11.FAIR VALUE MEASUREMENT
The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. The fair value hierarchy prioritizes the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories:
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Level 1 – Inputs are quoted market prices in active markets for identical assets or liabilities (these are observable market inputs).
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Level 2 – Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability (includes quoted market prices for similar assets or identical or similar assets in markets in which there are few transactions, prices that are not current or prices that vary substantially).
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Level 3 – Inputs are unobservable inputs that reflect the entity's own assumptions in pricing the asset or liability (used when little or no market data is available).
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The Company holds funds in a money market account, which are considered Level 1 assets. The Company values its money market funds at fair value on a recurring basis.
As of September 30, 2021 and December 31, 2020, the fair value of the Company’s money market funds was $43,385 and $53,380, respectively.
There have been no transfers between Level 1, Level 2 and Level 3 in the period presented. The Company did not have any Level 2 or Level 3 financial assets or liabilities in the period presented.
12.SEGMENT INFORMATION
Historically, management has not made operating decisions and assessed performance based on geographic locations. Rather, the chief operating decision-maker makes operating decisions and assesses performance based on the products and services of the identified operating segments. While management does consider real estate and brokerage services, the acquired technology and affiliated services provided to be identified operating segments, the profits and losses and assets of the technology and affiliated services business units are not material.
Operating Segments
The Company primarily operates as a cloud-based real estate brokerage. The real estate brokerage business represents 99.2% and 99.6% of the total revenue of the Company for the three months ended September 30, 2021 and 2020, respectively. The real estate brokerage business represents 99.3% and 99.7% of the total revenue of the Company for the nine months ended September 30, 2021 and 2020, respectively. The real estate brokerage business represents 99.2% and 98.9% of the total assets of the Company as of September 30, 2021 and December 31, 2020, respectively.
The Company offers software subscriptions to customers to access its virtual reality software platform. Additionally, the Company offers professional services for implementation and consulting services. However, the operations and assets of the technology segment are not managed by the Company’s chief operating decision-maker as a separate reportable segment.
Services provided through First Cloud and Silverline are in the emerging stages of development as contributing segments and are not material to the Company’s total revenue, total net income or total assets as of September 30, 2021 and 2020, respectively.
The Company aggregates the identified operating segments for reporting purposes and has one reportable segment.
Geographical Information
The Company primarily operates within the real estate brokerage markets in the United States and Canada. During the previous two years, the Company expanded operations into the U.K., Australia, South Africa, India, Mexico, Portugal, France, Puerto Rico, Brazil, Italy, Hong Kong, Colombia, Spain, Israel, Panama and Germany.
The Company’s management analyzes geographical locations on a forward-looking basis to identify growth opportunities. For the three months ended September 30, 2021 and 2020, approximately 8% and 6%, respectively, of the Company’s total revenue was generated outside of the U.S. For the nine months ended September 30, 2021 and 2020, approximately 8% and 5%, respectively, of the Company’s total revenue was generated outside of the U.S. Assets held outside of the U.S. were 9% and 7% as of September 30, 2021 and December 31, 2020
The Company’s technology services and affiliated services are currently provided primarily in the U.S.