3.	Fair Value Measurements

The Company reports assets and liabilities recorded at fair value on the Company’s consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The categories are as follows:

Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs are quoted prices for similar assets and liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments.

Level 3—Inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation.

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis as of March 31, 2015 and 2014 based on the three-tier fair value hierarchy (in thousands):


	Fair Value Measurements as of March 31, 2015
	Level 1		Level 2		Level 3		Total
Description:
Money market funds	$	56,455	$	—	$	—	$	56,455
Certificates of deposit		—		1,800		—		1,800
Commercial paper		—		30,288		—		30,288
Corporate notes and bonds		—		38,715		—		38,715
U.S. treasury securities		500		—		—		500
U.S. government agencies		—		33,199		—		33,199
Restricted cash—money market funds		4,623		—		—		4,623

Total	$	61,578	$	104,002	$	—	$	165,580

Included in cash and cash equivalents							$	65,454

Included in short-term investments							$	95,503

Included in restricted cash							$	4,623


	Fair Value Measurements as of March 31, 2014
	Level 1		Level 2		Level 3		Total
Description:
Money market funds	$	3,512	$	—	$	—	$	3,512
Restricted cash—money market funds		5,601		—		—		5,601

Total	$	9,113	$	—	$	—	$	9,113

Convertible preferred stock warrant liability	$	—	$	—	$	830	$	830

Included in cash and cash equivalents							$	3,512

Included in restricted cash							$	5,601

Included in other liabilities, non-current							$	830

There were no transfers between fair value measurement levels during the fiscal year ended March 31, 2015.

Level 3 instruments consist solely of the Company’s preferred stock warrant liability. Prior to the Company’s IPO, outstanding warrants to purchase shares of the Company’s Series A and Series D convertible preferred stock were classified as other liabilities. The initial liability recorded was adjusted for changes in the fair values of the Company’s preferred stock warrants during each reporting period and was recorded as a component of other (expense) income, net in the statement of operations. During the fiscal years ended March 31, 2015, 2014, and 2013, the Company recognized charges in the amount of $82,000, $0.7 million, and $13,000, respectively, which was recorded as other expense in the Company’s consolidated statements of operations.

Upon the closing of the Company’s IPO and the conversion of the underlying preferred stock to common stock, the Company’s warrants to purchase shares of Series A and Series D convertible preferred stock were converted into warrants to purchase shares of the Company’s common stock. The aggregate fair value of these warrants upon the closing of the IPO was $0.9 million which was reclassified from liabilities to additional paid-in capital, a component of stockholders’ equity (deficit), and the Company ceased recording any further related periodic fair value adjustments. The Company estimated the fair values of these warrants using the Black-Scholes option-pricing model, based on the inputs for the estimated fair value of the underlying convertible preferred stock at the valuation measurement date, the remaining contractual term of the warrant, risk-free interest rates, expected dividend rates and expected volatility of the price of the underlying convertible preferred stock. These estimates were based on subjective assumptions.

Immediately prior to the close of the IPO and as of March 31, 2014, the Company determined the fair value of the outstanding convertible preferred stock warrants utilizing the following assumptions:


	Prior to Close of IPO on December 17,	As of March 31,
	2014	2014
Remaining contractual term (in years)	0.0 - 3.7	4.4 - 8.4
Risk-free interest rate	0.0 - 1.4%	1.5 - 2.5%
Volatility	45%	50%
Dividend yield	—	—

The above assumptions were determined as follows:

Remaining Contractual Term—The remaining contractual term represented the time from the date of the valuation to the expiration of the warrant.

Risk-Free Interest Rate—The risk-free interest rate was based on the U.S. Treasury yield in effect as of December 17, 2014 and March 31, 2014, and for zero coupon U.S. Treasury notes with maturities approximately equal to the term of the warrant.

Volatility—The volatility was derived from historical volatilities of several unrelated publicly listed peer companies over a period approximately equal to the term of the warrant because the Company had limited information on the volatility of the preferred stock since there was no trading history. When making the selections of industry peer companies to be used in the volatility calculation, the Company considered the size, operational, and economic similarities to the Company’s principle business operations.

Dividend Yield—The expected dividend assumption was based on the Company’s expectations about its dividend policy.

The warrant to purchase shares of the Company’s Series D convertible preferred stock was automatically net exercised for an aggregate of 12,193 shares of common stock upon closing of the Company’s IPO in December 2014.

The warrant to purchase shares of the Company’s Series A convertible preferred stock that was converted into a warrant to purchase shares of the Company’s common stock was net exercised for an aggregate of 27,573 shares of common stock in January 2015.

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments as follows (in thousands):


	Preferred Stock Warrant Liability
Balance at March 31, 2014	$	830
Change in fair value of preferred stock warrant liability		82
Reclassification of preferred stock warrant liabilities to additional paid-in capital in conjunction with the conversion of the convertible preferred stock into common stock upon the closing of the Company’s IPO		(912	)

Balance at March 31, 2015	$	—

Gross unrealized gains or losses for cash equivalents and available-for-sale marketable securities as of March 31, 2015 and 2014 were not material. As of March 31, 2015 and 2014, there were no securities that were in an unrealized loss position for more than 12 months.

The following table classifies the Company’s available-for-sale short-term investments by contractual maturities as of March 31, 2015 and 2014 (in thousands):


	March 31, 2015		March 31, 2014
Due in one year	$	53,287	$	—
Due in one to two years		42,216		—

Total	$	95,503	$	—

For certain other financial instruments, including accounts receivable, accounts payable and other current liabilities, the carrying amounts approximate their fair value due to the relatively short maturity of these balances.