurrent	—		—		21,186		21,186
Other liabilities, noncurrent	6,740		1,850		(2,617)		5,973
Total stockholders’ equity	273,141		(13,883)		166		259,424

Consolidated Statement of Operations
Revenue	$	302,647	$	(2,085)	$	—	$	300,562
Operating expense—General and administrative	67,493		—		(166)		67,327
Net loss attributable to common stockholders	(14,740)		(2,085)		166		(16,659)
Net loss per share attributable to common stockholders, basic and diluted	(0.13)		(0.02)		—		(0.15)

⁽¹⁾ Amounts include other adjustments made in conjunction with the adoption of Topic 842.

flows now include restricted cash and restricted cash equivalents, such as cash and cash equivalents underlying funds held in escrow and restricted cash.

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Statement [Abstract]
Revenue	$ 300,562	$ 253,354	$ 202,552
Cost of revenue	88,144	81,458	65,443
Gross profit	212,418	171,896	137,109
Operating expenses
Research and development	64,027	55,488	45,604
Sales and marketing	95,891	72,963	53,044
General and administrative	67,327	49,336	37,334
Provision for transaction losses	3,905	5,821	4,250
Total operating expenses	231,150	183,608	140,232
Loss from operations	(18,732)	(11,712)	(3,123)
Interest expense	1,306	2,038	960
Other (income) expense, net	(3,407)	6,142	62
Total loss before income taxes	(16,631)	(19,892)	(4,145)
Income tax benefit (provision)	(28)	(15)	22
Net loss	(16,659)	(19,907)	(4,123)
Premium paid on repurchase of redeemable convertible preferred stock	0	0	(6,506)
Net loss attributable to common stockholders	$ (16,659)	$ (19,907)	$ (10,629)
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.15)	$ (0.38)	$ (0.32)
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares)	109,814,604	52,327,518	32,944,714

Redeemable Convertible Preferred Stock - Narrative (Details) $ / shares in Units, $ in Thousands	1 Months Ended		12 Months Ended
	Oct. 31, 2018 $ / shares shares	Nov. 30, 2017 $ / shares shares	Dec. 31, 2019 $ / shares	Dec. 31, 2018 USD ($) $ / shares	Dec. 31, 2017 USD ($) $ / shares shares
Redeemable Noncontrolling Interest [Line Items]
Redeemable convertible preferred stock, shares outstanding (in shares) \| shares	61,279,079
Temporary equity redemption terms, change in control threshold			50.00%
Dividends declared on the Preferred Stock \| $					$ 0
Voting right protective provision, shares outstanding threshold \| shares					15,100,000
Voting right protective provision, approval percentage				50.00%	50.00%
Convertible preferred stock conversion terms, minimum threshold from initial public offering \| $					$ 50,000
Conversion ratio					1
Repurchase of redeemable convertible preferred stock, price per share (in dollars per share)		$ 4.50
Repurchase of redeemable convertible preferred stock, consideration received \| $				$ 19,200
Repurchase of redeemable convertible preferred stock, carrying value \| $				12,700
Repurchase of redeemable convertible preferred stock \| $				6,500	$ 6,506
Additional Paid-in Capital
Redeemable Noncontrolling Interest [Line Items]
Repurchase of redeemable convertible preferred stock \| $				$ 6,500	$ 6,506
Series A-1
Redeemable Noncontrolling Interest [Line Items]
Dividends payable, amount per share (in dollars per share)			$ 0.80
Issue price per share (in dollars per share)					$ 10.00
Liquidation preference per share (in dollars per share)				$ 10.00
Repurchase and retirement of redeemable convertible preferred stock (in shares) \| shares		874,069
Series A-2
Redeemable Noncontrolling Interest [Line Items]
Dividends payable, amount per share (in dollars per share)			0.000008
Issue price per share (in dollars per share)					0.0001
Liquidation preference per share (in dollars per share)				0.0001
Repurchase and retirement of redeemable convertible preferred stock (in shares) \| shares		3,151,858
Series B-1
Redeemable Noncontrolling Interest [Line Items]
Dividends payable, amount per share (in dollars per share)			0.4568
Issue price per share (in dollars per share)					5.71
Liquidation preference per share (in dollars per share)				5.71
Repurchase and retirement of redeemable convertible preferred stock (in shares) \| shares		242,562
Series B-2
Redeemable Noncontrolling Interest [Line Items]
Dividends payable, amount per share (in dollars per share)			$ 0.4568
Issue price per share (in dollars per share)					$ 5.71
Liquidation preference per share (in dollars per share)				$ 5.71
IPO
Redeemable Noncontrolling Interest [Line Items]
Number of shares issued in stock transaction (in shares) \| shares	7,840,908
Price per share of stock transaction (in dollars per share)	$ 15.00

Income Taxes - Narrative (Details) - USD ($) $ in Thousands		12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Jan. 01, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Operating Loss Carryforwards [Line Items]
Effective tax rate		(0.17%)	(0.07%)	0.53%
Deferred tax assets, valuation allowance		$ 63,542	$ 49,439
Tax at federal statutory rate		21.00%	21.00%	34.00%
Operating loss carryforwards expiration		$ 21,600
Change in valuation allowance		(63.42%)	(19.21%)	458.55%
Unrecognized excess tax benefit	$ 1,600
Unrecognized tax benefits		$ 12,782	$ 10,973	$ 10,200	$ 17,370
Unrecognized tax benefits that impact effective tax rate		0
Federal
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards		220,400	172,300
Tax credit carryforwards		10,100	8,800
State
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards		50,300	38,500
Change in valuation allowance				80.00%
Tax credit carryforwards		$ 11,300	$ 9,700

Net Loss Per Share Attributable to Common Stockholders - Schedule of Potentially Dilutive Securities (Details) - shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	19,745,024	24,961,070	85,330,442
Options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	15,140,579	23,774,279	23,607,746
Common stock issuable upon conversion of redeemable convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	0	0	61,279,079
Common stock issuable upon exercise of common stock warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	450,000	898,331	45,286
Common stock issuable upon exercise and redeemable conversion of preferred stock warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	0	0	398,331
Common stock issuable upon vesting of restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	2,503,182	288,460	0
Common stock issuable in connection with employee stock purchase plan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares excluded from computation of diluted net loss per share attributable to common stockholders	1,651,263	0	0

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

For the years ended December 31, 2019, 2018, and 2017, the loss before income taxes consisted of the following (in thousands):


	2019		2018		2017
Domestic	$	(16,658)	$	(19,925)	$	(4,153)
Foreign	27		33		8
Total loss before income taxes	$	(16,631)	$	(19,892)	$	(4,145)

For the years ended December 31, 2019, 2018 and 2017, the components of the income tax benefit (provision) were as follows (in thousands):


	2019		2018		2017
Current:
Federal	$	—	$	—	$	—
State	(26)		(11)		1
Foreign	(2)		(4)		21
Total current	$	(28)	$	(15)	$	22
Deferred:
Federal	$	—	$	—	$	—
State	—		—		—
Foreign	—		—		—
Total deferred	$	—	$	—	$	—
Total income tax benefit (provision)	$	(28)	$	(15)	$	22

The Company had an effective tax rate of (0.17)%, (0.07)% and 0.53% for the years ended December 31, 2019, 2018 and 2017, respectively. The reconciliation of the statutory federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2019, 2018 and 2017 were as follows:


	2019		2018		2017
Tax at federal statutory rate	21.00	%	21.00	%	34.00	%
State tax, net of federal benefit	(0.27)		1.88		1.03
Stock-based compensation	51.45		(5.84)		(38.63)
Warrant expense	—		(6.98)		(1.00)
Other items	(4.34)		(1.46)		(1.10)
Research and development credits	13.74		10.54		102.35
Net operating loss expiration	(18.33)		—		(9.29)
Change in valuation allowance	(63.42)		(19.21)		458.55
Rate differential impact of Tax Cuts and Jobs Act of 2017	—		—		(545.38)
Effective tax rate	(0.17)	%	(0.07)	%	0.53	%

Deferred income taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. As of December 31, 2019 and 2018, the significant components of the Company’s deferred tax assets and liabilities were as follows (in thousands):


	2019		2018
Deferred tax assets:
Net operating loss carryforwards	$	48,988	$	38,895
Stock-based compensation	4,192		3,096
Operating lease liability	10,248		—
Non-deductible accrued expenses, reserves and other	2,596		2,916
Research and development credits	8,762		6,724
Gross deferred tax assets	74,786		51,631
Deferred tax liabilities:
Acquired intangible assets	(693)		(1,298)
Operating lease asset	(9,202)		—
Depreciation and amortization	(1,349)		(894)
Net deferred tax assets prior to valuation allowance	63,542		49,439
Valuation allowance	(63,542)		(49,439)
Net deferred tax assets	$	—	$	—

The Company established a full valuation allowance of $63.5 million and $49.4 million as of December 31, 2019 and 2018, respectively, against its net deferred tax assets. The Company determines its valuation allowance on deferred tax assets by considering both positive and negative evidence in order to ascertain whether it is more likely than not that deferred tax assets will be realized. Realization of deferred tax assets is dependent upon the generation of future taxable income, if any, the timing and amount of which are uncertain. Due to the history of losses the Company has generated in the past, the Company believes that it is not more likely than not that all of the deferred tax assets can be realized as of December 31, 2019. Accordingly, the Company has recorded a full valuation allowance on its deferred tax assets.

The Company has federal net operating loss (“NOL”) carryforwards of approximately $220.4 million and $172.3 million as of December 31, 2019 and 2018, respectively. The federal NOLs generated in the years ended December 31, 1999 through 2017 will begin to expire in 2020 for federal income tax purposes, including $21.6 million in 2020. NOLs originating before January 1, 2018, are eligible to offset taxable income, if not otherwise limited under Internal Revenue Code (“IRC”) §382 limitations. NOLs generated after December 31, 2017, have an infinite carryforward period and subject to 80% deduction limitation based upon pre-NOL deduction taxable income. The Company has California NOL carryforwards of approximately $50.3 million and $38.5 million as of December 31, 2019 and 2018, respectively. California NOLs generated in the years ended December 31, 2008 through 2018 will begin to expire in 2028. California NOLs generated before 2008 have expired in accordance the California Revenue Taxation Code and related regulations.

The Company has federal research and development credits (“Credits”) of approximately $10.1 million and $8.8 million as of December 31, 2019 and 2018, respectively. The federal Credit will begin to expire in 2020 through 2039. The Company has California Credits of approximately $11.3 million and $9.7 million as of December 31, 2019 and 2018, respectively. California Credits have an infinite carryforward period.

Utilization of the NOL and Credit carryforwards that were generated prior to January 1, 2018, may be subject to a substantial annual limitation due to ownership change limitations that may have occurred or that could occur in the future, as required by IRC §382 and §383, as well as similar state provisions.

The Company adopted ASU No. 2016-09 effective January 1, 2018, on a prospective basis. The Company’s previously unrecognized excess tax benefit of $1.6 million has been recognized as an increase to both the NOL deferred tax asset and the valuation allowance. There was no material impact as a result of this adoption.

Uncertain Tax Positions

As of December 31, 2019, the Company’s total amount of unrecognized tax benefits was $12.8 million, none of which would impact the Company’s effective tax rate, if recognized.

For the years ended December 31, 2019, 2018 and 2017, the activity related to the unrecognized tax benefits were as follows (in thousands):


	2019		2018		2017
Gross unrecognized tax benefits—beginning balance	$	10,973	$	10,200	$	17,370
Increase related to tax positions taken during prior year	—		108		—
Decrease related to tax positions taken during prior year	(164)		(2)		(7,739)
Increase related to tax positions taken during current year	1,973		667		569
Gross unrecognized tax benefits—ending balance	$	12,782	$	10,973	$	10,200

For the year ended December 31, 2017, the changes related to prior year uncertain tax positions reflected above is largely attributable to the completion of a study on the qualifying activities related to research and development costs giving rise to research and development tax credits.

The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. To the extent accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction of the provision for income taxes in the period that such determination is made. As of December 31, 2019, the Company did not currently recognize any penalties or interest charges relating to uncertain tax positions. The Company does not anticipate the recorded reserves to change significantly in the next 12 months.

The Company is subject to taxation in the United States and various other state and foreign jurisdictions. Due to certain tax attribute carryforwards, the tax years 1999 to 2019 remain open to examination by the major taxing jurisdictions in which the Company is subject to tax. As of December 31, 2019, the Company was not under examination by the Internal Revenue Service or any state or foreign tax jurisdiction.

Preferred and Common Stock Warrants - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Apr. 30, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	May 31, 2018
Class of Warrant or Right [Line Items]
Proceeds from Warrant Exercises	$ 1,200
Class of warrant or right, warrants surrendered	64,646	37
Stock issued during period, warrant exercises (in shares)	333,685	49,963
Reclassification of redeemable convertible preferred stock warrant liability to redeemable convertible preferred stock			$ 6,100	$ 100
Common stock warrant exercisable conversion		10.00%
Revaluation of warrant expense		$ 711	$ 226	$ 0
Redeemable Convertible Preferred Stock Warrants, One \| Series A-1
Class of Warrant or Right [Line Items]
Number of shares issued upon exercisable of warrants		26,000
Exercise price of warrants (in dollars per share)		$ 3.13
Redeemable Convertible Preferred Stock Warrants, One \| Series A-2 \| Maximum
Class of Warrant or Right [Line Items]
Number of shares issued upon exercisable of warrants		57,181
Redeemable Convertible Preferred Stock Warrants \| Series A-1
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share)		$ 3.13
Redeemable Convertible Preferred Stock Warrants \| Series A-1 \| Maximum
Class of Warrant or Right [Line Items]
Number of shares issued upon exercisable of warrants		124,506
Redeemable Convertible Preferred Stock Warrants \| Series A-2
Class of Warrant or Right [Line Items]
Number of shares issued upon exercisable of warrants		273,825
Common Stock Warrant
Class of Warrant or Right [Line Items]
Number of shares issued upon exercisable of warrants		45,286
Exercise price of warrants (in dollars per share)		$ 0.06
Shares issued upon exercise of warrants (in shares)			45,286
Common Stock Warrant \| Tides Foundation
Class of Warrant or Right [Line Items]
Number of shares issued upon exercisable of warrants					500,000
Exercise price of warrants (in dollars per share)					$ 0.01
Class of warrant or right, exercised (in shares)		50,000

Redeemable Convertible Preferred Stock (Tables)

12 Months Ended

Dec. 31, 2019

Temporary Equity Disclosure [Abstract]

Schedule of Redeemable Convertible Preferred Stock

Redeemable convertible preferred stock as of December 31, 2017 consisted of the following (in thousands, except share data):


	Shares Authorized	Shares Issued and Outstanding	Net Carrying Value		Aggregate Liquidation Preference
Series A-1	10,141,345	9,142,770	$	72,181	$	91,427
Series A-2	60,000,000	47,124,931	65,853		5
Series B-1	5,854,982	4,866,360	27,628		27,787
Series B-2	145,018	145,018	824		828
Total redeemable convertible preferred stock	76,141,345	61,279,079	$	166,486	$	120,047

Revenue

12 Months Ended

Dec. 31, 2019

Revenue from Contract with Customer [Abstract]

Revenue

Disaggregation of Revenue

See Note 14 for the Company’s disaggregated revenues by type of service and geographic area.

Remaining Performance Obligations

As of December 31, 2019, the Company had approximately $13.4 million of remaining performance obligations. The Company’s remaining performance obligations represent transaction price that has been allocated to unexercised material rights related to the Company’s arrangements with freelancers subject to tiered service fees. As of December 31, 2019, the Company is expected to recognize approximately $11.5 million over the next 12 months, with the remaining balance recognized thereafter.

The Company has applied the practical expedients and exemptions and does not disclose the value of remaining performance obligations for (i) contracts with an original expected length of one year or less; and (ii) contracts for which the variable consideration is allocated entirely to a wholly unsatisfied promise to transfer a distinct service that forms part of a single performance obligation under the series guidance.

Contract Balances

The following table provides information about the balances of the Company’s trade and client receivables and contract liabilities (deferred revenue):


	As of December 31, 2019		As of January 1, 2019 (As Adjusted)
Trade and client receivables, net of allowance	$	30,156	$	20,327
Contract liabilities
Deferred revenue	$	13,799	$	10,834
Deferred revenue (component of other liabilities, noncurrent)	$	3,153	$	1,690

Changes in the contract liabilities balances during 2019 were a result of normal business activity and deferral of revenue related to arrangements with freelancers subject to tiered service fees and related allocation of transaction price to material rights.

During the year ended December 31, 2019, the Company recognized $10.1 million of revenue that was included in deferred revenue as of January 1, 2019.

Balance Sheet Components

12 Months Ended

Dec. 31, 2019

Balance Sheet Related Disclosures [Abstract]

Balance Sheet Components

Property and Equipment, Net

Property and equipment, net consisted of the following as of December 31, 2019 and 2018 (in thousands):


	2019		2018
Computer equipment and software	$	3,613	$	3,189
Internal-use software and platform development costs	12,726		6,287
Leasehold improvements	10,576		5,783
Office furniture and fixtures	2,454		2,545
Total property and equipment	29,369		17,804
Less: Accumulated depreciation	(7,915)		(6,989)
Property and equipment, net	$	21,454	$	10,815

Depreciation expense related to property and equipment was $2.8 million, $2.2 million, and $1.5 million for the years ended December 31, 2019, 2018, and 2017, respectively.

The Company capitalized $6.4 million, $4.0 million, and $0.5 million of internal-use software and platform development costs during the years ended December 31, 2019, 2018, and 2017, respectively.

Amortization expense related to the capitalized internal-use software and platform development costs was $1.2 million for the year ended December 31, 2019, of which $0.9 million was included in cost of revenue related to developed technology used on the platform. Amortization expense related to the capitalized internal-use software and platform development costs was $0.1 million for the year ended December 31, 2018. There was no amortization expense for the year ended December 31, 2017 related to the internal-use software and platform development costs as the underlying assets had not been placed into service as of December 31, 2017.

Intangible Assets, Net

All of the Company’s identifiable intangible assets were acquired in March 2014 from the Elance-oDesk Combination. Intangible assets, net consisted of the following (in thousands):


	As of December 31, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trade names	$	2,293	$	2,293	$	—
User relationships	18,678		15,343		3,335
Developed technology	10,356		10,356		—
Domain names	529		529		—
Total	$	31,856	$	28,521	$	3,335


	As of December 31, 2018
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trade names	$	2,293	$	2,293	$	—
User relationships	18,678		12,674		6,004
Developed technology	10,356		10,356		—
Domain names	529		529		—
Total	$	31,856	$	25,852	$	6,004

Total amortization expense of intangible assets was $2.7 million for each of the years ended December 31, 2019, 2018, and 2017. Amortization expense is included in general and administrative expenses. As of December 31, 2019, the remaining useful life for user relationships was 1.3 years.

As of December 31, 2019, the estimated future amortization expense for the acquired intangible assets is as follows (in thousands):


Year Ended December 31,	Estimated Amortization Expense
2020	$	2,668
2021	667

Total	$	3,335

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following as of December 31, 2019 and 2018 (in thousands):


	2019		2018
Accrued compensation and related benefits	$	5,344	$	9,314
Accrued freelancer costs	622		2,465
Accrued indirect taxes	2,401		1,630
Accrued vendor expenses	5,485		6,002
Accrued payment processing fees	832		715
Operating lease liability, current	3,214		—
Other	444		822
Total accrued expenses and other current liabilities	$	18,342	$	20,948

Operating Leases

The Company leases office space and certain equipment under various operating leases, with the vast majority of its lease portfolio consisting of operating leases for office space. The Company has also entered into arrangements where it acts as a sublessor in its leases of office space. The Company has not entered into any significant finance, sales-type, or direct financing leases.

The Company’s significant judgments include determining whether an arrangement is or contains a lease, the determination of the discount rate used to calculate the lease liability and whether or not lease incentives are reasonably certain to occur in the initial measurement of the lease liability. Operating lease assets and lease liabilities are recognized at commencement date and initially measured based on the present value of lease payments over the defined lease term. Lease expense is recognized on a straight-line basis over the lease term.

A contract is or contains an embedded lease if the contract meets all of the below criteria:

•There is an identified asset;

•The Company has the right to obtain substantially all of the economic benefit of the asset; and

•The Company has the right to direct the use of the asset.

For initial measurement of the present value of lease payments and for subsequent measurement of lease modifications, the Company is required to use the rate implicit in the lease. Since the majority of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate, which is a collateralized rate. The application of the incremental borrowing rate is performed on a lease-by-lease basis and approximates the rate at which the Company could borrow, on a secured basis for a similar term, an amount equal to its lease payments in a similar economic environment.

The Company’s leases have remaining lease terms of approximately one year to nine years, which may include the option to extend the lease. The Company includes lease payments associated with renewal options in its operating lease asset and liability only when it becomes reasonably certain the company will exercise the renewal option. The Company has not included renewal options for any of its operating leases in its determination of lease liabilities. The Company does not have lease agreements with residual value guarantees, sale leaseback terms, or material restrictive covenants. Leases with an initial term of 12 months or less are not recognized on the consolidated balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

The following table summarizes the Company’s operating lease assets and lease liabilities as of December 31, 2019 (in thousands):


Balance Sheet Classification		As of December 31, 2019
Assets
Operating—noncurrent	Operating lease asset	$	21,908
Liabilities
Operating—current	Accrued expenses and other current liabilities	3,214
Operating—noncurrent	Operating lease liability, noncurrent	21,186
Total lease liabilities		$	24,400

Operating lease cost, inclusive of variable lease charges, for the year ended December 31, 2019 was $5.9 million. Sublease income recognized during the year ended December 31, 2019 was approximately $0.4 million. Charges related to operating leases that are variable, and therefore not included in the measurement of the lease liabilities, were $0.6 million for the year ended December 31, 2019. The Company made lease payments of $3.3 million during the year ended December 31, 2019. The Company obtained an $8.6 million operating lease asset in exchange for a new lease obligation during the year ended December 31, 2019. As of December 31, 2019, the Company had no material finance leases.

The following table shows the Company’s future lease commitments due in each of the next five years and thereafter for operating leases (in thousands):


Year Ended December 31,	Leases
2020	$	3,313
2021	3,919
2022	5,391
2023	5,796
2024	4,838
Thereafter	6,954

Total lease payments	30,211
Adjustment for discount to present value	(5,811)
Total	$	24,400

As of December 31, 2019, the Company had $2.2 million of net operating lease commitments not included in the table above for additional office space in the Company’s Chicago, Illinois office building. The lease for the additional space will commence in fiscal year 2020 with a lease term of five years.

As of December 31, 2018, future aggregate minimum lease payments under the non-cancellable operating leases were as follows (in thousands):


Year Ended December 31,	Leases⁽¹⁾
2019	$	3,569
2020	4,683
2021	4,914
2022	5,052
2023	5,194
Thereafter	4,890
Less: rental payments from subleases	(363)
Total	$	27,939

⁽¹⁾ Amounts are based on Topic 840 that were superseded upon adoption of Topic 842 as of January 1, 2019.

As of and for the year ended December 31, 2019, the weighted-average remaining lease term is 6.2 years, and the weighted-average discount rate is 5.86%.

Redeemable Convertible Preferred Stock - Schedule of Redeemable Convertible Preferred Stock (Details) $ in Thousands	Dec. 31, 2017 USD ($) shares
Temporary Equity [Line Items]
Shares Authorized (in shares) \| shares	76,141,345
Shares Issued (in shares) \| shares	61,279,079
Net Carrying Value \| $	$ 166,486
Aggregate Liquidation Preference \| $	$ 120,047
Series A-1
Temporary Equity [Line Items]
Shares Authorized (in shares) \| shares	10,141,345
Shares Issued (in shares) \| shares	9,142,770
Net Carrying Value \| $	$ 72,181
Aggregate Liquidation Preference \| $	$ 91,427
Series A-2
Temporary Equity [Line Items]
Shares Authorized (in shares) \| shares	60,000,000
Shares Issued (in shares) \| shares	47,124,931
Net Carrying Value \| $	$ 65,853
Aggregate Liquidation Preference \| $	$ 5
Series B-1
Temporary Equity [Line Items]
Shares Authorized (in shares) \| shares	5,854,982
Shares Issued (in shares) \| shares	4,866,360
Net Carrying Value \| $	$ 27,628
Aggregate Liquidation Preference \| $	$ 27,787
Series B-2
Temporary Equity [Line Items]
Shares Authorized (in shares) \| shares	145,018
Shares Issued (in shares) \| shares	145,018
Net Carrying Value \| $	$ 824
Aggregate Liquidation Preference \| $	$ 828

Balance Sheet Components - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 29,369	$ 17,804
Less: Accumulated depreciation	(7,915)	(6,989)
Property and equipment, net	21,454	10,815
Computer equipment and software
Property, Plant and Equipment [Line Items]
Total property and equipment	3,613	3,189
Internal-use software and platform development costs
Property, Plant and Equipment [Line Items]
Total property and equipment	12,726	6,287
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment	10,576	5,783
Office furniture and fixtures
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 2,454	$ 2,545

Preferred and Common Stock Warrants (Tables)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Assumptions Used to Calculate Fair Value of Outstanding Warrants

The following assumptions were used to calculate the estimated fair value of the then-outstanding warrants until the closing date of the Company’s IPO:



Dividend yield	0	%
Expected term (in years)	2.75
Risk-free interest rates	1.8	%
Expected volatility	34.6	%

Debt - Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Debt Disclosure [Abstract]
2019	$ 7,571
2020	7,571
2021	3,179
Year Ended December 31,	$ 18,321	$ 24,000

Debt (Tables)

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Summary of Carrying Value of Debt

The following table presents the carrying value of the Company’s debt obligations as of December 31, 2019 and 2018 (in thousands):


	2019			2018
First term loan—18 months of interest-only payments ended in March 2019 followed by 36 equal monthly installments of principal plus interest, maturing March 2022; interest at prime plus 0.25% per annum	$	11,250		$	15,000
Second term loan—17 months of interest-only payments ended in March 2019 followed by 42 equal monthly installments of principal plus interest, maturing September 2022; interest at prime plus 0.25% per annum	7,071			9,000

Total debt	18,321			24,000
Less: Unamortized debt discount issuance costs	(38)			(90)
Balance	18,283			23,910
Debt, current	(7,584)			(5,671)
Debt, noncurrent	$	10,699		$	18,239
Weighted-average interest rate	6.93		%	6.89		%

Schedule of Maturities of Long-term Debt

Future maturities of principal payments, excluding potential early payments, as of December 31, 2019, were expected to be as follows (in thousands):


Year Ended December 31,	Principal Payments
2020	$	7,571
2021	7,571
2022	3,179



Total	$	18,321

- 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://fasb.org/us-gaap/role/ref/legacyRef
-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://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=114775744&loc=d3e28541-108399

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21506-112644

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-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://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=114775744&loc=d3e28551-108399

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
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-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21521-112644

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21538-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=114775985&loc=d3e28878-108400

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21475-112644

+ Details

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (16,659)	$ (19,907)	$ (4,123)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Provision for transaction losses	3,118	5,110	4,250
Depreciation and amortization	6,661	4,949	4,186
Amortization of debt issuance costs	52	77	49
Amortization of discount on purchases of marketable securities	(1,158)	0	0
Amortization of operating lease asset	3,945
Change in fair value of redeemable convertible preferred stock warrant liability	0	6,056	118
Tides Foundation common stock warrant expense	711	226	0
Stock-based compensation expense	18,798	10,361	6,846
Loss on disposal of fixed assets	14	91	66
Changes in operating assets and liabilities:
Trade and client receivables	(10,918)	3,506	(8,860)
Prepaid expenses and other assets	(2,069)	(1,292)	(479)
Operating lease liability	(1,453)
Accounts payable	(1,457)	1,609	74
Accrued expenses and other liabilities	(2,957)	2,849	(6,148)
Deferred revenue	4,430	109	20
Net cash provided by (used in) operating activities	1,058	13,744	(4,001)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities	(168,786)	0	0
Proceeds from maturities of marketable securities	84,500	0	0
Purchases of property and equipment	(10,752)	(3,002)	(1,830)
Internal-use software and platform development costs	(5,886)	(3,839)	(489)
Net cash used in investing activities	(100,924)	(6,841)	(2,319)
CASH FLOWS FROM FINANCING ACTIVITIES:
Changes in escrow funds payable	10,535	10,991	27,362
Proceeds from exercises of stock options and common stock warrant	18,155	8,160	2,547
Proceeds from exercise of redeemable convertible preferred stock warrant	0	0	260
Repurchase of redeemable convertible preferred stock	0	0	(19,208)
Taxes paid related to net share settlement of restricted stock units	0	(247)	0
Proceeds from borrowings on debt	50,000	15,000	34,000
Payment of debt issuance costs	0	0	(177)
Repayment of debt	(55,679)	(25,000)	(17,000)
Proceeds from employee stock purchase plan	6,391	0	0
Proceeds from the initial public offering, net of discounts and commissions	0	109,381	0
Payments of costs related to the initial public offering	0	(6,220)	(41)
Net cash provided by financing activities	29,402	112,065	27,743
NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	(70,464)	118,968	21,423
Cash, cash equivalents, and restricted cash—beginning of year	230,067	111,099	89,676
Cash, cash equivalents, and restricted cash—end of year	159,603	230,067	111,099
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income taxes	42	13	55
Cash paid for interest	1,291	1,976	847
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Property and equipment purchased but not yet paid	161	2,815	114
Internal-use software and platform development costs incurred but not yet paid	684	130	0
Reclassification of redeemable convertible preferred stock warrant liability to redeemable convertible preferred stock	0	0	144
Conversion of redeemable convertible preferred stock warrant in connection with the initial public offering	0	7,160	0
Conversion of redeemable convertible preferred stock in connection with the initial public offering	0	166,486	0
Unpaid deferred offering costs	$ 0	$ 0	$ 25

Revenue - Additional Information (Details) $ in Millions	12 Months Ended
Revenue - Additional Information (Details) $ in Millions	Dec. 31, 2019 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining performance obligation, amount	$ 13.4
Revenue recognized	10.1
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, amount	13.4
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01
Revenue from Contract with Customer [Abstract]
Remaining performance obligation, amount	$ 11.5
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, amount	$ 11.5

Net Loss Per Share Attributable to Common Stockholders (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders


	2019		2018		2017
Numerator:
Net loss	$	(16,659)	$	(19,907)	$	(4,123)
Less: Premium on repurchase of redeemable convertible preferred stock	—		—		(6,506)

Net loss attributable to common stockholders	$	(16,659)	$	(19,907)	$	(10,629)
Denominator:
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted	109,814,604		52,327,518		32,944,714
Net loss per share attributable to common stockholders, basic and diluted	$	(0.15)	$	(0.38)	$	(0.32)

Schedule of Potentially Dilutive Shares Excluded from Computation of Diluted Net Loss Per Share Attributable to Common Stockholders


	2019	2018	2017
Options to purchase common stock	15,140,579	23,774,279	23,607,746
Common stock issuable upon conversion of redeemable convertible preferred stock	—	—	61,279,079
Common stock issuable upon exercise of common stock warrants	450,000	898,331	45,286
Common stock issuable upon exercise and redeemable conversion of preferred stock warrants	—	—	398,331
Common stock issuable upon vesting of restricted stock units	2,503,182	288,460	—
Common stock issuable in connection with employee stock purchase plan	1,651,263	—	—
Total	19,745,024	24,961,070	85,330,442

Fair Value Measurements - Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Financial Assets:
Total financial assets	$ 120,767	$ 117,138
Level I
Financial Assets:
Total financial assets	69,973	117,138
Level II
Financial Assets:
Total financial assets	50,794	0
Level III
Financial Assets:
Total financial assets	0	0
Cash equivalents—money market funds
Financial Assets:
Cash equivalents	35,286
Total financial assets		117,138
Cash equivalents—money market funds \| Level I
Financial Assets:
Cash equivalents	35,286
Total financial assets		117,138
Cash equivalents—money market funds \| Level II
Financial Assets:
Cash equivalents	0
Total financial assets		0
Cash equivalents—money market funds \| Level III
Financial Assets:
Cash equivalents	0
Total financial assets		$ 0
Commercial paper
Financial Assets:
Total financial assets	50,794
Commercial paper \| Level I
Financial Assets:
Total financial assets	0
Commercial paper \| Level II
Financial Assets:
Total financial assets	50,794
Commercial paper \| Level III
Financial Assets:
Total financial assets	0
U.S. government securities
Financial Assets:
Total financial assets	34,687
U.S. government securities \| Level I
Financial Assets:
Total financial assets	34,687
U.S. government securities \| Level II
Financial Assets:
Total financial assets	0
U.S. government securities \| Level III
Financial Assets:
Total financial assets	$ 0

Segment and Geographical Information - Geographic Area (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 300,562	$ 253,354	$ 202,552
Freelancers
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	187,442	163,242	132,066
Freelancers \| United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	50,154	40,313	26,596
Freelancers \| India
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	27,369	25,485	21,880
Freelancers \| Philippines
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	19,660	17,057	14,761
Freelancers \| Rest of world
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	90,259	80,387	68,829
Clients
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	113,120	90,112	70,486
Clients \| United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	87,241	65,578	55,179
Clients \| Rest of world
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 25,879	$ 24,534	$ 15,307

Stock-Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands	1 Months Ended				4 Months Ended	12 Months Ended
	Jan. 31, 2019 shares	Aug. 31, 2018 offering_period shares	Oct. 31, 2017 shares	Aug. 31, 2014 shares	Jun. 30, 2014 shares	Dec. 31, 2019 USD ($) shares	Dec. 31, 2018 USD ($) $ / shares shares	Dec. 31, 2017 USD ($) $ / shares shares	Jan. 01, 2019 shares	Oct. 03, 2018 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock shares reserved for future issuance (in shares) \| shares						36,180,533	37,219,376
Dividend yield						0.00%
Intrinsic value of options exercised						$ 73,000	$ 18,000	$ 2,900
Weighted-average grant-date fair value of options granted (in dollars per share) \| $ / shares							$ 3.65	$ 1.54
Common stock, shares issued (in shares) \| shares						113,604,398	106,454,321
Total						$ 18,798	$ 10,361	$ 6,846
Issuance of common stock in connection with the initial public offering, net of discounts and commissions							109,381
Secondary Market Transactions
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total							400
Number of shares issued and sold (in shares) \| shares								488,484
Issuance of common stock in connection with the initial public offering, net of discounts and commissions							$ 2,300
Secondary Market Transactions \| Average
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Average share price (in dollars per share) \| $ / shares							$ 4.72
Options to purchase common stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock shares reserved for future issuance (in shares) \| shares						15,140,579	23,774,279
Total						$ 8,500	$ 8,600	$ 6,300
RSUs issued and outstanding
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock shares reserved for future issuance (in shares) \| shares						2,503,182	288,460
Fully vested non-option equity instruments granted (in shares) \| shares							35,494
Value of equity granted							$ 500
Share-based tax liability of granted shares							$ 200
Shares surrendered to pay for tax liability \| shares							12,648
Total						$ 7,900	$ 1,100
ESPP Plan shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total						$ 2,600	$ 600
Common stock issuable in connection with employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common shares under 2018 ESPP (in shares) \| shares	851,634
Elance-oDesk Assumed Award Plans
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Discount on share at purchase date from original option price						16.14%
Vesting period						4 years
Expiration period						10 years
2014 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period					4 years
Expiration period					10 years
Shares available for grant \| shares					12,462,985
Shares issued in period \| shares		100,000	4,500,000	3,001,091
Grant price, threshold of fair value price must meet					100.00%
2018 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant \| shares									5,322,716
Common stock shares reserved for future issuance (in shares) \| shares						16,091,801	10,558,306			10,701,505
Dividend yield						0.00%	0.00%	0.00%
Initial offering period of ESPP		24 months
Common shares under 2018 ESPP (in shares) \| shares						556,663
2018 Equity Incentive Plan \| Options to purchase common stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation cost, options						$ 6,800
Unrecognized stock-based compensation cost, weighted average period of recognition						2 years 2 months 12 days
2018 Equity Incentive Plan \| RSUs issued and outstanding
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation cost, options						$ 34,200
Unrecognized stock-based compensation cost, weighted average period of recognition						3 years 4 months 24 days
2018 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Discount on share at purchase date from original option price		15.00%
Common stock shares reserved for future issuance (in shares) \| shares		1,700,000				1,994,971	1,700,000
Initial offering period of ESPP		24 months
Unrecognized stock-based compensation cost, options						$ 5,100
Number of offering periods in ESPP \| offering_period		4
Length of offering period		6 months
Common stock percentage of purchase price		85.00%
Transition Agreement
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield						0.00%
Total						$ 3,500
Due To Affiliate, Monthly						$ 40

Basis of Presentation and Summary of Significant Accounting Policies - Narrative (Details)	12 Months Ended
	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($) segment	Dec. 31, 2017 USD ($)	Jan. 01, 2019 USD ($)
Subsidiary, Sale of Stock [Line Items]
Restricted cash	$ 2,490,000	$ 2,753,000	$ 2,309,000
Restricted cash, current	1,700,000	2,200,000
Restricted cash, noncurrent	800,000	500,000
Escrow funds payable	$ 108,721,000	$ 98,186,000
Number of Clients \| segment	2	2
Revenue	$ 300,562,000	$ 253,354,000	202,552,000
Gross trade receivables	10,300,000	9,100,000
Gross client receivables	$ 22,100,000	16,000,000.0
Capitalized costs, amortization period	2 years
Capitalized costs	$ 6,400,000	4,000,000.0	500,000
Internal-use software and platform development costs capitalized, amortization expense	$ 1,200,000	100,000	0
Number of reportable segments \| segment	1
Goodwill impairment	$ 0
Deferred offering costs		6,300,000
Advertising expense	37,400,000	23,600,000	$ 14,600,000
Foreign currency transactions gain (loss)	900,000	(400,000)
Deferred revenue	13,799,000	722,000		$ 10,834,000
Accumulated deficit	(171,957,000)	(143,499,000)
Operating lease asset	21,908,000			17,300,000
Operating lease liabilities	24,400,000			$ 17,800,000
Increase (Decrease) in Deferred Revenue	$ (11,800,000)
Minimum
Subsidiary, Sale of Stock [Line Items]
Property and equipment, useful lives	2 years
Intangible asset, useful life	2 years
Maximum
Subsidiary, Sale of Stock [Line Items]
Property and equipment, useful lives	5 years
Intangible asset, useful life	7 years
Foreign Currency Forward Contracts
Subsidiary, Sale of Stock [Line Items]
Derivative, notional amount	$ 5,400,000	4,800,000
Loss on derivatives	900,000	400,000
Client Accounting For More than 10% revenue
Subsidiary, Sale of Stock [Line Items]
Revenue	$ 32,000,000.0	$ 29,500,000

Balance Sheet Components - Lessee, Operating Lease, Disclosure (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Balance Sheet Related Disclosures [Abstract]
Operating lease asset	$ 21,908	$ 17,300
Operating lease liability, current	3,214		$ 0
Operating lease liability, noncurrent	21,186
Total	$ 24,400	$ 17,800

Preferred and Common Stock Warrants - Assumptions Used to Calculate Fair Value of Outstanding Warrants (Details) - Redeemable Convertible Preferred Stock Warrants	Oct. 31, 2018
Dividend Yield
Class of Warrant or Right [Line Items]
Outstanding warrants measurement input	0
Expected Term
Class of Warrant or Right [Line Items]
Outstanding warrants measurement input	2 years 9 months
Risk-Free Interest Rates
Class of Warrant or Right [Line Items]
Outstanding warrants measurement input	0.018
Expected Volatility
Class of Warrant or Right [Line Items]
Outstanding warrants measurement input	0.346

Fair Value Measurements

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

The Company defines fair value as the exchange price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance describes three levels of inputs that may be used to measure fair value:

•Level I—Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in active markets;

•Level II—Observable inputs other than Level I prices, such as unadjusted quoted prices for similar assets or liabilities in active markets, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•Level III—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These inputs are based on the Company’s own assumptions used to measure assets and liabilities at fair value and require significant management judgment or estimation.

The categorization of a financial instrument within the fair value hierarchy is based upon the lowest level of input that is significant to its fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the assets or liabilities.

The Company’s financial instruments that are carried at fair value consist of Level I and Level II assets as of December 31, 2019 and 2018. The following tables set forth the fair value of the Company’s financial assets measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands):


	December 31, 2019
	Level I		Level II		Level III		Total


Cash equivalents—money market funds	$	35,286	$	—	$	—	$	35,286

Marketable securities
Commercial paper	—		50,794		—		50,794
U.S. government securities	34,687		—		—		34,687
Total financial assets	$	69,973	$	50,794	$	—	$	120,767


	December 31, 2018
	Level I		Level II		Level III		Total

Cash equivalents—money market funds	$	117,138	$	—	$	—	$	117,138
Total financial assets	$	117,138	$	—	$	—	$	117,138

Prior to the IPO, the Company measured its redeemable convertible preferred stock warrant liability at fair value on a recurring basis, and it was classified within Level III because the warrants were valued using a Black-Scholes valuation model, for which some inputs are unobservable in the market. The valuation methodology and underlying assumptions are discussed further in Note 9. For the years ended December 31, 2018 and 2017, the Company recorded $6.1 million and $0.1 million, respectively, related to the revaluation of its redeemable convertible preferred stock warrant liability, which is included in other (income) expense, net in the Company’s consolidated statement of operations. Upon the closing of the IPO in October 2018, the

redeemable convertible preferred stock warrant converted to a common stock warrant. As such, the Company reclassified its redeemable convertible preferred stock warrant liability to additional paid-in capital.

The following table sets forth a summary of the changes in the fair value of the redeemable convertible preferred stock warrant liability (in thousands):




Fair value at December 31, 2016	$	1,130
Change in fair value	118
Reclassification to redeemable convertible preferred stock due to warrant exercise	(144)
Fair value at December 31, 2017	1,104
Change in fair value	6,056
Conversion to common stock warrant in connection with the initial public offering	(7,160)
Fair value at December 31, 2018	$	—

- 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

Basis of Presentation and Summary of Significant Accounting Policies - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Allowance for Doubtful Accounts Receivable [Roll Forward]
Allowance for doubtful accounts, beginning balance	$ 2,832	$ 1,577	$ 2,473
Provision for doubtful accounts	3,193	4,940	2,646
Amounts written off	(3,810)	(3,685)	(3,542)
Allowance for doubtful accounts, ending balance	$ 2,215	$ 2,832	$ 1,577

Stock-Based Compensation - Components of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Compensation expense	$ 18,798	$ 10,361	$ 6,846
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Compensation expense	456	282	290
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Compensation expense	6,471	3,258	1,797
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Compensation expense	2,609	1,637	1,299
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Compensation expense	$ 9,262	$ 5,184	$ 3,460

Common Stock - Reserved for Future Issuance (Details) - shares	Dec. 31, 2019	Dec. 31, 2018	Oct. 03, 2018	Aug. 31, 2018
Class of Stock [Line Items]
Common stock shares reserved for future issuance (in shares)	36,180,533	37,219,376
2018 Equity Incentive Plan
Class of Stock [Line Items]
Common stock shares reserved for future issuance (in shares)	16,091,801	10,558,306	10,701,505
2018 Employee Stock Purchase Plan
Class of Stock [Line Items]
Common stock shares reserved for future issuance (in shares)	1,994,971	1,700,000		1,700,000
Warrant to purchase common stock
Class of Stock [Line Items]
Common stock shares reserved for future issuance (in shares)	450,000	898,331
Options issued and outstanding
Class of Stock [Line Items]
Common stock shares reserved for future issuance (in shares)	15,140,579	23,774,279
RSUs issued and outstanding
Class of Stock [Line Items]
Common stock shares reserved for future issuance (in shares)	2,503,182	288,460

Common Stock (Tables)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Summary of Common Stock Shares Reserved for Future Issuance

As of December 31, 2019 and 2018, the Company had reserved shares of common stock for future issuance as follows:


	2019	2018
Options issued and outstanding	15,140,579	23,774,279
RSUs issued and outstanding	2,503,182	288,460

Warrant to purchase common stock	450,000	898,331


Remaining shares reserved for future issuances under 2018 Equity Incentive Plan	16,091,801	10,558,306
Remaining shares reserved for future issuances under 2018 Employee Stock Purchase Plan	1,994,971	1,700,000
Total	36,180,533	37,219,376

- Definition

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=65888546&loc=d3e21300-112643

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21553-112644

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 480
-SubTopic 10
-Section S99
-Paragraph 1
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+ Details

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Letters of Credit In conjunction with the operating lease agreements, as of December 31, 2019 and 2018, the Company had three irrevocable letters of credit outstanding in the aggregate amount of $0.8 million. The letters of credit are collateralized by restricted cash in the same amount. No amounts had been drawn against these letters of credit as of December 31, 2019 and 2018. Contingencies The Company accrues contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. From time to time in the normal course of business, various claims and litigation have been asserted or commenced. Due to uncertainties inherent in litigation and other claims the Company can give no assurance that it will prevail in any such matters, which could subject the Company to significant liability or damages. Any claims or litigation could have an adverse effect on the Company’s business, financial position, results of operations or cash flows in or following the period that claims or litigation are resolved. As of December 31, 2019 and 2018, the Company was not a party to any material legal proceedings or claims, nor is the Company aware of any pending or threatened litigation or claims that could reasonably be expected to have a material adverse effect on its business, operating results, cash flows, or financial condition. Accordingly, the Company has determined that the existence of a material loss as of this date is neither probable nor reasonably possible. Indemnification The Company has indemnification agreements with its officers, directors, and certain key employees to indemnify them while they are serving in good faith in their respective positions. In the ordinary course of business, the Company enters into contractual arrangements under which it agrees to provide indemnification of varying scope and terms to clients, business partners, vendors and other parties, including, but not limited to, losses arising out of the Company’s breach of such agreements, claims related to potential data or information security breaches, intellectual property infringement claims made by third parties, and other liabilities relating to or arising from the Company’s products and services or its acts or omissions. In addition, subject to the terms of the applicable agreement, as part of the Company’s Upwork Enterprise offering, the Company indemnifies clients that subscribe to worker classification services for losses arising from worker misclassification. It is not possible to determine the maximum potential loss under these indemnification provisions due to the Company’s limited history of prior indemnification claims and the facts and circumstances involved in each particular provision.

Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Other (income) expense, net	$ (3,407)	$ 6,142	$ 62
Cash equivalents—money market funds
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Other (income) expense, net		$ 6,100	$ 100

Income Taxes - Deferred Tax Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets:
Net operating loss carryforwards	$ 48,988	$ 38,895
Stock-based compensation	4,192	3,096
Operating lease liability	10,248	0
Non-deductible accrued expenses, reserves and other	2,596	2,916
Research and development credits	8,762	6,724
Gross deferred tax assets	74,786	51,631
Deferred tax liabilities:
Acquired intangible assets	(693)	(1,298)
Operating lease asset	(9,202)
Depreciation and amortization	(1,349)	(894)
Net deferred tax assets prior to valuation allowance	63,542	49,439
Valuation allowance	(63,542)	(49,439)
Net deferred tax assets	$ 0	$ 0

Income Taxes - Loss Before Tax (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Domestic	$ (16,658)	$ (19,925)	$ (4,153)
Foreign	27	33	8
Total loss before income taxes	$ (16,631)	$ (19,892)	$ (4,145)