0001104659-15-007370 | 10-Q | XBRL Viewer

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Dec. 31, 2014	Jan. 30, 2015
Document and Entity Information
Entity Registrant Name	Paylocity Holding Corp
Entity Central Index Key	0001591698
Document Type	10-Q
Document Period End Date	Dec. 31, 2014
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		50,486,538
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2014	Jun. 30, 2014
Current assets:
Cash and cash equivalents	$ 89,480	$ 78,848
Accounts receivable, net	1,030	756
Prepaid expenses and other	2,978	2,694
Deferred income tax assets, net	684	706
Total current assets before funds held for clients	94,172	83,004
Funds held for clients	858,139	417,261
Total current assets	952,311	500,265
Long-term prepaid expenses	222	313
Capitalized software, net	5,704	5,093
Property and equipment, net	15,216	13,125
Intangible assets, net	5,940	6,320
Goodwill	3,035	3,035
Total assets	982,428	528,151
Current liabilities:
Accounts payable	3,373	2,133
Taxes payable	19	5
Consideration related to acquisition	400	2,985
Accrued expenses	11,720	10,744
Total current liabilities before client fund obligations	15,512	15,867
Client fund obligations	858,139	417,261
Total current liabilities	873,651	433,128
Deferred rent	2,905	3,175
Deferred income tax liabilities, net	731	714
Total liabilities	877,287	437,017
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000 shares authorized, no shares issued and outstanding at June 30, 2014 and December 31, 2014
Common stock, $0.001 par value, 155,000 shares authorized at June 30, and December 31, 2014, 49,564 shares issued and outstanding at June 30, 2014; and 50,487 shares issued and outstanding at December 31, 2014	50	50
Additional paid-in capital	150,557	125,255
Accumulated deficit	(45,466)	(34,171)
Total stockholders' equity	105,141	91,134
Total liabilities and stockholders' equity	$ 982,428	$ 528,151

Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Dec. 31, 2014	Jun. 30, 2014
Consolidated Balance Sheets
Preferred Stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred Stock, shares authorized	5,000	5,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Common Stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common Stock, shares authorized	155,000	155,000
Common Stock, shares issued	50,487	49,564
Common Stock, shares outstanding	50,487	49,564

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Revenues:
Recurring fees	$ 32,055	$ 22,145	$ 61,197	$ 42,883
Interest income on funds held for clients	390	378	753	731
Total recurring revenues	32,445	22,523	61,950	43,614
Implementation services and other	1,868	1,382	3,472	2,660
Total revenues	34,313	23,905	65,422	46,274
Cost of revenues:
Recurring revenues	11,953	9,081	22,010	17,074
Implementation services and other	6,093	4,237	11,488	7,991
Total cost of revenues	18,046	13,318	33,498	25,065
Gross profit	16,267	10,587	31,924	21,209
Operating expenses:
Sales and marketing	9,401	5,423	18,479	10,612
Research and development	5,271	2,347	9,298	4,303
General and administrative	8,061	5,228	15,509	9,139
Total operating expenses	22,733	12,998	43,286	24,054
Operating loss	(6,466)	(2,411)	(11,362)	(2,845)
Other income (expense)	80	22	129	50
Loss before income taxes	(6,386)	(2,389)	(11,233)	(2,795)
Income tax (benefit) expense	34	(877)	62	(1,239)
Net loss	(6,420)	(1,512)	(11,295)	(1,556)
Net loss attributable to common stockholders	$ (6,420)	$ (2,293)	$ (11,295)	$ (3,118)
Net loss per share attributable to common stockholders, basic and diluted	$ (0.13)	$ (0.07)	$ (0.23)	$ (0.10)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted	49,775	31,988	49,670	31,988

Consolidated Statements of Changes in Stockholders' Equity (Deficit) - 6 months ended Dec. 31, 2014 - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balance at Jun. 30, 2014	$ 50	$ 125,255	$ (34,171)	$ 91,134
Balance (in shares) at Jun. 30, 2014	49,564			49,564
Increase (Decrease) in Stockholders' Equity
Follow-on offering, net of issuance costs		18,384		$ 18,384
Follow-on offering, net of issuance costs (in shares)	750
Stock-based compensation expense		7,447		7,447
Stock options exercised		617		617
Stock options exercised (in shares)	104
Issuance of common stock upon vesting of restricted stock units (in shares)	100
Issuance of common stock under employee stock purchase plan		670		670
Issuance of common stock under employee stock purchase plan (in shares)	36
Net settlement for taxes and/or exercise price related to equity awards		(1,816)		(1,816)
Net settlement for taxes and/or exercise price related to equity awards	(67)
Net loss			(11,295)	(11,295)
Balance at Dec. 31, 2014	$ 50	$ 150,557	$ (45,466)	$ 105,141
Balance (in shares) at Dec. 31, 2014	50,487			50,487

Consolidated Statements of Cash Flows $ in Thousands	6 Months Ended
Consolidated Statements of Cash Flows $ in Thousands	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)
Cash flows from operating activities:
Net loss	$ (11,295)	$ (1,556)
Adjustments to reconcile to net cash provided by operating activities:
Stock-based compensation	7,137	349
Depreciation and amortization	4,160	2,924
Deferred income tax (benefit) expense	39	(1,239)
Provision for doubtful accounts	71	6
Loss on disposal of equipment	42
Changes in operating assets and liabilities:
Accounts receivable	(345)	50
Prepaid expenses	(193)	(715)
Trade accounts payable	697	778
Accrued expenses	536	295
Net cash provided by operating activities	849	892
Cash flows from investing activities:
Capitalized internally developed software costs	(1,579)	(1,859)
Purchases of property and equipment	(4,165)	(2,787)
Payments for acquisition	(2,585)
Net change in funds held for clients	(440,878)	(135,858)
Net cash used in investing activities	(449,207)	(140,504)
Cash flows from financing activities:
Net change in client funds obligation	440,878	135,858
Proceeds from follow-on offering, net of cash paid for issuance costs	(18,716)
Payments on initial public offering costs	(75)	(698)
Proceeds from exercise of stock options	(181)
Proceeds from employee stock purchase plan	670
Taxes paid related to net share settlement of equity awards	(1,380)
Principal payments on long-term debt		(313)
Net cash provided by financing activities	458,990	134,847
Net Change in Cash and Cash Equivalents	10,632	(4,765)
Cash and Cash Equivalents-Beginning of Year	78,848	7,594
Cash and Cash Equivalents-End of Year	89,480	2,829
Supplemental disclosure of non-cash investing and financing activities
Build-out allowance received from landlord		580
Deferred offering costs included in accounts payable		863
Unpaid follow-on offering costs included in accrued expenses	332
Purchases of property and equipment, accrued but not paid	1,366	759
Supplemental disclosure of cash flow information
Cash paid for income taxes	$ 26	195
Cash paid for interest		$ 48

Organization and Description of Business	6 Months Ended
Organization and Description of Business	Dec. 31, 2014
Organization and Description of Business
Organization and Description of Business	(1) Organization and Description of Business Paylocity Holding Corporation (the “Company”), through its wholly owned subsidiary, Paylocity Corporation, is a cloud-based provider of payroll and human capital management software solutions for medium-sized organizations. Services are provided in a Software-as-a-Service (“SaaS”) delivery model utilizing the Company’s cloud-based platform. Payroll services include collection, remittance and reporting of payroll liabilities to the appropriate federal, state and local authorities. Follow-On Offering In December 2014, the Company completed a follow-on offering in which it issued and sold 750 shares of common stock and existing shareholders sold 3,850 shares of common stock at a public offering price of $26.25 per share. The Company did not receive any proceeds from the sale of common stock by the existing shareholders. The Company received net proceeds of $18,384 after deducting underwriting discounts and commissions of $935 and other offering expenses of $368.

Summary of Significant Accounting Policies	6 Months Ended
Summary of Significant Accounting Policies	Dec. 31, 2014
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	(2) Summary of Significant Accounting Policies (a) Consolidation and Use of Estimates These unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the allowance for doubtful accounts, software developed for internal use, valuation and useful lives of long-lived assets, definite-lived intangibles, goodwill, stock-based compensation, valuation of net deferred income tax assets and the best estimate of selling price for revenue recognition purposes. Future events and their effects cannot be predicted with certainty; accordingly, accounting estimates require the exercise of judgment. Accounting estimates used in the preparation of these consolidated financial statements change as new events occur, as more experience is acquired, as additional information is obtained and as the operating environment changes. (b) Interim Unaudited Consolidated Financial Information The accompanying unaudited consolidated financial statements and notes have been prepared in accordance with GAAP and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, changes in stockholders’ equity and cash flows. The results of operations for the three-month and six-month periods ended December 31, 2014 are not necessarily indicative of the results for the full year or the results for any future periods. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended June 30, 2014 included in the Company’s Annual Report on Form 10-K filed with the SEC on August 22, 2014. (c) Income Taxes Differences in the normal relationship between the income tax expense (benefit) and pre-tax income (loss) materially result from the existence of a valuation allowance recorded against the preponderance of the net deferred tax assets. (d) Stock-Based Compensation The Company recognizes all employee stock-based compensation as a cost in the financial statements. Equity-classified awards, including those under the 2014 Employee Stock Purchase Plan (“ESPP”), are measured at the grant date fair value of the award and expense is recognized, net of assumed forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. The Company estimates grant date fair value using the Black-Scholes option-pricing model and periodically updates the assumed forfeiture rates for actual experience over the option vesting term or the term of the ESPP purchase period. (e) Recently Issued Accounting Standards In May 2014, the Financial Accounting Standard Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 supersedes a majority of existing revenue recognition guidance under US GAAP, and requires companies to recognize revenue when it transfers goods or services to a customer in an amount that reflects the consideration to which a company expects to be entitled. Companies may need to apply more judgment and estimation techniques or methods while recognizing revenue, which could result in additional disclosures to the financial statements. Topic 606 allows for either a “full retrospective” adoption or a “modified retrospective” adoption. The Company is currently evaluating which adoption method it will use. Early application is not permitted. The Company plans on adopting ASU 2014-09 beginning July 1, 2017 and is currently assessing the potential effects of these changes to its consolidated financial statements. From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s consolidated financial statements upon adoption.

Balance Sheet Information

6 Months Ended

Dec. 31, 2014

Balance Sheet Information

Balance Sheet Information

(3) Balance Sheet Information

The following tables provide details of selected consolidated balance sheet items:

Activity in the allowance for doubtful accounts was as follows:

Balance at June 30, 2014	$	126
Charged to expense	71
Write-offs	(39		)
Balance at December 31, 2014	$	158

Capitalized software and accumulated amortization were as follows:

	June 30,			December 31,
	2014			2014
Internally developed software	$	19,863		$	21,752
Accumulated amortization	(14,770		)	(16,048		)
Capitalized software, net	$	5,093		$	5,704

Amortization of capitalized internal-use software costs is included in Cost of Revenues-Recurring Revenues and amounted to $624 and $685 for the three months ended December 31, 2013 and 2014, respectively and $1,229 and $1,278 for the six months ended December 31, 2013 and 2014, respectively.

Property and equipment consist of the following:

	June 30,			December 31,
	2014			2014
Office equipment	$	1,449		$	1,716
Computer equipment	7,726			11,059
Furniture and fixtures	2,317			2,351
Software	4,963			5,133
Leasehold improvements	6,059			6,390
Time clocks rented by clients	2,360			2,698
	24,874			29,347
Accumulated depreciation	(11,749		)	(14,131		)
Property and equipment, net	$	13,125		$	15,216

Depreciation expense amounted to $909 and $1,354 for the three months ended December 31, 2013 and 2014, respectively and $1,695 and $2,502 for the six months ended December 31, 2013 and 2014, respectively.

The components of accrued expenses were as follows:

	June 30,		December 31,
	2014		2014
Accrued payroll and personnel costs	$	8,781	$	9,481
Current portion of deferred rent	577		669
Other	1,386		1,570
Total accrued expenses	$	10,744	11,720

Intangible assets consist of the following:

	June 30, 2014			December 31, 2014			Weighted Average Useful Life
Client relationships	$	6,180		$	6,180		9 years
Non-solicitation agreement	220			220			3 years
Total	6,400			6,400
Accumulated amortization	(80		)	(460		)
Intangible assets, net	$	6,320		$	5,940

There was no amortization expense for acquired intangible assets for the three months or six months ended December 31, 2013. Amortization expense for acquired intangible assets was $190 for the three months and $380 for the six months ended December 31, 2014.

Fair Value Measurement	6 Months Ended
Fair Value Measurement	Dec. 31, 2014
Fair Value Measurement
Fair Value Measurement	(4) Fair Value Measurement The Company applies the fair value measurement and disclosure provisions of ASC 820, Fair Value Measurements and Disclosures, and ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:  Level 1—Quoted prices in active markets for identical assets and liabilities.  Level 2—Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.  Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. Substantially all of the Company’s assets that are measured at fair value on a recurring basis are measured using Level 1 inputs. The Company considers the recorded value of its financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, and accounts payable, to approximate the fair value of the respective assets and liabilities at June 30, 2014 and December 31, 2014 based upon the short-term nature of the assets and liabilities.

- 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

Benefit Plans

6 Months Ended

Dec. 31, 2014

Benefit Plans

Benefit Plans

(5) Benefit Plans

(a) Equity Incentive Plan

The Company maintains a 2008 Equity Incentive Plan (the “2008 Plan”) and a 2014 Equity Incentive Plan (the “2014 Plan”) pursuant to which the Company has reserved 6,800 shares of its common stock for issuance to its employees, directors and non-employee third parties. The 2014 Plan serves as the successor to the 2008 plan and permits the granting of options to purchase common stock and other equity incentives at the discretion the compensation committee of the Company’s board of directors. No new awards will be issued under the 2008 Plan as of the effective date of the 2014 Plan. Outstanding awards under the 2008 Plan continue to be subject to the terms and conditions of the 2008 Plan.

Under the 2008 and 2014 Plans, the exercise price of each option is not less than the fair value of a share of common stock on the grant date. As of December 31, 2014, the Company had 2,036 shares allocated to the 2014 Plan, but not yet issued or subject to outstanding options or awards. Generally, the Company issues previously unissued shares for the exercise of stock options; however, previously acquired shares may be reissued to satisfy future issuances. The options typically vest ratably over a three or four year period and expire 10 years from the grant date. Compensation expense for the fair value of the options at their grant date is recognized ratably over the vesting schedule.

Stock-based compensation expense related to stock options and the vesting of Restricted Stock Awards (“RSAs”) and Restricted Stock Units (“RSUs”) is included in the following line items in the accompanying unaudited consolidated statements of operations:

	Three months ended December 31,				Six months ended December 31,
	2013		2014		2013		2014
Cost of revenue — recurring	$	—	$	466	$	—	$	814
Cost of revenue — non-recurring	—		386		—		677
Sales and marketing	—		894		—		1,778
Research and development	—		849		—		1,384
General and administrative	168		1,259		349		2,484
Total stock-based compensation	$	168	$	3,854	$	349	$	7,137

In addition, the Company capitalized $148 and $310 of stock compensation costs in its internal use software in the three-month and six-month periods ended December 31, 2014, respectively. No such amounts were capitalized in internal use software in the three and six month periods ended December 31, 2013.

The Company values stock options using the Black-Scholes option-pricing model, which requires the input of subjective assumptions, including the risk-free rate, expected life, expected stock price volatility and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for U.S. Treasury securities consistent with the expected term of the Company’s employee stock options. The expected life represents the period of time the stock options are expected to be outstanding and is based on the simplified method. Under the simplified method, the expected life of an option is presumed to be the mid-point between the vesting date and the end of the contractual term. The Company utilizes the simplified method due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected life of the stock options. The Company has a limited history of trading as a public company. Therefore, the expected volatility is based on historical volatilities for publicly traded stock of comparable companies over the estimated expected life of the stock options. The Company assumed no dividend yield because it does not expect to pay dividends in the near future, which is consistent with the Company’s history of not paying dividends.

The following table summarizes the assumptions used for estimating the fair value of stock options granted for the six months ended December 31:

	Period ended December 31,
	2013		2014
Valuation assumptions:
Expected dividend yield	0	%	0	%
Expected volatility	29.5	%	43.9	%
Expected term (years)	4.0		6.25
Risk-free interest rate	0.52	%	1.91	%

The following table summarizes changes during the quarter in the number of shares available for grant under our equity incentive plans:

	Number of Shares
Available for grant at July 1, 2014	2,581
RSU’s granted	(384	)
Options granted	(322	)
Shares withheld in settlement of taxes and exercise price	67
Forfeitures	228
Shares removed	(134	)
Available for grant at December 31, 2014	2,036

Shares removed represents forfeitures of shares and shares withheld in settlement of taxes and payment of exercise price related to grants made under the 2008 Plan. As noted above, no new awards will be issued under the 2008 Plan.

The table below presents stock option activity during the six months ended December 31, 2014:

	Outstanding Options
	Number of shares		Weighted average exercise price		Weighted average remaining contractual term	Aggregate intrinsic value
Balance at July 1, 2014	4,388		$	10.00	8.58	$	51,017
Options granted	322		24.80
Options forfeited	(219	)	12.62
Options exercised	(104	)	5.98
Balance at December 31, 2014	4,387		$	11.05	8.15	$	66,065
Options exercisable at December 31, 2014	1,341		$	2.91	6.49	$	31,102
Options vested and expected to vest at December 31, 2014	4,192		$	10.77	8.10	$	64,319

There were no options granted during the three-month periods ended December 31, 2013 and 2014, respectively. The weighted average grant date fair value of options granted during the six-month periods ended December 31, 2013 and 2014 was $1.71 and $11.15, respectively. The total intrinsic value of options exercised during the three and six month periods ended December 31, 2014 was $1,839 and $2,063, respectively. There were no options exercised in the three-month or six-month periods ended December 31, 2013. At December 31, 2014, there was $9,640 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock option granted under the Plan. That cost is expected to be recognized over a weighted average period of 1.73 years.

The Company may also grant RSAs and RSUs under the 2014 Plan with terms determined at the discretion of the Compensation Committee of the Company’s Board of Directors. The following table represents restricted stock unit activity during the six months ended December 31, 2014:

	Units		Weighted average grant date fair value
RSU balance at July 1, 2014	102		$	17.00
RSUs granted	384		24.75
RSUs vested	(100	)	17.57
RSUs cancelled/forfeited	(9	)	24.80
RSU balance at December 31, 2014	377		$	24.57
RSUs expected to vest at December 31, 2014	342		$	24.55

At December 31, 2014, there was $6,483 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested restricted stock awards granted under the Plan. That cost is expected to be recognized over a weighted average period of 2.13 years.

(b) Employee Stock Purchase Plan

The Company’s 2014 Employee Stock Purchase Plan (“ESPP”) was adopted by the Board of Directors and approved by the stockholders on February 6, 2014 and was effective upon completion of the Company’s initial public offering.

Under the Company’s ESPP, the Company can grant stock purchase rights to all eligible employees during specific offering periods not to exceed twenty-seven months. Each offering period will begin on the first trading day on or after May 16 and November 16 of each year, effective after the first offering period after the Company’s initial public offering (“IPO”). Shares are purchased through employees’ payroll deductions, up to a maximum of 10% of employees’ compensation for each purchase period, at a purchase price equal to 85% of the lesser of the fair market value of the Company’s common stock at the first trading day of the applicable offering period or the purchase date. Participants may purchase up to $25 worth of common stock or 2 shares of common stock in any one year. The ESPP is considered compensatory and results in compensation expense.

A total of one-million shares of common stock were reserved for future issuance under the ESPP, of which 36 have been issued as of December 31, 2014. The number of shares of common stock reserved for issuance under the ESPP will increase automatically each year, beginning on January 1, 2015 and continuing through and including January 1, 2024. The number of shares added each year will be equal to the lesser of (a) 400, (b) seventy-five one hundredths percent (0.75%) of the number of shares of common stock of the Company issued and outstanding on the immediately preceding December 31, or (c) an amount determined by the Company’s board of directors.

The Company commenced its initial ESPP four-month offering period on July 16, 2014 and commenced a six-month offering period on November 16, 2014. The Company recorded compensation expense attributable to the ESPP of $154 and $284 for the three-month and six-month periods ended December 31, 2014, respectively, which is included in the summary of stock-based compensation expense above. The grant date fair value of the ESPP offering periods was estimated using the following weighted average assumptions:

	Period ended December 31,
	2013	2014
Valuation assumptions:
Expected dividend yield	N/A	0%
Expected volatility	N/A	35.5 – 41.7%
Expected term (years)	N/A	0.3 – 0.5
Risk-free interest rate	N/A	0.04 – 0.06%

The Company maintains a 401(k) plan with a safe harbor matching provision that covers all eligible employees. The Company matches 50% of the employees’ contributions up to 6% of their gross pay. Contributions were approximately $229 and $327 for the three-month periods ended December 31, 2013 and 2014, respectively and were approximately $477 and $709 for the six-month periods ended December 31, 2013 and 2014, respectively.

Commitments and Contingencies	6 Months Ended
Commitments and Contingencies	Dec. 31, 2014
Commitments and Contingencies
Commitments and Contingencies	(6) Commitments and Contingencies Reseller Agreements The Company had agreements with two organizations that sell the Company’s offerings and services in defined areas of the country, one of which was terminated in May 2014. The Company exercised its right to terminate the first reseller agreement and acquired substantially all of the assets of the reseller in May 2014 as described in Note 5 of the audited consolidated financial statements and related notes for the year ended June 30, 2014 included in the Company’s Annual Report on Form 10-K filed with the SEC on August 22, 2014. The Company paid the first reseller $737 and $1,351 during the three and six months ended December 31, 2013, respectively, under the terminated reseller agreement. The Company paid the first reseller $200 and $2,585 during the three and six months ended December 31, 2014, respectively, under the terms of the asset purchase agreement signed at closing in May 2014. The initial term of the second reseller agreement commenced in June 2009 and is set to expire in June 2016 unless renewed or terminated. The second reseller agreement originally provided that the reseller may terminate the agreement by providing nine months’ prior notice or upon an initial public offering by the Company. The Company amended this agreement in December of 2013 to provide that the reseller may not give a nine-month termination notice until after the earlier of (i) six months following the closing of an initial public offering by the Company or (ii) December 31, 2014. In addition, the Company, but not the reseller, has the right to terminate the agreement at any time. If a termination were to occur, the purchase price of the assets would be equal to 3.3 times the net revenues of the reseller for the 12 months preceding the termination effective date. The Company paid the second reseller $471 and $695 during the three-month periods ended December 31, 2013 and 2014, respectively and $963 and $1,330 during the six-month periods ended December 31, 2013 and 2014, respectively.

Earnings Per Share

6 Months Ended

Dec. 31, 2014

Earnings Per Share

Earnings Per Share

(7) Earnings Per Share

For the periods presented prior to the Company’s IPO, basic and diluted net loss per common share is presented in conformity with the two-class method required for participating securities. Concurrently with the closing of the Company’s IPO on March 24, 2014, all shares of outstanding Redeemable Convertible Preferred Stock automatically converted into 11,933 shares of the Company’s common stock. Following the date of the IPO, the two-class method was no longer required as the Company has one class of securities issued and outstanding.

Prior to the conversion of the Redeemable Convertible Preferred Stock, holders of Series A and Series B Redeemable Convertible Preferred Stock each were entitled to liquidation preferences payable prior and in preference to any dividends on any shares of the Company’s common stock. In the event a dividend was paid on common stock, the holders of Redeemable Convertible Preferred Stock were entitled to a proportionate share of any such dividend as if they were holders of common stock (on an as-if converted basis). The holders of the Company’s Redeemable Convertible Preferred Stock did not have a contractual obligation to share in the losses of the Company. The Company considered its Redeemable Convertible Preferred Stock to be participating securities and, in accordance with the two-class method, earnings allocated to Redeemable Convertible Preferred Stock and the related number of outstanding shares of Redeemable Convertible Preferred Stock have been excluded from the computation of basic and diluted net loss per common share.

Under the two-class method, net loss attributable to common stockholders is determined by allocating undistributed earnings, calculated as net loss less current period Redeemable Convertible Preferred Stock cumulative dividends, between common stock and Redeemable Convertible Preferred Stock. In computing diluted net loss attributable to common stockholders, undistributed earnings are re-allocated to reflect the potential impact of dilutive securities.

Basic net loss per common share is computed using the weighted-average number of common shares outstanding during the period. Since the Series A and Series B Redeemable Convertible Preferred Stock were entitled to participate should any common stock dividends have been declared but were not obligated to participate in any losses generated by the Company, basic net income per share is computed using the weighted-average number of common shares outstanding during the period plus the Series A and Series B Redeemable Convertible Preferred Stock on a weighted-average basis.

Diluted net loss per share is computed using the weighted-average number of common shares outstanding during the period and, if dilutive, potential common shares outstanding during the period. Since the Series A and Series B Redeemable Convertible Preferred Stock were entitled to participate should any common stock dividends be declared but were not obligated to participate in any losses generated by the Company, diluted net income per share is computed using the weighted-average number of common shares plus the Series A and Series B Redeemable Convertible Preferred Stock on a weighted-average basis and, if dilutive, potential common shares outstanding during the period. The Company’s potential common shares consist of the incremental common shares issuable upon the exercise of stock options. The dilutive effect of outstanding stock options is reflected in diluted earnings per share by application of the treasury stock method.

The following table presents the calculation of basic and diluted net loss per share:

	Three months ended December 31,						Six months ended December 31,
	2013			2014			2013			2014
Basic net loss per share:
Numerator:
Net Loss	$	(1,512	)	$	(6,420	)	$	(1,556	)	$	(11,295	)
Less: Preferred dividend rights attributable to participating securities	(781		)	—			(1,562		)	—
Net loss attributable to common stockholders	$	(2,293	)	$	(6,420	)	$	(3,118	)	$	(11,295	)

Denominator:
Weighted-average shares used in computing net loss per share attributable to common stockholders:
Basic (in thousands)	31,988			49,775			31,988			49,670
Weighted-average effect of potentially dilutive shares:
Employee stock options and restricted stock units (in thousands)	—			—			—			—
Diluted (in thousands)	31,988			49,775			31,988			49,670

Net loss per share attributable to common stockholders, basic and diluted	$	(0.07	)	$	(0.13	)	$	(0.10	)	$	(0.23	)

The following table summarizes the outstanding employee stock options, restricted stock units, shares purchasable via the employee stock purchase plan as of the balance sheet date, and redeemable convertible preferred stock that were excluded from the diluted per share calculation for the periods presented because to include them would have been anti-dilutive:

	Three months ended December 31,		Six months ended December 31,
	2013	2014	2013	2014

Redeemable convertible preferred stock	11,933	—	11,933	—
Restricted stock units	—	377	—	377
Employee stock purchase plan shares	—	12	—	12
Employee stock options	2,376	4,387	2,376	4,387
Total	14,309	4,776	14,309	4,776

RSAs were excluded from both basic and diluted earnings per share calculations for the three-month and six-month periods ended December 31, 2013 as the vesting conditions had not been met as of that date.

Income Taxes	6 Months Ended
Income Taxes	Dec. 31, 2014
Income Taxes
Income Taxes	(8) Income Taxes The Company’s quarterly provision for income taxes is based on an estimated annual income tax rate. The Company’s quarterly provision for income taxes also includes the tax impact of certain unusual or infrequently occurring items, if any, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, in the interim period in which they occur. The Company recorded income tax (benefit) expense of $(877) and $34 for the three-month periods ended December 31, 2013 and 2014, respectively and $(1,239) and $62 for the six-month periods ended December 31, 2013 and 2014, respectively. The Company’s effective rate for the three and six months ended December 31, 2013 differed from statutory rates primarily due to federal and state research and development credits and expenses not deductible for income tax reporting purposes. The Company’s effective tax rate for the three and six months ended December 31, 2014 differ from statutory rates primarily due to the existence of a valuation allowance recorded against the preponderance of the net deferred tax assets. The Company reviews the likelihood that it will realize the benefit of its deferred tax assets and, therefore, the need for a valuation allowance on a quarterly basis. It established a valuation allowance on all of its net deferred tax assets except for deferred tax liabilities associated with indefinite-lived intangible assets during fiscal 2014, given that the company determined that it was more likely than not that the Company would not recognize the benefits of its net operating loss carryforwards prior to their expiration. As of December 31, 2014, the Company had no unrecognized tax benefits. On September 13, 2013, the IRS issued final regulations and re-proposed regulations that provide guidance with respect to (i) the treatment of materials and supplies, (ii) capitalization of amounts paid to acquire or produce tangible property, (iii) the determination of whether an expenditure with respect to tangible property is a deductible repair or a capital expenditure, and (iv) dispositions of MACRS property. The final regulations will be effective for the fiscal year ending June 30, 2015. Management is reviewing the regulations, but does not believe there will be a material impact on the Company’s results of operations, financial position, or cash flows.

Related Party Transactions	6 Months Ended
Related Party Transactions	Dec. 31, 2014
Related Party Transactions
Related Party Transactions	(9) Related Party Transactions The Company has a Memorandum of Understanding (“Memorandum”) and a Non-Competition and Non-Solicitation Agreement (“Non-Compete”) with its Chairman Steve Sarowitz and Blue Marble, a separate legal entity owned by Mr. Sarowitz. The Memorandum established the ongoing market based terms between the Company and Blue Marble for services provided to or on behalf of each other. In addition, Paylocity obtained a right of first refusal on the sale of Blue Marble, an option exercisable starting three years from the date of the Memorandum to purchase Blue Marble, and the right of first refusal to purchase any acquisition target of Blue Marble outside the United States of America, all at fair market value. The Memorandum requires Blue Marble to obtain written consent from Paylocity should Blue Marble intend to acquire an entity that provides or partners with other service providers to provide products and services to clients located in the United States of America. The Company provides no management guidance to the entity, has no equity interest in the entity, no obligation or intention to fund any of the entity’s operational shortfalls, and no right to any operational surpluses generated by the entity. The Non-Compete agreement outlines the permissible activities and ongoing responsibilities of Mr. Sarowitz and Blue Marble including an obligation not to compete with services offered by Paylocity and an obligation not to solicit employees of Paylocity.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References + Details

Subsequent events	6 Months Ended
Subsequent events	Dec. 31, 2014
Subsequent events
Subsequent events	(10) Subsequent Events On January 1, 2015, pursuant to the provisions of the 2014 Equity Incentive Plan, the number of common shares in reserve increased by 2,272 shares automatically and, pursuant to the provisions of the 2014 Employee Stock Purchase Plan, the number of common shares in reserve increased by 137 shares as determined by the Board of Directors. In January 2015, the underwriters for the Company’s follow-on offering exercised their option to purchase 360 additional shares from certain shareholders of the Company of the 690 available as described in the final prospectus filed with the SEC on December 12, 2014. The Company did not receive any proceeds from the sale of common stock by the existing shareholders. The Company has evaluated subsequent events from the balance sheet date through February 6, 2015, the date at which the financial statements were available to be issued and has determined that there are no such events that would have a material impact on the financial statements.

Summary of Significant Accounting Policies (Policies)	6 Months Ended
Summary of Significant Accounting Policies (Policies)	Dec. 31, 2014
Summary of Significant Accounting Policies
Consolidation and Use of Estimates	(a) Consolidation and Use of Estimates These unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the allowance for doubtful accounts, software developed for internal use, valuation and useful lives of long-lived assets, definite-lived intangibles, goodwill, stock-based compensation, valuation of net deferred income tax assets and the best estimate of selling price for revenue recognition purposes. Future events and their effects cannot be predicted with certainty; accordingly, accounting estimates require the exercise of judgment. Accounting estimates used in the preparation of these consolidated financial statements change as new events occur, as more experience is acquired, as additional information is obtained and as the operating environment changes.
Interim Unaudited Consolidated Financial Information	(b) Interim Unaudited Consolidated Financial Information The accompanying unaudited consolidated financial statements and notes have been prepared in accordance with GAAP and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, changes in stockholders’ equity and cash flows. The results of operations for the three-month and six-month periods ended December 31, 2014 are not necessarily indicative of the results for the full year or the results for any future periods. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended June 30, 2014 included in the Company’s Annual Report on Form 10-K filed with the SEC on August 22, 2014.
Income Taxes	(c) Income Taxes Differences in the normal relationship between the income tax expense (benefit) and pre-tax income (loss) materially result from the existence of a valuation allowance recorded against the preponderance of the net deferred tax assets.
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]	(d) Stock-Based Compensation The Company recognizes all employee stock-based compensation as a cost in the financial statements. Equity-classified awards, including those under the 2014 Employee Stock Purchase Plan (“ESPP”), are measured at the grant date fair value of the award and expense is recognized, net of assumed forfeitures, on a straight-line basis over the requisite service period for each separately vesting portion of the award. The Company estimates grant date fair value using the Black-Scholes option-pricing model and periodically updates the assumed forfeiture rates for actual experience over the option vesting term or the term of the ESPP purchase period.
Recently Issued Accounting Standards	(e) Recently Issued Accounting Standards In May 2014, the Financial Accounting Standard Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 supersedes a majority of existing revenue recognition guidance under US GAAP, and requires companies to recognize revenue when it transfers goods or services to a customer in an amount that reflects the consideration to which a company expects to be entitled. Companies may need to apply more judgment and estimation techniques or methods while recognizing revenue, which could result in additional disclosures to the financial statements. Topic 606 allows for either a “full retrospective” adoption or a “modified retrospective” adoption. The Company is currently evaluating which adoption method it will use. Early application is not permitted. The Company plans on adopting ASU 2014-09 beginning July 1, 2017 and is currently assessing the potential effects of these changes to its consolidated financial statements. From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s consolidated financial statements upon adoption.

- Definition

Disclosure of accounting policy for income taxes, which may include its accounting policies for recognizing and measuring deferred tax assets and liabilities and related valuation allowances, recognizing investment tax credits, operating loss carryforwards, tax credit carryforwards, and other carryforwards, methodologies for determining its effective income tax rate and the characterization of interest and penalties in the financial statements.

+ References + Details

Balance Sheet Information (Tables)

6 Months Ended

Dec. 31, 2014

Balance Sheet Information

Schedule of activity in allowance for doubtful accounts

Balance at June 30, 2014	$	126
Charged to expense	71
Write-offs	(39		)
Balance at December 31, 2014	$	158

Schedule of capitalized software and accumulated amortization

	June 30,			December 31,
	2014			2014
Internally developed software	$	19,863		$	21,752
Accumulated amortization	(14,770		)	(16,048		)
Capitalized software, net	$	5,093		$	5,704

Schedule of property and equipment

	June 30,			December 31,
	2014			2014
Office equipment	$	1,449		$	1,716
Computer equipment	7,726			11,059
Furniture and fixtures	2,317			2,351
Software	4,963			5,133
Leasehold improvements	6,059			6,390
Time clocks rented by clients	2,360			2,698
	24,874			29,347
Accumulated depreciation	(11,749		)	(14,131		)
Property and equipment, net	$	13,125		$	15,216

Schedule of components of accrued expenses

	June 30,		December 31,
	2014		2014
Accrued payroll and personnel costs	$	8,781	$	9,481
Current portion of deferred rent	577		669
Other	1,386		1,570
Total accrued expenses	$	10,744	11,720

Schedule of intangible assets

	June 30, 2014			December 31, 2014			Weighted Average Useful Life
Client relationships	$	6,180		$	6,180		9 years
Non-solicitation agreement	220			220			3 years
Total	6,400			6,400
Accumulated amortization	(80		)	(460		)
Intangible assets, net	$	6,320		$	5,940

Benefit Plans (Tables)

6 Months Ended

Dec. 31, 2014

Benefit Plans

Schedule of stock-based compensation expense related to stock options and the vesting of Restricted Stock Awards ("RSAs") and Restricted Stock Units ("RSUs")

	Three months ended December 31,				Six months ended December 31,
	2013		2014		2013		2014
Cost of revenue — recurring	$	—	$	466	$	—	$	814
Cost of revenue — non-recurring	—		386		—		677
Sales and marketing	—		894		—		1,778
Research and development	—		849		—		1,384
General and administrative	168		1,259		349		2,484
Total stock-based compensation	$	168	$	3,854	$	349	$	7,137

Summary of the assumptions used for estimating the fair value of stock options granted

	Period ended December 31,
	2013		2014
Valuation assumptions:
Expected dividend yield	0	%	0	%
Expected volatility	29.5	%	43.9	%
Expected term (years)	4.0		6.25
Risk-free interest rate	0.52	%	1.91	%

Summary of shares available for grant under our equity incentive plans

	Number of Shares
Available for grant at July 1, 2014	2,581
RSU’s granted	(384	)
Options granted	(322	)
Shares withheld in settlement of taxes and exercise price	67
Forfeitures	228
Shares removed	(134	)
Available for grant at December 31, 2014	2,036

Schedule of stock option activity

	Outstanding Options
	Number of shares		Weighted average exercise price		Weighted average remaining contractual term	Aggregate intrinsic value
Balance at July 1, 2014	4,388		$	10.00	8.58	$	51,017
Options granted	322		24.80
Options forfeited	(219	)	12.62
Options exercised	(104	)	5.98
Balance at December 31, 2014	4,387		$	11.05	8.15	$	66,065
Options exercisable at December 31, 2014	1,341		$	2.91	6.49	$	31,102
Options vested and expected to vest at December 31, 2014	4,192		$	10.77	8.10	$	64,319

Schedule of Restricted stock unit activity

	Units		Weighted average grant date fair value
RSU balance at July 1, 2014	102		$	17.00
RSUs granted	384		24.75
RSUs vested	(100	)	17.57
RSUs cancelled/forfeited	(9	)	24.80
RSU balance at December 31, 2014	377		$	24.57
RSUs expected to vest at December 31, 2014	342		$	24.55

Schedule of estimated grant date fair value of ESPP offering period using weighted average assumptions

	Period ended December 31,
	2013	2014
Valuation assumptions:
Expected dividend yield	N/A	0%
Expected volatility	N/A	35.5 – 41.7%
Expected term (years)	N/A	0.3 – 0.5
Risk-free interest rate	N/A	0.04 – 0.06%

Earnings Per Share (Tables)

6 Months Ended

Dec. 31, 2014

Earnings Per Share

Schedule of calculation of basic and diluted net loss per share

	Three months ended December 31,						Six months ended December 31,
	2013			2014			2013			2014
Basic net loss per share:
Numerator:
Net Loss	$	(1,512	)	$	(6,420	)	$	(1,556	)	$	(11,295	)
Less: Preferred dividend rights attributable to participating securities	(781		)	—			(1,562		)	—
Net loss attributable to common stockholders	$	(2,293	)	$	(6,420	)	$	(3,118	)	$	(11,295	)

Denominator:
Weighted-average shares used in computing net loss per share attributable to common stockholders:
Basic (in thousands)	31,988			49,775			31,988			49,670
Weighted-average effect of potentially dilutive shares:
Employee stock options and restricted stock units (in thousands)	—			—			—			—
Diluted (in thousands)	31,988			49,775			31,988			49,670

Net loss per share attributable to common stockholders, basic and diluted	$	(0.07	)	$	(0.13	)	$	(0.10	)	$	(0.23	)

Summary of outstanding employee stock options and redeemable convertible preferred stock excluded from the diluted per share calculation because to include them would have been anti-dilutive

	Three months ended December 31,		Six months ended December 31,
	2013	2014	2013	2014

Redeemable convertible preferred stock	11,933	—	11,933	—
Restricted stock units	—	377	—	377
Employee stock purchase plan shares	—	12	—	12
Employee stock options	2,376	4,387	2,376	4,387
Total	14,309	4,776	14,309	4,776

Organization and Description of Business (Detail) $ / shares in Units, shares in Thousands, $ in Thousands	1 Months Ended	6 Months Ended
	Dec. 31, 2014 USD ($) $ / shares shares	Dec. 31, 2014 $ / shares shares
Follow-on offering
Number of shares of common stock issued and sold \| shares	750
Public offering price (in dollar per share) \| $ / shares	$ 26.25	$ 26.25
Net proceeds after deducting underwriting discounts and commissions and other offering expenses \| $	$ 18,384
Underwriting discounts and commissions \| $	935
Other offering expenses \| $	$ 368
Common Stock
Follow-on offering
Number of shares of common stock issued and sold \| shares		750
Existing shareholders
Follow-on offering
Number of shares of common stock issued and sold \| shares	3,850

Balance Sheet Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Jun. 30, 2014
Activity in allowance for doubtful accounts
Balance at beginning of period			$ 126
Charged to expense			71	$ 6
Write-offs			(39)
Balance at end of period	$ 158		158
Capitalized software and accumulated amortization
Internally developed software	21,752		21,752		$ 19,863
Accumulated amortization	(16,048)		(16,048)		(14,770)
Capitalized software, net	5,704		5,704		5,093
Amortization of capitalized internal-use software costs	685	$ 624	1,278	1,229
Property and equipment
Property and equipment, gross	29,347		29,347		24,874
Accumulated depreciation	(14,131)		(14,131)		(11,749)
Property and equipment, net	15,216		15,216		13,125
Depreciation expense	1,354	$ 909	2,502	$ 1,695
Components of accrued expenses
Accrued payroll and personnel costs	9,481		9,481		8,781
Current portion of deferred rent	669		669		577
Other	1,570		1,570		1,386
Total accrued expenses	11,720		11,720		10,744
Office equipment
Property and equipment
Property and equipment, gross	1,716		1,716		1,449
Computer equipment
Property and equipment
Property and equipment, gross	11,059		11,059		7,726
Furniture and fixtures
Property and equipment
Property and equipment, gross	2,351		2,351		2,317
Software
Property and equipment
Property and equipment, gross	5,133		5,133		4,963
Leasehold improvements
Property and equipment
Property and equipment, gross	6,390		6,390		6,059
Time clocks rented by clients
Property and equipment
Property and equipment, gross	$ 2,698		$ 2,698		$ 2,360

Balance Sheet Information (Details 2) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Jun. 30, 2014
Intangible Assets
Intangible assets	$ 6,400		$ 6,400		$ 6,400
Intangible assets, accumulated amortization	(460)		(460)		(80)
Intangible assets, net	5,940		5,940		6,320
Amortization expense	190	$ 0	380	$ 0
Client relationships
Intangible Assets
Intangible assets	6,180		$ 6,180		6,180
Useful life			9 years
Non-solicitation agreement
Intangible Assets
Intangible assets	$ 220		$ 220		$ 220
Useful life			3 years

Benefit Plans (Details) shares in Thousands	6 Months Ended
Benefit Plans (Details) shares in Thousands	Dec. 31, 2014 shares
Equity Incentive Plans
Number of shares of common stock reserved for issuance	6,800
Stock options
Equity Incentive Plans
Expiration period	10 years
Stock options \| Minimum
Equity Incentive Plans
Vesting period	3 years
Stock options \| Maximum
Equity Incentive Plans
Vesting period	4 years
2008 Plan
Equity Incentive Plans
Awards issued (in shares)	0
2014 Plan
Equity Incentive Plans
Number of shares allocated but not yet issued or subject to outstanding options or awards	2,036

Benefit Plans (Details 2) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Benefit Plans (Details 2) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Benefit Plans
Total stock-based compensation expense	$ 3,854	$ 168	$ 7,137	$ 349
Stock compensation costs capitalized	148	0	310	0
Cost of revenue - recurring
Benefit Plans
Total stock-based compensation expense	466		814
Cost of revenue - non-recurring
Benefit Plans
Total stock-based compensation expense	386		677
Sales and marketing
Benefit Plans
Total stock-based compensation expense	894		1,778
Research and development
Benefit Plans
Total stock-based compensation expense	849		1,384
General and administrative
Benefit Plans
Total stock-based compensation expense	$ 1,259	$ 168	$ 2,484	$ 349

Benefit Plans (Details 3) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended			6 Months Ended		12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Jun. 30, 2014
Equity Incentive Plan Member
Shares Available for Grant
Balance at the beginning of the period (in shares)		2,581,000		2,581,000
RSU's granted (in shares)				(384,000)
Shares withheld in settlement of taxes and exercise price				67,000
Forfeitures (in shares)				228,000
Shares removed				(134,000)
Balance at the end of the period (in shares)	2,036,000			2,036,000		2,581,000
Number of shares
Options forfeited (in shares)				(228,000)
Units
RSU's granted (in shares)				384,000
Stock options
Valuation assumptions:
Expected dividend yield (as a percent)				0.00%	0.00%
Expected volatility (as a percent)				43.90%	29.50%
Expected term (years)				6 years 3 months	4 years
Risk-free interest rate (as a percent)				1.91%	0.52%
Shares Available for Grant
Options granted (in shares)	0		0	(322,000)
Forfeitures (in shares)				219,000
Number of shares
Balance at the beginning of the period (in shares)		4,388,000		4,388,000
Options granted (in shares)	0		0	322,000
Options forfeited (in shares)				(219,000)
Options exercised (in shares)			0	(104,000)	0
Balance at the end of the period (in shares)	4,387,000			4,387,000		4,388,000
Options exercisable at the end of the period (in shares)	1,341,000			1,341,000
Options vested and expected to vest at the end of the period (in shares)	4,192,000			4,192,000
Weighted average exercise price
Balance at the beginning of the period (in dollars per share)		$ 10.00		$ 10.00
Options granted (in dollars per share)				24.80
Options forfeited (in dollars per share)				12.62
Options exercised (in dollars per share)				5.98
Balance at the end of the period (in dollars per share)	$ 11.05			11.05		$ 10.00
Options exercisable at the end of the period (in dollars per share)	2.91			2.91
Options vested and expected to vest at the end of the period (in dollars per share)	$ 10.77			$ 10.77
Weighted average remaining contractual term
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2				8 years 1 month 24 days		8 years 6 months 29 days
SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2				8 years 1 month 24 days		8 years 6 months 29 days
Options exercisable at the end of the period				6 years 5 months 27 days
Options vested and expected to vest at the end of the period				8 years 1 month 6 days
Aggregate intrinsic value
Balance at the beginning of the period		$ 51,017		$ 51,017
Balance at the end of the period (in dollars)	$ 66,065			66,065		$ 51,017
Options exercisable at the end of the period	31,102			31,102
Options vested and expected to vest at the end of the period	64,319			$ 64,319
Weighted average grant date fair value of options granted (in dollars per share)		$ 11.15		$ 11.15	$ 1.71
Total intrinsic value of options exercised	1,839			$ 2,063
Weighted average grant date fair value
Total unrecognized compensation cost, net of estimated forfeitures	$ 9,640			$ 9,640
Weighted average period to recognize unrecognized compensation cost				1 year 8 months 23 days
Stock options \| Equity Incentive Plan Member
Shares Available for Grant
Options granted (in shares)				(322,000)
Number of shares
Options granted (in shares)				322,000
RSUs
Shares Available for Grant
RSU's granted (in shares)				(384,000)
Units
RSU Balance at the beginning of the period (in shares)		102,000		102,000
RSU's granted (in shares)				384,000
RSUs vested (in shares)				(100,000)
RSUs cancelled/forfeited (in shares)				(9,000)
RSU Balance at the end of the period (in shares)	377,000			377,000		102,000
RSUs expected to vest at the end of the period (in shares)	342,000			342,000
Weighted average grant date fair value
RSU Balance at the beginning of the period (in dollars per share)		$ 17.00		$ 17.00
RSU's granted (in dollars per share)				24.75
RSUs vested (in dollars per share)				17.57
RSUs cancelled/forfeited (in dollars per share)				24.80
RSU Balance at the end of the period (in dollars per share)	$ 24.57			24.57		$ 17.00
RSUs expected to vest at the end of the period (in dollars per share)	$ 24.55			$ 24.55
Total unrecognized compensation cost, net of estimated forfeitures	$ 6,483			$ 6,483
Weighted average period to recognize unrecognized compensation cost				2 years 1 month 17 days

Benefit Plans (Details 4) - USD ($) $ in Thousands			3 Months Ended		6 Months Ended
Benefit Plans (Details 4) - USD ($) $ in Thousands	Jul. 16, 2014	Feb. 06, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Equity Incentive Plans
Compensation expense (in dollars)			$ 3,854	$ 168	$ 7,137	$ 349
Employee Stock Purchase Plan
Equity Incentive Plans
Offering period	4 months
Percentage of employee compensation, maximum		10.00%
Percentage of fair market value as a purchase price		85.00%
Value of shares per employee, maximum		$ 25
Number of shares per employee, maximum		2,000
Number of periods during which shares can be purchased		1 year
Number of shares authorized			1,000,000		1,000,000
Number of shares issued					36
Additional number of shares reserved for issuance each year					400,000
Percentage of additional number of shares reserved for issuance each year					0.75%
Compensation expense (in dollars)			$ 154		$ 284
Employee Stock Purchase Plan \| Minimum
Valuation assumptions:
Expected volatility					35.50%
Expected term (years)					3 months 18 days
Risk-free interest rate					0.04%
Employee Stock Purchase Plan \| Maximum
Equity Incentive Plans
Offering period		27 months
Valuation assumptions:
Expected dividend yield					0.00%
Expected volatility					41.70%
Expected term (years)					6 months
Risk-free interest rate					0.06%

Benefit Plans (Details 5) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Benefit Plans (Details 5) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Benefit Plans
Matching contributions by the Company as percentage of employees' contributions			50.00%
Maximum contributions as percentage of employees' gross pay			6.00%
Contributions	$ 327	$ 229	$ 709	$ 477

Commitments and Contingencies (Details) $ in Thousands	1 Months Ended	3 Months Ended		6 Months Ended
Commitments and Contingencies (Details) $ in Thousands	May 31, 2014	Dec. 31, 2014 USD ($) item	Dec. 31, 2013 USD ($)	Dec. 31, 2014 USD ($) item	Dec. 31, 2013 USD ($)
Commitments and Contingencies
Number of reseller organizations \| item		2		2
First reseller agreement
Reseller agreements
Reseller agreements terminated	1
Amount paid to reseller per terms of our resale agreement			$ 737		$ 1,351
Amount paid under the terms of an asset purchase agreement		$ 200		$ 2,585
Second reseller agreement
Reseller agreements
Amount paid to reseller per terms of our resale agreement		$ 695	$ 471	$ 1,330	$ 963
Prior notice period to terminate the agreement by resellers				9 months
Minimum period after closing of initial public offering to provide prior notice by the reseller for termination of agreement				6 months
Purchase price of assets as multiplier of net revenues of reseller for 12 months preceding termination effective date \| item		3.3		3.3
Period considered for multiplier of annual revenues to calculate purchase price of assets				12 months

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Mar. 24, 2014
Earnings Per Share
Number of shares of common stock issued on automatic conversion of outstanding preferred stock					11,933
Numerator:
Net loss	$ (6,420)	$ (1,512)	$ (11,295)	$ (1,556)
Less: Preferred dividend rights attributable to participating securities		(781)		(1,562)
Net loss attributable to common stockholders	$ (6,420)	$ (2,293)	$ (11,295)	$ (3,118)
Weighted-average shares used in computing net loss per share attributable to common stockholders:
Basic (in shares)	49,775	31,988	49,670	31,988
Weighted-average effect of potentially dilutive shares:
Diluted (in shares)	49,775	31,988	49,670	31,988
Net loss per share attributable to common stockholders:
Net loss per share attributable to common stockholders, basic and diluted	$ (0.13)	$ (0.07)	$ (0.23)	$ (0.10)
Anti-dilutive securities excluded from diluted per share calculation
Total (in shares)	4,776	14,309	4,776	14,309
Redeemable convertible preferred stock
Anti-dilutive securities excluded from diluted per share calculation
Total (in shares)		11,933		11,933
RSUs
Anti-dilutive securities excluded from diluted per share calculation
Total (in shares)	377		377
Employee Stock Purchase Plan
Anti-dilutive securities excluded from diluted per share calculation
Total (in shares)	12		12
Employee stock options
Anti-dilutive securities excluded from diluted per share calculation
Total (in shares)	4,387	2,376	4,387	2,376

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Income Taxes
Amount of tax provision (benefit) recorded	$ 34	$ (877)	$ 62	$ (1,239)
Unrecognized tax benefits	$ 0		$ 0

Related Party Transactions (Details)	6 Months Ended
Related Party Transactions (Details)	Dec. 31, 2014
Related party transactions
Exercise period for right of first refusal option on sale of Blue Marble	3 years
Blue Marble Member
Related party transactions
Equity interest (as a percent)	0.00%

Subsequent events (Details) - shares shares in Thousands	1 Months Ended
Subsequent events (Details) - shares shares in Thousands	Jan. 31, 2015	Jan. 01, 2015	Dec. 31, 2014
Subsequent events
Number of shares of common stock reserved for issuance			6,800
Subsequent event
Subsequent events
Follow on offering exercised by underwriters (in shares)	360
Shares available for grant	690
Subsequent event \| 2014 Plan
Subsequent events
Additional shares available for grant		2,272
Subsequent event \| Employee Purchase Plan 2014
Subsequent events
Additional shares available for grant		137