10-K

Table Of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934     For the fiscal year ended December 31, 2013

 OR

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934      For the transition period from                     to

 Commission file number 001-35339

ANGIE’S LIST, INC.

(Exact name of registrant as specified in its charter)

Delaware	27-2440197
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
1030 E. Washington Street Indianapolis, IN	46202
(Address of principal executive offices)	(Zip Code)

(888) 888-5478

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

(Title of each class)	(Name of each exchange on which registered)
Common Stock, $0.001 par value	The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act:

None.

(Title of Class) 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☒    No  ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.    Yes  ☐    No  ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐  (Do not check if a smaller reporting company)	Smaller reporting company	☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

The aggregate market value of the voting common stock held by non-affiliates of the registrant as of June 30, 2013, computed by reference to the number of shares outstanding and using the price at which the stock was last sold, was $1,134,108,866.

As of February 27, 2014, the number of shares of the registrant’s common stock outstanding was 58,507,109.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Definitive Proxy Statement relating to its 2014 annual meeting of stockholders, to be filed subsequent to the date hereof, are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. Such Definitive Proxy Statement will be filed with the Securities and Exchange Commission not later than 120 days after the conclusion of the registrant’s fiscal year ended December 31, 2013. Except with respect to information specifically incorporated by reference in this Annual Report on Form 10-K, the Definitive Proxy Statement is not deemed to be filed as part of this Annual Report on Form 10-K.

PART I.
Item 1.	Business	1
Item 1A.	Risk Factors	6
Item 1B.	Unresolved Staff Comments	26
Item 2.	Properties	27
Item 3.	Legal Proceedings	27
Item 4.	Mine Safety Disclosures	27
PART II.
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	28
Item 6.	Selected Consolidated Financial and Other Data	30
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	47
Item 8.	Financial Statements and Supplementary Data	48
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	70
Item 9A.	Controls and Procedures	70
Item 9B.	Other Information	72
PART III.
Item 10.	Directors, Executive Officers and Corporate Governance	72
Item 11.	Executive Compensation	72
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	72
Item 13.	Certain Relationships and Related Transactions, and Director Independence	72
Item 14.	Principal Accountant Fees and Services	72
PART IV.
Item 15.	Exhibits and Financial Statement Schedules	73

PART I.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA

This Annual Report on Form 10-K contains “forward-looking statements” that involve substantial risks and uncertainties. The statements contained in this Annual Report on Form 10-K that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including, but not limited to, statements regarding our expectations, beliefs, intentions, strategies, future operations, future financial position, future revenue, projected expenses and plans and objectives of management. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “will,” “would,” “should,” “could,” “can,” “predict,” “potential,” “continue,” “objective,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. However, not all forward-looking statements contain these identifying words. In addition, some of the industry and market data contained in this Annual Report on Form 10-K are based on data collected by third parties, including The Nielsen Company (“Nielsen”) and Merkle Inc. This information involves a number of assumptions and limitations. Although we believe that each source is reliable as of its respective date, we have not independently verified the accuracy or completeness of this information. These forward-looking statements reflect our current views about future events and involve known risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievement to be materially different from those expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section entitled “Risk Factors” included in this Annual Report on Form 10-K. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. We qualify all of our forward-looking statements by these cautionary statements.

ITEM 1.      BUSINESS

Overview

Angie’s List operates a consumer-driven service for members to research, hire, rate and review local professionals for critical needs, such as home, health care and automotive services. Our ratings and reviews, which are available only to our members, help our members find the best provider for their local service needs. We allow local service providers who are highly rated by our members to advertise discounts and other promotions to our members. As of December 31, 2013, we offered our service to approximately 2.5 million paying members in 253 local markets in the United States.

We help consumers purchase “high cost of failure” services in an extremely fragmented local marketplace. These services, which include home remodeling, plumbing, roof repair, health care and automobile repair, are typically expensive and carry a high cost to the consumer if performed poorly. Consumers seeking reputable providers of these services generally are forced to rely on incomplete data from word-of-mouth testimonials, local advertisements, the Yellow Pages or Internet search results, all of which may be incomplete, unreliable or misleading. Our ratings are based exclusively on reviews from our members and we accept no anonymous reviews. As a result, we believe our reviews are a trusted resource for consumers to find high quality local service providers.

We also help local service providers find quality customers and differentiate themselves in a competitive marketplace. Our members represent an attractive, targeted group of consumers for service providers. Our typical member is between the ages of 35 and 64, is married, owns a home, is college educated and has an annual household income of at least $100,000, based on information derived and interpreted by us as a result of our own analysis from general demographic data provided by Nielsen.

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The value proposition we offer to both consumers and local service providers strengthens our position as a trusted resource and allows us to derive revenue from both members and service providers. As more members contribute reviews to our service, we increase the breadth and depth of content offered to members, attracting more members and enhancing the value of our service to reputable local service providers, for whom our members constitute a large pool of qualified customers for their services. We believe our high level of member engagement and our consistently high membership and service provider renewal rates are evidence of the value we offer both members and service providers.

Our Services

We offer an efficient way for consumers and reputable service providers to find each other, always placing the interests of the consumer first.

Member Services

Applying the “ask-your-neighbor” approach across our target markets, we compile a breadth of highly relevant, member-generated ratings and reviews that provide insights consumers cannot obtain on their own. We collect reviews from both members and non-members, and we prohibit anonymous reviews. Only our members’ reviews factor into service providers’ ratings, and consumers must subscribe to access our ratings and reviews. We actively monitor for fraudulent reviews.

Our members’ reviews span more than 720 categories of high cost of failure services such as home, health care and automotive services. Consumers may purchase monthly, annual and multi-year memberships to Angie’s List, Angie’s List Health & Wellness or Angie’s List Classic Cars in certain markets, or bundled membership packages that include access to reports on local service providers in all three lists. The following table highlights some of the service provider categories included in each of our three lists.

Angie’s List	Angie’s List Health & Wellness	Angie’s List Classic Cars
Carpet cleaning	Dentists	Appraisals
Electrical	Dermatologists	Bodywork
Handymen	Elder care	Chrome work
Heating & A/C	Hospitals	Custom painting
Housecleaning	OB/GYN	Detailing
Painting	Ophthalmologists	Engine modification
Plumbing	Pediatricians	Parts locators
Remodeling	Plastic surgeons	Restoration
Roofing	Primary care	Storage
Windows	Psychiatrists	Wheels and tires

Our members rate local service providers on an “A” through “F” grading scale based on six criteria: overall experience, price, quality, responsiveness, punctuality and professionalism. Ratings on each criterion are averaged across all member reviews submitted for the service provider to produce the service provider’s grade on Angie’s List. Non-member reviews do not factor into the ratings, but appear in a separate section from the member reviews on a service provider’s profile. Service providers cannot influence their ratings on Angie’s List. In addition to a letter grade, we encourage members to provide a detailed description and commentary on the service experience. We also ask for the approximate cost of the service, the date that the service was provided and whether the member would hire the local service provider again. Members can report on each unique experience they have with a service provider. However, if a member submits more than one review on the same service provider within 180 days, the second review is published only if we determine that it is for a separate service experience. Member ratings determine which local service providers are eligible to offer discounts and other money-saving promotions.

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We do not allow our members to submit reviews anonymously. We believe that this policy is critical to maintaining the integrity of our reviews. We permit local service providers to respond to reviews, both positive and negative, to provide our members both sides of the story. We also deploy a variety of other resources, including a team of internal audit personnel and our proprietary fraud detection technology, to ensure that our members can trust the reviews they find through our service. We use automated techniques to screen all reviews for fraudulent activity, duplicate reviews and vulgar language prior to their publication. Flagged reviews receive additional screening to ensure their accuracy, reliability and propriety.

We provide convenient access to our members’ reviews on the Internet, by smartphone and telephone. We also provide our members with live customer support from our inbound member call center and help our members resolve disputes with service providers through our complaint resolution process.

In 2013, 2012, and 2011, membership revenue accounted for approximately 27%, 31% and 38% of our total revenue, respectively.

Service Provider Services

Our members are looking for reputable providers of high cost of failure services, and use our service to find them. Consumers subscribe to our service when they are ready to purchase. Local service providers with high ratings from our members benefit from access to this large, qualified pool of demand.

We offer local service providers with an average grade of “B” or better and at least two reviews submitted in the last three years the opportunity to offer exclusive discounts to our members through their online profiles, through our inbound member call center and in Angie’s List Magazine. If a service provider’s grade falls below a “B” during the term of its contract, or if a service provider refuses to engage in our complaint resolution process or engages in what we determine to be dishonest behavior on our service, we immediately terminate its contract and suspend its discounts and other promotions. This policy, which may cause us to forgo revenue that we otherwise would receive, is guided by our commitment to our consumer-first philosophy.

In addition to traditional advertising on our website and publications, we offer our members the opportunity to purchase services through us from service providers rated on our website, which we refer to as e-commerce. These offerings are available through both email promotions and through postings on our website. When the member purchases the service, the transaction is processed through Angie’s List. The member then can work directly with the service provider to schedule the service. These e-commerce offerings provide our members a discount and an easier way to complete their service needs.

Because our membership, not Angie’s List, determines which local service providers are eligible to advertise with us based on their reviews, service providers who advertise are known to be reputable. We believe that smaller local service providers particularly benefit from our service because they compete based on the quality and value of their services rather than the size of their marketing budgets.

A local service provider does not need to advertise with us to be included on Angie’s List or to manage its online profile. We encourage local service providers to take an active role in managing their profiles and monitoring members’ ratings and reviews through our free Business Center service. Through this service, local service providers can update their profile contact information, sign up for email notification when we receive a new review of their services and respond to members’ reviews.

In 2013, 2012, and 2011, service provider revenue accounted for approximately 73%, 69% and 62% of our total revenue, respectively.

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Marketing and Sales

We focus our marketing efforts primarily on acquiring new members to increase our market penetration. Our marketing strategy includes a mix of advertising offline on national cable and broadcast television, national broadcast radio and magazines as well as online through search engine marketing and online display. Our co-founder and Chief Marketing Officer, Angie Hicks, serves as the company spokeswoman. Additionally, we use our original content to supplement our advertising spend and further strengthen our brand through search engine optimization.

Our sales personnel focuses on originating and renewing advertising contracts and identifying and converting e-commerce opportunities with service providers. The majority of this sales force is located at our headquarters in Indianapolis, Indiana, and they will call upon eligible local service providers in our 253 paid membership markets in the United States.

Competition

We compete for members with traditional, offline consumer resources and with online providers of consumer ratings, reviews and referrals on the basis of a number of factors, including breadth of our service provider listings, reliability of our content, breadth, depth and timeliness of information and strength and recognition of our brand. We also compete for a share of local service providers’ overall advertising budgets with traditional, offline media companies and other Internet marketing providers on the basis of a number of factors, including return on investment, our high quality membership profile, effectiveness and relevance of our member discount program, our pricing structure and recognition of our brand. Our competitors include:

• Traditional, offline competitors. We compete for members with a number of traditional, offline consumer resources, such as the Yellow Pages and Consumers’ CHECKBOOK. Many of these competitors also have consumer reviews and information about service providers available online.

• Online competitors. We compete for members with “free to consumer” online ratings websites and referral services funded directly by service providers or by service provider advertising, such as HomeAdvisor, Inc., the “Diamond Certified” directory operated by American Ratings Corporation, Yelp, Inc., Kudzu, an indirect subsidiary of Cox Enterprises, Inc., and Insider Pages, an indirect subsidiary of IAC/InterActiveCorp. In our Angie’s List Health & Wellness categories, we compete for members with other online resources for patients, such as RateMDs, Inc. and Health Grades, Inc. Across all categories, we also compete with established Internet companies such as Facebook, Inc., Google, Inc., Groupon, Inc., LivingSocial, Inc., Microsoft Corporation and Yahoo! Inc.

Our Technology

Our proprietary technology platform is designed to create an engaging user experience for our members, to enable us to collect and verify the integrity of our members’ reviews and to help us to connect our members with relevant local service providers. We have a team of product and engineering professionals at our headquarters in Indianapolis, Indiana and in Palo Alto, California dedicated to enhancing our technology platform, developing new services for members and service providers and conducting product and quality assurance testing.

Key elements of our proprietary technology platform include:

• Search. Our search technology combines structured and free-form content to allow members to search for service providers in numerous categories. Our search uses a number of factors, such as grade, number of reviews, service area and current discounts or other promotions to connect our members with the most relevant local service providers.

• Targeted review acquisition. We have developed a review targeting engine for collecting reviews on local service providers from our members. This engine enables us to identify members who may have hired a service provider they found through Angie’s List, and we encourage these members to submit a review of their service experience.

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• Fraud detection. We use various technology-based algorithms and filters to detect fraudulent reviews. Because most of our memberships are paid, our reviews are not anonymous and provide a degree of traceability and accountability not present in other sites.

• Service provider sales lead targeting. We use a lead scoring engine to identify the most qualified service provider leads for our service provider sales representatives to target. This engine assigns scoring weights to a variety of attributes which we believe make service providers a good prospect for our sales representatives.

• Membership, contracts and renewal tools. We have developed sophisticated and proprietary tools for managing memberships and markets, highly localized and targeted service provider contracts and automatic renewals of both memberships and service provider contracts.

• E-commerce tools. We have developed tools to allow members to purchase services through us from service providers rated on our website. Our Big Deal and Storefront offerings give our members the option to receive email alerts of deals or search through service provider offerings on our website.

We have developed our website and related infrastructure with the goal of maximizing the availability of our service to our members and service providers. Our website and related infrastructure are primarily hosted on a network located at our headquarters and in a redundant third-party facility in Pittsburgh, Pennsylvania.

Intellectual Property

We protect our intellectual property rights by relying on federal, state and common law rights, as well as contractual restrictions. We control access to our proprietary technology by entering into confidentiality and invention assignment agreements with our personnel and contractors and confidentiality agreements with third parties. In addition to these contractual arrangements, we also rely on a combination of trade secrets, trademarks, trade dress, domain names and copyrights to protect our intellectual property. We believe our domain names, trademarks and service marks are important to our marketing strategy and development of awareness of our brand, and therefore, we pursue their registration in the United States and in certain locations outside the United States. As of December 31, 2013, we have registered 24 trademarks in the United States, including “Angie’s List,” and two registered trademarks in Canada, as well as four pending trademark applications in the United States.

Personnel

As of December 31, 2013, we had 1,637 full-time personnel in the United States. None of our personnel is covered by a collective bargaining agreement. We believe that relations with our personnel are good.

Seasonality

While we believe seasonal trends have affected and will continue to affect our quarterly results, our trajectory of rapid growth may have overshadowed these effects to date. We believe that our business will be subject to seasonality in the future, which may result in fluctuations in our financial results.

Operating Segments and Geographic Areas

We manage our business on the basis of one operating segment. Substantially all of our revenue in the year ended December 31, 2013 was from members and participating service providers in the United States.

Available Information

We were organized in the State of Indiana in April 1995 as Brownstone Publishing, LLC. In April 2010, we became a Delaware corporation and changed our name to Angie’s List, Inc. Our principal executive offices are located at 1030 E. Washington Street, Indianapolis, Indiana, 46202, and our telephone number is (888) 888-5478.

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Our website is located at www.angieslist.com and our “Investor Relations” website is located at investor.angieslist.com.

We file reports with the Securities and Exchange Commission (“SEC”), including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any other filings required by the SEC. We make available on our “Investor Relations” website, free of charge, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. We use our “Investor Relations” website as a means of disclosing material non-public information and for complying with disclosure obligations under Regulation FD. Accordingly, investors should monitor investor.angieslist.com, in addition to following our press releases, SEC filings and public conference calls and webcasts. References to our website and our “Investor Relations” website in this report are intended to be inactive textual references only, and none of the information contained on our website or our “Investor Relations” website is part of this report or incorporated in this report by reference.

The public may read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

ITEM 1A      RISK FACTORS

Investing in our common stock involves a high degree of risk. Before deciding to invest in our common stock, you should carefully consider each of the following risk factors and all other information set forth in this Annual Report on Form 10-K. The following risks and the risks described elsewhere in this Annual Report on Form 10-K, including in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” could materially harm our business, financial condition, operating results, cash flow and prospects. If that occurs, the trading price of our common stock could decline, and you may lose all or part of your investment.

Risks Related to Our Business

We have incurred net losses each year since inception, and we expect to continue to incur net losses as we continue to invest aggressively to grow and penetrate our markets.

We have incurred significant net losses each year since inception. As a result, we had an accumulated deficit of $252.3 million as of December 31, 2013. Consequently, we have funded our operations through equity and debt financings. A key element of our strategy has been to aggressively grow both the number of markets in which we offer our service and our penetration in each of these markets. In addition, we have expanded the number of local service provider categories that we maintain for our members’ review, launched new products and services for members and local service providers and significantly grown our service provider sales headcount and sales activity. We anticipate that our expenses will continue to increase as we continue to invest in growing our paid membership base, increase the number and variety of our service provider categories, increase the number of service providers participating as advertisers, develop new marketing initiatives and enhance our technology platform. In particular, we intend to continue to invest substantial resources in marketing to acquire new paid memberships, in selling to grow our base of participating service providers and in technology to enhance our product offerings. These planned investments may consume a portion of our cash flow and may result in additional net losses and negative cash flow. We also expect to incur increased operating expenses as we hire additional personnel and invest in our infrastructure to support anticipated future growth and the reporting and compliance obligations to which we are subject as a public company. In addition, in our efforts to increase revenue as the number of members has grown, we have expanded and expect to continue to expand our sales personnel. If our hiring of additional sales personnel does not result in a sufficient increase in revenue, the cost of this additional headcount will not be offset, which would harm our operating results and financial condition.

If our revenue does not grow or declines, or if our operating expenses exceed our expectations, we may not become profitable on a sustained basis. In addition, if our future growth and operating performance or our negative cash flow or losses resulting from our investment in membership acquisition fail to meet investor or analyst expectations, our operating results, financial condition and stock price could be materially adversely affected.

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We have significantly increased our annual investment in membership acquisition. If the revenue generated by new paid memberships differs significantly from our expectations, or if our membership acquisition costs or costs associated with servicing our members increase, we may not be able to recover our membership acquisition costs or generate profits from this investment.

We spent $87.5 million and $80.2 million on marketing to acquire new memberships in 2013 and 2012, respectively, and expect to continue to spend significant amounts to acquire additional memberships, primarily through national advertising. Our decisions regarding investments in membership acquisition are based upon our marginal marketing cost per paid membership acquisition and our analysis of the revenue we have historically generated per paid membership over the expected lifetime of such membership. Our analysis of the revenue that we expect new paid memberships to generate over their lifetimes depends upon several estimates and assumptions, including membership renewal rates, future membership fees and incremental advertising revenue from service providers driven by increased penetration in a particular market. Due to our recent expansion, our experience with long-term financial and operating trends is limited to a relatively small proportion of our overall number of paid membership markets. Our experience in markets in which we presently have low penetration rates may differ from our more established markets.

Our average revenue per market and total revenue per paid membership in a geographic market have generally increased with the maturity and corresponding increased penetration of our markets in prior periods. In the future, we expect total revenue per paid membership to fluctuate from period to period, reflecting the timing of adjustments to advertising rates given the advertising contract terms and membership pricing innovations designed to drive increased penetration, among other factors. In addition, we intend to continue to evaluate and adopt new pricing and packaging strategies, such as reduced membership pricing, to support our strategy of driving increased membership growth and improved retention, which have caused and may continue to cause membership revenue per paid membership and total revenue per paid membership to decline in some or all of our membership cohorts.

If our estimates and assumptions regarding the revenue we can generate from new paid memberships prove incorrect, or if the revenue generated by new paid memberships over the periods such members continue to subscribe differs significantly from that of paid memberships acquired in prior periods, we may be unable to recover our membership acquisition costs or generate profits from our investment in acquiring new paid memberships. Moreover, if our membership acquisition costs or the costs associated with servicing our members increase, the return on our investment may be lower than we anticipate irrespective of the revenue generated by new memberships. If we cannot generate profits from this investment, we may need to alter our growth strategy, and our growth rate and results of operations may be adversely affected.

Our business depends on the strength of our brand, which has been built by the trust of consumers, and the failure to maintain that trust would damage our brand and harm our ability to maintain or expand our base of paid memberships and participating service providers.

Trust in the integrity of the “Angie’s List” brand and in the objective, unbiased nature of our ratings and reviews has contributed significantly to our ability to attract new paid memberships and participating service providers. Maintaining consumer trust and enhancing our brand will depend largely on our ability to maintain our commitment to and reputation for placing the interests of the consumer first. If our existing or potential members perceive that we are not focused primarily on helping them make more informed purchasing decisions about local services transactions or that the advertising revenue we receive from service providers interferes with the objective rating of service providers on the basis of member reviews, our reputation and the strength of our brand will be adversely affected. Complaints or negative publicity about our sales and business practices, services, personnel and customer service, irrespective of their validity, and data privacy and security issues could diminish consumers’ confidence in our service and adversely impact our brand. For example, in August 2012, a lawsuit seeking class action status, Fritzinger v. Angie’s List, Inc., was filed against us in the U.S. District Court for the Southern District of Indiana, alleging that we automatically renew membership fees at a higher rate than customers are led to believe, breaching our membership agreements.

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Trust in our brand also will suffer if we are not able to maintain the quality and integrity of the ratings and reviews that appear on Angie’s List. We collect reviews from both members and non-members and make these reviews available to members on our website, although non-member reviews are not factored into the service providers’ ratings. While we use various technology-based algorithms and filters to detect fraudulent reviews, and we believe that our prohibition of anonymous reviews provides a degree of traceability and accountability not present in other websites, we cannot guarantee the accuracy of our reviews. Moreover, as our base of paid memberships expands and the number of local service providers rated and reviewed by our members grows, we may see an increase in fraudulent or inaccurate reviews. If fraudulent or inaccurate reviews — positive or negative — increase on Angie’s List and we are unable to effectively identify and remove such reviews, the overall quality of our ratings and reviews would decrease, our reputation as a source of trusted ratings and reviews may be harmed and consumers and local service providers may be deterred from using our products and services. We regularly employ steps designed to ensure that consumer reviews are not inaccurate or fraudulent and that service providers are rated according only to member reviews of them rather than their advertising with us or any other factor. If such steps prove ineffective or if members otherwise believe that we are not objective, we could lose their trust, and our brand and business could be harmed.

In addition, our brand could be harmed if others use any of our trademarks inappropriately. For example, local service providers may use our trademarks without our permission, including our “Super Service Award,” which is available only to local service providers that have maintained superior service ratings. We have in the past taken, and will in the future take, action, including initiating litigation, to protect our trademarks and the integrity of our brand. If such efforts are unsuccessful, our brand and our business would be adversely affected.

If our efforts to increase the number of our paid memberships, to retain existing paid memberships and to maintain high levels of member engagement are not successful, our growth prospects and revenue will be adversely affected.

Our ability to grow our business and to generate both membership revenue and service provider revenue depends on attracting new paid memberships, retaining our existing paid membership base and maintaining high levels of member engagement. We must convince prospective members of the benefits of our service and existing members of its continuing value. In addition, we must convince our members to submit reviews of local service providers to our database. We are dependent upon increased penetration and active member engagement in each of our markets to grow our database of reviews of local service providers, and in turn to enhance the value of our service to other members and prospective members in that market and to increase membership revenue per paid membership. We also depend on growing our paid membership base to increase our service provider revenue in that market by driving greater participation by service providers in our advertising programs and higher advertising rates. We cannot assure you that we will be successful in maintaining or expanding our paid membership base, or in increasing our revenue per paid membership.

In addition, we have historically relied upon high membership renewal rates and “word of mouth” referrals from existing members to maintain and grow our paid membership base. If our efforts to satisfy our existing members are not successful, we may not be able to maintain our renewal rates or continue receiving those referrals. Furthermore, although we use our number of paid memberships as one indicator of the growth of our business, some of our members may not actively use our service or submit reviews of local service providers to our database. If member engagement does not meet our expectations, we may lose members or service providers who advertise with us, and our revenue may not increase or may decline.

Our ability to increase the number of our paid memberships and to maintain high levels of member engagement will require us to address a number of challenges, and we may fail to do so successfully. Some of these challenges include:

• continuing to build our database of member-generated ratings and reviews of local service providers;

• increasing the number and variety of local service providers reviewed by our members;

• convincing consumers of the benefits of our service, and making it easy for them to become paid members; 

• delivering an optimal member experience, including relevant, high-quality discount, coupon and other promotional offers from our participating local service providers and compelling, easy-to-use e-commerce offerings; and

• continuing to innovate and keep pace with changes in technology and our competitors.

Our inability to increase the number of our paid memberships and to maintain high levels of member engagement would have an adverse effect on our growth prospects, operating results and financial condition.

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Any failure to convince local service providers of the benefits of advertising with us would harm our business.

For 2013 and 2012, we derived 73% and 69%, respectively, of our revenue from service providers, and we expect to continue to derive an increasing percentage of our revenue from service providers in the future. Our ability to attract and retain participating service providers and, ultimately, to generate advertising revenue depends on a number of factors, including:

• increasing the number of paid memberships in our existing markets;

• maintaining high levels of member engagement;

• competing effectively for advertising dollars with other online and offline advertising providers; and

• continuing to develop and diversify our advertising offerings.

Historically, advertising markets for local service providers have been dominated by traditional offline advertising media, such as broadcast and cable television, broadcast radio, newspapers and the Yellow Pages. We offer both offline and online advertising products to eligible local service providers, and our business will depend in part on local service providers’ willingness to pay for our advertising products. Local service providers may view advertising with us as experimental and its long-term effectiveness as unproven, may choose not to advertise with us, or may leave us for competing alternatives upon expiration or termination of their agreements with us. Failure to demonstrate the value of our service would result in reduced spending by, or loss of, existing or potential future participating service providers, which would materially harm our revenue and business.

Unlike competitors such as Yellow Pages, we generally do not employ local “feet on the street” sales forces to sell advertising to service providers and instead rely on call center sales personnel. The resulting lack of a personal connection with local service providers may impede us in growing service provider revenue. As we grow, we will need to recruit, integrate and retain additional skilled and experienced call center sales personnel who can demonstrate our value proposition to service providers and increase the monetization of our membership base. We will be adversely affected if we hire poorly and if sales personnel do not reach levels of effectiveness within a period of time consistent with our historical experience or if we are unable to convince service providers to advertise with us through our call center model.

Our success depends in part upon our ability to increase our service provider revenue per paid membership as we increase our market penetration.

Historically, our service provider revenue per paid membership in a given market has generally increased with market penetration as we attracted more service providers and charged higher advertising rates as the pool of members using our service to actively seek local service providers has grown. Because we only increase advertising rates at the time of contract renewal, such rate increases in a given market may trail increases in market penetration. In addition, in certain markets we have not increased our advertising rates as rapidly as the number of paid memberships has grown. Moreover, trends in market penetration and growth in service provider revenue per paid membership in our larger or less penetrated markets have differed from our experiences in our smaller or more penetrated markets. Accordingly, growth of our membership may not result in service provider revenue increases until future periods, if at all. In addition, we are subject to risks associated with the credit quality of our service providers. If service providers to whom we have provided advertising services are unable to meet their contractual obligations to us, our service provider revenue could decrease, and our results of operations could be harmed.

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We are and will continue to be faced with many competitive challenges, any of which could adversely affect our prospects, results of operations and financial condition.

We compete for both members and service providers with a range of established and emerging companies. We compete for members on the basis of a number of factors, including breadth of service provider listings, reliability of our content, breadth, depth and timeliness of information and strength and recognition of our brand. We compete for a share of local service providers’ advertising budgets on the basis of a number of factors, including return on investment, our high quality membership profile, effectiveness and relevance of our service providers’ discount offers to our members, our pricing structure and recognition of our brand. Our current competitors for memberships and service providers include a number of traditional offline consumer resources, such as the Yellow Pages and Consumers’ CHECKBOOK. Many of these competitors also have consumer reviews and information about service providers available online. We also compete with “free to consumer” online ratings websites and referral services funded directly by service providers or by service provider advertising, such as HomeAdvisor, Inc., the “Diamond Certified” directory operated by American Ratings Corporation, Yelp, Inc., Kudzu, an indirect subsidiary of Cox Enterprises, Inc., and Insider Pages, an indirect subsidiary of IAC/InterActiveCorp. In our Angie’s List Health & Wellness categories, we compete for members with other online resources for patients, such as RateMDs, Inc. and Health Grades, Inc. Across all categories, we also compete with established Internet companies who have significantly greater resources and name recognition than we do.

To compete effectively for members, we must continue to invest significant resources in marketing and in the development of our products and services to enhance value for members. To compete effectively for service provider revenue, we must continue to invest significant resources in our sales force, in the development of existing and new advertising products, the acquisition of new paid memberships and the collection of our members’ reviews of local service providers. Many of our competitors for service providers utilize local sales forces or “feet on the street,” and we may be at a disadvantage as a result of our call center-based sales model. Failure to compete effectively against our current or future competitors could result in loss of current or potential participating service providers or a reduced share of our participating service providers’ overall advertising budget, which could adversely affect our pricing and margins, lower our service provider revenue and prevent us from achieving or maintaining profitability. We cannot assure you that we will be able to compete effectively for memberships or service providers in the future against existing or new competitors, and the failure to do so could result in loss of existing or potential paid memberships, reduced membership base and service provider revenue, increased marketing or selling expenses or diminished brand strength, any of which could harm our business.

If we are unable to replicate our performance in our larger markets, our operating results and financial condition will be harmed.

Our penetration rates in a number of our larger geographic markets lag those of our mid-size markets. Many of our largest markets, including New York City, Los Angeles and San Francisco, were converted to paid status beginning in 2006 and 2007, and these markets have produced the largest number of new members in recent years. However, the penetration rate in these larger markets has lagged, on a percentage basis, those of our mid-size markets that converted in the same time frame. We believe that a principal reason for the lower penetration rates in our larger markets is the manner in which we market Angie’s List. We have chosen to spend the majority of our marketing dollars on national advertising. We believe that this advertising strategy provides us the most cost-efficient manner of acquiring new paid memberships. However, advertising nationally means we deliver the same volume of advertising regardless of the size of market. Since each market differs in terms of the number of advertising outlets available, the impact of our spending on national advertising varies across markets. In our experience, smaller markets typically have fewer advertising outlets available than larger markets. We believe the same volume of advertising in a smaller market is more effective in building brand awareness and generating new memberships than in larger markets. We expect to continue to allocate our marketing dollars in accordance with our national advertising strategy and accordingly expect to continue to see lower relative penetration rates in the larger markets.

Slower penetration of our larger markets may delay or prevent us from increasing total revenue per paid membership in these markets. If we are unable to replicate the performance we have achieved in our most mature markets in our larger and less penetrated markets, or if growth in larger or less penetrated markets is significantly slower than we anticipate, our operating results and financial condition could be harmed.

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Interruptions or delays in service arising from our third-party cloud-based data services providers or our own systems could impair the delivery of our service and harm our business.

We rely in part upon third-party vendors, including data center, Internet infrastructure and bandwidth, and payment processing providers, to provide our products and services to our members and service providers. We do not control the operation of the third-party facilities, and both our own facilities and the third-party data center facility are vulnerable to damage or interruption from tornadoes, floods, fires, power loss, telecommunications failures and similar events. They also are subject to break-ins, sabotage, intentional acts of vandalism, cyber-attacks, the failure of physical, administrative, and technical security measures, terrorist acts, human error, the financial insolvency of the third-party provider and other unanticipated problems or events. The occurrence of any of these events could result in interruptions in our service and unauthorized access to, or alteration of, the content and data contained on our systems and the content and data that these third-party vendors store and deliver on our behalf.

Our technology infrastructure is critical to the performance of our systems and our overall operations. Certain aspects of our technology infrastructure run on a complex distributed system, or what is commonly known as cloud computing. We own, operate and maintain the primary elements of this system, but some elements of this system are operated by third parties that we do not control and which would require significant time to replace, thereby increasing our vulnerability to problems with the services they provide. We have experienced, and expect to continue to experience, interruptions and delays in service and availability for such elements. Any errors, failures, interruptions or delays experienced in connection with these cloud computing technologies and information services could negatively impact our relationship with our members, our brand and reputation and our ability to attract, retain and serve our members and service providers.

In addition, we have designed and built key portions of the software code and technical infrastructure through which we serve our products and services, and we plan to continue to maintain and develop certain elements internally. Our software code and technical infrastructure are complex, and such efforts may lead to increased technology expense, operational inefficiencies, or interruptions in the delivery or degradation of the quality of our products and services. These issues may not be identified immediately, which could result in further interruption, degradation or cost.

If we fail to effectively manage our growth, our business, operating and financial results may suffer.

We have experienced, and expect to continue to experience, significant growth in new and existing markets, which has placed, and will continue to place, significant demands on our management and our operational and financial infrastructure. We expect that our growth strategy will require us to commit substantial financial, operational and technical resources, and we expect that our marketing cost per paid membership acquisition may increase in the near term. Continued growth also could strain our ability to maintain reliable service levels for our members and participating service providers, to effectively monetize our membership base, to develop and improve our operational, financial and management controls, to enhance our reporting systems and procedures and to recruit, train and retain highly skilled personnel. As our operations grow in size, scope and complexity, we will need to improve and upgrade our systems and infrastructure and may determine we need to open additional operational locations, such as call centers, to support our advertising sales, which will require significant expenditures and allocation of valuable management resources. If we fail to maintain the necessary level of discipline and efficiency, or if we fail to allocate limited resources effectively in our organization as it grows, our business, operating results and financial condition may suffer.

We may not maintain our current rate of revenue growth.

Our paid membership base has grown rapidly in recent periods in new and existing markets. As a result, our membership revenue and service provider revenue have increased quickly and substantially. We believe that our continued revenue growth will depend on, among other factors, our ability to:

• improve our penetration of our existing markets by efficiently deploying marketing expenditures to attract new paid memberships and by retaining our existing paid memberships in these markets;

• maintain high levels of member engagement and the quality and integrity of our members’ reviews of local service providers;

• increase the number and variety of local service providers reviewed by our members and convince highly-rated local service providers to advertise with us;

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• retain service providers that currently advertise with us and convince them to increase their advertising spending with us;

• continue to develop and diversify our product offerings for local service providers;

• recruit, integrate and retain skilled and experienced sales personnel who can demonstrate our value proposition to service providers;

• provide our members and local service providers with superior user experiences;

• react to changes in technology and challenges from existing and new competitors; and

• increase awareness of our brand.

We cannot assure you that our paid membership base or our service provider participation will continue to grow or will not decline as a result of increased competition and the maturation of our business. If our growth rates were to decline significantly or become negative, it could adversely affect our financial condition and results of operations. You should not rely on our historical rate of revenue growth as an indication of our future performance.

The Company’s inability to implement its strategic plan and growth initiatives may have an adverse impact on future results.

The Company’s ability to succeed in its strategic plan and growth initiatives could require significant capital investment and management attention, which may result in the diversion of these resources from the core business and other business issues and opportunities. Additionally, any new initiative is subject to certain risks, including customer acceptance, competition, product differentiation, challenges to economies of scale in merchandise sourcing and the ability to attract and retain qualified management and other personnel. There can be no assurance that the Company will be able to develop and successfully implement its strategic plan and growth initiatives to a point where they will become profitable or generate positive cash flow. If the Company cannot successfully execute its strategic plan and growth initiatives, the Company’s financial condition and results of operations may be adversely impacted.

Our future growth depends in part on our ability to effectively develop and sell additional products, services and features.

We invest in the development of new products, services and features with the expectation that we will be able to effectively offer them to consumers and local service providers. For example, we have introduced two e-commerce offerings, Angie’s List Big Deal and Storefront, which give our members the option to receive email alerts or search through service provider offerings on our website for deals. We plan to continue to develop additional advertising products for qualified local service providers. In addition, we may acquire vertical offerings that address additional “high cost of failure” segments of the market for local services.

Our future growth depends in part on our ability to sell these products and services, as well as additional features and enhancements to our existing offerings. As our new offerings evolve, we have adapted our sales and marketing strategies for them, and changes in these strategies may delay or prevent growth in these parts of our business. For example, we continue to refine our service provider eligibility criteria, pricing and our vendor credit and customer refund policies for our e-commerce offerings, which may cause our revenue from these offerings to fluctuate from period to period in the future. Further, many of our current and potential service provider advertisers have modest advertising budgets. Accordingly, we cannot assure you that the successful introduction of new products or services will not adversely affect sales of our current products and services or that those service providers that currently advertise with us will increase their aggregate spending as a result of the introduction of new products and services. If our efforts to effectively develop and sell additional products, services and features are not successful, our business may suffer.

We invest in features, functionality and customer support designed to drive traffic and increase engagement with members and service providers; however, these investments may not lead to increased revenue.

Our future growth and profitability will depend in large part on the effectiveness and efficiency of our efforts to convert consumers and local service providers who visit Angie’s List into paid memberships and participating service providers, respectively. We have made and will continue to make substantial investments in features and functionality for our website that are designed to drive online traffic and user engagement and in customer support for local service providers who do not advertise with us. These activities do not directly generate revenue, and we cannot assure you that we will reap any rewards from these investments. If the expenses that we incur in connection with these activities do not result in sufficient growth in paid members and participating service providers to offset their cost, our business, financial condition and results of operations will be adversely affected.

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Our operating results may fluctuate, which makes our results difficult to predict and could cause our results to fall short of expectations.

Our revenue and operating results vary significantly from quarter to quarter and year to year because of a variety of factors, many of which are outside our control. As a result, comparing our operating results on a period to period basis may not be meaningful. In addition to other risk factors discussed in this “Risk Factors” section, factors that may contribute to the variability of our quarterly and annual results include:

• our ability to retain our current paid memberships and build our paid membership base;

• our ability to retain our service providers that currently advertise with us and convince them to increase their advertising spending with us;

• our revenue mix and any changes we make to our membership fees or other sources of revenue;

• our marketing costs or selling expenses;

• our ability to effectively manage our growth;

• the effects of increased competition in our business;

• our ability to keep pace with changes in technology and our competitors;

• costs associated with defending any litigation or enforcing our intellectual property rights;

• the impact of economic conditions in the United States on our revenue and expenses; and

• changes in government regulation affecting our business.

From time to time we change the compensation plans for our sales personnel. For example, in the fourth quarter of 2012, we transitioned to a new compensation plan for our sales personnel responsible for new advertising originations. Any future changes to such compensation plans could disrupt our sales personnel, adversely affecting sales and reducing our revenue. We cannot guarantee that we will accurately forecast the impact of future changes to such compensation plans on our operating results.

Seasonal variations in the behavior of our members and service providers also may cause fluctuations in our financial results. For example, we expect to experience some effects of seasonal trends in member and service provider behavior due to decreased demand for home improvement services in winter months. In addition, advertising expenditures by local service providers tend to be discretionary in nature and may be sporadic, reflecting overall economic conditions, the economic prospects of specific local service providers or industries, budgeting constraints and buying patterns and a variety of other factors, many of which are outside our control. We also expect revenue contributions from our e-commerce offerings to fluctuate from period to period as the offerings evolve and due to seasonality. While we believe seasonal trends have affected and will continue to affect our quarterly results, our trajectory of rapid growth may have overshadowed these effects to date. We believe that our business will be subject to seasonality in the future, which may result in fluctuations in our financial results.

Our revenue may be negatively affected if we are required to pay sales tax or other transaction taxes on all or a portion of our past and future sales in jurisdictions where we are currently not collecting and reporting tax.

We currently only pay sales or other transaction taxes in certain jurisdictions in which we do business. We do not separately collect sales or other transaction taxes. A successful assertion by any state, local jurisdiction or country in which we do not pay such taxes that we should be paying sales or other transaction taxes on the sale of our products or services, or the imposition of new laws requiring the payment of sales or other transaction taxes on the sale of our products or services, could result in substantial tax liabilities related to past sales, create increased administrative burdens or costs, discourage consumers and service providers from purchasing products or services from us, decrease our ability to compete or otherwise substantially harm our business and results of operations.

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We depend on key personnel to operate our business, and if we are unable to retain, attract and integrate qualified personnel, our ability to develop and successfully grow our business could be harmed.

We believe that our future success depends in part upon the continued service of key members of our management team as well as our ability to attract and retain highly skilled and experienced sales, technical and other personnel. Our co-founders, William S. Oesterle and Angie Hicks, are critical to our overall management as well as the development of our culture and strategic direction. In particular, the reputation, popularity and talent of Ms. Hicks is an important factor in public perceptions of Angie’s List, and the loss of her services or any repeated or sustained shifts in public perceptions of her could adversely affect our business.

In addition, qualified individuals are in high demand in the Internet sector, and we may incur significant costs to attract them. Competition for these personnel is intense, and we may not be successful in attracting and retaining qualified personnel. Many of the companies with which we compete for experienced personnel have greater resources than us. In addition, in making employment decisions, particularly in the technology sector, job candidates often consider the value of the stock options they are to receive in connection with their employment. If we are unable to attract and retain our executive officers and key employees, we may not be able to achieve our strategic objectives, and our business could be harmed.

We have historically relied primarily on cash, rather than equity, compensation for the majority of our workforce. As such, we may have difficulty competing on a national scale for candidates focused on equity incentives. If we are unable to attract and retain executive officers and key personnel to our headquarters in Indianapolis, Indiana or integrate recently hired executive officers and key personnel, our business, operating results and financial condition could be harmed.

If we cannot maintain our corporate culture as we grow, we could lose the innovation, teamwork and focus that contribute crucially to our business.

We believe that a critical component of our success has been our corporate culture, which we believe fosters innovation, encourages teamwork, cultivates creativity and promotes focus on execution. We have invested substantial time, energy and resources in building a highly collaborative team that works together effectively in an environment designed to promote openness, honesty, mutual respect and the pursuit of common goals. As we continue to develop the infrastructure of a public company and continue to grow, we may find it difficult to maintain these valuable aspects of our corporate culture. Any failure to preserve our culture could negatively impact our future success, including our ability to attract and retain personnel, encourage innovation and teamwork and effectively focus on and pursue our corporate objectives.

We may require additional capital to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances. If capital is not available to us, our business, operating results and financial condition may be harmed.

We may require additional capital to operate or expand our business. In addition, some of the strategic initiatives we have in early stages of development may require substantial additional capital resources before they begin to generate revenue. Additional funds may not be available when we need them, on terms that are acceptable to us, or at all. For example, the loan and security agreement governing our term loan and revolving credit facility contains various restrictive covenants, including restrictions on our ability to dispose of assets, make acquisitions or investments, incur debt or liens, make distributions to our stockholders or enter into certain types of related party transactions, and any debt financing secured by us in the future could involve further restrictive covenants, which may make it more difficult for us to obtain additional capital and pursue business opportunities. If we raise additional funds through the issuance of equity or convertible securities, the percentage ownership of holders of our common stock could be significantly diluted, and these newly issued securities may have rights, preferences or privileges senior to those of holders of our common stock. Furthermore, volatility in the credit or equity markets may have an adverse effect on our ability to obtain debt or equity financing or the cost of such financing. If we do not have funds available to enhance our solutions, maintain the competitiveness of our technology and pursue business opportunities, we may not be able to service our existing members, acquire new members or attract or retain participating service providers, which could have an adverse effect on our business, operating results and financial condition.

If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired, which would adversely affect our business and our stock price.

Ensuring that we have adequate internal financial and accounting controls and procedures in place to produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be reevaluated frequently. We have in the past discovered, and may in the future discover, areas of our internal financial and accounting controls and procedures that need improvement.

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Our management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Our management does not expect that our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within our company will be detected.

Because we recognize membership revenue over the term of the membership and recognize service provider revenue ratably over the relevant contract period, downturns or upturns in membership or in service provider advertising may not be immediately reflected in our operating results.

We recognize membership revenue ratably over the term of a paid subscription and recognize service provider revenue ratably over the time period during which the advertisements are run. Because approximately 94% of our members subscribed on an annual or multi-year basis as of December 31, 2013, a large portion of our membership revenue for each quarter reflects deferred revenue from memberships purchased in previous quarters. Similarly, because our service provider contracts run for an average term of more than one year, a large portion of our service provider revenue each quarter reflects purchasing decisions made in prior periods. Therefore, an increase or decrease in new or renewed memberships or new or renewed service provider contracts in any one quarter will not necessarily be fully reflected in our revenue for that quarter but will affect our revenue in future quarters. Accordingly, the effect of significant downturns or upturns in membership or advertising sales may not fully impact our results of operations until future periods.

We may suffer liability as a result of the ratings or reviews posted on our website.

Our terms of use specifically require members and non-members submitting reviews to represent that their ratings and reviews are based on their actual first-hand experiences and are accurate, truthful and complete in all respects and that they have the right and authority to grant us a license to publish their reviews. However, we do not have the ability to verify the accuracy of these representations on a case-by-case basis. There is a risk that areview may be considered defamatory or otherwise offensive, objectionable or illegal under applicable law. Therefore, there is a risk that publication on our website of our ratings and reviews may give rise to a suit against us for defamation, civil rights infringement, negligence, copyright or trademark infringement, invasion of privacy, personal injury, product liability, breach of contract, unfair competition, discrimination, antitrust or other legal claims. From time to time, we are involved in claims and lawsuits based on the contents of the ratings and reviews posted on our website, including claims of defamation. To date, we have not suffered a material loss due to a claim of defamation. We expect that we will be subject to similar claims in the future, which may result in costly and time-consuming litigation, liability for money damages or injury to our reputation.

If we fail to generate or maintain expected high quality reviews and reports from our members, we will be unable to provide members with the information they seek, which could negatively impact our membership retention and growth.

Our business depends on our ability to provide our members with the information they seek, which is directly dependent on the quality and quantity of the reviews and reports provided by our members. For example, we may be unable to offer our members adequate information on local service providers if our members do not contribute content that is helpful or relevant to the service category in a particular market. We may be unable to provide members with the information they seek if our members are unwilling to contribute reviews and reports because of concerns they will be sued or harassed by service providers they review, instances of which have occurred in the past and may occur again in the future. In addition, we may not be able to provide members with the information they seek if the information on our site is not updated. We do not remove older reviews, and members may view these reviews as less relevant, helpful or reliable. If our site does not provide current information about local service providers or members perceive reviews on our site as less relevant, our brand and business could suffer.

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Membership growth is impacted by traffic to our website from search engines such as Google, Bing and Yahoo!, some of which offer products and services that compete directly with our services. If our website fails to rank prominently in unpaid search results, traffic to our site could decline, and our business would be adversely impacted.

A portion of our website traffic comes from non-paid search results that appear on search engines such as Google and Bing. For example, in 2013, member sales from search engine optimization (“SEO”) efforts grew 57% as compared to 2012. While SEO has a much lower cost per acquisition compared to outbound channels such as advertising and has helped reduce our overall cost per member acquisition, our ability to maintain high organic search rankings is not within our control. As such, our competitors’ SEO efforts may result in their websites receiving a higher search result page ranking than ours. Separately, Internet search engines could revise their methodologies in a way that could adversely affect our search result rankings. For example, Google makes changes to its algorithm(s) every year, any one of which could potentially impact our rankings, which we are dependent upon to drive traffic and ultimately sales to our site. Our website has experienced fluctuations in search result rankings in the past, and we anticipate similar fluctuations in the future. Any reduction in the number of Internet users directed to our website through search engines could harm our business.

If local service providers rated on our website do not meet the expectations of our members, or engage in unethical or illegal conduct, we may suffer reputational harm, liability or adverse effects on our profitability and liquidity as a result.

Our business depends on our reputation for quality and integrity, which may be harmed by actions taken by local service providers that are outside our control. Given that our members use our service to gather information about projects that carry a high risk of failure, and have the opportunity to purchase these services at a discounted rate through our Big Deal and Storefront offerings, if they are performed incompetently or if service providers fail to perform prepaid services, our reputation could be undermined. We cannot be certain that highly-rated local service providers will perform to the satisfaction of our members or that services purchased in advance through our Big Deal or Storefront offerings will be performed to the satisfaction of our members or at all. In addition, unethical or illegal conduct by local service providers rated on our website could damage our reputation or expose us to liability arising from claims made by or on behalf of those harmed by such conduct.

We pay service providers in advance for all Big Deals and Storefront offerings purchased by members. Under this payment model, service providers are paid regardless of whether the Big Deal is redeemed or the Storefront services are performed. Subject to certain limitations, our members may request a refund from us on their e-commerce transactions. As we do not have control over service providers and the quality of the services they deliver, we develop estimates for refund claims. Our actual level of refund claims could prove to be greater than the level of refund claims we estimate, particularly as our revenue from e-commerce offerings grows and we develop additional e-commerce products, services and features. Moreover, our members may make requests for refunds with respect to which we are unable to recover reimbursement from our service providers. An increase in our refund rates, or our inability to recover from our service providers, could adversely affect our profitability and liquidity.

Many people utilize smartphones and other mobile devices, as well as tablets, to access information about local service providers. If we are not successful in developing products through the use of these technologies, or our products are not widely adopted, our business could be adversely affected.

The number of people who seek information about local service providers through mobile devices, including smartphones and tablets, has increased significantly in the past few years. If our members are unable to access our ratings and reviews of service providers on their mobile devices, if we otherwise fail to develop and maintain effective mobile advertising and e-commerce products and services or if our mobile products and services are not widely adopted by our members, our business may suffer. Additionally, as new mobile devices and platforms are released, it is difficult to forecast the problems that may arise, and we may need to devote significant resources to the development, support and maintenance of these products. Finally, if we experience problems with continued integration of our mobile applications, or mobile apps, into mobile devices, if we have issues with providers of mobile operating systems or mobile application download stores, such as Apple, Inc. or Google, or if we face increased costs to distribute our mobile apps, our business could suffer.

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Failure to comply with federal and state laws and regulations relating to privacy and security of personal information, including personal health information, could result in liability to us, damage our reputation and harm our business.

A variety of federal and state laws and regulations govern the collection, use, retention, sharing and security of personal information. We collect and utilize demographic and other information from and about our members as they interact with our service. We also may collect information from our members when they provide ratings and reviews of local service providers, participate in polls or contests or sign up to receive email newsletters. Further, we use tracking technologies, including “cookies,” to help us manage and track our members’ interactions with our service and deliver relevant advertising. Claims or allegations that we have violated laws and regulations related to privacy and data security could in the future result in negative publicity and a loss of confidence in us by our members and our participating service providers and may subject us to fines by credit card companies and the loss of our ability to accept credit and debit card payments. In addition, we have posted privacy policies and practices concerning the collection, use and disclosure of member data on our websites and mobile applications. Several Internet companies have incurred penalties for failing to abide by the representations made in their privacy policies and practices.

In rating and reviewing health care or wellness providers, our members may post personal health information about themselves or others, and the health care or wellness providers reviewed by members may submit responses that contain private or confidential health information about reviewing members or others. While we strive to comply with applicable privacy and security laws and regulations regarding personal health information, as well as our own posted privacy policies, any failure or perceived failure to comply may result in proceedings or actions against us by government entities or others or could cause us to lose members and participating service providers, which could adversely affect our business.

We have incurred, and will continue to incur, expenses to comply with privacy and security standards and protocols for personal information, including personal health information, imposed by law, regulation, self-regulatory bodies, industry standards and contractual obligations. However, such laws and regulations are evolving and subject to potentially differing interpretations, and federal and state legislative and regulatory bodies may expand current or enact new laws or regulations regarding privacy matters. We are unable to predict what additional legislation or regulation in the area of privacy of personal information could be enacted or its effect on our operations and business.

If our security measures are breached and unauthorized access is obtained to our members’ or service providers’ data, our service may be perceived as not being secure, and members and service providers may curtail or terminate their use of our service.

In the ordinary course of business, we collect and store sensitive data, including intellectual property, our proprietary business information and that of our members and service providers and personally identifiable information of our members, service providers and employees in our data centers and networks. The secure processing, maintenance and transmission of this information is critical to our operations and business strategy. Our service involves the storage and transmission of our members’ and service providers’ proprietary information, such as credit card and bank account numbers, and security breaches could expose us to a risk of loss of this information, litigation and possible liability. Our payment services may be susceptible to credit card and other payment fraud schemes, including unauthorized use of credit cards, debit cards or bank account information, identity theft or merchant fraud.

If our security measures are breached as a result of third-party action, employee error, malfeasance or otherwise, and as a result, someone obtains unauthorized access to our members’ data, our reputation may be damaged, our business may suffer and we could incur significant liability. As techniques used to obtain unauthorized access or to sabotage systems change frequently and generally are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. If an actual or perceived breach of our security occurs, the public perception of the effectiveness of our security measures could be harmed, and we could lose members and service providers, which could adversely affect our business.

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We are subject to a number of risks related to intentional business disruptions, cyber-attacks and piracy.

Despite a number of precautionary measures already in place and significant ongoing investments to protect against security risks, data protection breaches, cyber-attacks and other intentional disruptions of our products and offerings, we expect to be an ongoing target of attacks specifically designed to impede the performance of our products and offerings and harm our reputation as a company. Similarly, experienced third parties may attempt to penetrate our network security or the security of our website and misappropriate proprietary information or cause interruptions of our services. As the techniques used by such third parties to access or sabotage networks change frequently and may not be recognized until launched against a target, we may be unable to anticipate these techniques. The theft or unauthorized use or publication of our trade secrets and other confidential business information as a result of such an event could adversely affect our competitive position, reputation, brand and future sales of our products, and our customers may assert claims against us related to resulting losses of confidential or proprietary information. Our business could be subject to significant disruption, and we could suffer monetary and other losses and reputational harm, in the event of such incidents and claims.

We are subject to a number of risks related to accepting credit card and debit card payments.

We accept payments from our members primarily through credit and debit card transactions. For credit and debit card payments, we pay interchange and other fees, which may increase over time. An increase in those fees would require us to either increase the prices we charge for our service, which could cause us to lose members and membership revenue, or suffer an increase in our operating expenses, either of which could adversely affect our operating results.

If we or any of our processing vendors experience problems with our billing software, or if the billing software malfunctions, it could adversely affect our member satisfaction and could cause one or more of the major credit card companies to disallow our continued use of their payment products. In addition, if our billing software fails to work properly and, as a result, we do not automatically charge our members’ credit cards on a timely basis or at all, we could lose membership revenue, which could harm our operating results.

We are also subject to payment card association operating rules, certification requirements and rules governing electronic funds transfers, including the Payment Card Industry Data Security Standard, or PCI DSS, a security standard with which companies that collect, store or transmit certain data regarding credit and debit cards, credit and debit card holders and credit and debit card transactions are required to comply. Our failure to comply fully with the PCI DSS may violate payment card association operating rules, federal and state laws and regulations and the terms of our contracts with payment processors and merchant banks. Such failure to comply fully also may subject us to fines, penalties, damages and civil liability and may result in the loss of our ability to accept credit and debit card payments. In addition, there is no guarantee that PCI DSS compliance will prevent illegal or improper use of our payment systems or the theft, loss or misuse of data pertaining to credit and debit cards, credit and debit card holders and credit and debit card transactions.

If we fail to adequately control fraudulent credit card transactions, we may face civil liability, diminished public perception of our security measures and significantly higher credit card-related costs, each of which could adversely affect our business, financial condition and results of operations.

If we are unable to maintain our chargeback rate at acceptable levels, our credit card fees for chargeback transactions or our fees for many or all categories of credit and debit card transactions, credit card companies and debit card issuers may increase our fees or terminate their relationship with us. Any increases in our credit card and debit card fees could adversely affect our results of operations, particularly if we elect not to raise our rates for our service to offset the increase. The termination of our ability to process payments on any major credit or debit card would significantly impair our ability to operate our business.

As we develop and sell new products, services and features, we may be subject to additional and unexpected regulations, which could increase our costs or otherwise harm our business.

As we develop and sell products and services that address new segments of the market for local services and expand our advertising services, we may become subject to additional laws and regulations, which could create unexpected liabilities for us, cause us to incur additional costs or restrict our operations. For example, our Angie’s List Health & Wellness offerings may become subject to complex federal and state health care laws and regulations, the application of which to specific products and services is unclear. Many existing health care laws and regulations, when enacted, did not anticipate the online health and wellness information and advertising products and services that we provide; nevertheless, they may be applied to our products and services.

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We have e-commerce offerings, such as Angie’s List Big Deal and Storefront, which allow our members to purchase services or products from our service providers. Transactions between members and local service providers in connection with these offerings may be subject to regulation, in whole or in part, by federal, state and local authorities.

In addition, the application of certain laws and regulations to some of our promotions are uncertain. These include laws and regulations such as the Credit Card Accountability Responsibility and Disclosure Act of 2009, or the CARD Act, and unclaimed and abandoned property laws. If these promotions were subject to the CARD Act or any similar state law or regulation, we may be required to record liabilities with respect to unredeemed promotions, and we may be subject to additional fines and penalties.

From time to time, we may be notified of additional laws and regulations which governmental organizations or others may claim should be applicable to our business. Our failure to accurately anticipate the application of these laws and regulations, or other failure to comply, could create liability for us, result in adverse publicity or cause us to alter our business practices, which could cause our revenue to decrease, our costs to increase or our business to otherwise be harmed.

Our business depends on our ability to maintain and scale the network infrastructure necessary to operate our websites and applications.

Our members access reviews and other information through our websites and applications. Our reputation and ability to acquire, retain and serve our members and service providers are dependent upon the reliable performance of our websites and applications and the underlying network infrastructure. As our membership base and the amount of information shared on our websites and applications continue to grow, we will need an increasing amount of network capacity and computing power. We have made, and expect to continue to make, substantial investments in data centers, equipment and related network infrastructure to handle the traffic on our websites and the data submitted to us by our members. The operation of these systems is expensive and complex and could result in operational failures. In the event that our membership base or the amount of traffic on our websites and applications grows more quickly than anticipated, we may be required to incur significant additional costs. If we do not maintain or expand our network infrastructure successfully, or if we experience operational failures, our reputation could be harmed, and we could lose current and potential members and participating service providers, which could harm our operating results and financial condition.

We may not be able to successfully prevent other companies, including copycat websites, from misappropriating our data in the future.

From time to time, third parties have attempted to misappropriate our member-generated ratings and reviews and other data regarding our service providers through website scraping, search robots or other means. We have deployed several technologies designed to detect and prevent such efforts. However, we may not be able to successfully detect and prevent all such efforts in a timely manner or assure that no misuse of our data occurs.

In addition, third parties operating “copycat” websites have attempted to misappropriate data from our network and to imitate our brand or the functionality of our website. When we have become aware of such efforts by other companies, we have employed technological or legal measures in an attempt to halt their operations. However, we may not be able to detect all such efforts in a timely manner, or at all, and even if we could, the technological and legal measures available to us may be insufficient to stop their operations. In some cases, particularly in the case of companies operating outside of the United States, our available remedies may not be adequate to protect us against the damage to our business caused by such websites. Regardless of whether we can successfully enforce our rights against the operation of these websites, any measures that we may take could require us to expend significant financial or other resources and have a significantly adverse effect on our brand.

Failure to adequately protect our intellectual property could substantially harm our business and operating results.

We rely on a combination of intellectual property rights, including trade secrets, copyrights and trademarks, as well as contractual restrictions, to safeguard our intellectual property. We do not have any patents or pending patent applications. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy our digital content, aspects of our solutions for members and service providers, our technology, software, branding and functionality, or obtain and use information that we consider proprietary. Moreover, policing our proprietary rights is difficult and may not always be effective. As we expand internationally, we may need to enforce our rights under the laws of countries that do not protect proprietary rights to as great an extent as do the laws of the United States.

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Our digital content is not protected by any registered copyrights or other registered intellectual property. Rather, our digital content is protected by statutory and common law rights, user agreements that limit access to and use of our data and by technological measures. Compliance with use restrictions is difficult to monitor, and our proprietary rights in our digital content databases may be more difficult to enforce than other forms of intellectual property rights.

As of December 31, 2013, we have registered 24 trademarks in the United States, including “Angie’s List,” and two registered trademarks in Canada, as well as four pending trademark applications in the United States. Some of our trade names may not be eligible to receive trademark protection. Trademark protection may also not be available, or sought by us, in every country in which our service may become available online. Competitors may adopt service names similar to ours or purchase our trademarks and confusingly similar terms as keywords in Internet search engine advertising programs, thereby impeding our ability to build brand identity and possibly confusing consumers and local service providers. Moreover, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate marks similar to our trademarks. In addition, in the past, some local service providers have used our trademarks inappropriately or without our permission, including our “Super Service Award,” which is available only to local service providers that have maintained superior service ratings. We have taken in the past and may in the future take action, including initiating litigation, to protect our intellectual property rights and the integrity of our brand, but these efforts may prove costly, ineffective or both.

We currently hold the “Angie’s List” Internet domain name and various other related domain names. Domain names generally are regulated by Internet regulatory bodies. If we lose the ability to use a domain name in the United States or any other country, we would be forced to incur significant additional expense to market our solutions, including the development of a new brand and the creation of new promotional materials, which could substantially harm our business and operating results. The regulation of domain names in the United States and in foreign countries is subject to change. Regulatory bodies could establish additional top-level domains, appoint additional domain name registrars or modify the requirements for holding domain names. As a result, we may not be able to acquire or maintain the domain names that utilize the “Angie’s List” name in all of the countries in which we currently intend to conduct business.

In order to protect our trade secrets and other confidential information, we rely in part on confidentiality agreements with our personnel, consultants and third parties with whom we have relationships. These agreements may not effectively prevent disclosure of trade secrets and other confidential information and may not provide an adequate remedy in the event of misappropriation of trade secrets or any unauthorized disclosure of trade secrets and other confidential information. In addition, others may independently discover trade secrets and confidential information, and in such cases, we could not assert any trade secret rights against such parties. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our trade secret rights and related confidentiality and nondisclosure provisions, and failure to obtain or maintain trade secret protection, or our competitors being able to obtain our trade secrets or to independently develop technology similar to ours or competing technologies, could adversely affect our competitive business position.

Litigation or proceedings before the U.S. Patent and Trademark Office or other governmental authorities and administrative bodies in the United States and abroad may be necessary in the future to enforce our intellectual property rights, to protect our domain names and to determine the validity and scope of the proprietary rights of others. Our efforts to enforce or protect our proprietary rights may be ineffective, could result in substantial costs and diversion of resources and could substantially harm our operating results.

Assertions by third parties of infringement or other violation by us of their intellectual property rights could result in significant costs and substantially harm our business and operating results.

Internet, technology and media companies are frequently subject to litigation based on allegations of infringement, misappropriation or other violations of intellectual property rights. Some Internet, technology and media companies, including some of our competitors, own large numbers of patents, copyrights, trademarks and trade secrets, which they may use to assert claims against us. Third parties may in the future assert that we have infringed, misappropriated or otherwise violated their intellectual property rights, and as we face increasing competition, the possibility of intellectual property rights claims against us grows. We cannot assure you that we are not infringing or violating any third-party intellectual property rights.

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We cannot predict whether assertions of third-party intellectual property rights or any infringement or misappropriation claims arising from such assertions will substantially harm our business and operating results. If we are forced to defend against any infringement or misappropriation claims, whether they are with or without merit, are settled out of court or are determined in our favor, we may be required to expend significant time and financial resources on the defense of such claims. Furthermore, an adverse outcome of a dispute may require us to pay damages, potentially including treble damages and attorneys’ fees, if we are found to have willfully infringed a party’s patent or copyright rights, cease making, licensing or using solutions that are alleged to infringe or misappropriate the intellectual property of others, expend additional development resources to redesign our solutions, enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content or materials and to indemnify our partners and other third parties. Royalty or licensing agreements, if required or desirable, may be unavailable on terms acceptable to us, or at all, and may require significant royalty payments and other expenditures. Any of these events could seriously harm our business, operating results and financial condition. In addition, any lawsuits regarding intellectual property rights, regardless of their success, could be expensive to resolve and would divert the time and attention of our management and technical personnel.

Some of our services and technologies may use “open source” software, which may restrict how we use or distribute our services or require that we release the source code of certain services subject to those licenses.

Some of our services and technologies may incorporate software licensed under so-called “open source” licenses, including, but not limited to, the GNU General Public License and the GNU Lesser General Public License. Such open source licenses typically require that source code subject to the license be made available to the public and that any modifications or derivative works to open source software continue to be licensed under open source licenses. These open source licenses typically mandate that proprietary software, when combined in specific ways with open source software, becomes subject to the open source license. If we combine our proprietary software with open source software, we could be required to release the source code of our proprietary software.

We take steps to ensure that our proprietary software is not combined with, nor incorporates, open source software in ways that would require our proprietary software to be subject to an open source license. However, few courts have interpreted open source licenses, and the manner in which these licenses may be interpreted and enforced is therefore subject to some uncertainty. Additionally, we rely on multiple software programmers to design our proprietary technologies, and although we take steps to prevent our programmers from including open source software in the technologies and software code that they design, write and modify, we do not exercise complete control over the development efforts of our programmers, and we cannot be certain that our programmers have not incorporated open source software into our proprietary products and technologies or that they will not do so in the future. In the event that portions of our proprietary technology are determined to be subject to an open source license, we could be required to publicly release the affected portions of our source code, re-engineer all or a portion of our technologies or otherwise be limited in the licensing of our technologies, each of which could reduce or eliminate the value of our services and technologies and materially and adversely affect our business, results of operations and prospects.

We rely on third parties to provide software and related services necessary for the operation of our business.

We incorporate and include third-party software into and with our product and service offerings and expect to continue to do so. The operation of our product and service offerings could be impaired if errors occur in the third-party software that we use. It may be more difficult for us to correct any defects in third-party software as the development and maintenance of the software is not within our control. Accordingly, our business could be adversely affected in the event of any errors in this software. We cannot assure you that any third-party licensors will continue to make their software available to us on acceptable terms, or at all, or to invest the appropriate levels of resources in their software to maintain and enhance its capabilities or to remain in business. Any impairment in our relationships with these third-party licensors could have an adverse effect on our business, results of operations, cash flow and financial condition. These third-party in-licenses may expose us to increased risk, including risks associated with the assimilation of new technology sufficient to offset associated acquisition and maintenance costs. The inability to obtain any of these licenses could result in delays in development of solutions until equivalent technology can be identified and integrated. Any such delays in services could cause our business, operating results and financial condition to suffer.

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We are involved in litigation matters that are expensive and time consuming, and, if resolved adversely, could harm our business, financial condition or results of operations.

We are involved in lawsuits, including a putative class action lawsuit brought by members and stockholder class action lawsuits, and we anticipate that we will continue to be a target for lawsuits in the future. Any negative outcome from such lawsuits could result in payment of substantial monetary damages or fines or undesirable changes to our products, services or business practices, and accordingly, our business, financial condition or results of operations could be materially and adversely affected. Although the results of such lawsuits and claims cannot be predicted with certainty, we currently believe that the final outcome of those matters that we currently face will not have a material adverse effect on our business, financial condition, results of operations or cash flows, except as otherwise recorded within the consolidated financial statements. However, there can be no assurance that a favorable final outcome will be obtained in all our cases, and regardless of the outcome, any lawsuit can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. Any lawsuit to which we are a party may result in an onerous or unfavorable judgment that may not be reversed upon appeal or in payments of substantial damages or fines, or we may decide to settle lawsuits on similarly unfavorable terms, which could adversely affect our business, financial conditions or results of operations.

Covenants in the loan and security agreement governing our term loan and revolving credit facility may restrict our operations, and if we do not effectively manage our business to comply with these covenants, our financial condition could be adversely affected.

The loan and security agreement governing our term loan and revolving credit facility contains various restrictive covenants, including restrictions on our ability to dispose of assets, make acquisitions or investments, incur debt or liens, make distributions to our stockholders or enter into certain types of related party transactions. We are also required to maintain certain financial covenants. Our ability to meet these restrictive covenants can be affected by events beyond our control, and we may be unable to do so. In addition, our failure to maintain effective internal controls to measure compliance with our financial covenants could affect our ability to take corrective actions on a timely basis and could result in our being in breach of these covenants. Our loan and security agreement provides that our breach or failure to satisfy certain covenants constitutes an event of default. Upon the occurrence of an event of default, which includes a material adverse change, our lenders could elect to declare all amounts outstanding under one or more of our debt agreements to be immediately due and payable. If we are unable to repay those amounts, our financial condition could be adversely affected.

Because we generate substantially all of our revenue in the United States, a decline in aggregate demand for local services in the United States could cause our revenue to decline.

Substantially all of our revenue is from members and participating service providers in the United States. Consequently, a decline in consumer demand for local services, particularly in the home improvement and health and wellness segments, or for consumer ratings and reviews could have a disproportionately greater impact on our revenue than if our geographic mix of revenue was less concentrated. In addition, as expenditures by service providers generally tend to reflect overall economic conditions, to the extent that economic growth in the United States remains slow, reductions in advertising by local service providers could have a serious impact on our service provider revenue and negatively impact our business.

If use of the Internet does not continue to increase, our growth prospects will be harmed.

Our future success is substantially dependent upon the continued use of the Internet as an effective medium of business and communication by consumers. Internet use may not continue to develop at historical rates, and consumers may not continue to use the Internet to research and hire local service providers. In addition, the Internet may not be accepted as a viable resource for a number of reasons, including:

• actual or perceived lack of security of information or privacy protection;

• possible disruptions, computer viruses or other damage to Internet servers or to users’ computers; and

• excessive governmental regulation.

Our success will depend, in large part, upon third parties maintaining the Internet infrastructure to provide a reliable network backbone with the speed, data capacity, security and hardware necessary for reliable Internet access and services. Our growth prospects are also significantly dependent upon the availability and adoption of broadband Internet access and other high-speed Internet connectivity technologies.

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We face many risks associated with our long-term plan to expand our operations outside of the United States.

Expanding our operations into international markets is an element of our long-term strategy. However, offering our products and services outside of the United States involves numerous risks and challenges. Most importantly, acquiring paid memberships in foreign countries and convincing foreign service providers to advertise with us would require substantial investment by us in local advertising and marketing, and there can be no assurance that we would succeed or achieve any return on this investment. In addition, international expansion would expose us to other risks such as:

• the need to modify our technology and sell our products and services in non-English speaking countries;

• the need to localize our products and services to the preferences and customs of foreign consumers and local service providers;

• difficulties in managing operations due to language barriers, distance, staffing, cultural differences and business infrastructure constraints;

• our lack of experience in marketing, and encouraging viral marketing, in foreign countries;

• application of foreign laws and regulations to us, including more stringent consumer and data protection laws;

• fluctuations in currency exchange rates;

• risk of member or local service provider fraud;

• reduced or ineffective protection of our intellectual property rights in some countries; and

• potential adverse tax consequences associated with foreign operations and revenue.

As a result of these obstacles, we may find it impossible or prohibitively expensive to enter foreign markets, or entry into foreign markets could be delayed, which could harm our business, operating results and financial condition.

We may acquire other companies or technologies, which could divert our management’s attention, result in additional dilution to our stockholders and otherwise disrupt our operations and harm our operating results.

Our success will depend, in part, on our ability to expand our product and service offerings and grow our business in response to changing technologies, member and service provider demands and competitive pressures. In some circumstances, we may determine to do so through the acquisition of complementary businesses or technologies rather than through internal development. We have limited experience acquiring other businesses and technologies. The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable acquisitions, whether or not they are consummated. Furthermore, even if we successfully acquire additional businesses or technologies, we may not be able to integrate the acquired personnel, operations and technologies successfully or effectively manage the combined business following the acquisition. We also may not achieve the anticipated benefits from the acquired business or technology. In addition, we may unknowingly inherit liabilities from future acquisitions that arise after the acquisition and are not adequately covered by indemnities. Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results. If an acquired business or technology fails to meet our expectations, our operating results, business and financial condition may suffer.

Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.

At December 31, 2013, we had federal net operating loss carryforwards of approximately $105.3 million and state net operating loss carryforwards of approximately $130.9 million. Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code, if a corporation undergoes an “ownership change,” the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes, such as research tax credits, to offset its post-change income and taxes may be limited. In general, an “ownership change” generally occurs if there is a cumulative change in our ownership by “5-percent shareholders” that exceeds 50 percentage points over a rolling three-year period. Similar rules may apply under state tax laws. We may have experienced an ownership change in the past and may experience ownership changes in the future as a result of future transactions in our stock, some of which may be outside our control. As a result, if we earn net taxable income, our ability to use our pre-change net operating loss carryforwards, or other pre-change tax attributes, to offset United States federal and state taxable income and taxes may be subject to limitations.

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Our business is subject to the risks of tornadoes, floods, fires, earthquakes and other natural catastrophic events and to interruption by man-made problems such as computer viruses or terrorism.

Our systems and operations are vulnerable to damage or interruption from tornadoes, floods, fires, power losses, telecommunications failures, terrorist attacks, acts of war, human errors, break-ins or similar events. For example, a significant natural disaster, such as a tornado, fire or flood, could have a material adverse impact on our business, operating results and financial condition, and our insurance coverage may be insufficient to compensate us for such losses that may occur. A portion of our technology team is located in the San Francisco Bay Area, a region known for seismic activity. In addition, acts of terrorism could cause disruptions in our business or the economy as a whole. Our servers may also be vulnerable to computer viruses, break-ins and similar disruptions from unauthorized tampering with our computer systems, which could lead to interruptions, delays, loss of critical data or the unauthorized disclosure of confidential customer data. We currently have limited disaster recovery capability, and our business interruption insurance may be insufficient to compensate us for losses that may occur. As we rely heavily on our servers, computer and communications systems and the Internet to conduct our business and provide high quality service to our members and service providers, such disruptions could negatively impact our ability to run our business, which could have an adverse effect on our operating results and financial condition.

Risks Related to Owning Our Common Stock

Our stock price may be volatile, and the value of an investment in our common stock may decline.

The trading price of our common stock has been, and is likely to continue to be volatile, and could decline substantially within a short period of time. For example, since shares of our common stock were sold in our initial public offering in November 2011 at a price of $13.00 per share, our trading price has ranged from $8.94 to $28.32. The trading price of our common stock may be subject to wide fluctuations in response to various factors, some of which are beyond our control. In addition to the factors discussed in this “Risk Factors” section, these factors include:

• our operating performance and the operating performance of similar companies;

• the overall performance of the equity markets;

• the number of shares of our common stock publicly owned and available for trading;

• threatened or actual litigation;

• changes in laws or regulations relating to our solutions;

• any major change in our board of directors or management;

• publication of research reports about us or our industry, changes in securities analysts’ projections or recommendations, withdrawal of research coverage, or our failure to meet analysts’ projections;

• large volumes of sales of shares of our common stock by existing stockholders; and

• general political and economic conditions.

In addition, the stock market has experienced extreme price and volume fluctuations that often have been unrelated or disproportionate to the operating performance of listed companies. Securities class action litigation has often been instituted against companies following periods of volatility in the overall market and in the market price of a company’s securities. We are currently the subject of multiple stockholder class action lawsuits. These lawsuits, and any future stockholder class action lawsuits initiated against us, could result in very substantial costs, divert our management’s attention and resources and harm our business, operating results and financial condition.

Future sales of our common stock by stockholders could depress the market price of our common stock.

As of December 31, 2013, holders of approximately 15,069,628 shares, or 26%, of our common stock vested stock options and options which vest within 60 days and their transferees have rights, subject to some conditions, to require us to file registration statements covering the sale of their shares or to include their shares in registration statements that we may file for ourselves or other stockholders. In addition, in November 2011, March 2012 and October 2013, we filed registration statements on Form S-8 under the Securities Act to register an aggregate of 10,830,475 shares of our common stock for issuance under our amended and restated omnibus incentive plan. This plan also provides for automatic increases in the shares reserved for issuance under the plan. These shares may be sold in the public market upon issuance and, once vested, any restrictions are provided under the terms of the applicable plan or award agreement. If these additional shares are sold, or if it is perceived that they will be sold, in the public market, the trading price of our common stock could decline.

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We have incurred and will continue to incur increased costs as a result of becoming a reporting company.

We have faced and will continue to face increased legal, accounting, administrative and other costs as a result of becoming a reporting company. We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and related SEC rules and regulations, the Dodd-Frank Act, the listing requirements of the NASDAQ Global Market and other applicable securities rules and regulations. Compliance with these rules and regulations has increased our legal and financial compliance costs and likely will continue to make legal, accounting and administrative activities more time-consuming and costly. We are also incurring substantially higher costs to obtain directors’ and officers’ insurance than we did as a private company. In addition, as we gain experience with the costs associated with being a reporting company, we may identify and incur additional overhead costs.

If securities or industry analysts publish inaccurate or unfavorable research about our business, cease coverage of our company or make projections that exceed our actual results, our stock price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that securities or industry analysts publish about us or our business. If one or more of the analysts who cover us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock price would likely decline. If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.

Furthermore, such analysts publish their own projections regarding our actual results. These projections may vary widely from one another and may not accurately predict the results we actually achieve. Our stock price may decline if we fail to meet securities and analysts’ projections.

Concentration of ownership among our officers and directors and their affiliates may limit the influence of new investors on corporate decisions.

Our officers, directors and their affiliated funds beneficially own or control, directly or indirectly, approximately 27% of the outstanding shares of common stock. As a result, if some of these persons or entities act together, they will have significant influence over the outcome of matters submitted to our stockholders for approval, including the election of directors and approval of significant corporate transactions, such as a merger or other sale of our company or its assets. This concentration of ownership could limit the ability of other stockholders to influence corporate matters and may have the effect of delaying or preventing an acquisition or cause the market price of our stock to decline. Some of these persons or entities may have interests different from yours.

Certain provisions in our charter documents and Delaware law could discourage takeover attempts and lead to management entrenchment.

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that could have the effect of delaying or preventing changes in control or changes in our management without the consent of our board of directors, including, among other things:

• a classified board of directors with three year staggered terms, which could delay the ability of stockholders to replace a majority of our board of directors;

• no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;

• the ability of our board of directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror;

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• the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;

• a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;

• the requirement that a special meeting of stockholders may be called only by a majority vote of our Board of Directors, the Chairman of our Board of Directors, our Chief Executive Officer, our President or our Secretary, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;

• the requirement for the affirmative vote of holders of at least 66 2/3% of the voting power of all of the then-outstanding shares of the voting stock, voting together as a single class, to amend the provisions of our amended and restated certificate of incorporation relating to the issuance of preferred stock and management of our business or our amended and restated bylaws, which may inhibit the ability of an acquiror to amend our amended and restated certificate of incorporation or amended and restated bylaws to facilitate a hostile acquisition;

• the ability of our board of directors, by majority vote, to amend our amended and restated bylaws, which may allow our board of directors to take additional actions to prevent a hostile acquisition and inhibit the ability of an acquiror to amend our amended and restated bylaws to facilitate a hostile acquisition; and

• advance notice procedures with which stockholders must comply to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us.

We are also subject to certain anti-takeover provisions under the General Corporation Law of the State of Delaware, or the DGCL. Under Section 203 of the DGCL, a corporation may not, in general, engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the stock for three years or (i) our board of directors approves the transaction prior to the stockholder acquiring the 15% ownership position, (ii) upon consummation of the transaction that resulted in the stockholder acquiring the 15% ownership position, the stockholder owns at least 85% of the outstanding voting stock (excluding shares owned by directors or officers and shares owned by certain employee stock plans) or (iii) the transaction is approved by the board of directors and by the stockholders at an annual or special meeting by a vote of 66 2/3% of the outstanding voting stock (excluding shares held or controlled by the interested stockholder). These provisions in our amended and restated certificate of incorporation and amended and restated bylaws and under Delaware law could discourage potential takeover attempts.

We do not intend to pay dividends for the foreseeable future.

We never have declared or paid any cash dividends on our capital stock and do not intend to pay any cash dividends in the foreseeable future. In addition, our debt agreements restrict our ability to make distributions to our stockholders. We anticipate that we will retain any future earnings for use in the development of our business and for general corporate purposes. Any determination to pay dividends in the future will be at the discretion of our board of directors.

ITEM 1B.      UNRESOLVED STAFF COMMENTS

None.

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ITEM 2.     PROPERTIES

We own approximately 120,000 square feet of office space at our headquarters in Indianapolis, Indiana, which we purchased in 2012. In addition, we lease approximately 70,000 square feet of office space in Indianapolis, Indiana, Denver, Colorado and Palo Alto, California, pursuant to leases expiring in 2014 and 2015. We believe our current facilities will be adequate or that additional space will be available to us on commercially reasonable terms for the foreseeable future.

ITEM 3.     LEGAL PROCEEDINGS

Information pertaining to legal proceedings can be found in “Item 8. Financial Statements and Supplementary Data — Note 9. Commitments and Contingencies” of this Annual Report on Form 10-K, and is incorporated by reference herein.

ITEM 4.     MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5.      MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock has been listed on the Nasdaq Global Market under the symbol “ANGI” since our initial public offering on November 17, 2011. Prior to this time, there was no public market for our common stock. The following table shows the high and low sale prices per share of our common stock as reported on the Nasdaq Global Market for the periods indicated:

	2013
	High		Low
First Quarter	$	20.17	$	11.14
Second Quarter	$	27.66	$	18.15
Third Quarter	$	28.32	$	19.05
Fourth Quarter	$	22.62	$	11.88

	2012
	High		Low
First Quarter	$	19.82	$	12.81
Second Quarter	$	18.78	$	11.77
Third Quarter	$	16.06	$	8.94
Fourth Quarter	$	12.08	$	8.95

As of February 13, 2014, we had approximately 3,200 holders of record of our common stock. The number of beneficial stockholders is substantially greater than the number of holders of record because a large portion of our common stock is held through brokerage firms.

We have never declared or paid, and do not anticipate declaring or paying, any cash dividends on our common stock. Any future determination as to the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant.

For equity compensation plan information refer to Item 12 in Part III of this Annual Report on Form 10-K.

Performance Graph

This performance graph shall not be deemed “filed” with the Securities and Exchange Commission for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of Angie’s List, Inc. under the Securities Act, except as shall be expressly set forth by specific reference in such filing.

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The following graph shows a comparison from November 17, 2011 (the date our common stock commenced trading on the Nasdaq Global Market) through December 31, 2013 of cumulative total return for our common stock, the Nasdaq Composite Index and the RDG Internet Composite Index. Such returns are based on historical results and are not intended to suggest future performance. Data for the Nasdaq Composite Index and the RDG Internet Composite Index assume reinvestment of dividends.

	11/11		11/11		12/11		3/12		6/12		9/12		12/12		3/13		6/13		9/13		12/13
Angie’s List, Inc.		100.00		88.88		123.85		145.31		121.85		81.38		92.23		152.00		204.31		173.00		116.54
NASDAQ Composite		100.00		98.59		98.88		112.93		109.79		115.53		111.06		125.24		131.16		146.57		162.74
RDG Internet Composite		100.00		96.54		97.63		123.61		117.15		127.66		116.03		119.03		123.52		139.64		160.39

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ITEM 6.      SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

The following selected consolidated financial and other data regarding our business should be read in conjunction with, and are qualified by reference to, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this report. Our historical results are not necessarily indicative of results to be expected in any future period.

	Years Ended December 31,
	2013			2012			2011			2010			2009
Revenue
Membership	$	65,307		$	47,717		$	33,815		$	25,149		$	20,434
Service provider		180,335			108,082			56,228			33,890			25,166
Total revenue		245,642			155,799			90,043			59,039			45,600
Operating expenses
Operations and support(1)		40,072			27,081			16,417			12,464			11,654
Selling(1)		90,143			58,596			33,815			16,892			12,671
Marketing		87,483			80,230			56,122			30,237			16,114
Technology(1)		26,197			16,870			9,109			6,270			5,062
General and administrative(1)		32,828			24,055			18,740			16,302			8,699
Operating loss		(31,081	)		(51,033	)		(44,160	)		(23,126	)		(8,600	)
Interest expense		1,868			1,856			3,004			3,966			3,381
Loss on debt extinguishment		—			—			1,830			—			—
Loss before income taxes		(32,949	)		(52,889	)		(48,994	)		(27,092	)		(11,981	)
Income tax expense		40			5			43			154			—
Net loss	$	(32,989	)	$	(52,894	)	$	(49,037	)	$	(27,246	)	$	(11,981	)
Net loss per common share—basic and diluted	$	(0.57	)	$	(0.92	)	$	(1.60	)	$	(0.99	)	$	(0.45	)
Weighted average number of common shares outstanding— basic and diluted(2)		58,230,927			57,485,589			30,655,532			27,603,927			26,666,918
(1)   Includes non-cash stock-based compensation as follows:
Operations and support	$	64		$	—		$	—		$	—		$	—
Selling		147			—			—			—			—
Technology		17			762			786			496			—
General and administrative		3,836			2,181			3,056			6,203			76
	$	4,064		$	2,943		$	3,842		$	6,699		$	76

(2) The weighted average number of common shares for all periods prior to April 30, 2010 is based on member units assuming conversion to common stock at the applicable rates effective upon reorganization as a corporation on April 30, 2010.

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	Years Ended December 31,
	2013			2012			2011			2010			2009
Other Data (unaudited):
Total paid memberships (end of period)(1)		2,484,059			1,787,394			1,074,757			602,882			411,727
Gross paid memberships added (in period)(2)		1,218,258			1,092,935			716,350			355,580			219,140
Marketing cost per paid membership acquisition (in period)(3)	$	72		$	73		$	78		$	85		$	74
First-year membership renewal rate (in period)(4)		74	%		75	%		75	%		70	%		67	%
Average membership renewal rate (in period)(4)		78	%		78	%		78	%		75	%		73	%
Participating service providers (end of period)(5)		46,329			35,952			24,095			15,060			10,415
Total service provider contract value (end of period, in thousands)(6)	$	194,137		$	132,646		$	73,609		$	43,050		$	30,849

(1)	Reflects the number of paid memberships at the end of each period presented. Total paid memberships also includes a de minimis number of complimentary memberships in our paid markets for all periods presented. The number of memberships lost during the periods presented were 521,593, 380,298, 244,475, 164,425, and 140,902 for 2013, 2012, 2011, 2010, and 2009, respectively.
(2)	Reflects the total number of new paid memberships added in a reporting period.
(3)	Reflects marketing expense divided by gross paid memberships added in a reporting period.
(4)	First-year membership renewal rate reflects the percentage of paid memberships expiring in the reporting period after the first year of membership that are renewed, and average membership renewal rate reflects the percentage of all paid memberships expiring in the reporting period that are renewed. Renewal rates exclude monthly memberships.
(5)	Reflects the total number of service providers under contract for advertising at the end of the period.
(6)	Reflects the total contract value of active service provider contracts at the end of the period. Contract value is the total payment obligation, including amounts already recognized in revenue, of a service provider to us over the stated term of the contract.

	As of December 31,
	2013			2012		2011		2010			2009
Balance Sheet Data:
Cash and cash equivalents	$	34,803		$	42,638	$	88,607	$	9,209		$	2,016
Short-term investments		21,055			10,460		—		—			—
Working capital		(21,672	)		9,411		58,085		(18,378	)		(15,331	)
Total assets		105,643			96,229		111,398		22,601			12,299
Total deferred revenue		80,438			55,331		34,786		23,261			18,024
Long-term debt, including accrued interest		14,918			14,869		14,820		16,463			22,503
Common stock and additional paid-in capital		257,572			248,392		236,015		85,486			—
Stockholders’ equity (deficit)		(18,490	)		5,319		45,836		(33,757	)		(36,268	)

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ITEM 7.      MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the notes thereto included elsewhere in this report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this report, particularly in the “Risk Factors” section.

Overview

We operate a consumer-driven service for our members to research, hire, rate, review, and purchase local services for critical needs, such as home, health care and automotive services. Our ratings and reviews, which are available only to our members, help our members find the best provider for their local service needs. We had approximately 2.5 million paid memberships as of December 31, 2013. We allow local service providers who are highly rated by our members to advertise discounts and other promotions to our members.

We generate revenue from both our members and our service providers. We derive membership revenue from subscription fees and, in certain cases, non-refundable initiation fees for monthly, annual and multi-year memberships. These fees typically are charged in advance. Subscription fees are recognized ratably over the subscription period, and initiation fees are recognized ratably over the expected life of the membership. As of December 31, 2013, approximately 94% of our total membership base had purchased annual or multi-year memberships. These subscription fees represent a significant source of working capital and provide a relatively predictable revenue stream.

We derive service provider revenue principally from term-based sales of advertising to local service providers. Our members grade local service providers on an “A” to “F” scale, and we invite local service providers with an average grade of “B” or better and at least two reviews submitted in the last three years to advertise to our members through any or all of our website, email promotions, monthly magazine and call center. As of December 31, 2013, approximately 452,000 local service providers rated by our members were eligible to offer discounts and other promotions to our members based on these criteria. Service provider contracts can be prepaid or invoiced monthly at the option of the service provider and carry an early termination penalty. We recognize service provider revenue ratably over the period in which an advertising campaign is run. We are expanding our service provider sales personnel to drive increased service provider revenue. Our high service provider renewal rates, both in number of service providers renewing and as a percentage of initial contract value renewed, have provided us with a relatively predictable revenue stream.

In addition to traditional advertising on our website and publications, our e-commerce solutions offer our members the opportunity to purchase services through us from service providers rated highly on our website. These offerings are available through both email promotions and through postings on our website. When the member purchases the service, the transaction is processed through Angie’s List. The member then can work directly with the service provider to schedule the service. These e-commerce offerings provide our members a discount and an easier way to fulfill their service needs.

To establish a new market, we begin by offering free memberships and actively soliciting members’ reviews of local service providers. As the number of members and the number of reviews of service providers grow, we begin charging membership fees and offering advertising opportunities to eligible local service providers. Historically, we have begun to convert most markets to paid membership status within 24 months after launch.

Increasing new paid memberships is a key growth strategy. Increased penetration in a market results in more member reviews of local service providers, which increases the value of our service to consumers and drives further membership growth in that market. Increased penetration in a market also drives increased advertising sales to service providers and supports higher advertising rates as the pool of members actively seeking to hire service providers grows. However, our ability to increase advertising rates tends to lag increased penetration of our markets due to our inability to increase rates under existing service provider contracts prior to renewal. Our primary strategy for new member acquisition is national offline and online advertising.

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As described further in the “Market Cohort Analysis” below, we believe that our estimated penetration rate and average revenue per market will increase as markets mature, and over the long term, we believe that these increased revenues will more than offset our operating expenses. In addition, our advertising spending is focused on the acquisition of new members, rather than the maintenance of existing members. Given that our advertising contracts are typically short-term, we can rapidly adjust marketing expense and thus decrease total operating expenses to reduce cash used in operations or generate cash and profits from operations should we begin to experience adverse trends in marketing cost per paid membership acquisition or wish to optimize for profitability at the expense of rapid growth. We believe that our high membership renewal rates and “word of mouth” referrals from existing members, combined with effective purchasing of lower volumes of advertising and increasing utilization of search engine optimization, or SEO, would enable us to maintain and potentially grow the size of our paid membership base at a lower level of overall advertising spending.

Recent Developments

On August 2, 2013, we acquired substantially all of the assets of SmartHabitat, Inc. (“BrightNest”) for a purchase price of $2.7 million. The purchase price consists of $2.2 million in cash paid at closing and an additional $0.5 million that is payable on the one-year anniversary of the closing, subject to certain performance criteria of BrightNest employees hired by us on the acquisition date. The acquisition of the BrightNest assets adds a user-friendly front end and personalized member experience with expanded content offerings and enhanced technologies. Revenues and expenses related to BrightNest, which were not material for the period ended December 31, 2013, are included in the consolidated results of operations from the date of acquisition.

Market Cohort Analysis

To analyze our progress in executing our expansion plan, we compile certain financial and operating data regarding markets we have entered, grouped by the years in which the markets transitioned to paid membership status. The table below summarizes this data for 2013 by the following cohorts. The pre-2003 cohort includes our ten most established markets, where we initially built out our business model. The markets in this cohort include several mid-sized urban markets in the midwest as well as Chicago and Boston. The 2003 through 2007 cohort includes the first major subset of markets, including many of our largest potential markets, that we targeted in our national expansion strategy. The markets in these older cohorts generally have achieved penetration rates that allow us to transition beyond introductory membership and advertising rates. The 2008-2010 and post-2010 cohorts include markets that have most recently converted to paid status and that still have predominantly introductory membership and advertising rates. The markets in these cohorts generally are smaller markets that we entered to fill out our national presence.

Cohort	# of Markets		Avg. Revenue/ Market(1)		Membership Revenue/Paid Membership(2)		Service Provider Revenue/Paid Membership(3)		Avg. Marketing Expense/ Market(4)		Total Paid Memberships(5)		Estimated Penetration Rate(6)			Annual Membership Growth Rate(7)
Pre-2003		10	$	6,329,201	$	39.16	$	113.65	$	1,317,075		470,206		11.5	%		31	%
2003-2007		35		4,385,040		34.39		97.74		1,384,373		1,350,130		9.0	%		39	%
2008-2010		103		253,976		16.84		36.08		193,802		574,024		9.3	%		38	%
Post 2010		105		24,119		12.46		26.17		56,170		89,699		4.9	%	n/a
Total		253										2,484,059

(1)	Average revenue per market is calculated by dividing the revenue recognized for the markets in a given cohort by the number of markets in the cohort at year end.
(2)	Membership revenue per paid membership is calculated as our membership revenue in the cohort divided by the average number of paid memberships in the cohort. We calculate this average per market to facilitate comparisons among cohorts, but it is not intended to represent typical characteristics of actual markets within the cohort.
(3)	Service provider revenue per paid membership is calculated as service provider revenue in the cohort divided by the average number of paid memberships in the cohort. We calculate this average per market to facilitate comparisons among cohorts, but it is not intended to represent typical characteristics of actual markets within the cohort.

(4)	Average marketing expense per market is calculated first by allocating marketing expense to each cohort based on the percentage of our total target demographic for all markets in such cohort, as determined by third-party data, and then dividing the allocated cohort marketing expense by the number of markets in the cohort at year end. We calculate this average per market to facilitate comparisons among cohorts, but it is not intended to represent typical characteristics of actual markets within the cohort. According to a January 2014 demographic study by Merkle Inc. that we commissioned, there were approximately 30 million households in the United States in our target demographic, which consists of homeowners aged 35 to 64 with an annual household income of at least $75,000. Approximately 27 million of these households were in our markets. The average number of households per market in our demographic target were 410,000, 430,000, 60,000 and 20,000 for the pre-2003, 2003-2007, 2008-2010 and post-2010 cohorts, respectively.
(5)	Includes total paid memberships as of December 31, 2013. Total paid memberships in each cohort includes a de minimis number of complimentary memberships in our paid markets for the period presented.
(6)	Estimated penetration rate is calculated by dividing the number of paid memberships in a given cohort as of December 31, 2013 by the number of households meeting our target demographic criteria in such cohort.
(7)	Annual membership growth rate is the rate of increase in the total number of paid memberships in the cohort between December 31, 2013 and 2012.

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Our average revenue per market and total revenue per paid membership have generally increased with the maturity and corresponding increased penetration of our markets in prior periods. In the future, we expect total revenue per paid membership to fluctuate from period to period, reflecting the timing of our ability to adjust advertising rates given our advertising contract terms and membership pricing innovations designed to drive increased penetration. For example:

● Our average advertising contract term is typically more than one year, and we are only able to increase rates for a given participating service provider upon contract renewal. As such, there is a lag in our ability to leverage increased penetration in a market into increased advertising rates;

● In 80 of our markets, we offer members the opportunity to purchase only those segments of Angie’s List that are most relevant to them, which includes the original Angie’s List (covering 396 categories, including home, lawn, car and pets), Angie’s List Health & Wellness or Angie’s List Classic Cars. These segments continue to be offered in all other markets as a single bundle. We anticipate unbundling our offerings in more of our markets as market penetration increases and the number and categories of local service providers reviewed by members in such markets grow. We believe this pricing model enables us to offer a better value proposition to our members and preserve cross-selling opportunities as members’ needs evolve, although we also expect that this strategy may result in lower average membership fees per paid membership overall;

● Increasingly we are seeing members opt for annual memberships, and as such, the percentage of our membership base on monthly memberships has declined. While we believe annual memberships are more beneficial to members and promote high renewal rates, these memberships generate lower proceeds than monthly memberships taken on an annualized basis; and

● In certain markets we have elected to retain lower membership pricing than we have historically used to drive deeper penetration.

Our most important growth strategy remains driving increased membership growth, which creates the network effects of a more valuable service for consumers and a more attractive commercial platform for service providers. We intend to continue to evaluate and adopt innovative pricing and packaging strategies, such as deeply reduced membership pricing, to deliver compelling value to our members and thereby support membership growth and retention. Although these overall dynamics have caused and may continue to cause membership revenue per paid membership to decline sequentially in some of our cohorts, we believe that the increase in our membership base is critical for continuing to produce the overall growth in average revenue per market, service provider revenue per paid membership and total revenue per paid membership across all cohorts that we have experienced.

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As a market matures, our penetration rate typically increases. Historically, while the absolute number of paid members may grow faster in large markets, our small and medium markets have often achieved greater penetration over a shorter time period than our larger markets. We believe that a principal reason for our lower penetration rates in large markets is the manner in which we market Angie’s List to our target demographic in such markets. We have chosen to spend the majority of our marketing dollars on national advertising. We believe that this advertising strategy provides us the most cost effective and efficient manner of acquiring new paid memberships. However, advertising nationally means we deliver the same volume of advertising regardless of the size of the market. Since each market differs in terms of the number of advertising outlets available, the impact of our spending on national advertising varies across markets. In our experience, smaller markets typically have fewer advertising outlets than larger markets. We believe the same volume of advertising in a smaller market is more effective in building brand awareness and generating new memberships than in larger markets. We expect to continue to see lower relative penetration rates in our larger markets for these reasons. As several of these larger markets are in the 2003-2007 cohort, over time our penetration rate in this cohort may lag other cohorts.

Key Operating Metrics

In addition to the line items in our financial statements, we regularly review a number of other operating metrics related to our membership and service provider bases to evaluate our business, determine the allocation of resources and make decisions regarding business strategies. We believe information on these metrics is useful for investors and analysts to understand the underlying trends in our business. The following table summarizes our key operating metrics, which are unaudited, for the years ended December 31, 2013, 2012 and 2011:

	Years Ended December 31,
	2013			2012			2011
Total paid memberships (end of period)		2,484,059			1,787,394			1,074,757
Gross paid memberships added (in period)		1,218,258			1,092,935			716,350
Marketing cost per paid membership acquisition (in period)	$	72		$	73		$	78
First-year membership renewal rate (in period)		74	%		75	%		75	%
Average membership renewal rate (in period)		78	%		78	%		78	%
Participating service providers (end of period)		46,329			35,952			24,095
Total service provider contract value (end of period, in thousands)	$	194,137		$	132,646		$	73,609

Total paid memberships. Total paid memberships reflects the number of paid memberships at the end of each period presented. Total paid memberships also includes a de minimis number of complimentary memberships in our paid markets for all periods presented. We generally expect that there will be one membership per household and, as such, each membership may actually represent multiple individual consumers.

Gross paid memberships added. Gross paid memberships added reflects the total number of new paid memberships added in a reporting period. Gross paid memberships added increased substantially in each period presented, which we believe has been driven by our increasing investment in national advertising and, to a lesser extent, by “word of mouth” referrals from our existing members.

Marketing cost per paid membership acquisition. We calculate marketing cost per paid membership acquisition in a reporting period as marketing expense divided by gross paid memberships added in that period. As we advertise in national media, some of our marketing expense also increases the number of unpaid memberships. On a comparative basis, marketing cost per paid membership acquisition can reflect our success in generating new paid memberships through our SEO efforts and “word of mouth” referrals and experimentation and adjustments to our marketing expense to focus on more effective advertising outlets for membership acquisition. We typically have higher marketing expense in the second and third quarters of the year in order to attract consumers during the periods when we have found they are most actively seeking Angie’s List services. Our marketing expense is normally reduced in the fourth quarter, reflecting reduced consumer activity in the service sector and higher advertising rates generally due to holiday promotional activity.

Membership renewal rates. First-year membership renewal rate reflects the percentage of paid memberships expiring in the reporting period after the first year of membership that are renewed. Average membership renewal rate reflects the percentage of all paid memberships expiring in the reporting period that are renewed. Renewal rates do not include monthly memberships, which comprised approximately 6% of our total membership base as of December 31, 2013. Given the correlation between increased penetration and higher total revenue per paid membership, we view first-year membership renewal rate and average membership renewal rate as key indicators of expected operating results in future periods.

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Participating service providers. We include in participating service providers the total number of service providers under contract for advertising at the end of the period.

Total service provider contract value. We calculate service provider contract value as the total contract value of active service provider contracts at the end of the period. Contract value is the total payment obligation of a service provider to us, including amounts already recognized in revenue, over the stated term of the contract.

In addition, we also track contract value backlog as a key metric. Contract value backlog consists of the portion of service provider contract value at the stated date which has not yet been recognized as revenue. At December 31, 2013 and 2012, our contract value backlog was $121.4 million and $82.1 million, respectively.

Basis of Presentation and Recent Trends

Revenue

Membership revenue. Our members sign up for monthly, annual or multi-year subscriptions to our service. Membership revenue includes subscription fees and, in certain cases, non-refundable initiation fees charged to new members. We charge the full price of membership at the commencement of the subscription period and at each renewal date (whether monthly, annual or multi-year), unless the member chooses not to renew the membership before the renewal date. Our members prepay their membership fees at the commencement of the subscription period. We record prepaid membership fees as deferred revenue and recognize the fees as revenue over the subscription period. We charge a non-refundable initiation fee in connection with monthly memberships and the lowest cost annual memberships in less penetrated markets. For the year ended December 31, 2013, we recognized revenue from non-refundable initiation fees over the expected life of the membership, which we estimated to be 15 months for monthly memberships and 76 months for annual and multi-year memberships, based on our historical experience.

Service provider revenue. Local service providers generally pay for advertisements in advance on a monthly or annual basis. Our average advertising contract term in effect as of December 31, 2013 was more than twelve months. The vast majority of our service provider contracts cover a period of twelve months. This term allows us to have a predictable revenue stream while providing us an opportunity to adjust advertising rates at the renewal period as our membership penetration of a given market increases.

We recognize revenue from the sale of website and call center advertising ratably over the time period in which the advertisements run. We recognize revenue from the sale of advertising placement in the Angie’s List Magazine in the month the advertisement is published and distributed. As our penetration of a given market increases, we are typically able to charge higher rates for advertising because service providers are able to reach a larger base of potential customers. However, as we only increase advertising rates at the time of contract renewal, increases in service provider revenue in a given market may trail increases in market penetration.

Our e-commerce offerings primarily consist of Big Deal and Storefront, which allow our members to purchase services or products from our service providers through us. We receive a portion of the offer price at the time of the purchase, recognizing the revenue net of the total transaction. Revenue is recognized in the period the offer is sold to members and is included in service provider revenue. While we are not the merchant of record with respect to our members for these transactions, we do offer members refunds in certain circumstances. Revenue from e-commerce transactions is recorded net of a reserve for estimated refunds.

Operating expenses

Operations and support. Operations and support expense consists primarily of costs associated with publishing the Angie’s List Magazine, operating our call center and providing support to our members and service providers, including wages and other employee benefits, credit card processing fees for member enrollment and other service provider transactions on our website, report transcription and data entry and amortization of the cost of acquired data. Operations and support expense does not include the cost of maintaining our website, which is included in technology expense. With the growth of our membership base, we expanded our call center staff to maintain high levels of customer service and encourage high renewal rates. We also use third-party marketing research firms to enable our members to submit reviews by telephone to enrich the content available to our members and expand the number of service providers eligible to advertise with us. We expect our operations and support expense to increase in absolute dollars in the future as we continue to grow our membership and scale our operations.

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Selling. Selling expense consists primarily of commissions, wages and other employee benefits for personnel focused on selling and renewing advertising to eligible service providers and e-commerce deals. We pay substantially higher commissions to our service provider sales personnel for contracts with first-time participating service providers than we pay for renewals. Our e-commerce sales personnel earn commissions based on the net revenue received from the sale of Big Deal and Storefront offerings. Selling expense also includes the cost of service provider marketing efforts, facilities related to sales personnel, supplies and sales personnel training, as well as personnel-related costs for account management. Because selling expense primarily consists of commissions, we generally expect it to fluctuate with service provider revenue.

Marketing. Marketing expense consists of national television, radio and print, as well as online advertising for the purpose of acquiring new paid memberships. As the vast majority of our advertising spending is related to our growth strategy, and our advertising contracts are typically short-term, we can rapidly adjust marketing expense. We intend to continue to invest substantial amounts in acquiring new paid memberships.

Technology. Technology expense consists primarily of personnel-related costs, including wages, employee benefits, including stock-based compensation, and expenditures for professional services and facilities, all of which are related to maintenance of our website and product development. Our technology expense has increased during the periods presented primarily as a result of the addition of technology personnel and enhancement of our technology platform. We expect technology expense to continue to increase in absolute dollars in future periods to support the growth in our members, service providers and personnel.

General and administrative. General and administrative expense consists primarily of personnel-related costs, including wages, benefits, including stock-based compensation, and expenditures for executive, legal, finance, human resources, marketing and corporate communications personnel, product management, as well as professional fees, facilities expense, insurance premiums, acquisition costs, amortization of certain intangibles, depreciation of building and improvements and other corporate expenses. We expect general and administrative expenses to continue to increase in absolute dollars in future periods as we support our growing organization.

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Results of Operations

The following tables set forth our results of operations for the periods presented in absolute dollars and as a percentage of our revenue for those periods. The period-to-period comparison of financial results is not necessarily indicative of future results.

	Years Ended December 31,
	2013			2012			2011
Revenue
Membership	$	65,307		$	47,717		$	33,815
Service provider		180,335			108,082			56,228
Total revenue		245,642			155,799			90,043
Operating expenses
Operations and support(1)		40,072			27,081			16,417
Selling(1)		90,143			58,596			33,815
Marketing		87,483			80,230			56,122
Technology(1)		26,197			16,870			9,109
General and administrative(1)		32,828			24,055			18,740
Operating loss		(31,081	)		(51,033	)		(44,160	)
Interest expense		1,868			1,856			3,004
Loss on debt extinguishment		—			—			1,830
Loss before income taxes	$	(32,949	)	$	(52,889	)	$	(48,994	)
Income tax expense		40			5			43
Net loss	$	(32,989	)	$	(52,894	)	$	(49,037	)

(1) Includes non-cash stock-based compensation as follows:

Operations and support	$	64	$	—	$	—
Selling		147		—		—
Technology		17		762		786
General and administrative		3,836		2,181		3,056
	$	4,064	$	2,943	$	3,842

The following table sets forth operating data of the Company as a percentage of total revenue for the years indicated below.

	Years Ended December 31,
	2013			2012			2011
Revenue
Membership		27	%		31	%		38	%
Service provider		73			69			62
Total revenue		100	%		100	%		100	%
Operating expenses
Operations and support		16			17			18
Selling		37			38			38
Marketing		36			52			62
Technology		11			11			10
General and administrative		13			15			21
Operating loss		(13	)		(33	)		(49	)
Interest expense		1			1			3
Loss on debt extinguishment		—			—			2
Loss before income taxes		(14	)		(34	)		(54	)
Income tax expense		—			—			—
Net loss		(14%	)		(34%	)		(54%	)

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Comparison of the years ended December 31, 2013, 2012 and 2011

Revenue

	Years Ended December 31,
	2013			2012			2011			2013 over 2012			2012 over 2011
	(dollars in thousands)
Revenue
Membership	$	65,307		$	47,717		$	33,815			37	%		41	%
Service provider		180,335			108,082			56,228			67	%		92	%
Total revenue	$	245,642		$	155,799		$	90,043			58	%		73	%
Percentage of revenue by type
Membership		27	%		31	%		38	%
Service provider		73	%		69	%		62	%
Total revenue		100	%		100	%		100	%
Total paid memberships (end of period)		2,484,059			1,787,394			1,074,757			39	%		66	%
Gross paid memberships added (in period)		1,218,258			1,092,935			716,350			11	%		53	%
Participating service providers (end of period)		46,329			35,952			24,095			29	%		49	%

2013 compared to 2012. Total revenue increased $89.8 million for 2013 as compared to 2012.

Membership revenue increased $17.6 million, primarily due to a 39% increase in the total number of paid memberships, partially offset by an 8% decrease in average membership revenue per paid membership in 2013. The decrease in average membership revenue per paid membership primarily resulted from growth in paid memberships in less penetrated markets where average membership fees per paid membership are lower. This decline also reflected the effect of allowing members in our more penetrated markets to purchase only those segments of Angie’s List that are most relevant to them at a lower membership rate than applicable for the full service. As of December 31, 2013, there were 80 markets in which we offered members the opportunity to purchase individual segments. We offer only bundled memberships to members in less penetrated markets. In addition, in 2013 we reduced prices in certain markets which also yielded a decline in revenue per average paid membership. The decrease in membership revenue per paid membership also resulted from an increase from 91% to 94% in total paid memberships constituting annual and multi-year memberships. Consumers pay more per month for a monthly membership than for an annual membership. Therefore, in periods in which our percentage of memberships shifts to more annual and multi-year memberships, our membership revenue per paid membership decreases.

Service provider revenue increased $72.3 million to 73% of total revenue, primarily as a result of a 29% increase in the number of local service providers participating in our advertising programs and a 22% increase in revenue per average participating service provider. Service provider revenue primarily consists of revenue from advertising contracts with service providers. As our penetration of a given market increases, we are typically able to charge higher rates for advertising because service providers are able to reach a larger base of potential customers. However, as we only increase advertising rates at the time of contract renewal, increases in service provider revenue in a given market may trail increases in market penetration. We also include our e-commerce revenue of $22.1 million and $14.5 million in 2013 and 2012, respectively, in service provider revenue. Our e-commerce revenue is generated by our Angie’s List Big Deal and Storefront offerings. We expect the revenue contribution from these offerings to fluctuate from period to period as the offerings evolve and due to seasonality.

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2012 compared to 2011. Total revenue increased $65.8 million for 2012 as compared to 2011.

Membership revenue increased $13.9 million primarily due to a 66% increase in the total number of paid memberships, partially offset by a 17% decrease in membership revenue per average paid membership in 2012. The decrease in membership revenue per average paid membership resulted primarily from growth in paid memberships in less penetrated markets where average membership fees per paid membership are lower. This decline also reflected the effect of allowing members in our more penetrated markets to purchase only those segments of Angie’s List that are most relevant to them at a lower membership rate than applicable for the full service. We offer only bundled memberships to members in less penetrated markets. The decrease in membership revenue per average paid membership in 2012 is also the result of a shift to more annual and multi-year memberships as a percentage of total paid memberships.

Service provider revenue increased $51.9 million to 69% of total revenue primarily as a result of a 49% increase in the number of local service providers participating in our advertising programs and an increase in revenue per average participating service provider. Service provider revenue primarily consists of revenue from advertising contracts with service providers. As our penetration of a given market increases, we are typically able to charge higher rates for advertising because service providers are able to reach a larger base of potential customers. However, because we only increase advertising rates at the time of contract renewal, increases in service provider revenue in a given market may trail increases in market penetration. We also included our e-commerce revenue of $14.5 million and $6.7 million in service provider in 2012 and 2011, respectively. Our e-commerce revenue is generated by our Angie’s List Big Deal and Storefront offerings.

Operations and support

	Years Ended December 31,
	2013			2012			2011			2013 over 2012			2012 over 2011
	(dollars in thousands)
Operations and support	$	40,072		$	27,081		$	16,417			48	%		65	%
Percentage of revenue		16	%		17	%		18	%

2013 compared to 2012. Operations and support expense increased $13.0 million for 2013 compared to 2012. This increase was due in part to a $5.3 million increase in operations and support personnel-related costs as we increased our headcount to service our growing member and service provider base. Additionally, there was a $2.0 million increase in credit card processing fees year over year due to the increased volume of membership enrollment and service provider transactions. We also incurred a $3.7 million increase in publication-related costs associated with the increased circulation of our monthly Angie’s List Magazine due to the continued expansion of our membership base. We expect operations and support expense to continue to increase in absolute dollars as we grow our membership and service provider base. Operations and support expense as a percentage of revenue decreased to 16% from 17% as a result of the increase in revenue and our realization of economies of scale as we service our members and service providers.

2012 compared to 2011. Operations and support expense increased $10.7 million for 2012 compared to 2011. This increase was due in part to a $4.4 million increase in call center costs as compared to the prior year period as we increased our headcount to service our growing member and service provider base. There was a $2.2 million increase in credit card processing fees due to the increased volume of membership enrollment and service provider transactions. We also incurred a $2.1 million increase in costs associated with the collection of member reviews of service providers as we continued to increase the content on our website. Publication-related costs increased by $1.3 million due to a 68% increase in circulation of our monthly Angie’s List Magazine which is consistent with the growth of our membership base. Operations and support expense as a percentage of revenue decreased to 17% from 18% as a result of the increase in revenue and our realization of economies of scale as we service our members and service providers.

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Selling

	Years Ended December 31,
	2013			2012			2011			2013 over 2012			2012 over 2011
	(dollars in thousands)
Selling	$	90,143		$	58,596		$	33,815			54	%		73	%
Percentage of revenue		37	%		38	%		38	%

2013 compared to 2012. Selling expense increased $31.5 million for 2013 compared to 2012. This increase is largely due to an increase in service provider revenue, which increased 67% over the prior year. Additionally, we increased the number of sales personnel and management responsible for originating new advertising contracts and e-commerce transactions by 39% to 773. We also increased the number of sales personnel and management responsible for contract renewals by 38% to 192 from December 31, 2012.

Selling expense as a percentage of revenue decreased to 37% in 2013 from 38% in 2012, primarily as a result of our transition to a new compensation structure for our sales personnel. Additionally, as selling expense primarily consists of commissions, we expect it to fluctuate with service provider revenue and the composition of that revenue over time.

2012 compared to 2011. Selling expense increased $24.8 million for 2012 compared to 2011. This increase is due to an increase in service provider revenue. Service provider revenue increased 92% over the prior year. We increased the number of our sales personnel and management responsible for originating new advertising contracts and e-commerce transactions by 60% to 558. Additionally, the number of our sales personnel and management responsible for contract renewals increased by 117% to 139 from December 31, 2011.

Selling expense as a percentage of revenue remained consistent for 2012 as compared to 2011.

Marketing

	Years Ended December 31,
	2013			2012			2011			2013 over 2012			2012 over 2011
	(dollars in thousands)
Marketing	$	87,483		$	80,230		$	56,122			9	%		43	%
Percentage of revenue		36	%		52	%		62	%
Gross paid memberships added in the period		1,218,258			1,092,935			716,350
Marketing cost per paid membership acquisition	$	72		$	73		$	78

2013 compared to 2012. Marketing expense increased $7.3 million for 2013 compared to 2012, primarily due to a planned increase in national advertising spending for 2013 to acquire new members.

Marketing expense as a percentage of revenue decreased from the prior year period due to total revenue increasing at a greater rate than marketing expense increased in absolute dollars. Even with the current year increase in marketing expense, our marketing cost per paid membership acquisition decreased from $73 to $72 as a result of improved brand awareness, successful SEO efforts, improved effectiveness in purchasing advertising and the “word of mouth” benefits of increased penetration. Consistent with the seasonality that characterizes our business, our marketing expense and marketing cost per paid membership acquisition typically peak in the second and third quarters of the year. We expect marketing expense to decrease as a percentage of revenue in 2014.

2012 compared to 2011. Marketing expense increased $24.1 million for 2012 compared to 2011, primarily due to a planned increase in national advertising spending for 2012 to acquire new members.

Marketing expense as a percentage of revenue decreased from the prior year period due to total revenue increasing at a greater rate than marketing expense increased in absolute dollars. Even with the current year increase in marketing expense, our marketing cost per paid membership acquisition decreased from $78 to $73 as a result of improved brand awareness, successful web search efforts, improved effectiveness in purchasing advertising and the “word of mouth” benefits of increased penetration. Consistent with the seasonality that characterizes our business, our marketing expense and marketing cost per paid membership acquisition typically peak in the second and third quarters of the year.

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Technology

	Years Ended December 31,
	2013			2012			2011			2013 over 2012			2012 over 2011
	(dollars in thousands)
Technology	$	26,197		$	16,870		$	9,109			55	%		85	%
Percentage of revenue		11	%		11	%		10	%
Non-cash stock-based compensation	$	17		$	762		$	786

2013 compared to 2012. Technology expense increased $9.3 million for 2013 compared to 2012. The increase in technology expense was primarily attributable to a $5.1 million increase in personnel-related costs and a $2.9 million increase in technology-related outside consulting and professional fees as well as costs incurred to continue to develop our technology platform and service our growing base of members and service providers. This was offset by a decrease in non-cash stock based compensation related to forfeitures occurring in the current year.

Technology expense as a percentage of revenue remained consistent compared with the prior year. We expect technology expense to increase in absolute dollars and as a percentage of revenue as we continue to develop our technology and product offerings.

2012 compared to 2011. Technology expense increased $7.8 million for 2012 compared to 2011. The increase in technology expense was primarily attributable to a $3.9 million increase in personnel-related costs as we continued to develop our technology platform, including expanding our mobile offerings and establishing a technology presence in Palo Alto, California. We also incurred additional technology costs related to servicing our growing base of members and service providers.

For these reasons technology expense increased as a percentage of revenue compared with the prior year.

General and administrative

	Years Ended December 31,
	2013			2012			2011			2013 over 2012			2012 over 2011
	(dollars in thousands)
General and administrative	$	32,828		$	24,055		$	18,740			36	%		28	%
Percentage of revenue		13	%		15	%		21	%
Non-cash stock-based compensation	$	3,836		$	2,181		$	3,056

2013 compared to 2012. General and administrative expense increased $8.8 million for 2013 compared to 2012. The increase is partially explained by a $4.0 million charge recorded during the fourth quarter of 2013 reflecting the expected settlement of pending litigation for which we have entered into a settlement agreement that is subject to court approval. Additionally, there was an approximately $1.8 million year over year increase in bad debt expense related to uncollectible receivables as well as a $1.7 million increase in non-cash stock-based compensation due to additional grants during 2013. The remaining portion of the fluctuation in general and administrative expense is attributable to increases in headquarters staff and outside consulting and professional fees and other public company costs. These increases were partially offset by non-recurring costs incurred of $0.7 million for fees related to the follow-on sale of common stock in May 2012 that were not present in the current year. General and administrative expense as a percentage of revenue decreased primarily due to the increase in revenue and our realization of economies of scale.

2012 compared to 2011. General and administrative expense increased $5.3 million for 2012 compared to 2011. Personnel-related costs increased $2.1 million primarily as a result of an increase in our headquarters staff, and we incurred an additional $1.2 million in outside consulting and professional services fees to support our growing public company. We also incurred $0.7 million for non-recurring fees related to the follow-on sale of common stock in May 2012. Non-cash stock-based compensation expense decreased by $0.9 million primarily due to restricted grants that immediately vested as a result of our initial public offering in 2011.

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Interest expense

2013 compared to 2012. Interest expense was approximately $1.9 million for both 2013 and 2012 as debt balances remained constant.

2012 compared to 2011. Interest expense decreased $1.1 million for 2012 compared to 2011, as the result of a decrease in average debt outstanding in 2012 as well as lower interest rates associated with the refinancing of our primary debt obligations during 2011.

Loss on debt extinguishment

Loss on debt extinguishment in 2011 was due to the refinancing of our primary debt obligations, which resulted in pre-payment penalties and write-offs of debt discounts and unamortized loan fees. We did not incur any loss on debt extinguishment in 2013 or 2012.

Liquidity and Capital Resources

General

At December 31, 2013, we had $34.8 million in cash and cash equivalents and $21.1 million in short-term investments. Cash and cash equivalents consists of bank deposit accounts and money market funds with contractual maturities of three months or less, which, at times, may exceed federally insured limits. Short-term investments consist of certificates of deposit and corporate bonds with maturities greater than 90 days but less than one year. To date, the carrying value of these investments approximate their fair values, and we have incurred no loss in these accounts.

We have financed our operations primarily through private and public sales of equity and, to a lesser extent, from borrowings. Our principal sources of operating cash flows are receipts for membership fees and service provider transactions. We continue to invest aggressively to grow our business. Over the past three years, our largest uses of cash in operating activities have been for national advertising campaigns to expand our membership base and commissions paid to service provider sales personnel as our service provider revenue has increased.

Our cash flows from operating activities are influenced by certain timing differences. Membership fees from our members are generally collected at the beginning of the membership period and are a part of our working capital although the associated revenue is recognized over the term of the subscription period. Additionally, from time to time we amend our commission plans for sales personnel, and changes to these plans can have a positive or negative impact on prepaid commissions depending on the structure of the commission plan in place.

We believe that our existing cash and cash equivalents and short-term investments will be sufficient to fund our operations for at least the next 12 months. From time to time, we may explore additional financing sources to develop or enhance our services, to fund expansion, to respond to competitive pressures, to acquire or to invest in complementary products, businesses or technologies, or to lower our cost of capital, which could include equity, equity-linked and debt financing. We cannot assure you that any additional financing will be available to us on acceptable terms, if at all.

Summary cash flow information for the years ended December 31, 2013, 2012 and 2011 is set forth below.

	Years Ended December 31,
	2013			2012			2011
Net cash provided by (used in) operating activities	$	8,906		$	(33,397	)	$	(33,135	)
Net cash used in investing activities		(21,857	)		(22,006	)		(4,276	)
Net cash provided by financing activities		5,116			9,434			116,809

Net Cash Provided By (Used in) Operating Activities

We have experienced negative operating cash flows in previous years principally due to our aggressive investment in sales personnel and national advertising campaigns for the purpose of acquiring new members. Our operating cash flows will continue to be affected principally by the extent to which we continue to pursue our growth strategy, including investing in national advertising, changes in price per average paid membership, the expansion of our sales personnel to originate service provider contracts, investing in technology personnel and equipment, and other increases in headcount to grow our business. Our largest source of operating cash flows is cash collections from our members and service providers.

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Cash provided by operating activities for 2013 of $8.9 million was generated despite a net loss of $33.0 million. Our cash provided by operating activities was attributable to a deferred revenue increase of $25.1 million as a result of an increase in both the number of our paid memberships and in the number of service providers participating in our advertising programs, a $6.6 million net increase in accounts payable and accrued liabilities primarily related to increases in accrued compensation, the impact of a $4.0 million current period legal accrual and the expected timing of payment of these balances, and a decrease in prepaid expenses of $6.2 million primarily attributable to our change in compensation structure for our sales personnel responsible for new advertising originations. In addition, our net loss included approximately $11.4 million of non-cash expenses, which included $4.1 million of stock-based compensation expense, $4.1 million of depreciation and amortization, $2.7 million of bad debt expense and $0.5 million attributable to the amortization of debt discount and deferred financing fees. Uses of cash included a $7.3 million increase in accounts receivable attributable to an increase in service provider billings.

Our use of cash in operating activities for 2012 was primarily attributable to our net loss of $52.9 million, reflecting continued investments in our national advertising campaigns, an increase in our sales personnel, as well as other headcount increases and other expenses to grow our business. This net loss included $8.0 million of non-cash expenses, which included $2.9 million of stock-based compensation expense, $2.8 million of depreciation and amortization, $2.0 million of bad debt expense, and $0.3 million of amortization of debt discount and deferred financing fees. Additional uses of cash included an $8.0 million increase in prepaid expenses primarily as a result of the timing of payment of commissions to our sales personnel and a $5.8 million increase in accounts receivable associated with the growth in service provider revenue. These uses of cash in operating activities were offset in part by a $4.8 million increase in accounts payable and accrued liabilities, primarily attributable to increases in accrued marketing expenses and accrued but unpaid commissions, and increases in deferred revenue of $20.5 million, as a result of an increase both in the number of our paid memberships and in the number of service providers participating in our advertising programs.

Our use of cash in operating activities for 2011 was primarily attributable to our net loss of $49.0 million, reflecting continued investments in our national advertising campaigns, an increase in our sales personnel, as well as other headcount increases and other expenses to grow our business. This net loss included $8.6 million of non-cash expenses, which included $3.8 million of stock-based compensation expense, $1.7 million of depreciation and amortization, $0.6 million of accrued interest on debt maturity, $0.8 million of bad debt expense and $0.6 million attributable to the amortization of debt discount and deferred financing fees. Non-cash expenses also included a $1.1 million write-off attributable to our debt refinancing during 2011. Additional uses of cash included a $6.1 million increase in prepaid expenses primarily as a result of the timing of payment of commissions to our sales personnel and the cash payment of accrued interest of $2.7 million. These uses of cash in operating activities were offset in part by a $6.6 million increase in accounts payable and accrued liabilities primarily attributable to increases in accrued marketing expenses and accrued but unpaid commissions, and increases in deferred revenue of $11.5 million as a result of an increase both in the number of our paid memberships and in the number of service providers participating in our advertising programs.

Net Cash Used in Investing Activities

Our use of cash in investing activities in 2013 was attributable to the purchase, net of sales, of $10.8 million in investments in corporate bonds, commercial paper and certificates of deposit with maturities between ninety days and one year, $8.1 million for facilities and information technology hardware and software, $2.2 million for the purchase of BrightNest assets in August 2013 and $0.8 million for data acquisition to acquire consumer reports on service providers.

Our use of cash in investing activities in 2012 was attributable to the purchase of $10.5 million in investments in corporate bonds and certificates of deposits with maturities between ninety days and one year, the purchase of our headquarters facility including land and buildings for $6.8 million, including the costs and fees to acquire the properties, $2.9 million in office improvements and information technology investments, and $2.0 million for data acquisition.

Our use of cash in investing activities in 2011 was attributable to $2.9 million in information technology investments to further improve our hardware and software for members, service providers and our growing employee base, $1.2 million for data acquisition and $0.2 million in other expenditures on property and equipment.

Net Cash Provided by Financing Activities

Net cash provided by financing activities for 2013 consisted solely of proceeds from the exercise of employee stock options.

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Net cash provided by financing activities for 2012 included proceeds of $8.6 million from our follow-on offering of common stock, net of underwriting discounts and expenses and additional offering-related expenses. Additionally, we obtained proceeds of $0.8 million as a result of the exercise of stock options.

Net cash provided by financing activities for 2011 included proceeds of $88.6 million from our initial public offering of common stock and simultaneous sale of stock to one of our directors, net of underwriting discounts and expenses and additional offering-related expenses the sale of preferred stock of $57.9 million, and the issuance of $15.0 million of new long-term debt. These proceeds were offset in part by stock repurchases of $21.9 million, and both scheduled and early debt extinguishment payments aggregating $21.8 million. We also incurred $0.9 million of financing costs related to the issuance of new debt obligations during the current period.

Debt Obligations

On August 31, 2011, we entered into a loan and security agreement that provides for a $15.0 million term loan and a $15.0 million revolving credit facility. A portion of the revolving credit facility is available for letters of credit and corporate credit cards. The term loan bears interest at a per annum rate equal to the greater of (i) the current cash interest rate of LIBOR plus 10% or (ii) 10.5%, and requires monthly interest-only payments until maturity in August 2015. The revolving credit facility requires monthly interest-only payments on advances, which bear interest at a per annum rate equal to LIBOR plus 5%. In addition, when less than 50% of the revolving credit facility is drawn, we are required to pay a non-usage charge of 0.50% per annum of the average unused portion of the revolving credit facility. The term loan provides for penalties for early prepayment. The term loan and revolving credit facility provide for additional interest upon an event of default and are secured by substantially all of our assets. In connection with entering into the loan and security agreement, we issued a warrant to purchase 88,240 shares of common stock to one of the lenders. The fair value of this warrant was recorded as a discount to the term loan, with the amount of the discount being amortized as interest expense through the loan’s maturity. As of December 31, 2013, we had $14.9 million in outstanding borrowings under the term loan and available credit of $15.0 million under the revolving credit facility.

The loan and security agreement contains various restrictive covenants, including restrictions on our ability to dispose of assets, make acquisitions or investments, incur debt or liens, make distributions to our stockholders or enter into certain types of related party transactions. We also are required to comply with certain financial covenants, including a minimum asset coverage ratio, and non-financial covenants. Upon an event of default, which includes a material adverse change, the lenders may accelerate amounts outstanding, terminate the agreement and foreclose on all collateral. We were in compliance with all financial and non-financial covenants at December 31, 2013.

Off-Balance Sheet Arrangements

We do not engage in any off-balance sheet activities. We do not have any off-balance sheet interest in variable interest entities, which include special purpose entities and other structured finance entities.

Contractual Obligations

We enter into long-term contractual obligations and commitments in the normal course of business, primarily debt obligations and non-cancellable operating leases. Our contractual cash obligations at December 31, 2013 are set forth below.

	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 Years
Long-term debt obligations, including accrued interest	$	17,750	$	1,650	$	16,100	$	—	$	—
Operating lease obligations		787		663		124		—		—
Total contractual obligations	$	18,537	$	2,313	$	16,224	$	—	$	—

Critical Accounting Policies and Estimates

Our financial statements are prepared in accordance with generally accepted accounting principles in the United States, or U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates.

We believe the following critical accounting policies involve significant areas of management’s judgment and estimates in the preparation of our consolidated financial statements.

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Membership Revenue Recognition

We recognize revenue when all of the following conditions are met: there is persuasive evidence of an arrangement, the service has been provided to the customer, the collection of the fees is reasonably assured and the amount of fees to be paid by the customer is fixed or determinable. Our revenue includes membership revenue, which includes non-refundable initiation fees and membership fees for monthly, annual and multi-year memberships, and service provider revenue, which includes revenue from service provider advertising.

We recognize revenue from membership fees on a straight-line basis during the contractual period over which the service is delivered. We amortize revenue from the initiation fees of members over the average membership life on a straight-line basis. The estimated membership lives of monthly members and annual members for 2013 are 15 months and 76 months, respectively, based on historical experience. Estimates made by us may differ from actual customer lives. These differences may impact initiation fee revenue, depending on whether the estimated customer life decreases or increases. A change in the estimated customer life by one year in either direction would have a minimal impact to total revenue.

Stock-Based Compensation

We measure stock-based compensation expense for personnel at the grant date fair value of the award and recognize expense on a straight-line basis over the vesting period. Determining the fair value of an award requires judgment.

We estimate the fair value of stock-based payment awards using the Black-Scholes option-pricing model. The determination of the fair value of a stock-based award on the date of grant using the Black-Scholes option-pricing model is affected by our stock price on the date of grant as well as assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the expected term of the award, actual and projected employee stock option exercise behaviors, the risk-free interest rate for the expected term of the award and expected dividends. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in our statements of operations.

The following table summarizes the weighted-average grant date fair value and the weighted-average assumptions relating to our stock options granted during 2013 and 2012:

	2013			2012
Dividend yield		0	%		0	%
Volatility		57	%		60	%
Risk-free interest rate		1.02	%		0.71	%
Expected term, in years		4.9			4.4
Weighted-average estimated fair value of options granted during the year	$	9.38		$	6.04

We use an expected dividend rate of zero based on the fact that we currently have no history or expectation of paying cash dividends on our capital stock. As our common stock had never been publicly traded prior to November 17, 2011, we estimated the expected volatility of our awards from the historical volatility of selected public companies within the internet and media industry with comparable characteristics to us, including similarity in size, lines of business, market capitalization, revenue and financial leverage as well as the expected volatility of our publicly traded common shares. The risk-free interest rate is based on the implied yield currently available on U.S. Treasury issues with terms approximately equal to the expected life of the option. We estimated our expected term based on our historical experience. A 10% change in our stock-based compensation would impact net income by $0.4 million and is immaterial.

Recent Accounting Pronouncements

For detailed information regarding recently issued accounting pronouncements and the expected impact on our financial statements, see Note 1, “Summary of Significant Accounting Policies” in the accompanying Notes to Consolidated Financial Statements included in Item 8 of this Form 10-K.

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ITEM 7A.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Fluctuations

We had cash and cash equivalents of $34.8 million at December 31, 2013, which was held in bank deposit accounts and money market funds for working capital purposes. In addition, we had short-term investments of $21.1 million in certificates of deposit and corporate bonds with maturities greater than 90 days but less than one year. The Company has the ability and intent to hold these investments to maturity. Declines in interest rates may reduce future investment income on these deposits. We do not enter into investments for trading or speculative purposes. We are paid interest on our deposits at variable rates and receive interest payments on held to maturity investments at fixed rates.

We do not believe that a hypothetical 10% increase or decrease in interest rates as of December 31, 2013 would have a material impact on our investment income.

In August 2011, we entered into a loan and security agreement that provides for a $15.0 million term loan and a $15.0 million revolving credit facility. The term loan bears interest at a per annum rate equal to the greater of (i) the current cash interest rate of LIBOR plus 10% or (ii) 10.5%, and requires monthly interest-only payments until maturity in August 2015. The revolving credit facility requires monthly interest-only payments on advances, which bear interest at a per annum rate equal to LIBOR plus 5%. As of December 31, 2013, we had $14.9 million in outstanding borrowings under the term loan and available credit of $15.0 million under the revolving credit facility. We do not believe an immediate 10% increase in interest rates would have a material effect on interest expense, and therefore, we do not expect our operating results or cash flows to be materially affected to any degree by a sudden change in market interest rates.

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ITEM 8.      FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Angie’s List, Inc.

Consolidated Financial Statements

Years Ended December 31, 2013, 2012 and 2011

Contents

Report of Independent Registered Public Accounting Firm	49
Consolidated Financial Statements
Consolidated Balance Sheets	50
Consolidated Statements of Operations	51
Consolidated Statements of Stockholders’ Equity (Deficit)	52
Consolidated Statements of Cash Flows	53
Notes to Consolidated Financial Statements	54

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Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of Angie’s List, Inc.

We have audited the accompanying consolidated balance sheets of Angie’s List, Inc. as of December 31, 2013 and 2012, and the related consolidated statements of operations, stockholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2013. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Angie’s List, Inc. at December 31, 2013 and 2012, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2013, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Angie’s List, Inc.’s internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“1992 framework”) and our report dated February 28, 2014 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Indianapolis, Indiana

February 28, 2014

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Angie’s List, Inc.

Consolidated Balance Sheets

(in thousands, except share data)

	December 31,
	2013			2012
Assets
Cash and cash equivalents	$	34,803		$	42,638
Restricted cash		50			50
Short-term investments		21,055			10,460
Accounts receivable, net of allowance for doubtful accounts of $1,107 and $922 at December 31, 2013 and 2012		12,385			7,787
Prepaid expenses and other current assets		13,651			19,810
Total current assets		81,944			80,745
Property and equipment, net		18,657			12,079
Goodwill		1,145			415
Amortizable intangible assets, net		3,500			2,356
Deferred financing fees, net		397			634
Total assets	$	105,643		$	96,229
Liabilities and stockholders’ equity (deficit)
Accounts payable	$	6,838		$	6,489
Accrued liabilities		21,770			14,058
Deferred membership revenue		35,560			27,627
Deferred advertising revenue		39,448			23,160
Total current liabilities		103,616			71,334
Long-term debt, including accrued interest		14,918			14,869
Deferred membership revenue, noncurrent		4,909			4,330
Deferred advertising revenue, noncurrent		521			214
Deferred income taxes		169			163
Total liabilities		124,133			90,910
Commitments and contingencies (Note 9)
Stockholders’ equity (deficit)
Preferred stock, $0.001 par value: 10,000,000 shares authorized, no shares issued or outstanding at December 31, 2013 and December 31, 2012		—			—
Common stock, $0.001 par value: 300,000,000 shares authorized, 67,014,757 and 66,425,988 shares issued and 58,456,045 and 57,867,276 shares outstanding at December 31, 2013 and December 31, 2012, respectively		67			66
Additional paid-in-capital		257,505			248,326
Treasury stock, at cost: 8,558,712 shares of common stock at December 31, 2013 and December 31, 2012		(23,719	)		(23,719	)
Accumulated deficit		(252,343	)		(219,354	)
Total stockholders’ equity (deficit)		(18,490	)		5,319
Total liabilities and stockholders’ equity (deficit)	$	105,643		$	96,229

See accompanying notes.

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Angie’s List, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share data)

	Year Ended December 31,
	2013			2012			2011
Revenue
Membership	$	65,307		$	47,717		$	33,815
Service provider		180,335			108,082			56,228
Total revenue		245,642			155,799			90,043
Operating expenses
Operations and support		40,072			27,081			16,417
Selling		90,143			58,596			33,815
Marketing		87,483			80,230			56,122
Technology		26,197			16,870			9,109
General and administrative		32,828			24,055			18,740
Operating loss		(31,081	)		(51,033	)		(44,160	)
Interest expense, net		1,868			1,856			3,004
Loss on debt extinguishment		—			—			1,830
Loss before income taxes		(32,949	)		(52,889	)		(48,994	)
Income tax expense		40			5			43
Net loss	$	(32,989	)	$	(52,894	)	$	(49,037	)
Net loss per common share—basic and diluted	$	(0.57	)	$	(0.92	)	$	(1.60	)
Weighted average number of common shares outstanding—basic and diluted		58,230,927			57,485,589			30,655,532

See accompanying notes.

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Angie’s List, Inc.

Consolidated Statements of Stockholders’ Equity (Deficit)

(in thousands)

	Convertible Preferred Stock			Common Stock		Additional Paid- In Capital		Treasury Stock			Accumulated Deficit			Total Equity (Deficit)
Balance at December 31, 2010	$	2		$	33	$	85,453	$	(1,822	)	$	(117,423	)	$	(33,757	)
Net loss		—			—		—		—			(49,037	)		(49,037	)
Sale of preferred stock, net of costs		1			—		57,922		—			—			57,923
Preferred stock conversion		(3	)		3		—		—			—			—
Issuance of common stock, net of costs		—			29		88,536		—			—			88,565
Repurchase of stock		—			—		—		(21,897	)		—			(21,897	)
Stock-based compensation		—			—		3,842		—			—			3,842
Issuance of warrants		—			—		197		—			—			197
Balance at December 31, 2011	$	—		$	65	$	235,950	$	(23,719	)	$	(166,460	)	$	45,836
Net loss		—			—		—		—			(52,894	)		(52,894	)
Issuance of common stock, net of costs		—			1		8,626		—			—			8,627
Stock-based compensation		—			—		2,943		—			—			2,943
Exercise of stock options and warrants		—			—		807		—			—			807
Balance at December 31, 2012	$	—		$	66	$	248,326	$	(23,719	)	$	(219,354	)	$	5,319
Net loss		—			—		—		—			(32,989	)		(32,989	)
Stock-based compensation		—			—		4,064		—			—			4,064
Exercise of stock options		—			1		5,115		—			—			5,116
Balance at December 31, 2013	$	—		$	67	$	257,505	$	(23,719	)	$	(252,343	)	$	(18,490	)

See accompanying notes.

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Angie’s List, Inc.

Consolidated Statements of Cash Flows

(in thousands)

	Year Ended December 31,
	2013			2012			2011
Operating activities
Net loss	$	(32,989	)	$	(52,894	)	$	(49,037	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		4,069			2,753			1,660
Deferred income taxes		6			5			4
Accrued interest due on debt maturity date		—			—			625
Amortization of debt discount and deferred financing fees		527			312			596
Bad debt expense		2,658			1,955			806
Noncash compensation expense		4,064			2,943			3,842
Noncash loss on debt extinguishment		—			—			1,075
Changes in certain assets:
Accounts receivable		(7,256	)		(5,805	)		(2,081	)
Prepaid expenses and other current assets		6,159			(7,975	)		(6,068	)
Changes in certain liabilities:
Accounts payable		(1,151	)		1,223			2,089
Accrued liabilities		7,712			3,541			4,497
Accrued interest on long-term debt		—			—			(2,668	)
Deferred advertising revenue		16,595			9,492			5,433
Deferred membership revenue		8,512			11,053			6,092
Net cash provided by (used in) operating activities		8,906			(33,397	)		(33,135	)
Investing activities
Restricted cash		—			250			—
Purchases of short-term investments		(32,814	)		(10,491	)		—
Sales of short-term investments		21,978			—			—
Acquisition of business		(2,150	)		—			—
Property and equipment		(8,102	)		(9,730	)		(3,085	)
Data acquisition costs		(769	)		(2,035	)		(1,191	)
Net cash used in investing activities		(21,857	)		(22,006	)		(4,276	)
Financing activities
Borrowings under lines of credit		—			—			10,000
Payments under lines of credit		—			—			(10,000	)
Principal payments on long-term debt		—			—			(21,797	)
Proceeds from long-term debt		—			—			15,000
Payments on capital lease obligations		—			—			(41	)
Purchases of treasury stock		—			—			(21,897	)
Cash paid for financing costs		—			—			(944	)
Proceeds from public stock offerings and other, net of fees		—			8,627			88,565
Proceeds from exercise of stock options		5,116			807			—
Sale of preferred stock, net of fees		—			—			57,923
Net cash provided by financing activities		5,116			9,434			116,809
Net increase (decrease) in cash		(7,835	)		(45,969	)		79,398
Cash and cash equivalents, beginning of period		42,638			88,607			9,209
Cash and cash equivalents, end of period	$	34,803		$	42,638		$	88,607
Supplemental cash flow disclosures
Cash paid for interest	$	1,602		$	1,680		$	4,899
Cash paid for income taxes		—			15			—
Capital expenditures incurred but not yet paid		1,000			—			—

See accompanying notes.

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Angie’s List, Inc.

Notes to Consolidated Financial Statements

Years Ended December 31, 2013, 2012, and 2011

(Dollars in Thousands, except per share data)

1. Summary of Significant Accounting Policies

Nature of Operations and Reorganization

Angie’s List, Inc. (collectively with its wholly owned subsidiaries, the Company) operates a consumer-driven service for its members to research, hire, rate and review local professionals for critical needs, such as home, health care and automotive services. Ratings and reviews, which are available only to the Company’s members, help its members to find the best provider for their local service needs. Membership subscriptions are sold on a monthly, annual and multi-year basis. The consumer rating network “Angie’s List” is maintained and updated based on member feedback. The Company also sells advertising in its monthly publication, on its website and through its call center to service providers that meet certain rating criteria. In addition, the Company’s e-commerce offerings provide its members the opportunity to purchase services directly from the Company from service providers that are rated on its website. The Company’s services are provided in markets located across the continental United States.

Operating segments are defined as components of an enterprise engaging in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company manages its business on the basis of one operating segment.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

The Company has evaluated subsequent events through the date these consolidated financial statements were issued.

Estimates

Management uses estimates and assumptions in preparing consolidated financial statements in accordance with accounting principles generally accepted in the United States. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported revenue and expenses. Actual results could vary from the estimates that were used.

Common Stock

On October 31, 2011, the Company effected an eight-for-one split of its common stock by way of a stock dividend. As a result of the stock split, holders of the Company’s common stock received seven additional shares of common stock for every share held on such date, and a proportionate adjustment was made to the applicable conversion prices for each share of the Company’s outstanding convertible preferred stock (see Note 12). All share and per share amounts for all periods presented in these consolidated financial statements and notes thereto were adjusted retroactively, where applicable, to reflect this stock split and the adjustment of the convertible preferred stock conversion prices.

In May 2012, the Company completed a follow-on public offering of 8,629,797 shares of its common stock, which included 703,235 shares of common stock sold by the Company and 7,926,562 shares of common stock sold by the selling stockholders (inclusive of 189,374 shares of common stock from the partial exercise of the over-allotment option granted to the underwriters). The Company incurred fees resulting from the transaction of approximately $770, of which $81 is included in additional paid-in-capital and $689 is included in general and administrative expenses.

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Revenue Recognition and Deferred Revenue

The Company recognizes revenue when all of the following conditions are met: there is persuasive evidence of an arrangement, the service has been provided to the customer, the collection of the fees is reasonably assured and the amount of fees to be paid by the customer is fixed or determinable.

Membership Revenue

Revenue from the sale of membership subscriptions is recognized ratably over the term of the associated subscription.

At the time a member joins, the Company may receive a one-time nonrefundable enrollment fee. Enrollment fees are deferred and recognized on a straight-line basis over an estimated average membership life of 76 months for annual or multi-year members and 15 months for monthly members, which is based on historical membership experience. The Company reviews the estimated average membership life on an annual basis, or more frequently if circumstances change. Changes in member behavior, performance, competition and economic conditions may cause attrition levels to change, which could impact the estimated average membership life.

Service Provider Revenue

Revenue from the sale of advertising in the Company’s publication is recognized in the month in which the Company’s monthly publication is published and distributed. Revenue from the sale of website and call center advertising is recognized ratably over the time period the advertisements run. Revenue from e-commerce vouchers is recognized on a net basis when the voucher has been delivered to the purchaser. While the Company is not the merchant of record with respect to its customers for these transactions, it does offer customers refunds in certain circumstances. Revenue from e-commerce transactions is recorded net of a reserve for estimated refunds. The Company’s e-commerce revenue was $22,062, $14,475, and $6,651 for 2013, 2012, and 2011, respectively.

Deferred Revenue

Deferred revenue includes the unamortized portion of revenue associated with membership and advertising fees for which the Company has received payment in advance of services or advertising to be provided.

Cash and Cash Equivalents

The Company maintains its cash in bank deposit accounts and money market funds with contractual maturities of three months or less, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts.

Restricted Cash

Restricted cash relates to monies held in reserve at institutions pursuant to credit card processing agreements. The restricted cash is not available for operating activities.

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Short-term Investments

Investments with maturities less than one year consist of certificates of deposit (short-term only) and corporate bonds, all of which are designated as held-to-maturity investments and are recorded at amortized cost, adjusted for amortization of premiums to maturity computed under the effective interest method, in the consolidated balance sheets. Such amortization and interest income from held-to-maturity investments is included in interest expense, net in the consolidated statement of operations. For these investments, the Company’s objective is to earn a higher rate of return on funds that are not anticipated to be required to meet liquidity needs in the near term, while maintaining a low level of investment risk with the positive intent and ability to hold these investments to maturity. Short-term investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may be impaired. As of December 31, 2013, Angie’s List, Inc. had $21,055 in short-term investments with no material unrealized gains or losses.

Accounts Receivable

Accounts receivable are stated at the amount billed to service providers, less an estimated allowance for doubtful accounts. The Company performs ongoing credit evaluations and generally requires no collateral from service providers. Management reviews individual accounts as they become past due to determine collectability. The allowance for doubtful accounts is adjusted periodically based on management’s consideration of past due accounts. Individual accounts are charged against the allowance when all reasonable collection efforts have been exhausted.

The changes in the allowance for doubtful accounts during the years ended December 31, 2013, 2012 and 2011 were as follows:

	Year Ended December 31,
	2013			2012			2011
Beginning balance	$	922		$	535		$	241
Additions, net of recoveries		3,773			1,955			806
Deductions		(3,588	)		(1,568	)		(512	)
Ending Balance	$	1,107		$	922		$	535

Property and Equipment

Property and equipment are stated at cost and are depreciated over the estimated useful life of each asset. The Company also capitalizes the cost of computer software developed or obtained for internal use. The Company’s estimated lives for property and equipment range from 3 to 25 years. Depreciation is computed using the straight-line method. Repairs and routine maintenance are charged to expense as incurred.

Data Acquisition Costs

Data acquisition costs consist of external costs related to acquiring consumer reports on service providers. These reports are used by the Company to provide its members with feedback on service providers. Amortization is computed using the straight-line method over the period which the information is expected to benefit the Company’s members, which is estimated to be three years. The capitalized costs are included in intangible assets on the consolidated balance sheet, and the amortized expense is reflected within operations and support expenses in the consolidated statements of operations.

Long-Lived Assets

Long-lived assets, including property and equipment and amortizable intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by comparison of the carrying amount to future net undiscounted cash flows expected to be generated by the related asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the assets. To date, there have been no adjustments to the respective carrying values.

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Goodwill

Goodwill is not amortized but is tested for impairment annually on December 31 and more frequently whenever an event occurs or circumstances indicate the carrying amount may be impaired. If the estimated fair value of goodwill is lower than its carrying amount, a goodwill impairment is indicated, and goodwill is written down to its estimated fair value. To date, there has been no impairment of goodwill.

Sales Commissions

Commissions expense from the sale of service provider advertisements is recognized ratably over the term of the associated advertisement. The Company defers the recognition of commission expense until such time as the revenue related to the customer contract for which the commission was paid is recognized. Deferred commissions for each contract are amortized to expense in a manner consistent with how revenue is recognized for such contract, resulting in straight-line recognition of expense over the contractual term. Unamortized commission expense of $9,395 and $17,215 as of December 31, 2013 and 2012, respectively, is included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. The decrease in unamortized commissions expense in 2013 is a reflection of the change in the Company’s payment practice for commissions whereby the Company now times the actual commission payment to more closely align with the timing of expense recognition.

Deferred Financing Fees

In August 2011, in connection with its entry into a loan and security agreement, the Company incurred certain costs associated with these financing activities of $944, which are being amortized into interest expense over the term of the credit facility. Deferred financing costs recorded previously in 2009 and 2010 of $328 and $1,074 were recorded as a result of certain financing agreements and were being amortized over the terms of their respective agreements. In connection with the extinguishment of its senior and subordinated loan agreements in August 2011, the Company expensed the unamortized portion of deferred financing fees associated with these loan agreements, which are included in the loss on debt extinguishment. Deferred financing fees, net of accumulated amortization, totaled $397 and $634 at December 31, 2013 and 2012, respectively. Amortization expense of $237, $232 and $524 is included in interest expense in the consolidated statements of operations for the fiscal years ended December 31, 2013, 2012 and 2011, respectively.

Income Taxes

The Company is subject to corporate-level federal and state income taxes at prevailing corporate rates and accounts for income taxes and the related accounts using the liability method in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 740, Income Taxes. Under this method, the Company accrues income taxes payable or refundable and recognizes deferred tax assets and liabilities based on differences between the book and tax basis of assets and liabilities. The Company measures deferred tax assets and liabilities using enacted rates in effect for the years in which the differences are expected to reverse and recognizes the effect of a change in enacted rates in the period of enactment. After determining the total amount of deferred tax assets, the Company determines whether it is more likely than not that some portion of the deferred tax assets will not be realized. If the Company determines that a deferred tax asset is not likely to be realized, a valuation allowance will be established against that asset to record it at its expected realizable value.

The Company establishes assets and liabilities for uncertain positions taken or expected to be taken in income tax returns using a more-likely-than-not recognition threshold. The Company includes in income tax expense any interest and penalties related to uncertain tax positions.

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Marketing Expense

Marketing expense consists of national television, radio and print, as well as online, advertising. The Company expenses all advertising costs as incurred.

Stock-Based Compensation

The Company accounts for stock-based compensation using the fair value recognition provisions of ASC 718, Stock Compensation. For its awards of restricted stock and stock options, the Company recognizes stock-based compensation expense in an amount equal to the fair market value on the grant date of the respective award. The Company recognizes this expense, net of estimated forfeitures, on a straight-line basis over the requisite service period.

The fair value of the stock under the plans was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

Expected volatility is based on historical volatilities for publicly traded common stock of comparable companies over the estimated expected life of the stock options. The expected term represents the period of time the stock options are expected to be outstanding. The risk-free interest rate is based on yields of U.S. Treasury securities with a maturity similar to the estimated expected term of the stock options.

Sales and Use Tax

Sales and use tax expenses are included within operations and support in the consolidated statements of operations. The Company does not separately collect sales and use taxes from its members.

Recent Accounting Pronouncements

In July 2013, the FASB issued Accounting Standards Update No. 2013-11: Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) (“ASU 2013-11”). An entity is required to present unrecognized tax benefits as a decrease in a net operating loss, similar tax loss or tax credit carryforward if certain criteria are met. The determination of whether a deferred tax asset is available is based on the unrecognized tax benefit and the deferred tax asset that exists at the reporting date and presumes disallowance of the tax position at the reporting date. The guidance will eliminate the diversity in practice in the presentation of unrecognized tax benefits but will not alter the way in which entities assess deferred tax assets for realizability. ASU 2013-11 will be effective for the company in fiscal 2014. The Company is currently assessing the impact to the consolidated financial statements.

2. Net Loss Per Common Share

Basic and diluted net loss per common share is computed by dividing consolidated net loss by the weighted average number of common shares outstanding for the period. Basic and diluted net loss per common share were $(0.57) and $(0.92) for the years ended December 31, 2013 and December 31, 2012, respectively.

The following potential dilutive equity securities are not included in the diluted net loss per common share calculation because they would have an antidilutive effect:

	December 31, 2013		December 31, 2012
Stock options		3,310,764		2,820,619

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3. Fair Value Measurements

Whenever possible, quoted prices in active markets are used to determine the fair value of our financial instruments. Our financial instruments are not held for trading or other speculative purposes. The estimated fair value of financial instruments was determined by using available market information and appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that we could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

Fair Value Hierarchy

Fair value is based on 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. ASC 820, Fair Value Measurement Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. Generally Accepted Accounting Principles and International Financial Reporting Standards, defined and established a framework for measuring fair value and expands disclosures about fair value measurements for financial assets and liabilities that are adjusted to fair value on a recurring basis and/or financial assets and liabilities that are measured at fair value on a nonrecurring basis, which were adjusted to fair value during the period. In accordance with ASC 820, we categorized our financial assets and liabilities that are adjusted to fair value based on the priority of the inputs to the valuation technique, following the three-level fair value hierarchy prescribed by ASC 820, as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available.

Valuation Techniques

The Company’s cash equivalents are classified within Level 1 on the basis of valuations using quoted market prices. As many fixed income securities do not trade daily, fair values are often derived using recent trades of securities with similar features and characteristics. When recent trades are not available, pricing models are used to determine these prices. These models calculate fair values by discounting future cash flows at estimated market interest rates. Such market rates are derived by calculating the appropriate spreads over comparable U.S. Treasury securities, based on the credit quality, industry and structure of the asset. Typical inputs and assumptions to pricing models include, but are not limited to, a combination of benchmark yields, reported trades, issuer spreads, liquidity, benchmark securities, bids, offers, reference data, and industry and economic events. The Company’s fixed income corporate bond investments and certificates of deposit with fixed maturities are valued using recent trades or pricing models and are therefore classified in Level 2.

Recurring Fair Value Measurements

There were no movements between fair value measurement levels of the Company’s cash equivalents and short-term investments during 2013 and 2012. The following tables summarize the financial instruments of the Company at fair value based on the fair value hierarchy for each class of instrument as of December 31, 2013 and 2012:

			Fair Value Measurement at December 31, 2013 Using
	Carrying Value at December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Money market funds	$	655	$	655	$	—	$	—
Investments:
Certificates of deposit		13,750				13,734
Corporate bonds		7,305				7,303
Total assets	$	21,710	$	655	$	21,037	$	—

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			Fair Value Measurement at December 31, 2012 Using
	Carrying Value at December 31, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Money market funds	$	1,183	$	1,183	$	—	$	—
Investments:
Certificates of deposit		2,640				2,639
Corporate bonds		7,820				7,816
Total assets	$	11,643	$	1,183	$	10,455	$	—

The carrying amount of the term loan approximates its fair value, using level 2 inputs, because this borrowing bears interest at variable (market) rate at December 31, 2013 and 2012.

Non-Recurring Fair Value Measurements

The Company has certain assets that are measured at fair value on a non-recurring basis under circumstances and events that include those described in Note 6, Goodwill and Amortizable Intangible Assets, and are adjusted to fair value only when the carrying values are more than the fair values. The categorization of the framework used to price the assets is considered a Level 3 measurement due to the subjective nature of the unobservable inputs used to determine the fair value.

Assets and liabilities acquired in business combinations are recorded at their fair value as of the date of acquisition. Refer to Note 6 for the fair values of assets acquired and liabilities assumed in connection with the acquisition of substantially all the assets of SmartHabitat (“BrightNest”).

The carrying amounts of accounts receivable and accounts payable reported in the consolidated balance sheets approximate fair value.

4. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets were comprised of the following:

	December 31,
	2013		2012
Prepaid and deferred commissions	$	9,395	$	17,215
Other		4,256		2,595
Total prepaid expenses and other current assets	$	13,651	$	19,810

5. Property and Equipment

Property and equipment was comprised of the following:

	December 31,
	2013			2012
Furniture and equipment	$	7,965		$	5,929
Land		1,464			1,401
Buildings and improvements		8,711			6,417
Software		5,949			1,949
		24,089			15,696
Less accumulated depreciation		(5,432	)		(3,617	)
	$	18,657		$	12,079

In November 2012, the Company acquired its headquarters facilities from its lessor, a related party, at a cost of $6,785, including costs and fees to acquire the properties. Buildings are being depreciated on a straight-line basis over 25 years.

Depreciation expense for the years ended December 31, 2013, 2012, and 2011, was $1,565, $994 and $661, respectively. Computer software amortization expense for 2013, 2012 and 2011 was $961, $524 and $218, respectively.

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6. Goodwill and Amortizable Intangible Assets

The Company has goodwill as well as certain amortizable intangible assets consisting of data acquisition costs, a member list, content and core technology. The goodwill and amortizable intangible asset balances reflect the goodwill, member list, content and core technology acquired during the August 2, 2013 acquisition of substantially all the assets of BrightNest for a purchase price of $2,650, inclusive of $1,920 in acquired intangible assets and goodwill of $730.The purchase price consisted of $2,150 in cash paid at closing and an additional $500 that is payable on the one-year anniversary of the closing, subject to certain performance criteria of BrightNest employees hired by the Company on the acquisition date. The acquisition of the BrightNest assets adds a user-friendly front end and personalized member experience with expanded content offerings and enhanced technologies. Revenues and expenses related to BrightNest, which are not material, are included in the consolidated results of operations from the date of acquisition.

Amortization on the intangible assets is computed using the straight-line method over the estimated lives of the assets. Amortizable intangible assets at December 31, 2013 are as follows:

	Cost		Accumulated Amortization		Net		Amortization Period (in years)
2013
Member List	$	1,670	$	122	$	1,548		6.0
Content		140		12	$	128		3.0
Core technology		110		16	$	94		3.0
Data acquisition costs		3,296		1,566	$	1,730		3.0
	$	5,216	$	1,716	$	3,500
2012
Data acquisition costs	$	4,017	$	1,661	$	2,356		3.0
	$	4,017	$	1,661	$	2,356

Amortization expense on amortizable intangible assets for the years ended December 31, 2013, 2012 and 2011, was $1,546, $1,234 and $781, respectively. The estimated amortization expense related to amortizable intangible assets at December 31, 2013 for each of the next five years is as follows: $1,520 in 2014, $831 in 2015, $430 in 2016, $278 in 2017 and 2018 and $162 thereafter.

The Company’s recorded goodwill balance at December 31, 2013 and 2012 was $1,145 and $415, respectively. The Company expects the amount recorded as goodwill for the BrightNest acquisition to be fully deductible for tax purposes.

7. Accrued Liabilities 

Accrued liabilities were comprised of the following:

	December 31,
	2013		2012
Accrued sales commissions	$	2,570	$	4,342
Sales and use tax		3,158		2,130
Accrued compensation		5,229		2,246
Uninvoiced accounts payable		2,977		2,372
Legal accrual		4,000		—
Other		3,836		2,968
Total accrued liabilities	$	21,770	$	14,058

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8. Long-term Debt

Debt was comprised of the following:

	December 31,
	2013			2012
Term loan	$	15,000		$	15,000
Debt discount on term loan		(82	)		(131	)
		14,918			14,869
Less current maturities		—			—
Total long-term debt, including accrued interest	$	14,918		$	14,869

On August 31, 2011, the Company entered into a loan and security agreement that provides for a $15,000 term loan and a $15,000 revolving credit facility. A portion of the revolving credit facility is available for letters of credit and corporate credit cards. The term loan bears interest at a per annum rate equal to the greater of (i) the current cash interest rate of LIBOR plus 10% or (ii) 10.5%, and requires monthly interest-only payments until maturity in August 2015. The revolving credit facility requires monthly interest-only payments on advances, which bear interest at a per annum rate equal to LIBOR plus 5%. In addition, when less than 50% of the revolving credit facility is drawn, the Company is required to pay a non-usage charge of 0.50% per annum of the average unused portion of the credit facility. The term loan provides for penalties for early prepayment. The term loan and revolving credit facility provide for additional interest upon an event of default and are secured by substantially all of the Company’s assets. In connection with entering into the loan and security agreement, the Company issued a convertible warrant to purchase 88,240 shares of common stock to one of the lenders. The fair value of this warrant was recorded as a discount to the term loan, with the amount of the discount being amortized as interest expense through the loan’s maturity. As of December 31, 2013, the Company had $14,900 in outstanding borrowings under the term loan and available credit of $15,000 under the revolving credit facility.

The loan and security agreement contains various restrictive covenants, including restrictions on the Company’s ability to dispose of assets, make acquisitions or investments, incur debt or liens, make distributions to stockholders or enter into certain types of related party transactions. The Company is also required to comply with certain financial covenants, including a minimum asset coverage ratio, and non-financial covenants. Upon an event of default, which includes a material adverse change, the lenders may accelerate amounts outstanding, terminate the agreement and foreclose on all collateral. The Company was in compliance with all financial and non-financial covenants at December 31, 2013, and management believes the Company will be in compliance through the end of fiscal 2014.

On August 31, 2011, the Company repaid in full the outstanding balance of $14,178 on a note payable, including additional interest of $3,200 ($2,668 of which had been accrued as of August 31, 2011), and prepayment penalties in the amount of $220 under the prior note payable, and terminated the related amended and restated loan and security agreement. On the same date, the Company also paid $6,087 to the holders of the senior subordinated note in satisfaction of the principal, interest and other fees due thereunder. The prepayment penalties, unaccrued additional interest and other fees are included in the loss on debt extinguishment within the consolidated statement of operations for 2011.

9. Commitments and Contingencies

Operating Leases

The Company has long-term noncancellable operating leases for offices and equipment that expire in various years through 2015. These leases require the Company to pay all executory costs (property taxes, maintenance and insurance). Rental payments include minimum rentals.

Future minimum lease payments required under long-term noncancellable operating leases at December 31, 2013 were:

	Total
Payable in
2014	$	663
2015		124
2016		0
	$	787

Rental expense for all operating leases totaled $910, $1,381 and $915 in 2013, 2012 and 2011, respectively.

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Legal Matters

From time to time, the Company has or may become party to litigation incident to the ordinary course of business. The Company assesses the likelihood of any adverse judgments or outcomes with respect to these matters and determines loss contingency assessments on a gross basis after assessing the probability of incurrence of a loss and whether a loss is reasonably estimable. In addition, the Company considers other relevant factors that could impact its ability to reasonably estimate a loss. A determination of the amount of reserves required, if any, for these contingencies is made after analyzing each matter. The Company’s reserves may change in the future due to new developments or changes in strategy in handling these matters. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these matters listed below will not have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors.

Fritzinger v. Angie’s List. On August 14, 2012 a lawsuit seeking class action status was filed against the Company in the U.S. District Court for the Southern District of Indiana (the “Court”). The lawsuit alleges claims of breach of contract and unjust enrichment, alleging that the Company automatically renews membership fees at a higher rate than customers are led to believe, breaching their membership agreements. The plaintiff seeks compensatory damages and an award of treble damages, attorneys’ fees and costs. The Company and the plaintiff have agreed in principle to settlement terms, which remains subject to Court approval.  As of December 31, 2013, the Company has recorded a $4,000 legal accrual related to the settlement. The Company believes this amount represents the best estimate of the Company’s ultimate liability with respect to this litigation, and any difference between the amount recorded and the actual final court-approved settlement is not expected to have a material impact on our financial condition or results of operations.   

Baron v. Angie’s List, Inc., et al. On December 23, 2013, a class action complaint was filed in the Court, naming the Company and various current and former directors and officers as defendants and alleging that the defendants violated Section 10(b) of the Securities Act of 1934 (the “Exchange Act”) by making material misstatements in and omitting material information from the Company’s public disclosures concerning the Company’s business prospects. The complaint further alleges that the defendants violated Section 20(a) of the Exchange Act by virtue of their positions as control persons. The plaintiff has requested unspecified damages, interest, and costs, as well as ancillary relief. On January 23, 2014, the Court entered a scheduling order pursuant to which, upon appointment as lead plaintiff, the plaintiff has sixty days with which to file a consolidated complaint or stand on the current complaint. Pursuant to that order, the Company’s response to that complaint is due sixty days thereafter.

Bartolone v. Angie’s List, Inc., et al. On January 9, 2014, a class action complaint was filed in the Court, naming the same defendants, asserting the same claims, and asking for the same relief as sought in Baron, described above. On January 29, 2014, the Court entered a scheduling order identical to the order entered in Baron.

Baron and Bartolone are collectively referred to as the “Stockholder Class Action.” The Company believes that the Stockholder Class Action is without merit and intends to vigorously defend against it.

Korda v. William S. Oesterle, et al. On January 3, 2014, a derivative complaint was filed in the Court on behalf of the Company, naming the Company’s Board of Directors and various current or former officers as individual defendants and the Company as a nominal defendant. The plaintiff asserts a breach of fiduciary duty claim against the individual defendants based on their alleged knowledge that the Company’s public statements during 2013 concerning the Company’s business prospects were misleading. The plaintiff asserts a breach of fiduciary duty claim against certain individual defendants based on their sales of Angie’s List common stock between December 2012 and December 2013. The plaintiff asks for unspecified amounts in damages, interest, and cost, as well as ancillary relief. The parties are currently seeking to negotiate a stay of the action pending a ruling on the complaint in the Stockholder Class Action, described above.

10. Profit-Sharing Plan

The Company sponsors a 401(k) profit-sharing plan (the Plan) covering substantially all of its personnel. The Company’s contributions to the Plan are discretionary. The Company contributed 3% for all eligible personnel, which totaled $1,500, $1,032 and $745 in 2013, 2012 and 2011, respectively.

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11. Stock-Based Compensation

In April 2010, the Company adopted an Omnibus Incentive Plan (the Incentive Plan) in order to provide an incentive to certain executive officers, personnel and directors. The Incentive Plan was amended and restated effective August 2011, increasing the number of shares issuable to 5,090,496. In March 2012 and October 2013, additional shares of stock were reserved for issuance, bringing the total available shares issuable to 10,830,475. As of December 31, 2013, there were 8,992,890 shares of common stock reserved under the Incentive Plan, of which 5,682,126 shares remained available for future grants.

Stock Options

Stock options are awarded with an exercise price equal to the market price on the date of grant. The contractual terms for options expire ten years from the grant date and generally vest over a three or four-year period. The fair value of options on the date of grant is amortized on a straight-line basis over the requisite service period.

A summary of stock option activity under the plans as of December 31, 2013 and 2012 and changes during the periods then ended are as follows:

	Number of Shares			Weighted- Average Price/ Share			Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
							(In Years)
Outstanding at December 31, 2011		2,814,888		$	8.60			9.52	$	21,122
Granted		352,785			12.90
Exercised		(96,488	)		8.36
Cancelled		(250,566	)		(9.00	)
Outstanding at December 31, 2012		2,820,619		$	9.11			8.62	$	8,687
Granted		1,923,206			19.46
Exercised		(588,769	)		8.69
Cancelled		(844,292	)		(11.16	)
Outstanding at December 31, 2013		3,310,764		$	14.67			8.63	$	9,717

	Number of Shares		Weighted- Average Price/ Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
					(In Years)
Vested and Exercisable at December 31, 2012		863,736	$	8.78		8.50	$	2,847
Unvested at December 31, 2012		1,956,883		9.25		8.61
Vested and Exercisable at December 31, 2013		894,813	$	9.38		7.61	$	5,358
Unvested at December 31, 2013		2,415,951		16.63		7.91

The fair value of the stock under the plans was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

Expected volatility is based on historical volatilities for publicly traded common stock of comparable companies over the estimated expected life of the stock options. The expected term represents the period of time the stock options are expected to be outstanding. The risk-free interest rate is based on yields of U.S. Treasury securities with a maturity similar to the estimated expected term of the stock options.

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The weighted-average grant date fair value of options granted during 2013 and 2012 was $9.38 and $6.04 per share, respectively. The total intrinsic value of options exercised during 2013, 2012 and 2011 was $7,376, $297 and $0, respectively. The Company recognized compensation expense of $4,064, $2,943 and $1,673 in the consolidated statements of operations related to stock options in 2013, 2012 and 2011, respectively. As of December 31, 2013, total compensation expense related to non-vested options not yet recognized was $14,799, which will be recognized over the remaining weighted-average life of the awards, 3.22 years.

Restricted Stock

Restricted stock vests over various periods in accordance with the respective grant agreement. The fair value of restricted stock on the date of grant is amortized on a straight-line basis over the requisite vesting period, with the amount of compensation expense recognized at any date at least equal to the portion of the grant date value of the award that is vested at that date.

The Company recognized compensation expense of $2,169 in the consolidated statement of operations related to restricted stock in 2011. There was no restricted stock issued or outstanding during 2012 or 2013.

12. Convertible Preferred Stock

On March 15, 2011 and May 17, 2011, the Company issued 757,724 and 90,486 shares of Series D preferred stock for $53,600 and $6,400, respectively.

Each share of preferred stock was convertible, at the option of the holder, to common stock on a one-to-one basis, unless additional common shares had been issued by the Company (exclusive of shares issued to satisfy outstanding options, declared dividends or splits, or certain approved issuances to financial institutions or investors pursuant to a debt financing), at which point a defined conversion formula should be utilized to identify the appropriate conversion ratio. During August 2011, the preferred stockholders agreed via written consent of (1) the holders of at least 70% of the outstanding shares of Series D preferred stock, (2) the holders of at least 80% of the outstanding shares of Series C preferred stock, (3) the holders of at least a supermajority, as defined in the Amended and Restated Certificate of Incorporation, of the holders of the outstanding shares of Series B preferred stock, and (4) the holders of at least a supermajority of the outstanding shares of Series A preferred stock that each share of preferred stock shall be mandatorily converted to common stock immediately prior to the completion of a firm-commitment underwritten initial public offering if the share price is at least $70.74, as adjusted for stock splits and other adjustments. The Series A, B, C, and D convertible preferred stock are not subject to mandatory redemption outside the control of the Company.

On October 31, 2011, the Company effected an eight-for-one split of its common stock by way of a stock dividend declared. As a result of the stock split, holders of the Company’s common stock received seven additional shares of common stock for every share held on such date, and a proportionate adjustment was made to the applicable conversion prices for each share of the Company’s outstanding convertible preferred stock, resulting in a conversion ratio of one-to-eight. As a result of the initial public offering of stock at a price greater than the pre-split adjusted price of $70.74, all preferred shares were converted to common shares on November 17, 2011.

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13. Treasury Stock

In April 2011, the Company repurchased 1,940,744 shares of common stock for $16,496. Prior to the repurchase, a certain stockholder converted 14,096 shares of Series B and 29,663 shares of Series C preferred shares into common stock. Additionally, in June 2011, the Company repurchased 635,288 shares of common stock for $5,400.

The Company has 8,558,712 shares of its common stock in treasury stock as of December 31, 2013 and 2012. Of these, the Company’s wholly-owned subsidiary holds 5,743,744 shares of common stock.

14. Income Taxes

As management believes that it is more likely than not that the Company will not realize the full amount of the net deferred tax assets, the Company has recorded a valuation allowance for the deferred tax assets as of December 31, 2013, 2012 and 2011, respectively.

The components of income tax expense are summarized as follows:

	2013		2012		2011
Current:
U.S. federal	$	—	$	—	$	—
State		34		—		39
		34		—		39
Deferred:
U.S. federal		4		2		7
State		2		3		(3	)
		6		5		4
Income tax expense	$	40	$	5	$	43

The reconciliation of income tax expense computed at the U.S. federal statutory rate to the Company’s effective tax rate for the years ended December 31, 2013, 2012 and 2011 is as follows:

	2013			2012			2011
U.S. federal income tax rate		34.0	%		34.0	%		34.0	%
State income taxes, net of federal benefit		6.4			5.7			5.6
Valuation allowance		(39.7	)		(39.1	)		(36.7	)
Other		(0.8	)		(0.6	)		(2.8	)
Effective income tax rate		(0.1	)%		0.0	%		0.1	%

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Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2013 and 2012 are as follows:

	2013			2012
Deferred tax assets:
Current:
Deferred revenue	$	32,643		$	22,299
Non-current:
Intangibles — other		12,138			12,962
Net operating loss carryforwards		39,757			41,464
Equity compensation		1,999			1,388
Other		4,337			2,095
Total deferred tax assets		90,874			80,208
Valuation allowance		(87,006	)		(73,434	)
Total net deferred tax assets		3,868			6,774
Deferred tax liabilities:
Current:
Prepaids		(3,923	)		(7,010	)
Non-current:
Property and equipment		55			236
Goodwill		(169	)		(163	)
Total net deferred tax liabilities		(4,037	)		(6,937	)
Total net deferred tax liability	$	(169	)	$	(163	)

As of December 31, 2013, the Company had net operating loss carryforwards for federal and state income tax purposes of approximately $105,290 and $130,853, respectively. These net operating losses include an unrealized benefit of approximately $5,800 related to share-based compensation that will be recorded in equity when realized. The net operating loss carryforwards will expire in future years, primarily beginning in 2027. The net operating losses may be subject to annual limitations of use under Internal Revenue Code Section 382. The Company files income tax returns in the U.S. federal jurisdiction and in various state jurisdictions. Income tax returns for calendar 2010 to present are open for examination in the federal jurisdiction and in significant state jurisdictions.

A valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. The Company does not benefit from its deferred tax assets based on the deferred tax liabilities related to goodwill that are not expected to reverse during the carryforward period. As this deferred tax liability would not reverse until some future indefinite period when the intangibles are either sold or impaired, any resulting temporary differences cannot be considered a source of future taxable income to support realization of the deferred tax assets.

At December 31, 2013 and 2012, the Company did not have any material unrecognized income tax benefits recorded in its consolidated balance sheets.

15. Warrants

During 2011, the Company issued warrants to purchase 88,240 shares of common stock in connection with its loan and security agreement. These warrants are exercisable at the fair market value as of the grant date for a period of seven years from the grant date. The grant date fair value of the warrants was $2.23 per share, using the Black-Scholes option-pricing model. On October 17, 2012, the holder of these warrants completed a net issuance exercise in accordance with the terms of their agreement, resulting in the issuance of 14,272 shares of common stock.

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During 2010, the Company issued warrants to purchase 272,304 shares of common stock in connection with an amendment to its note payable. On March 7, 2012, the holder of these warrants completed a net issuance exercise in accordance with the terms of their agreement, resulting in the issuance of 120,096 shares of common stock.

A summary of warrant activity is as follows:

	Warrants			Weighted- Average Exercise Price
Outstanding at December 31, 2011		360,544		$	8.45
Issued		(360,544	)		8.45
Outstanding at December 31, 2012		—		$	—
Exercised
Outstanding at December 31, 2013		—		$	—

Outstanding warrants at December 31, 2011 had a weighted-average remaining contractual life of 5.7 years. There were no outstanding warrants as of December 31, 2012 or 2013.

16. Related-Party Transactions

In November 2012, the Company completed the purchase of its headquarters facilities (the “properties”), which were owned by Henry Amalgamated, LLC, and Henry Amalgamated II, LLC, Indiana limited liability companies (together, “Henry Amalgamated”) for an aggregate purchase price of $6,250, excluding fees and other charges. In connection with its acquisition of the properties, the Company’s leases for its headquarters facilities were terminated.

William S. Oesterle, the Company’s Chief Executive Officer and member of the Company’s board of directors, owns a 70% interest in Henry Amalgamated. As the transaction described above constitutes a related party transaction at the direction of the board of directors (the “board”), the audit committee of the Company’s board reviewed and negotiated the Company’s acquisition of the property. With the audit committee’s recommendation and after a full board review, the board approved this transaction. Prior to the acquisition, the Company leased these properties from Henry Amalgamated. In addition to the primary acquisition costs of $6,250, the Company paid $178 to Henry Amalgamated for other charges incurred to prepare the properties for use, of which $150 was capitalized with the purchase of the properties.

Rent expense to Henry Amalgamated was $11, $977 and $856 for 2013, 2012 and 2011, respectively. The Company did not owe Henry Amalgamated any amounts as of December 31, 2013 and 2012.

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17. Quarterly Financial Information (Unaudited)

The table below sets forth selected quarterly financial data for each of the last two fiscal years ($ in thousands, except per share data).

	Fiscal Year Ended December 31, 2013
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Total revenue	$	52,171		$	59,215		$	65,500		$	68,756
Operating income (loss)		(7,469	)		(13,855	)		(13,028	)		3,271
Net income (loss)		(7,947	)		(14,334	)		(13,511	)		2,803
Net income (loss) per common share—basic and diluted	$	(0.14	)	$	(0.25	)	$	(0.23	)	$	0.05

	Fiscal Year Ended December 31, 2012
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Total revenue	$	31,094		$	36,504		$	42,022		$	46,179
Operating income (loss)		(12,994	)		(22,930	)		(18,020	)		2,911
Net income (loss)		(13,450	)		(23,387	)		(18,487	)		2,430
Net income (loss) per common share—basic and diluted	$	(0.24	)	$	(0.41	)	$	(0.32	)	$	0.04

Information in any one quarterly period should not be considered indicative of annual results due to the effects of seasonality on the Company’s business.

The fourth quarter of 2013 includes a $4.0 million charge to general and administrative expense reflective of an expected settlement of pending litigation.

The fourth quarter of 2012 includes an out of period adjustment related to 2011 and prior to reduce commission expense by $700.

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ITEM 9.      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.   CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. Based on their evaluation as of the end of the period covered by this Annual Report on Form 10-K, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13(a)-15(f) and Rule 15(d)-15(f) of the Exchange Act, to provide reasonable assurance regarding the reliability of the company’s financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Management assessed our internal control over financial reporting as of December 31, 2013. Management based its assessment on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“1992 Framework”). Based on its assessment, our management has concluded that our internal control over financial reporting was effective as of December 31, 2013.

Ernst & Young, LLP, an independent registered public accounting firm, has issued an attestation report on our internal control over financial reporting, which is included in this Annual Report on Form 10-K.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended December 31, 2013 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of Angie’s List, Inc.

We have audited Angie’s List, Inc.’s internal control over financial reporting as of December 31, 2013 based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (”1992 Framework”). Angie’s List, Inc.’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Angie’s List, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Angie’s List, Inc. as of December 31, 2013 and 2012, and the related consolidated statements of operations, stockholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2013 of Angie’s List, Inc. and our report dated February 28, 2014 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Indianapolis, Indiana

February 28, 2014

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ITEM 9B.    OTHER INFORMATION

None.

PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Angie’s List has adopted a code of business conduct and ethics for directors, officers (including Angie’s List’s Chief Executive Officer and Chief Financial Officer) and employees, known as the Code of Business Conduct and Ethics. The Code of Business Conduct and Ethics is available on our “Investor Relations” website at investor.angieslist.com in the Corporate Governance section. Stockholders may request a free copy of the Code of Business Conduct and Ethics by sending an email request to investor@angieslist.com.

The other information required by this item will be contained in our definitive proxy statement to be filed with the Securities and Exchange Commission in connection with our 2014 annual meeting of stockholders (the “Proxy Statement”), which is expected to be filed not later than 120 days after the end of our fiscal year ended December 31, 2013, and is incorporated in this report by reference.

ITEM 11.    EXECUTIVE COMPENSATION

Information required by this Item is incorporated by reference to the sections of the Proxy Statement entitled “Executive Compensation,” “Director Compensation,” “Information Regarding the Board of Directors and its Committees—Compensation Committee Interlocks and Insider Participation” and “Compensation Committee Report.”

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information regarding security ownership of certain beneficial owners and management is incorporated by reference to the section of the Proxy Statement entitled “Security Ownership of Certain Beneficial Owners and Management.”

Information regarding our stockholder approved and non-approved equity compensation plans is incorporated by reference to the section of the Proxy Statement entitled “Executive Compensation—Equity Compensation Plan Information.”

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Information required by this Item is incorporated by reference to the sections of the Proxy Statement entitled “Certain Relationships and Related Party Transactions” and “Information Regarding the Board of Directors and its Committees—Independence of the Board of Directors.”

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information required by this Item is incorporated by reference to the section of the Proxy Statement entitled “Proposal No. 2 Ratification of Appointment of Independent Registered Public Accounting Firm.”

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PART IV

ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) The following documents are included as part of this Annual Report on Form 10-K.

(1) Index to Financial Statements

Report of Independent Registered Public Accounting Firm	49
Consolidated Balance Sheets as of December 31, 2013 and 2012	50
Consolidated Statements of Operations for the fiscal years ended December 31, 2013, 2012 and 2011	51
Consolidated Statements of Stockholders’ Equity (Deficit) for the fiscal years ended December 31, 2013, 2012 and 2011	52
Consolidated Statements of Cash Flows for the fiscal years ended December 31, 2013, 2012 and 2011	53
Notes to Consolidated Financial Statements	54
Report of Independent Registered Public Accounting Firm	71

(2) Financial Statement Schedule

All other schedules are omitted as the information required is inapplicable or the information is presented in the consolidated financial statements or the related notes.

(3) Exhibits

The documents set forth below are filed herewith or incorporated by reference to the location indicated.

			Incorporated by Reference
Exhibit No.	Exhibit Description	Form	File No.	Exhibit	Filing Date	Filed Herewith
3.01	Amended and Restated Certificate of Incorporation	S-1/A	333-176503	3.1	10/31/11
3.02	Amended and Restated Bylaws	S-1/A	333-176503	3.2	10/31/11
4.01	Fifth Amended and Restated Investor Rights Agreement, by and among Angie’s List, Inc. and the investors listed on Schedule A thereto, dated March 15, 2011, as amended	S-1	333-176503	4.2	08/25/11
10.01†	Amended and Restated Omnibus Incentive Plan and form of award agreements under the Amended and Restated Omnibus Incentive Plan	S-8	333-191884	99.1	10/24/13
10.02	Lease Agreement, dated February 28, 2009, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.2	08/25/11
10.03	First Addendum to Lease Agreement, dated May 4, 2010, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.3	08/25/11
10.04	Second Addendum to Lease Agreement, dated December 1, 2010, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.4	08/25/11
10.05	Third Addendum to Lease Agreement, dated December 16, 2010, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.5	08/25/11
10.06	Fourth Addendum to Lease Agreement, dated January 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.6	08/25/11
10.07	Fifth Addendum to Lease Agreement, dated June 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.7	08/25/11
10.08	Sixth Addendum to Lease Agreement, dated June 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.8	08/25/11

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10.09	Contingent Addendum to Lease Agreement, dated January 1, 2011 and effective February 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.9	08/25/11
10.10	Contingent Addendum to Lease Agreement, dated January 1 2011 and effective March 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.10	08/25/11
10.11	Parking Lease, dated February 28, 2009, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.11	08/25/11
10.12	Lease, dated November 2, 2007, by and between AL Campus Kids, LLC, and Henry Amalgamated, LLC (124 Herman Street)	S-1	333-176503	10.12	08/25/11
10.13	Lease, dated November 2, 2007, by and between AL Campus Kids, LLC, and Henry Amalgamated, LLC (118 Herman Street)	S-1	333-176503	10.13	08/25/11
10.14 †	Employment Agreement, dated July 10, 2006, by and between Brownstone Publishing, LLC and Michael D. Rutz	S-1	333-176503	10.15	08/25/11
10.15†	Form of Indemnification Agreement by and between Angie’s List, Inc. and each of its executive officers and its directors not affiliated with an investment fund	S-1/A	333-176503	10.19	09/29/11
10.16†	Form of Indemnification Agreement by and between Angie’s List, Inc. and each of its directors affiliated with an investment fund	S-1/A	333-176503	10.20	09/29/11
10.17	Loan and Security Agreement, dated August 31, 2011, by and between ORIX Venture Finance LLC, Bridge Bank National Association and Angie’s List, Inc.	S-1/A	333-176503	10.21	09/29/11
10.18	Project Agreement by and between Angie’s List, Inc. and the Consolidated City of Indianapolis, dated October 21, 2011	S-1/A	333-176503	10.22	11/02/11
10.19	Contingent Addendum to Lease Agreement, dated November 15, 2011 by and between the registrant and Henry Amalgamated LLC	10-K	001-35339	10.23	03/15/12
10.20	Contingent Addendum to Lease Agreement, dated December 1, 2011 by and between the registrant and Henry Amalgamated LLC	10-K	001-35339	10.24	03/15/12
10.21	Contingent Addendum to Lease Agreement, dated April 10, 2012 by and between the registrant and Henry Amalgamated LLC [934 E Washington Street, Indianapolis, IN 46202]	10-Q	001-35339	10.1	08/09/12
10.22	Contingent Addendum to Lease Agreement, dated April 10, 2012 by and between the registrant and Henry Amalgamated LLC [25 Pine Street, Indianapolis, IN 46202]	10-Q	001-35339	10.2	08/09/12
10.23	Contingent Addendum to Lease Agreement, dated April 10, 2012 by and between the registrant and Henry Amalgamated LLC [902 E Washington Street, Indianapolis, IN 46202]	10-Q	001-35339	10.3	08/09/12
10.24	Contingent Addendum to Lease Agreement, dated July 1, 2012 by and between the registrant and Henry Amalgamated LLC [902, 932 & 934 Suite A, E Washington Street, Indianapolis, IN 46202]	10-Q	001-35339	10.4	08/09/12
10.25	Purchase and sale agreement by and among Angie’s List, Inc. and Henry Amalgamated, LLC and Henry Amalgamated II, LLC	8-K	001-35339	10.1	11/09/12

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10.26†	Offer letter with Mark Howell, dated December 20, 2012	8-K	001-35339	10.1	01/17/13
10.27†	Offer letter with Patrick Brady, dated May 14, 2013	10-Q	001-35339	10.1	07/25/13
10.28†	Offer Letter Agreement by and between Angie’s List, Inc. and Thomas R. Fox, dated August 20, 2013	8-K	001-35339	10.1	08/21/13
21.01	Subsidiaries of the Registrant	S-1	333-176503	21.1	08/25/11
23.01	Consent of independent registered public accounting firm					X
24.01	Power of Attorney (included on signature page of this Annual Report on Form 10-K)					X
31.01	Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act					X
31.02	Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act					X
32.01	Certification of the Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act					X
32.02	Certification of the Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act					X
101.INS*(1)	XBRL Instance Document					X
101.SCH*(1)	XBRL Taxonomy Extension Schema Document					X
101.CAL*(1)	XBRL Taxonomy Extension Calculation Linkbase Document					X
101.DEF*(1)	XBRL Taxonomy Extension Definition Linkbase Document					X
101.LAB*(1)	XBRL Taxonomy Extension Labels Linkbase Document					X
101.PRE*(1)	XBRL Taxonomy Extension Presentation Linkbase Document					X

 † Indicates management contract or compensatory plan.

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SIGNATURES

Pursuant to the requirements Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on February 28, 2014.

ANGIE’S LIST, INC.
By:	/S/ WILLIAM S. OESTERLE
	Name: William S. Oesterle
	Title: Chief Executive Officer and Director

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints William S. Oesterle, Thomas R. Fox and Shannon Shaw and each of them, his or her true and lawful attorneys-in-fact and agents, with full power to act separately and full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto each said attorney-in-fact and agent full power and authority to do and perform each and every act in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or either of them or his or her or their substitute or substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1934, as amended, this report has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/S/ WILLIAM S. OESTERLE	Chief Executive Officer and Director (Principal Executive	February 28, 2014
William S. Oesterle	Officer)
/S/ THOMAS R. FOX	Chief Financial Officer (Principal Financial and	February 28, 2014
Thomas R. Fox	Accounting Officer)
/S/ JOHN W. BIDDINGER	Director	February 28, 2014
John W. Biddinger
/S/ MARK BRITTO	Director	February 28, 2014
Mark Britto
/S/ JOHN H. CHUANG	Director	February 28, 2014
John H. Chuang
/S/ STEVEN M. KAPNER	Director	February 28, 2014
Steven M. Kapner
/S/ KEITH J. KRACH	Director	February 28, 2014
Keith J. Krach

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Signature	Title	Date
/S/ ROGER H. LEE	Director	February 28, 2014
Roger H. Lee
/S/ MICHAEL S. MAURER	Director	February 28, 2014
Michael S. Maurer
/S/ SUSAN THRONSON	Director	February 28, 2014
Susan Thronson
/S/ ANGELA R. HICKS BOWMAN	Director	February 28, 2014
Angela R. Hicks Bowman

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EXHIBIT INDEX

			Incorporated by Reference
Exhibit No.	Exhibit Description	Form	File No.	Exhibit	Filing Date	Filed Herewith
3.01	Amended and Restated Certificate of Incorporation	S-1/A	333-176503	3.1	10/31/11
3.02	Amended and Restated Bylaws	S-1/A	333-176503	3.2	10/31/11
4.01	Fifth Amended and Restated Investor Rights Agreement, by and among Angie’s List, Inc. and the investors listed on Schedule A thereto, dated March 15, 2011, as amended	S-1	333-176503	4.2	08/25/11
10.01†	Amended and Restated Omnibus Incentive Plan and form of award agreements under the Amended and Restated Omnibus Incentive Plan	S-8	333-191884	99.1	10/24/13
10.02	Lease Agreement, dated February 28, 2009, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.2	08/25/11
10.03	First Addendum to Lease Agreement, dated May 4, 2010, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.3	08/25/11
10.04	Second Addendum to Lease Agreement, dated December 1, 2010, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.4	08/25/11
10.05	Third Addendum to Lease Agreement, dated December 16, 2010, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.5	08/25/11
10.06	Fourth Addendum to Lease Agreement, dated January 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.6	08/25/11
10.07	Fifth Addendum to Lease Agreement, dated June 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.7	08/25/11
10.08	Sixth Addendum to Lease Agreement, dated June 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.8	08/25/11
10.09	Contingent Addendum to Lease Agreement, dated January 1, 2011 and effective February 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.9	08/25/11

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10.10	Contingent Addendum to Lease Agreement, dated January 1 2011 and effective March 1, 2011, by and between the registrant and Henry Amalgamated, LLC	S-1	333-176503	10.10	08/25/11
10.11	Parking Lease, dated February 28, 2009, by and between Brownstone Publishing, LLC and Henry Amalgamated, LLC	S-1	333-176503	10.11	08/25/11
10.12	Lease, dated November 2, 2007, by and between AL Campus Kids, LLC, and Henry Amalgamated, LLC (124 Herman Street)	S-1	333-176503	10.12	08/25/11
10.13	Lease, dated November 2, 2007, by and between AL Campus Kids, LLC, and Henry Amalgamated, LLC (118 Herman Street)	S-1	333-176503	10.13	08/25/11
10.14 †	Employment Agreement, dated July 10, 2006, by and between Brownstone Publishing, LLC and Michael D. Rutz	S-1	333-176503	10.15	08/25/11
10.15†	Form of Indemnification Agreement by and between Angie’s List, Inc. and each of its executive officers and its directors not affiliated with an investment fund	S-1/A	333-176503	10.19	09/29/11
10.16†	Form of Indemnification Agreement by and between Angie’s List, Inc. and each of its directors affiliated with an investment fund	S-1/A	333-176503	10.20	09/29/11
10.17	Loan and Security Agreement, dated August 31, 2011, by and between ORIX Venture Finance LLC, Bridge Bank National Association and Angie’s List, Inc.	S-1/A	333-176503	10.21	09/29/11
10.18	Project Agreement by and between Angie’s List, Inc. and the Consolidated City of Indianapolis, dated October 21, 2011	S-1/A	333-176503	10.22	11/02/11
10.19	Contingent Addendum to Lease Agreement, dated November 15, 2011 by and between the registrant and Henry Amalgamated LLC	10-K	001-35339	10.23	03/15/12
10.20	Contingent Addendum to Lease Agreement, dated December 1, 2011 by and between the registrant and Henry Amalgamated LLC	10-K	001-35339	10.24	03/15/12
10.21	Contingent Addendum to Lease Agreement, dated April 10, 2012 by and between the registrant and Henry Amalgamated LLC [934 E Washington Street, Indianapolis, IN 46202]	10-Q	001-35339	10.1	08/09/12
10.22	Contingent Addendum to Lease Agreement, dated April 10, 2012 by and between the registrant and Henry Amalgamated LLC [25 Pine Street, Indianapolis, IN 46202]	10-Q	001-35339	10.2	08/09/12
10.23	Contingent Addendum to Lease Agreement, dated April 10, 2012 by and between the registrant and Henry Amalgamated LLC [902 E Washington Street, Indianapolis, IN 46202]	10-Q	001-35339	10.3	08/09/12
10.24	Contingent Addendum to Lease Agreement, dated July 1, 2012 by and between the registrant and Henry Amalgamated LLC [902, 932 & 934 Suite A, E Washington Street, Indianapolis, IN 46202]	10-Q	001-35339	10.4	08/09/12
10.25	Purchase and sale agreement by and among Angie’s List, Inc. and Henry Amalgamated, LLC and Henry Amalgamated II, LLC	8-K	001-35339	10.1	11/09/12
10.26†	Offer letter with Mark Howell, dated December 20, 2012	8-K	001-35339	10.1	01/17/13
10.27†	Offer letter with Patrick Brady, dated May 14, 2013	10-Q	001-35339	10.1	07/25/13
10.28†	Offer Letter Agreement by and between Angie’s List, Inc. and Thomas R. Fox, dated August 20, 2013	8-K	001-35339	10.1	08/21/13

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21.01	Subsidiaries of the Registrant	S-1	333-176503	21.1	08/25/11
23.01	Consent of independent registered public accounting firm					X
24.01	Power of Attorney (included on signature page of this Annual Report on Form 10-K)					X
31.01	Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act					X
31.02	Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act					X
32.01	Certification of the Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act					X
32.02	Certification of the Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act					X
101.INS*(1)	XBRL Instance Document					X
101.SCH*(1)	XBRL Taxonomy Extension Schema Document					X
101.CAL*(1)	XBRL Taxonomy Extension Calculation Linkbase Document					X
101.DEF*(1)	XBRL Taxonomy Extension Definition Linkbase Document					X
101.LAB*(1)	XBRL Taxonomy Extension Labels Linkbase Document					X
101.PRE*(1)	XBRL Taxonomy Extension Presentation Linkbase Document					X

  † Indicates management contract or compensatory plan.

80

EX-23

Exhibit 23.01

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:

(1)	Registration Statement (Form S-8 No. 333-178131) pertaining to the Amended and Restated Omnibus Incentive Plan of Angie’s List, Inc.,
(2)	Registration Statement (Form S-8 No. 333-180137) pertaining to the Amended and Restated Omnibus Incentive Plan of Angie’s List, Inc., and
(3)	Registration Statement (Form S-8 No. 333-191884) pertaining to the Amended and Restated Omnibus Incentive Plan of Angie’s List, Inc.;

of our reports dated February 28, 2014, with respect to the consolidated financial statements of Angie’s List, Inc. and the effectiveness of internal control over financial reporting of Angie’s List, Inc. included in this Annual Report (Form 10-K) of Angie’s List, Inc. for the year ended December 31, 2013.

/s/ Ernst & Young LLP

Indianapolis, Indiana

February 28, 2014 

EX-31

Exhibit 31.01

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, William S. Oesterle, certify that:

1. I have reviewed this annual report on Form 10-K of Angie’s List, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period presented in this report;

4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 28, 2014	/s/    WILLIAM S. OESTERLE
	William S. Oesterle
	Chief Executive Officer and Director
	(Principal Executive Officer)

EX-31

Exhibit 31.02

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Thomas R. Fox, certify that:

1. I have reviewed this annual report on Form 10-K of Angie’s List, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period presented in this report;

4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 28, 2014	/s/    THOMAS R. FOX
	Thomas R. Fox
	Chief Financial Officer
	(Principal Financial Officer)

EX-32

Exhibit 32.01

Certification Pursuant to 18 U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, William S. Oesterle, the Chief Executive Officer of Angie’s List, Inc., certify that (i) the annual report on Form 10-K for the fiscal year ended December 31, 2013 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Angie’s List, Inc.

/S/  WILLIAM S. OESTERLE

William S. Oesterle

Chief Executive Officer and Director

(Principal Executive Officer)

February 28, 2014

Date

EX-32

Exhibit 32.02

Certification Pursuant to 18 U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Thomas R. Fox, Chief Financial Officer of Angie’s List, Inc., certify that (i) the annual report on Form 10-K for the fiscal year ended December 31, 2013 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Angie’s List, Inc.

/S/   THOMAS R. FOX

Thomas R. Fox

Chief Financial Officer

(Principal Financial Officer)

February 28, 2014

Date

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Note 1 - Summary of Significant Accounting Policies (Details) - The Changes in the Allowance for Doubtful Accounts (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
The Changes in the Allowance for Doubtful Accounts [Abstract]
Beginning balance	$ 922	$ 535	$ 241
Additions, net of recoveries	3,773	1,955	806
Deductions	(3,588)	(1,568)	(512)
Ending Balance	$ 1,107	$ 922	$ 535

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Note 10 - Profit-Sharing Plan (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Compensation and Retirement Disclosure [Abstract]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	3.00%
Defined Contribution Plan, Employer Discretionary Contribution Amount	$ 1,500	$ 1,032	$ 745

XML

Note 6 - Goodwill and Amortizable Intangible Assets (Details) - Intangible Assets (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Note 6 - Goodwill and Amortizable Intangible Assets (Details) - Intangible Assets [Line Items]
Amortizable Intangible Assets	$ 5,216	$ 4,017
Accumulated Amortization	1,716	1,661
Net	3,500	2,356
Member List [Member]
Note 6 - Goodwill and Amortizable Intangible Assets (Details) - Intangible Assets [Line Items]
Amortizable Intangible Assets	1,670
Accumulated Amortization	116
Net	1,554
Amortization Period	6 years
Media Content [Member]
Note 6 - Goodwill and Amortizable Intangible Assets (Details) - Intangible Assets [Line Items]
Amortizable Intangible Assets	140
Accumulated Amortization	19
Net	121
Amortization Period	3 years
Core Technology [Member]
Note 6 - Goodwill and Amortizable Intangible Assets (Details) - Intangible Assets [Line Items]
Amortizable Intangible Assets	110
Accumulated Amortization	15
Net	95
Amortization Period	3 years
Data Acquisition Costs [Member]
Note 6 - Goodwill and Amortizable Intangible Assets (Details) - Intangible Assets [Line Items]
Amortizable Intangible Assets	3,296	4,017
Accumulated Amortization	1,566	1,661
Net	$ 1,730	$ 2,356
Amortization Period	3 years	3 years

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Note 11 - Stock-Based Compensation (Details) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Oct. 31, 2013	Aug. 31, 2011
Note 11 - Stock-Based Compensation (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in Shares)				10,830,475	5,090,496
Common Stock, Capital Shares Reserved for Future Issuance (in Shares)	8,992,890
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in Shares)	5,682,126
Share-based Compensation Arrangement by Share-based Payment Award Term	10 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share)	$ 9.38	$ 6.04
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value	$ 7,376	$ 297	$ 0
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized	5,800
Stock and Member Unit Options [Member]
Note 11 - Stock-Based Compensation (Details) [Line Items]
Allocated Share-based Compensation Expense	4,064	2,943	1,673
Restricted Stock [Member]
Note 11 - Stock-Based Compensation (Details) [Line Items]
Allocated Share-based Compensation Expense	0	0	2,169
Non-Vested Options [Member]
Note 11 - Stock-Based Compensation (Details) [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized	$ 14,799
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	3 years 80 days
Minimum [Member]
Note 11 - Stock-Based Compensation (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	3 years
Maximum [Member]
Note 11 - Stock-Based Compensation (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years

XML

Note 5 - Property and Equipment (Details) - Property and Equipment (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Property and Equipment [Abstract]
Furniture and equipment	$ 7,965	$ 5,929
Land	1,464	1,401
Buildings and improvements	8,711	6,417
Software	5,949	1,949
	24,089	15,696
Less accumulated depreciation	(5,432)	(3,617)
	$ 18,657	$ 12,079

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Note 9 - Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

	Total
Payable in
2014	$	663
2015		124
2016		0
	$	787

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Note 11 - Stock-Based Compensation (Details) - Summary of Vested and Exercisable and Unvested Shares (USD $) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Summary of Vested and Exercisable and Unvested Shares [Abstract]
Vested and exercisable, number of shares	894,813	863,736
Vested and exercisable, weighted-average price/share (in Dollars per share)	$ 9.38	$ 8.78
Vested and exercisable, weighted average remaining contractual term	7 years 222 days	8 years 6 months
Vested and exercisable, aggregate intrinsic value (in Dollars)	$ 5,358	$ 2,847
Unvested, number of shares	2,415,951	1,956,883
Unvested, weighted-average price/share (in Dollars per share)	$ 16.63	$ 9.25
Unvested, weighted average remaining contractual term	7 years 332 days	8 years 222 days

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Note 1 - Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Allowance for Credit Losses on Financing Receivables [Table Text Block]

	Year Ended December 31,
	2013			2012			2011
Beginning balance	$	922		$	535		$	241
Additions, net of recoveries		3,773			1,955			806
Deductions		(3,588	)		(1,568	)		(512	)
Ending Balance	$	1,107		$	922		$	535

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

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Note 8 - Long-term Debt (Details) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	12 Months Ended
	Aug. 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Note 8 - Long-term Debt (Details) [Line Items]
Debt Instrument, Face Amount	$ 15,000
Line of Credit Facility, Maximum Borrowing Capacity	15,000
Minimum Percent of Revolving Credit Facility Drawn which Triggers Non-Usage Charge	50.00%
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.50%
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares)	88,240			88,240	272,304
Loans Payable, Noncurrent		14,900
Line of Credit Facility, Remaining Borrowing Capacity		15,000
Repayments of Long-term Debt	14,178			21,797
Interest Paid	3,200	1,602	1,680	4,899
Interest Payable	2,668
Prepayment Penalties under Prior Note Payable	220
Repayments of Subordinated Debt	$ 6,087
Term Loan [Member]
Note 8 - Long-term Debt (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	10.00%
Revolving Credit Facility [Member]
Note 8 - Long-term Debt (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	5.00%
Minimum [Member]
Note 8 - Long-term Debt (Details) [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	10.50%

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Note 2 - Net Loss Per Common Share (Details) - Antidilutive Securities (Equity Option [Member])	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Equity Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock options	3,310,764	2,820,619

XML

Note 17 - Quarterly Financial Information (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Schedule of Quarterly Financial Information [Table Text Block]

	Fiscal Year Ended December 31, 2013
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Total revenue	$	52,171		$	59,215		$	65,500		$	68,756
Operating income (loss)		(7,469	)		(13,855	)		(13,028	)		3,271
Net income (loss)		(7,947	)		(14,334	)		(13,511	)		2,803
Net income (loss) per common share—basic and diluted	$	(0.14	)	$	(0.25	)	$	(0.23	)	$	0.05

	Fiscal Year Ended December 31, 2012
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Total revenue	$	31,094		$	36,504		$	42,022		$	46,179
Operating income (loss)		(12,994	)		(22,930	)		(18,020	)		2,911
Net income (loss)		(13,450	)		(23,387	)		(18,487	)		2,430
Net income (loss) per common share—basic and diluted	$	(0.24	)	$	(0.41	)	$	(0.32	)	$	0.04

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Note 9 - Commitments and Contingencies (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Note 9 - Commitments and Contingencies (Details) [Line Items]
Operating Leases, Rent Expense	$ 910	$ 1,381	$ 915
Estimated Litigation Liability, Current	4,000
Fritzinger v. Angie's List [Member]
Note 9 - Commitments and Contingencies (Details) [Line Items]
Estimated Litigation Liability, Current	$ 4,000

XML

Note 16 - Related-Party Transactions (Details) (USD $) In Thousands, unless otherwise specified	1 Months Ended	12 Months Ended
	Nov. 30, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Note 16 - Related-Party Transactions (Details) [Line Items]
Related Party Transaction, Purchases from Related Party	$ 6,250
Related Party Transaction, Amounts of Transaction	178
Other Charges Incurred to Prepare Properties for Use which was Capitalized	150
Payments for Rent		$ 11	$ 977	$ 856
Chief Executive Officer [Member]
Note 16 - Related-Party Transactions (Details) [Line Items]
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest	70.00%

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Note 14 - Income Taxes (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Note 14 - Income Taxes (Details) [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized	$ 5,800
Federal [Member]
Note 14 - Income Taxes (Details) [Line Items]
Operating Loss Carryforwards	105,290
State [Member]
Note 14 - Income Taxes (Details) [Line Items]
Operating Loss Carryforwards	$ 130,853

XML

Note 6 - Goodwill and Amortizable Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended			0 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Aug. 02, 2013 BrightNest [Member]
Note 6 - Goodwill and Amortizable Intangible Assets (Details) [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets				$ 2,650
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill				1,920
Goodwill	1,145	415		730
Payments to Acquire Businesses, Net of Cash Acquired	2,150			2,150
Business Combination, Contingent Consideration, Liability				500
Amortization of Intangible Assets	1,546	1,234	781
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months	1,520
Finite-Lived Intangible Assets, Amortization Expense, Year Two	831
Finite-Lived Intangible Assets, Amortization Expense, Year Three	430
Finite-Lived Intangible Assets, Amortization Expense, Year Four	278
Finite-Lived Intangible Assets, Amortization Expense, Year Five	278
Finite-Lived Intangible Assets, Amortization Expense, after Year Five	$ 162

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Note 3 - Fair Value Measurements

12 Months Ended

Dec. 31, 2013

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

3. Fair Value Measurements

Whenever possible, quoted prices in active markets are used to determine the fair value of our financial instruments. Our financial instruments are not held for trading or other speculative purposes. The estimated fair value of financial instruments was determined by using available market information and appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that we could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

Fair Value Hierarchy

Fair value is based on 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. ASC 820, Fair Value Measurement Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. Generally Accepted Accounting Principles and International Financial Reporting Standards, defined and established a framework for measuring fair value and expands disclosures about fair value measurements for financial assets and liabilities that are adjusted to fair value on a recurring basis and/or financial assets and liabilities that are measured at fair value on a nonrecurring basis, which were adjusted to fair value during the period. In accordance with ASC 820, we categorized our financial assets and liabilities that are adjusted to fair value based on the priority of the inputs to the valuation technique, following the three-level fair value hierarchy prescribed by ASC 820, as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available.

Valuation Techniques

The Company’s cash equivalents are classified within Level 1 on the basis of valuations using quoted market prices. As many fixed income securities do not trade daily, fair values are often derived using recent trades of securities with similar features and characteristics. When recent trades are not available, pricing models are used to determine these prices. These models calculate fair values by discounting future cash flows at estimated market interest rates. Such market rates are derived by calculating the appropriate spreads over comparable U.S. Treasury securities, based on the credit quality, industry and structure of the asset. Typical inputs and assumptions to pricing models include, but are not limited to, a combination of benchmark yields, reported trades, issuer spreads, liquidity, benchmark securities, bids, offers, reference data, and industry and economic events. The Company’s fixed income corporate bond investments and certificates of deposit with fixed maturities are valued using recent trades or pricing models and are therefore classified in Level 2.

Recurring Fair Value Measurements

There were no movements between fair value measurement levels of the Company’s cash equivalents and short-term investments during 2013 and 2012. The following tables summarize the financial instruments of the Company at fair value based on the fair value hierarchy for each class of instrument as of December 31, 2013 and 2012:

			Fair Value Measurement at December 31, 2013 Using
	Carrying Value at December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Money market funds	$	655	$	655	$	—	$	—
Investments:
Certificates of deposit		13,750				13,734
Corporate bonds		7,305				7,303
Total assets	$	21,710	$	655	$	21,037	$	—

			Fair Value Measurement at December 31, 2012 Using
	Carrying Value at December 31, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Money market funds	$	1,183	$	1,183	$	—	$	—
Investments:
Certificates of deposit		2,640				2,639
Corporate bonds		7,820				7,816
Total assets	$	11,643	$	1,183	$	10,455	$	—

The carrying amount of the term loan approximates its fair value, using level 2 inputs, because this borrowing bears interest at variable (market) rate at December 31, 2013 and 2012.

Non-Recurring Fair Value Measurements

The Company has certain assets that are measured at fair value on a non-recurring basis under circumstances and events that include those described in Note 6, Goodwill and Amortizable Intangible Assets, and are adjusted to fair value only when the carrying values are more than the fair values. The categorization of the framework used to price the assets is considered a Level 3 measurement due to the subjective nature of the unobservable inputs used to determine the fair value.

Assets and liabilities acquired in business combinations are recorded at their fair value as of the date of acquisition. Refer to Note 6 for the fair values of assets acquired and liabilities assumed in connection with the acquisition of substantially all the assets of SmartHabitat (“BrightNest”).

The carrying amounts of accounts receivable and accounts payable reported in the consolidated balance sheets approximate fair value.

XML

Note 14 - Income Taxes (Details) - The Components of Income Tax Expense (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Current:
State	$ 34		$ 39
	34		39
Deferred:
U.S. federal	4	2	7
State	2	3	(3)
	6	5	4
Income tax expense	$ 40	$ 5	$ 43

XML

Note 3 - Fair Value Measurements (Details) - Summary of the Financial Instruments of the Company at Fair Value (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Cash equivalents:
Carrying Value	$ 21,710	$ 11,643
Fair Value, Inputs, Level 1 [Member]
Cash equivalents:
Fair Value	655	1,183
Fair Value, Inputs, Level 1 [Member] | Money Market Funds [Member]
Cash equivalents:
Fair Value	655	1,183
Fair Value, Inputs, Level 2 [Member]
Cash equivalents:
Fair Value	21,037	10,455
Fair Value, Inputs, Level 2 [Member] | Certificates of Deposit [Member]
Cash equivalents:
Fair Value	13,734	2,639
Money Market Funds [Member]
Cash equivalents:
Carrying Value	655	1,183
Certificates of Deposit [Member]
Cash equivalents:
Carrying Value	13,750	2,640
Corporate Bond Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Cash equivalents:
Fair Value	7,303	7,816
Corporate Bond Securities [Member]
Cash equivalents:
Carrying Value	$ 7,305	$ 7,820

XML

Note 5 - Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

	December 31,
	2013			2012
Furniture and equipment	$	7,965		$	5,929
Land		1,464			1,401
Buildings and improvements		8,711			6,417
Software		5,949			1,949
		24,089			15,696
Less accumulated depreciation		(5,432	)		(3,617	)
	$	18,657		$	12,079

XML

Note 4 - Prepaid Expenses and Other Current Assets (Tables)

12 Months Ended

Dec. 31, 2013

Disclosure Text Block Supplement [Abstract]

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Table Text Block]

	December 31,
	2013		2012
Prepaid and deferred commissions	$	9,395	$	17,215
Other		4,256		2,595
Total prepaid expenses and other current assets	$	13,651	$	19,810

XML

Note 11 - Stock-Based Compensation (Details) - Summary of Stock Option Activity (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Summary of Stock Option Activity [Abstract]
Outstanding, number of shares	3,310,764	2,820,619	2,814,888
Outstanding, weighted-average price/share (in Dollars per share)	$ 14.67	$ 9.11	$ 8.60
Outstanding, weighted average remaining contractual term	8 years 229 days	8 years 226 days	9 years 189 days
Outstanding, aggregate intrinsic value (in Dollars)	$ 9,717	$ 8,687	$ 21,122
Granted, number of shares	1,923,206	352,785
Granted, weighted-average price/share (in Dollars per share)	$ 19.46	$ 12.90
Exercised, number of shares	(588,769)	(96,488)
Exercised, weighted-average price/share (in Dollars per share)	$ 8.69	$ 8.36
Cancelled, number of shares	(844,292)	(250,566)
Cancelled, weighted-average price/share (in Dollars per share)	$ (11.16)	$ (9.00)

XML

Note 4 - Prepaid Expenses and Other Current Assets (Details) - Prepaid Expenses and Other Current Assets (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Prepaid Expenses and Other Current Assets [Abstract]
Prepaid and deferred commissions	$ 9,395	$ 17,215
Other	4,256	2,595
Total prepaid expenses and other current assets	$ 13,651	$ 19,810

XML

Note 6 - Goodwill and Amortizable Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2013

Disclosure Text Block [Abstract]

Schedule of Intangible Assets and Goodwill [Table Text Block]

	Cost		Accumulated Amortization		Net		Amortization Period (in years)
2013
Member List	$	1,670	$	116	$	1,554		6.0
Content		140		19	$	121		3.0
Core technology		110		15	$	95		3.0
Data acquisition costs		3,296		1,566	$	1,730		3.0
	$	5,216	$	1,716	$	3,500
2012
Data acquisition costs	$	4,017	$	1,661	$	2,356		3.0
	$	4,017	$	1,661	$	2,356

XML

Note 7 - Accrued Liabilities (Tables)

12 Months Ended

Dec. 31, 2013

Disclosure Text Block Supplement [Abstract]

Schedule of Accrued Liabilities [Table Text Block]

	December 31,
	2013		2012
Accrued sales commissions	$	2,570	$	4,342
Sales and use tax		3,158		2,130
Accrued compensation		5,229		2,246
Uninvoiced accounts payable		2,977		2,372
Legal accrual		4,000		—
Other		3,836		2,968
Total accrued liabilities	$	21,770	$	14,058

XML

Note 2 - Net Loss Per Common Share

12 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

2. Net Loss Per Common Share

Basic and diluted net loss per common share is computed by dividing consolidated net loss by the weighted average number of common shares outstanding for the period. Basic and diluted net loss per common share were $(0.57) and $(0.92) for the years ended December 31, 2013 and December 31, 2012, respectively.

The following potential dilutive equity securities are not included in the diluted net loss per common share calculation because they would have an antidilutive effect:

	December 31, 2013		December 31, 2012
Stock options		3,310,764		2,820,619

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Note 8 - Long-term Debt (Tables)

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments [Table Text Block]

	December 31,
	2013			2012
Term loan	$	15,000		$	15,000
Debt discount on term loan		(82	)		(131	)
		14,918			14,869
Less current maturities		—			—
Total long-term debt, including accrued interest	$	14,918		$	14,869

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Note 1 - Summary of Significant Accounting Policies (Details) - Stock Option Valuation Assumptions	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Stock Option Valuation Assumptions [Abstract]
Risk-free Interest Rate	1.02%	0.71%	1.26%
Dividend Yield	0.00%	0.00%	0.00%
Expected Term	4 years 328 days	4 years 146 days	4 years 255 days
Volatility Factor	57.00%	60.00%	50.00%

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Note 9 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Required Under Long-Term Noncancellable Operating Leases (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Future Minimum Lease Payments Required Under Long-Term Noncancellable Operating Leases [Abstract]
2014	$ 663
2015	124
2016	0
	$ 787

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Assets
Cash and cash equivalents	$ 34,803	$ 42,638
Restricted cash	50	50
Short-term investments	21,055	10,460
Accounts receivable, net of allowance for doubtful accounts of $1,107 and $922 at December 31, 2013 and 2012	12,385	7,787
Prepaid expenses and other current assets	13,651	19,810
Total current assets	81,944	80,745
Property and equipment, net	18,657	12,079
Goodwill	1,145	415
Amortizable intangible assets, net	3,500	2,356
Deferred financing fees, net	397	634
Total assets	105,643	96,229
Liabilities and stockholders’ equity (deficit)
Accounts payable	6,838	6,489
Accrued liabilities	21,770	14,058
Total current liabilities	103,616	71,334
Long-term debt, including accrued interest	14,918	14,869
Deferred income taxes	169	163
Total liabilities	124,133	90,910
Commitments and contingencies (Note 9)
Stockholders’ equity (deficit)
Preferred stock, $0.001 par value: 10,000,000 shares authorized, no shares issued or outstanding at December 31, 2013 and December 31, 2012
Common stock, $0.001 par value: 300,000,000 shares authorized, 67,014,757 and 66,425,988 shares issued and 58,456,045 and 57,867,276 shares outstanding at December 31, 2013 and December 31, 2012, respectively	67	66
Additional paid-in-capital	257,505	248,326
Treasury stock, at cost: 8,558,712 shares of common stock at December 31, 2013 and December 31, 2012	(23,719)	(23,719)
Accumulated deficit	(252,343)	(219,354)
Total stockholders’ equity (deficit)	(18,490)	5,319
Total liabilities and stockholders’ equity (deficit)	105,643	96,229
Deferred membership revenue [Member]
Liabilities and stockholders’ equity (deficit)
Deferred revenue, current	35,560	27,627
Deferred revenue, noncurrent	4,909	4,330
Deferred advertising revenue [Member]
Liabilities and stockholders’ equity (deficit)
Deferred revenue, current	39,448	23,160
Deferred revenue, noncurrent	$ 521	$ 214

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Note 5 - Property and Equipment (Details) (USD $) In Thousands, unless otherwise specified	1 Months Ended	12 Months Ended
	Nov. 30, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Note 5 - Property and Equipment (Details) [Line Items]
Payments to Acquire Property, Plant, and Equipment	$ 6,785	$ 8,102	$ 9,730	$ 3,085
Depreciation		1,565	994	661
Capitalized Computer Software, Amortization		$ 961	$ 524	$ 218
Building [Member]
Note 5 - Property and Equipment (Details) [Line Items]
Property, Plant and Equipment, Useful Life	25 years

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Operating activities
Net loss	$ (32,989)	$ (52,894)	$ (49,037)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	4,069	2,753	1,660
Deferred income taxes	6	5	4
Accrued interest due on debt maturity date			625
Amortization of debt discount and deferred financing fees	527	312	596
Bad debt expense	3,773	1,955	806
Noncash compensation expense	4,064	2,943	3,842
Noncash loss on debt extinguishment			1,075
Changes in certain assets:
Accounts receivable	(8,371)	(5,805)	(2,081)
Prepaid expenses and other current assets	6,159	(7,975)	(6,068)
Changes in certain liabilities:
Accounts payable	(1,151)	1,223	2,089
Accrued liabilities	7,712	3,541	4,497
Accrued interest on long-term debt			(2,668)
Net cash provided by (used in) operating activities	8,906	(33,397)	(33,135)
Investing activities
Restricted cash		250
Purchases of short-term investments	(32,814)	(10,491)
Sales of short-term investments	21,978
Acquisition of business	(2,150)
Property and equipment	(8,102)	(9,730)	(3,085)
Data acquisition costs	(769)	(2,035)	(1,191)
Net cash used in investing activities	(21,857)	(22,006)	(4,276)
Financing activities
Borrowings under lines of credit			10,000
Payments under lines of credit			(10,000)
Principal payments on long-term debt			(21,797)
Proceeds from long-term debt			15,000
Payments on capital lease obligations			(41)
Purchases of treasury stock			(21,897)
Cash paid for financing costs			(944)
Proceeds from public stock offerings and other, net of fees		8,627	88,565
Proceeds from exercise of stock options	5,116	807
Sale of preferred stock, net of fees			57,923
Net cash provided by financing activities	5,116	9,434	116,809
Net increase (decrease) in cash	(7,835)	(45,969)	79,398
Cash and cash equivalents, beginning of period	42,638	88,607	9,209
Cash and cash equivalents, end of period	34,803	42,638	88,607
Supplemental cash flow disclosures
Cash paid for interest	1,602	1,680	4,899
Cash paid for income taxes		15
Capital expenditures incurred but not yet paid	1,000
Deferred advertising revenue [Member]
Changes in certain liabilities:
Deferred revenue	16,595	9,492	5,433
Deferred membership revenue [Member]
Changes in certain liabilities:
Deferred revenue	$ 8,512	$ 11,053	$ 6,092

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Note 12 - Convertible Preferred Stock (Details) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	0 Months Ended	1 Months Ended		12 Months Ended		1 Months Ended
	May 17, 2011	Mar. 15, 2011	May 31, 2012	Oct. 31, 2011	Dec. 31, 2011	Aug. 31, 2011	Oct. 31, 2011 Stock Dividend Declared [Member]	Oct. 31, 2011 Conversion Ratio [Member]	Aug. 31, 2011 Series D Preferred Stock [Member]	Aug. 31, 2011 Series C Preferred Stock [Member]
Note 12 - Convertible Preferred Stock (Details) [Line Items]
Stock Issued During Period, Shares, New Issues (in Shares)	90,486	757,724	703,235
Proceeds from Issuance of Preferred Stock and Preference Stock (in Dollars)	$ 6,400	$ 53,600			$ 57,923
Preferred Stock, Conversion Basis	one-to-one
Percent Held of Outstanding Shares of Preferred Stock									70.00%	80.00%
Share Price (in Dollars per share)						$ 70.74
Stockholders' Equity Note, Stock Split				eight-for-one			eight-for-one	one-to-eight
Additional Shares of Common Stock for Each Share Held as a Result of Stock Split (in Shares)				7

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Note 14 - Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	2013		2012		2011
Current:
U.S. federal	$	—	$	—	$	—
State		34		—		39
		34		—		39
Deferred:
U.S. federal		4		2		7
State		2		3		(3	)
		6		5		4
Income tax expense	$	40	$	5	$	43

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	2013			2012			2011
U.S. federal income tax rate		34.0	%		34.0	%		34.0	%
State income taxes, net of federal benefit		6.4			5.7			5.6
Valuation allowance		(39.7	)		(39.1	)		(36.7	)
Other		(0.8	)		(0.6	)		(2.8	)
Effective income tax rate		(0.1	)%		0.0	%		0.1	%

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

	2013			2012
Deferred tax assets:
Current:
Deferred revenue	$	32,643		$	22,299
Non-current:
Intangibles — other		12,138			12,962
Net operating loss carryforwards		39,757			41,464
Equity compensation		1,999			1,388
Other		4,337			2,095
Total deferred tax assets		90,874			80,208
Valuation allowance		(87,006	)		(73,434	)
Total net deferred tax assets		3,868			6,774
Deferred tax liabilities:
Current:
Prepaids		(3,923	)		(7,010	)
Non-current:
Property and equipment		55			236
Goodwill		(169	)		(163	)
Total net deferred tax liabilities		(4,037	)		(6,937	)
Total net deferred tax liability	$	(169	)	$	(163	)

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Note 15 - Warrants (Details) (USD $)	1 Months Ended	0 Months Ended	12 Months Ended
	Oct. 17, 2012	Mar. 07, 2012	Dec. 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Aug. 31, 2011	Dec. 31, 2010
Warrants [Abstract]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights			88,240			88,240	272,304
Warrants Term			7 years
Grant Date Fair Value of Warrants Per Share (in Dollars per share)			$ 2.23
Stock Issued During Period, Shares, Conversion of Convertible Securities	14,272	120,096
Outstanding Warrants Weighted Average Remaining Contractual Life			5 years 255 days
Warrants and Rights Outstanding (in Dollars)				$ 0	$ 0

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Note 16 - Related-Party Transactions

12 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

16. Related-Party Transactions

In November 2012, the Company completed the purchase of its headquarters facilities (the “properties”), which were owned by Henry Amalgamated, LLC, and Henry Amalgamated II, LLC, Indiana limited liability companies (together, “Henry Amalgamated”) for an aggregate purchase price of $6,250, excluding fees and other charges. In connection with its acquisition of the properties, the Company’s leases for its headquarters facilities were terminated.

William S. Oesterle, the Company’s Chief Executive Officer and member of the Company’s board of directors, owns a 70% interest in Henry Amalgamated. As the transaction described above constitutes a related party transaction at the direction of the board of directors (the “board”), the audit committee of the Company’s board reviewed and negotiated the Company’s acquisition of the property. With the audit committee’s recommendation and after a full board review, the board approved this transaction. Prior to the acquisition, the Company leased these properties from Henry Amalgamated. In addition to the primary acquisition costs of $6,250, the Company paid $178 to Henry Amalgamated for other charges incurred to prepare the properties for use, of which $150 was capitalized with the purchase of the properties.

Rent expense to Henry Amalgamated was $11, $977 and $856 for 2013, 2012 and 2011, respectively. The Company did not owe Henry Amalgamated any amounts as of December 31, 2013 and 2012.

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Note 15 - Warrants (Tables)

12 Months Ended

Dec. 31, 2013

Warrants [Abstract]

Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]

	Warrants			Weighted- Average Exercise Price
Outstanding at December 31, 2011		360,544		$	8.45
Issued		(360,544	)		8.45
Outstanding at December 31, 2012		—		$	—
Exercised
Outstanding at December 31, 2013		—		$	—

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Accounting Policies, by Policy (Policies)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Basis of Accounting, Policy [Policy Text Block]

Nature of Operations and Reorganization

Angie’s List, Inc. (collectively with its wholly owned subsidiaries, the Company) operates a consumer-driven service for its members to research, hire, rate and review local professionals for critical needs, such as home, health care and automotive services. Ratings and reviews, which are available only to the Company’s members, help its members to find the best provider for their local service needs. Membership subscriptions are sold on a monthly, annual and multi-year basis. The consumer rating network “Angie’s List” is maintained and updated based on member feedback. The Company also sells advertising in its monthly publication, on its website and through its call center to service providers that meet certain rating criteria. In addition, the Company’s e-commerce offerings provide its members the opportunity to purchase services directly from the Company from service providers that are rated on its website. The Company’s services are provided in markets located across the continental United States.

Operating segments are defined as components of an enterprise engaging in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company manages its business on the basis of one operating segment.

Consolidation, Policy [Policy Text Block]

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

The Company has evaluated subsequent events through the date these consolidated financial statements were issued.

Use of Estimates, Policy [Policy Text Block]

Estimates

Management uses estimates and assumptions in preparing consolidated financial statements in accordance with accounting principles generally accepted in the United States. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported revenue and expenses. Actual results could vary from the estimates that were used.

Stockholders' Equity, Policy [Policy Text Block]

Common Stock

On October 31, 2011, the Company effected an eight-for-one split of its common stock by way of a stock dividend. As a result of the stock split, holders of the Company’s common stock received seven additional shares of common stock for every share held on such date, and a proportionate adjustment was made to the applicable conversion prices for each share of the Company’s outstanding convertible preferred stock (see Note 12). All share and per share amounts for all periods presented in these consolidated financial statements and notes thereto were adjusted retroactively, where applicable, to reflect this stock split and the adjustment of the convertible preferred stock conversion prices.

In May 2012, the Company completed a follow-on public offering of 8,629,797 shares of its common stock, which included 703,235 shares of common stock sold by the Company and 7,926,562 shares of common stock sold by the selling stockholders (inclusive of 189,374 shares of common stock from the partial exercise of the over-allotment option granted to the underwriters). The Company incurred fees resulting from the transaction of approximately $770, of which $81 is included in additional paid-in-capital and $689 is included in general and administrative expenses.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition and Deferred Revenue

The Company recognizes revenue when all of the following conditions are met: there is persuasive evidence of an arrangement, the service has been provided to the customer, the collection of the fees is reasonably assured and the amount of fees to be paid by the customer is fixed or determinable.

Membership Revenue

Revenue from the sale of membership subscriptions is recognized ratably over the term of the associated subscription.

At the time a member joins, the Company may receive a one-time nonrefundable enrollment fee. Enrollment fees are deferred and recognized on a straight-line basis over an estimated average membership life of 76 months for annual or multi-year members and 15 months for monthly members, which is based on historical membership experience. The Company reviews the estimated average membership life on an annual basis, or more frequently if circumstances change. Changes in member behavior, performance, competition and economic conditions may cause attrition levels to change, which could impact the estimated average membership life.

Revenue Recognition, Sales of Services [Policy Text Block]

Service Provider Revenue

Revenue from the sale of advertising in the Company’s publication is recognized in the month in which the Company’s monthly publication is published and distributed. Revenue from the sale of website and call center advertising is recognized ratably over the time period the advertisements run. Revenue from e-commerce vouchers is recognized on a net basis when the voucher has been delivered to the purchaser. While the Company is not the merchant of record with respect to its customers for these transactions, it does offer customers refunds in certain circumstances. Revenue from e-commerce transactions is recorded net of a reserve for estimated refunds. The Company’s e-commerce revenue was $22,062, $14,475, and $6,651 for 2013, 2012, and 2011, respectively.

Revenue Recognition, Deferred Revenue [Policy Text Block]

Deferred Revenue

Deferred revenue includes the unamortized portion of revenue associated with membership and advertising fees for which the Company has received payment in advance of services or advertising to be provided.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash and Cash Equivalents

The Company maintains its cash in bank deposit accounts and money market funds with contractual maturities of three months or less, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts.

Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block]

Restricted Cash

Restricted cash relates to monies held in reserve at institutions pursuant to credit card processing agreements. The restricted cash is not available for operating activities.

Investment, Policy [Policy Text Block]

Short-term Investments

Investments with maturities less than one year consist of certificates of deposit (short-term only) and corporate bonds, all of which are designated as held-to-maturity investments and are recorded at amortized cost, adjusted for amortization of premiums to maturity computed under the effective interest method, in the consolidated balance sheets. Such amortization and interest income from held-to-maturity investments is included in interest expense, net in the consolidated statement of operations. For these investments, the Company’s objective is to earn a higher rate of return on funds that are not anticipated to be required to meet liquidity needs in the near term, while maintaining a low level of investment risk with the positive intent and ability to hold these investments to maturity. Short-term investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may be impaired. As of December 31, 2013, Angie’s List, Inc. had $21,055 in short-term investments with no material unrealized gains or losses.

Receivables, Policy [Policy Text Block]

Accounts Receivable

Accounts receivable are stated at the amount billed to service providers, less an estimated allowance for doubtful accounts. The Company performs ongoing credit evaluations and generally requires no collateral from service providers. Management reviews individual accounts as they become past due to determine collectability. The allowance for doubtful accounts is adjusted periodically based on management’s consideration of past due accounts. Individual accounts are charged against the allowance when all reasonable collection efforts have been exhausted.

The changes in the allowance for doubtful accounts during the years ended December 31, 2013, 2012 and 2011 were as follows:

	Year Ended December 31,
	2013			2012			2011
Beginning balance	$	922		$	535		$	241
Additions, net of recoveries		3,773			1,955			806
Deductions		(3,588	)		(1,568	)		(512	)
Ending Balance	$	1,107		$	922		$	535

Property, Plant and Equipment, Policy [Policy Text Block]

Property and Equipment

Property and equipment are stated at cost and are depreciated over the estimated useful life of each asset. The Company also capitalizes the cost of computer software developed or obtained for internal use. The Company’s estimated lives for property and equipment range from 3 to 25 years. Depreciation is computed using the straight-line method. Repairs and routine maintenance are charged to expense as incurred.

Intangible Assets, Finite-Lived, Policy [Policy Text Block]

Data Acquisition Costs

Data acquisition costs consist of external costs related to acquiring consumer reports on service providers. These reports are used by the Company to provide its members with feedback on service providers. Amortization is computed using the straight-line method over the period which the information is expected to benefit the Company’s members, which is estimated to be three years. The capitalized costs are included in intangible assets on the consolidated balance sheet, and the amortized expense is reflected within operations and support expenses in the consolidated statements of operations.

Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]

Long-Lived Assets

Long-lived assets, including property and equipment and amortizable intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by comparison of the carrying amount to future net undiscounted cash flows expected to be generated by the related asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the assets. To date, there have been no adjustments to the respective carrying values.

Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]

Goodwill

Goodwill is not amortized but is tested for impairment annually on December 31 and more frequently whenever an event occurs or circumstances indicate the carrying amount may be impaired. If the estimated fair value of goodwill is lower than its carrying amount, a goodwill impairment is indicated, and goodwill is written down to its estimated fair value. To date, there has been no impairment of goodwill.

Commissions Expense, Policy [Policy Text Block]

Sales Commissions

Commissions expense from the sale of service provider advertisements is recognized ratably over the term of the associated advertisement. The Company defers the recognition of commission expense until such time as the revenue related to the customer contract for which the commission was paid is recognized. Deferred commissions for each contract are amortized to expense in a manner consistent with how revenue is recognized for such contract, resulting in straight-line recognition of expense over the contractual term. Unamortized commission expense of $9,395 and $17,215 as of December 31, 2013 and 2012, respectively, is included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. The decrease in unamortized commissions expense in 2013 is a reflection of the change in the Company’s payment practice for commissions whereby the Company now times the actual commission payment to more closely align with the timing of expense recognition.

Deferred Charges, Policy [Policy Text Block]

Deferred Financing Fees

In August 2011, in connection with its entry into a loan and security agreement, the Company incurred certain costs associated with these financing activities of $944, which are being amortized into interest expense over the term of the credit facility. Deferred financing costs recorded previously in 2009 and 2010 of $328 and $1,074 were recorded as a result of certain financing agreements and were being amortized over the terms of their respective agreements. In connection with the extinguishment of its senior and subordinated loan agreements in August 2011, the Company expensed the unamortized portion of deferred financing fees associated with these loan agreements, which are included in the loss on debt extinguishment. Deferred financing fees, net of accumulated amortization, totaled $397 and $634 at December 31, 2013 and 2012, respectively. Amortization expense of $237, $232 and $524 is included in interest expense in the consolidated statements of operations for the fiscal years ended December 31, 2013, 2012 and 2011, respectively.

Income Tax, Policy [Policy Text Block]

Income Taxes

The Company is subject to corporate-level federal and state income taxes at prevailing corporate rates and accounts for income taxes and the related accounts using the liability method in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 740, Income Taxes. Under this method, the Company accrues income taxes payable or refundable and recognizes deferred tax assets and liabilities based on differences between the book and tax basis of assets and liabilities. The Company measures deferred tax assets and liabilities using enacted rates in effect for the years in which the differences are expected to reverse and recognizes the effect of a change in enacted rates in the period of enactment. After determining the total amount of deferred tax assets, the Company determines whether it is more likely than not that some portion of the deferred tax assets will not be realized. If the Company determines that a deferred tax asset is not likely to be realized, a valuation allowance will be established against that asset to record it at its expected realizable value.

The Company establishes assets and liabilities for uncertain positions taken or expected to be taken in income tax returns using a more-likely-than-not recognition threshold. The Company includes in income tax expense any interest and penalties related to uncertain tax positions.

Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block]

Marketing Expense

Marketing expense consists of national television, radio and print, as well as online, advertising. The Company expenses all advertising costs as incurred.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

Stock-Based Compensation

The Company accounts for stock-based compensation using the fair value recognition provisions of ASC 718, Stock Compensation. For its awards of restricted stock and stock options, the Company recognizes stock-based compensation expense in an amount equal to the fair market value on the grant date of the respective award. The Company recognizes this expense, net of estimated forfeitures, on a straight-line basis over the requisite service period.

The fair value of the stock under the plans was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

Expected volatility is based on historical volatilities for publicly traded common stock of comparable companies over the estimated expected life of the stock options. The expected term represents the period of time the stock options are expected to be outstanding. The risk-free interest rate is based on yields of U.S. Treasury securities with a maturity similar to the estimated expected term of the stock options.

Sales and Use Tax Policy [Policy Text Block]

Sales and Use Tax

Sales and use tax expenses are included within operations and support in the consolidated statements of operations. The Company does not separately collect sales and use taxes from its members.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

In July 2013, the FASB issued Accounting Standards Update No. 2013-11: Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) (“ASU 2013-11”). An entity is required to present unrecognized tax benefits as a decrease in a net operating loss, similar tax loss or tax credit carryforward if certain criteria are met. The determination of whether a deferred tax asset is available is based on the unrecognized tax benefit and the deferred tax asset that exists at the reporting date and presumes disallowance of the tax position at the reporting date. The guidance will eliminate the diversity in practice in the presentation of unrecognized tax benefits but will not alter the way in which entities assess deferred tax assets for realizability. ASU 2013-11 will be effective for the company in fiscal 2014. The Company is currently assessing the impact to the consolidated financial statements.

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Note 17 - Quarterly Financial Information (Unaudited) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Dec. 31, 2012	Dec. 31, 2013
Note 17 - Quarterly Financial Information (Unaudited) (Details) [Line Items]
Estimated Litigation Liability, Current		$ 4,000
Adjustment to Reduce Commission Expense Due to Prior Period Immaterial Error	700
General and Administrative Expense [Member]
Note 17 - Quarterly Financial Information (Unaudited) (Details) [Line Items]
Estimated Litigation Liability, Current		$ 4,000

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Note 1 - Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

1. Summary of Significant Accounting Policies

Nature of Operations and Reorganization

Angie’s List, Inc. (collectively with its wholly owned subsidiaries, the Company) operates a consumer-driven service for its members to research, hire, rate and review local professionals for critical needs, such as home, health care and automotive services. Ratings and reviews, which are available only to the Company’s members, help its members to find the best provider for their local service needs. Membership subscriptions are sold on a monthly, annual and multi-year basis. The consumer rating network “Angie’s List” is maintained and updated based on member feedback. The Company also sells advertising in its monthly publication, on its website and through its call center to service providers that meet certain rating criteria. In addition, the Company’s e-commerce offerings provide its members the opportunity to purchase services directly from the Company from service providers that are rated on its website. The Company’s services are provided in markets located across the continental United States.

Operating segments are defined as components of an enterprise engaging in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company manages its business on the basis of one operating segment.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

The Company has evaluated subsequent events through the date these consolidated financial statements were issued.

Estimates

Management uses estimates and assumptions in preparing consolidated financial statements in accordance with accounting principles generally accepted in the United States. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported revenue and expenses. Actual results could vary from the estimates that were used.

Common Stock

On October 31, 2011, the Company effected an eight-for-one split of its common stock by way of a stock dividend. As a result of the stock split, holders of the Company’s common stock received seven additional shares of common stock for every share held on such date, and a proportionate adjustment was made to the applicable conversion prices for each share of the Company’s outstanding convertible preferred stock (see Note 12). All share and per share amounts for all periods presented in these consolidated financial statements and notes thereto were adjusted retroactively, where applicable, to reflect this stock split and the adjustment of the convertible preferred stock conversion prices.

In May 2012, the Company completed a follow-on public offering of 8,629,797 shares of its common stock, which included 703,235 shares of common stock sold by the Company and 7,926,562 shares of common stock sold by the selling stockholders (inclusive of 189,374 shares of common stock from the partial exercise of the over-allotment option granted to the underwriters). The Company incurred fees resulting from the transaction of approximately $770, of which $81 is included in additional paid-in-capital and $689 is included in general and administrative expenses.

Revenue Recognition and Deferred Revenue

The Company recognizes revenue when all of the following conditions are met: there is persuasive evidence of an arrangement, the service has been provided to the customer, the collection of the fees is reasonably assured and the amount of fees to be paid by the customer is fixed or determinable.

Membership Revenue

Revenue from the sale of membership subscriptions is recognized ratably over the term of the associated subscription.

At the time a member joins, the Company may receive a one-time nonrefundable enrollment fee. Enrollment fees are deferred and recognized on a straight-line basis over an estimated average membership life of 76 months for annual or multi-year members and 15 months for monthly members, which is based on historical membership experience. The Company reviews the estimated average membership life on an annual basis, or more frequently if circumstances change. Changes in member behavior, performance, competition and economic conditions may cause attrition levels to change, which could impact the estimated average membership life.

Service Provider Revenue

Revenue from the sale of advertising in the Company’s publication is recognized in the month in which the Company’s monthly publication is published and distributed. Revenue from the sale of website and call center advertising is recognized ratably over the time period the advertisements run. Revenue from e-commerce vouchers is recognized on a net basis when the voucher has been delivered to the purchaser. While the Company is not the merchant of record with respect to its customers for these transactions, it does offer customers refunds in certain circumstances. Revenue from e-commerce transactions is recorded net of a reserve for estimated refunds. The Company’s e-commerce revenue was $22,062, $14,475, and $6,651 for 2013, 2012, and 2011, respectively.

Deferred Revenue

Deferred revenue includes the unamortized portion of revenue associated with membership and advertising fees for which the Company has received payment in advance of services or advertising to be provided.

Cash and Cash Equivalents

The Company maintains its cash in bank deposit accounts and money market funds with contractual maturities of three months or less, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts.

Restricted Cash

Restricted cash relates to monies held in reserve at institutions pursuant to credit card processing agreements. The restricted cash is not available for operating activities.

Short-term Investments

Investments with maturities less than one year consist of certificates of deposit (short-term only) and corporate bonds, all of which are designated as held-to-maturity investments and are recorded at amortized cost, adjusted for amortization of premiums to maturity computed under the effective interest method, in the consolidated balance sheets. Such amortization and interest income from held-to-maturity investments is included in interest expense, net in the consolidated statement of operations. For these investments, the Company’s objective is to earn a higher rate of return on funds that are not anticipated to be required to meet liquidity needs in the near term, while maintaining a low level of investment risk with the positive intent and ability to hold these investments to maturity. Short-term investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may be impaired. As of December 31, 2013, Angie’s List, Inc. had $21,055 in short-term investments with no material unrealized gains or losses.

Accounts Receivable

Accounts receivable are stated at the amount billed to service providers, less an estimated allowance for doubtful accounts. The Company performs ongoing credit evaluations and generally requires no collateral from service providers. Management reviews individual accounts as they become past due to determine collectability. The allowance for doubtful accounts is adjusted periodically based on management’s consideration of past due accounts. Individual accounts are charged against the allowance when all reasonable collection efforts have been exhausted.

The changes in the allowance for doubtful accounts during the years ended December 31, 2013, 2012 and 2011 were as follows:

	Year Ended December 31,
	2013			2012			2011
Beginning balance	$	922		$	535		$	241
Additions, net of recoveries		3,773			1,955			806
Deductions		(3,588	)		(1,568	)		(512	)
Ending Balance	$	1,107		$	922		$	535

Property and Equipment

Property and equipment are stated at cost and are depreciated over the estimated useful life of each asset. The Company also capitalizes the cost of computer software developed or obtained for internal use. The Company’s estimated lives for property and equipment range from 3 to 25 years. Depreciation is computed using the straight-line method. Repairs and routine maintenance are charged to expense as incurred.

Data Acquisition Costs

Data acquisition costs consist of external costs related to acquiring consumer reports on service providers. These reports are used by the Company to provide its members with feedback on service providers. Amortization is computed using the straight-line method over the period which the information is expected to benefit the Company’s members, which is estimated to be three years. The capitalized costs are included in intangible assets on the consolidated balance sheet, and the amortized expense is reflected within operations and support expenses in the consolidated statements of operations.

Long-Lived Assets

Long-lived assets, including property and equipment and amortizable intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability is measured by comparison of the carrying amount to future net undiscounted cash flows expected to be generated by the related asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the assets. To date, there have been no adjustments to the respective carrying values.

Goodwill

Goodwill is not amortized but is tested for impairment annually on December 31 and more frequently whenever an event occurs or circumstances indicate the carrying amount may be impaired. If the estimated fair value of goodwill is lower than its carrying amount, a goodwill impairment is indicated, and goodwill is written down to its estimated fair value. To date, there has been no impairment of goodwill.

Sales Commissions

Commissions expense from the sale of service provider advertisements is recognized ratably over the term of the associated advertisement. The Company defers the recognition of commission expense until such time as the revenue related to the customer contract for which the commission was paid is recognized. Deferred commissions for each contract are amortized to expense in a manner consistent with how revenue is recognized for such contract, resulting in straight-line recognition of expense over the contractual term. Unamortized commission expense of $9,395 and $17,215 as of December 31, 2013 and 2012, respectively, is included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. The decrease in unamortized commissions expense in 2013 is a reflection of the change in the Company’s payment practice for commissions whereby the Company now times the actual commission payment to more closely align with the timing of expense recognition.

Deferred Financing Fees

In August 2011, in connection with its entry into a loan and security agreement, the Company incurred certain costs associated with these financing activities of $944, which are being amortized into interest expense over the term of the credit facility. Deferred financing costs recorded previously in 2009 and 2010 of $328 and $1,074 were recorded as a result of certain financing agreements and were being amortized over the terms of their respective agreements. In connection with the extinguishment of its senior and subordinated loan agreements in August 2011, the Company expensed the unamortized portion of deferred financing fees associated with these loan agreements, which are included in the loss on debt extinguishment. Deferred financing fees, net of accumulated amortization, totaled $397 and $634 at December 31, 2013 and 2012, respectively. Amortization expense of $237, $232 and $524 is included in interest expense in the consolidated statements of operations for the fiscal years ended December 31, 2013, 2012 and 2011, respectively.

Income Taxes

The Company is subject to corporate-level federal and state income taxes at prevailing corporate rates and accounts for income taxes and the related accounts using the liability method in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 740, Income Taxes. Under this method, the Company accrues income taxes payable or refundable and recognizes deferred tax assets and liabilities based on differences between the book and tax basis of assets and liabilities. The Company measures deferred tax assets and liabilities using enacted rates in effect for the years in which the differences are expected to reverse and recognizes the effect of a change in enacted rates in the period of enactment. After determining the total amount of deferred tax assets, the Company determines whether it is more likely than not that some portion of the deferred tax assets will not be realized. If the Company determines that a deferred tax asset is not likely to be realized, a valuation allowance will be established against that asset to record it at its expected realizable value.

The Company establishes assets and liabilities for uncertain positions taken or expected to be taken in income tax returns using a more-likely-than-not recognition threshold. The Company includes in income tax expense any interest and penalties related to uncertain tax positions.

Marketing Expense

Marketing expense consists of national television, radio and print, as well as online, advertising. The Company expenses all advertising costs as incurred.

Stock-Based Compensation

The Company accounts for stock-based compensation using the fair value recognition provisions of ASC 718, Stock Compensation. For its awards of restricted stock and stock options, the Company recognizes stock-based compensation expense in an amount equal to the fair market value on the grant date of the respective award. The Company recognizes this expense, net of estimated forfeitures, on a straight-line basis over the requisite service period.

The fair value of the stock under the plans was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

Expected volatility is based on historical volatilities for publicly traded common stock of comparable companies over the estimated expected life of the stock options. The expected term represents the period of time the stock options are expected to be outstanding. The risk-free interest rate is based on yields of U.S. Treasury securities with a maturity similar to the estimated expected term of the stock options.

Sales and Use Tax

Sales and use tax expenses are included within operations and support in the consolidated statements of operations. The Company does not separately collect sales and use taxes from its members.

Recent Accounting Pronouncements

In July 2013, the FASB issued Accounting Standards Update No. 2013-11: Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) (“ASU 2013-11”). An entity is required to present unrecognized tax benefits as a decrease in a net operating loss, similar tax loss or tax credit carryforward if certain criteria are met. The determination of whether a deferred tax asset is available is based on the unrecognized tax benefit and the deferred tax asset that exists at the reporting date and presumes disallowance of the tax position at the reporting date. The guidance will eliminate the diversity in practice in the presentation of unrecognized tax benefits but will not alter the way in which entities assess deferred tax assets for realizability. ASU 2013-11 will be effective for the company in fiscal 2014. The Company is currently assessing the impact to the consolidated financial statements.

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Consolidated Balance Sheets (Parentheticals) (USD $) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Allowance for doubtful accounts (in Dollars)	$ 1,107	$ 922
Preferred stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
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	300,000,000	300,000,000
Common stock, shares issued	67,014,757	66,425,988
Common stock, shares outstanding	58,456,045	57,867,276
Treasury stock, at cost, shares of common stock	8,558,712	8,558,712

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Note 11 - Stock-Based Compensation

12 Months Ended

Dec. 31, 2013

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

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

11. Stock-Based Compensation

In April 2010, the Company adopted an Omnibus Incentive Plan (the Incentive Plan) in order to provide an incentive to certain executive officers, personnel and directors. The Incentive Plan was amended and restated effective August 2011, increasing the number of shares issuable to 5,090,496. In March 2012 and October 2013, additional shares of stock were reserved for issuance, bringing the total available shares issuable to 10,830,475. As of December 31, 2013, there were 8,992,890 shares of common stock reserved under the Incentive Plan, of which 5,682,126 shares remained available for future grants.

Stock Options

Stock options are awarded with an exercise price equal to the market price on the date of grant. The contractual terms for options expire ten years from the grant date and generally vest over a three or four-year period. The fair value of options on the date of grant is amortized on a straight-line basis over the requisite service period.

A summary of stock option activity under the plans as of December 31, 2013 and 2012 and changes during the periods then ended are as follows:

	Number of Shares			Weighted- Average Price/ Share			Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
							(In Years)
Outstanding at December 31, 2011		2,814,888		$	8.60			9.52	$	21,122
Granted		352,785			12.90
Exercised		(96,488	)		8.36
Cancelled		(250,566	)		(9.00	)
Outstanding at December 31, 2012		2,820,619		$	9.11			8.62	$	8,687
Granted		1,923,206			19.46
Exercised		(588,769	)		8.69
Cancelled		(844,292	)		(11.16	)
Outstanding at December 31, 2013		3,310,764		$	14.67			8.63	$	9,717

	Number of Shares		Weighted- Average Price/ Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
					(In Years)
Vested and Exercisable at December 31, 2012		863,736	$	8.78		8.50	$	2,847
Unvested at December 31, 2012		1,956,883		9.25		8.61
Vested and Exercisable at December 31, 2013		894,813	$	9.38		7.61	$	5,358
Unvested at December 31, 2013		2,415,951		16.63		7.91

The fair value of the stock under the plans was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

Expected volatility is based on historical volatilities for publicly traded common stock of comparable companies over the estimated expected life of the stock options. The expected term represents the period of time the stock options are expected to be outstanding. The risk-free interest rate is based on yields of U.S. Treasury securities with a maturity similar to the estimated expected term of the stock options.

The weighted-average grant date fair value of options granted during 2013 and 2012 was $9.38 and $6.04 per share, respectively. The total intrinsic value of options exercised during 2013, 2012 and 2011 was $7,376, $297 and $0, respectively. The Company recognized compensation expense of $4,064, $2,943 and $1,673 in the consolidated statements of operations related to stock options in 2013, 2012 and 2011, respectively. As of December 31, 2013, total compensation expense related to non-vested options not yet recognized was $14,799, which will be recognized over the remaining weighted-average life of the awards, 3.22 years.

Restricted Stock

Restricted stock vests over various periods in accordance with the respective grant agreement. The fair value of restricted stock on the date of grant is amortized on a straight-line basis over the requisite vesting period, with the amount of compensation expense recognized at any date at least equal to the portion of the grant date value of the award that is vested at that date.

The Company recognized compensation expense of $2,169 in the consolidated statement of operations related to restricted stock in 2011. There was no restricted stock issued or outstanding during 2012 or 2013.

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Document And Entity Information (USD $)	12 Months Ended
	Dec. 31, 2013	Feb. 27, 2014	Jun. 30, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	Angie's List, Inc.
Document Type	10-K
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		58,507,109
Entity Public Float			$ 1,134,108,866
Amendment Flag	false
Entity Central Index Key	0001491778
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Well-known Seasoned Issuer	No
Document Period End Date	Dec. 31, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	FY

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Note 12 - Convertible Preferred Stock

12 Months Ended

Dec. 31, 2013

Disclosure Text Block Supplement [Abstract]

Preferred Stock [Text Block]

12. Convertible Preferred Stock

On March 15, 2011 and May 17, 2011, the Company issued 757,724 and 90,486 shares of Series D preferred stock for $53,600 and $6,400, respectively.

Each share of preferred stock was convertible, at the option of the holder, to common stock on a one-to-one basis, unless additional common shares had been issued by the Company (exclusive of shares issued to satisfy outstanding options, declared dividends or splits, or certain approved issuances to financial institutions or investors pursuant to a debt financing), at which point a defined conversion formula should be utilized to identify the appropriate conversion ratio. During August 2011, the preferred stockholders agreed via written consent of (1) the holders of at least 70% of the outstanding shares of Series D preferred stock, (2) the holders of at least 80% of the outstanding shares of Series C preferred stock, (3) the holders of at least a supermajority, as defined in the Amended and Restated Certificate of Incorporation, of the holders of the outstanding shares of Series B preferred stock, and (4) the holders of at least a supermajority of the outstanding shares of Series A preferred stock that each share of preferred stock shall be mandatorily converted to common stock immediately prior to the completion of a firm-commitment underwritten initial public offering if the share price is at least $70.74, as adjusted for stock splits and other adjustments. The Series A, B, C, and D convertible preferred stock are not subject to mandatory redemption outside the control of the Company.

On October 31, 2011, the Company effected an eight-for-one split of its common stock by way of a stock dividend declared. As a result of the stock split, holders of the Company’s common stock received seven additional shares of common stock for every share held on such date, and a proportionate adjustment was made to the applicable conversion prices for each share of the Company’s outstanding convertible preferred stock, resulting in a conversion ratio of one-to-eight. As a result of the initial public offering of stock at a price greater than the pre-split adjusted price of $70.74, all preferred shares were converted to common shares on November 17, 2011.

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Consolidated Statements of Operations (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Revenue
Membership	$ 65,307	$ 47,717	$ 33,815
Service provider	180,335	108,082	56,228
Total revenue	245,642	155,799	90,043
Operating expenses
Operations and support	40,072	27,081	16,417
Selling	90,143	58,596	33,815
Marketing	87,483	80,230	56,122
Technology	26,197	16,870	9,109
General and administrative	32,828	24,055	18,740
Operating loss	(31,081)	(51,033)	(44,160)
Interest expense, net	1,868	1,856	3,004
Loss on debt extinguishment			1,830
Loss before income taxes	(32,949)	(52,889)	(48,994)
Income tax expense	40	5	43
Net loss	$ (32,989)	$ (52,894)	$ (49,037)
Net loss per common share—basic and diluted (in Dollars per share)	$ (0.57)	$ (0.92)	$ (1.60)
Weighted average number of common shares outstanding—basic and diluted (in Shares)	58,230,927	57,485,589	30,655,532

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Note 6 - Goodwill and Amortizable Intangible Assets

12 Months Ended

Dec. 31, 2013

Disclosure Text Block [Abstract]

Intangible Assets Disclosure [Text Block]

6. Goodwill and Amortizable Intangible Assets

The Company has goodwill as well as certain amortizable intangible assets consisting of data acquisition costs, a member list, content and core technology. The goodwill and amortizable intangible asset balances reflect the goodwill, member list, content and core technology acquired during the August 2, 2013 acquisition of substantially all the assets of BrightNest for a purchase price of $2,650, inclusive of $1,920 in acquired intangible assets and goodwill of $730. The purchase price consisted of $2,150 in cash paid at closing and an additional $500 that is payable on the one-year anniversary of the closing, subject to certain performance criteria of BrightNest employees hired by the Company on the acquisition date. The acquisition of the BrightNest assets adds a user-friendly front end and personalized member experience with expanded content offerings and enhanced technologies. Revenues and expenses related to BrightNest, which are not material, are included in the consolidated results of operations from the date of acquisition.

Amortization on the intangible assets is computed using the straight-line method over the estimated lives of the assets. Amortizable intangible assets at December 31, 2013 are as follows:

	Cost		Accumulated Amortization		Net		Amortization Period (in years)
2013
Member List	$	1,670	$	116	$	1,554		6.0
Content		140		19	$	121		3.0
Core technology		110		15	$	95		3.0
Data acquisition costs		3,296		1,566	$	1,730		3.0
	$	5,216	$	1,716	$	3,500
2012
Data acquisition costs	$	4,017	$	1,661	$	2,356		3.0
	$	4,017	$	1,661	$	2,356

Amortization expense on amortizable intangible assets for the years ended December 31, 2013, 2012 and 2011, was $1,546, $1,234 and $781, respectively. The estimated amortization expense related to amortizable intangible assets at December 31, 2013 for each of the next five years is as follows: $1,520 in 2014, $831 in 2015, $430 in 2016, $278 in 2017 and 2018 and $162 thereafter.

The Company’s recorded goodwill balance at December 31, 2013 and 2012 was $1,145 and $415, respectively. The Company expects the amount recorded as goodwill for the BrightNest acquisition to be fully deductible for tax purposes.

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Note 5 - Property and Equipment

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

5. Property and Equipment

Property and equipment was comprised of the following:

	December 31,
	2013			2012
Furniture and equipment	$	7,965		$	5,929
Land		1,464			1,401
Buildings and improvements		8,711			6,417
Software		5,949			1,949
		24,089			15,696
Less accumulated depreciation		(5,432	)		(3,617	)
	$	18,657		$	12,079

In November 2012, the Company acquired its headquarters facilities from its lessor, a related party, at a cost of $6,785, including costs and fees to acquire the properties. Buildings are being depreciated on a straight-line basis over 25 years.

Depreciation expense for the years ended December 31, 2013, 2012, and 2011, was $1,565, $994 and $661, respectively. Computer software amortization expense for 2013, 2012 and 2011 was $961, $524 and $218, respectively.

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Note 17 - Quarterly Financial Information (Unaudited)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Information [Text Block]

17. Quarterly Financial Information (Unaudited)

The table below sets forth selected quarterly financial data for each of the last two fiscal years ($ in thousands, except per share data).

	Fiscal Year Ended December 31, 2013
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Total revenue	$	52,171		$	59,215		$	65,500		$	68,756
Operating income (loss)		(7,469	)		(13,855	)		(13,028	)		3,271
Net income (loss)		(7,947	)		(14,334	)		(13,511	)		2,803
Net income (loss) per common share—basic and diluted	$	(0.14	)	$	(0.25	)	$	(0.23	)	$	0.05

	Fiscal Year Ended December 31, 2012
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Total revenue	$	31,094		$	36,504		$	42,022		$	46,179
Operating income (loss)		(12,994	)		(22,930	)		(18,020	)		2,911
Net income (loss)		(13,450	)		(23,387	)		(18,487	)		2,430
Net income (loss) per common share—basic and diluted	$	(0.24	)	$	(0.41	)	$	(0.32	)	$	0.04

Information in any one quarterly period should not be considered indicative of annual results due to the effects of seasonality on the Company’s business.

The fourth quarter of 2013 includes a $4.0 million charge to general and administrative expense reflective of an expected settlement of pending litigation.

The fourth quarter of 2012 includes an out of period adjustment related to 2011 and prior to reduce commission expense by $700.

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Note 13 - Treasury Stock

12 Months Ended

Dec. 31, 2013

Disclosure Text Block Supplement [Abstract]

Treasury Stock [Text Block]

13. Treasury Stock

In April 2011, the Company repurchased 1,940,744 shares of common stock for $16,496. Prior to the repurchase, a certain stockholder converted 14,096 shares of Series B and 29,663 shares of Series C preferred shares into common stock. Additionally, in June 2011, the Company repurchased 635,288 shares of common stock for $5,400.

The Company has 8,558,712 shares of its common stock in treasury stock as of December 31, 2013 and 2012. Of these, the Company’s wholly-owned subsidiary holds 5,743,744 shares of common stock.

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Note 9 - Commitments and Contingencies

12 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

9. Commitments and Contingencies

Operating Leases

The Company has long-term noncancellable operating leases for offices and equipment that expire in various years through 2015. These leases require the Company to pay all executory costs (property taxes, maintenance and insurance). Rental payments include minimum rentals.

Future minimum lease payments required under long-term noncancellable operating leases at December 31, 2013 were:

	Total
Payable in
2014	$	663
2015		124
2016		0
	$	787

Rental expense for all operating leases totaled $910, $1,381 and $915 in 2013, 2012 and 2011, respectively.

Legal Matters

From time to time, the Company has or may become party to litigation incident to the ordinary course of business. The Company assesses the likelihood of any adverse judgments or outcomes with respect to these matters and determines loss contingency assessments on a gross basis after assessing the probability of incurrence of a loss and whether a loss is reasonably estimable. In addition, the Company considers other relevant factors that could impact its ability to reasonably estimate a loss. A determination of the amount of reserves required, if any, for these contingencies is made after analyzing each matter. The Company’s reserves may change in the future due to new developments or changes in strategy in handling these matters. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these matters listed below will not have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors.

Fritzinger v. Angie’s List. On August 14, 2012 a lawsuit seeking class action status was filed against the Company in the U.S. District Court for the Southern District of Indiana (the “Court”). The lawsuit alleges claims of breach of contract and unjust enrichment, alleging that the Company automatically renews membership fees at a higher rate than customers are led to believe, breaching their membership agreements. The plaintiff seeks compensatory damages and an award of treble damages, attorneys’ fees and costs. The Company and the plaintiff have agreed in principle to settlement terms, which remains subject to Court approval.  As of December 31, 2013, the Company has recorded a $4,000 legal accrual related to the settlement. The Company believes this amount represents the best estimate of the Company’s ultimate liability with respect to this litigation, and any difference between the amount recorded and the actual final court-approved settlement is not expected to have a material impact on our financial condition or results of operations.   

Baron v. Angie’s List, Inc., et al. On December 23, 2013, a class action complaint was filed in the Court, naming the Company and various current and former directors and officers as defendants and alleging that the defendants violated Section 10(b) of the Securities Act of 1934 (the “Exchange Act”) by making material misstatements in and omitting material information from the Company’s public disclosures concerning the Company’s business prospects. The complaint further alleges that the defendants violated Section 20(a) of the Exchange Act by virtue of their positions as control persons. The plaintiff has requested unspecified damages, interest, and costs, as well as ancillary relief. On January 23, 2014, the Court entered a scheduling order pursuant to which, upon appointment as lead plaintiff, the plaintiff has sixty days with which to file a consolidated complaint or stand on the current complaint. Pursuant to that order, the Company’s response to that complaint is due sixty days thereafter.

Bartolone v. Angie’s List, Inc., et al. On January 9, 2014, a class action complaint was filed in the Court, naming the same defendants, asserting the same claims, and asking for the same relief as sought in Baron, described above. On January 29, 2014, the Court entered a scheduling order identical to the order entered in Baron.

Baron and Bartolone are collectively referred to as the “Stockholder Class Action.” The Company believes that the Stockholder Class Action is without merit and intends to vigorously defend against it.

Korda v. William S. Oesterle, et al. On January 3, 2014, a derivative complaint was filed in the Court on behalf of the Company, naming the Company’s Board of Directors and various current or former officers as individual defendants and the Company as a nominal defendant. The plaintiff asserts a breach of fiduciary duty claim against the individual defendants based on their alleged knowledge that the Company’s public statements during 2013 concerning the Company’s business prospects were misleading. The plaintiff asserts a breach of fiduciary duty claim against certain individual defendants based on their sales of Angie’s List common stock between December 2012 and December 2013. The plaintiff asks for unspecified amounts in damages, interest, and cost, as well as ancillary relief. The parties are currently seeking to negotiate a stay of the action pending a ruling on the complaint in the Stockholder Class Action, described above.

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Note 13 - Treasury Stock (Details) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended		12 Months Ended			1 Months Ended
	Jun. 30, 2011	Apr. 30, 2011	Dec. 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Mar. 31, 2011 Series B Preferred Stock [Member]	Mar. 31, 2011 Series C Preferred Stock [Member]	Dec. 31, 2013 Wholly-Owned Subsidiary [Member]	Dec. 31, 2012 Wholly-Owned Subsidiary [Member]
Note 13 - Treasury Stock (Details) [Line Items]
Treasury Stock, Shares, Acquired	635,288	1,940,744
Treasury Stock, Value, Acquired, Cost Method (in Dollars)	$ 5,400	$ 16,496	$ 21,897
Conversion of Stock, Shares Converted						14,096	29,663
Treasury Stock, Shares				8,558,712	8,558,712			5,743,744	5,743,744

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Note 7 - Accrued Liabilities

12 Months Ended

Dec. 31, 2013

Disclosure Text Block Supplement [Abstract]

Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block]

7. Accrued Liabilities 

Accrued liabilities were comprised of the following:

	December 31,
	2013		2012
Accrued sales commissions	$	2,570	$	4,342
Sales and use tax		3,158		2,130
Accrued compensation		5,229		2,246
Uninvoiced accounts payable		2,977		2,372
Legal accrual		4,000		—
Other		3,836		2,968
Total accrued liabilities	$	21,770	$	14,058

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Note 8 - Long-term Debt

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

8. Long-term Debt

Debt was comprised of the following:

	December 31,
	2013			2012
Term loan	$	15,000		$	15,000
Debt discount on term loan		(82	)		(131	)
		14,918			14,869
Less current maturities		—			—
Total long-term debt, including accrued interest	$	14,918		$	14,869

On August 31, 2011, the Company entered into a loan and security agreement that provides for a $15,000 term loan and a $15,000 revolving credit facility. A portion of the revolving credit facility is available for letters of credit and corporate credit cards. The term loan bears interest at a per annum rate equal to the greater of (i) the current cash interest rate of LIBOR plus 10% or (ii) 10.5%, and requires monthly interest-only payments until maturity in August 2015. The revolving credit facility requires monthly interest-only payments on advances, which bear interest at a per annum rate equal to LIBOR plus 5%. In addition, when less than 50% of the revolving credit facility is drawn, the Company is required to pay a non-usage charge of 0.50% per annum of the average unused portion of the credit facility. The term loan provides for penalties for early prepayment. The term loan and revolving credit facility provide for additional interest upon an event of default and are secured by substantially all of the Company’s assets. In connection with entering into the loan and security agreement, the Company issued a convertible warrant to purchase 88,240 shares of common stock to one of the lenders. The fair value of this warrant was recorded as a discount to the term loan, with the amount of the discount being amortized as interest expense through the loan’s maturity. As of December 31, 2013, the Company had $14,900 in outstanding borrowings under the term loan and available credit of $15,000 under the revolving credit facility.

The loan and security agreement contains various restrictive covenants, including restrictions on the Company’s ability to dispose of assets, make acquisitions or investments, incur debt or liens, make distributions to stockholders or enter into certain types of related party transactions. The Company is also required to comply with certain financial covenants, including a minimum asset coverage ratio, and non-financial covenants. Upon an event of default, which includes a material adverse change, the lenders may accelerate amounts outstanding, terminate the agreement and foreclose on all collateral. The Company was in compliance with all financial and non-financial covenants at December 31, 2013, and management believes the Company will be in compliance through the end of fiscal 2014.

On August 31, 2011, the Company repaid in full the outstanding balance of $14,178 on a note payable, including additional interest of $3,200 ($2,668 of which had been accrued as of August 31, 2011), and prepayment penalties in the amount of $220 under the prior note payable, and terminated the related amended and restated loan and security agreement. On the same date, the Company also paid $6,087 to the holders of the senior subordinated note in satisfaction of the principal, interest and other fees due thereunder. The prepayment penalties, unaccrued additional interest and other fees are included in the loss on debt extinguishment within the consolidated statement of operations for 2011.

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Note 10 - Profit-Sharing Plan

12 Months Ended

Dec. 31, 2013

Compensation and Retirement Disclosure [Abstract]

Pension and Other Postretirement Benefits Disclosure [Text Block]

10. Profit-Sharing Plan

The Company sponsors a 401(k) profit-sharing plan (the Plan) covering substantially all of its personnel. The Company’s contributions to the Plan are discretionary. The Company contributed 3% for all eligible personnel, which totaled $1,500, $1,032 and $745 in 2013, 2012 and 2011, respectively.

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Note 14 - Income Taxes (Details) - Deferred Tax Assets and Liabilities (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Current:
Deferred revenue	$ 32,643	$ 22,299
Non-current:
Intangibles — other	12,138	12,962
Net operating loss carryforwards	39,757	41,464
Equity compensation	1,999	1,388
Other	4,337	2,095
Total deferred tax assets	90,874	80,208
Valuation allowance	(87,006)	(73,434)
Total net deferred tax assets	3,868	6,774
Current:
Prepaids	(3,923)	(7,010)
Non-current:
Property and equipment	55	236
Goodwill	(169)	(163)
Total net deferred tax liabilities	(4,037)	(6,937)
Total net deferred tax liability	$ (169)	$ (163)

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Note 15 - Warrants (Details) - A Summary of Warrant Activity	Dec. 31, 2011	Aug. 31, 2011	Dec. 31, 2010	Dec. 31, 2013 Outstanding [Member]	Dec. 31, 2012 Outstanding [Member]	Dec. 31, 2011 Outstanding [Member]	Dec. 31, 2012 Issued [Member]	Dec. 31, 2013 Exercised [Member]
Class of Warrant or Right [Line Items]
Warrants	88,240	88,240	272,304	0	0	360,544	(360,544)	0
Weighted-average exercise price (in Dollars per Item)				0	0	8.45	8.45	0

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Note 14 - Income Taxes (Details) - The Reconciliation of Income Tax Expense Computed at the Federal Statutory Rate to the Company’s Effective Rax Rate	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
The Reconciliation of Income Tax Expense Computed at the Federal Statutory Rate to the Company’s Effective Rax Rate [Abstract]
U.S. federal income tax rate	34.00%	34.00%	34.00%
State income taxes, net of federal benefit	6.40%	5.70%	5.60%
Valuation allowance	(39.70%)	(39.10%)	(36.70%)
Other	(0.80%)	(0.60%)	(2.80%)
Effective income tax rate	(0.10%)	0.00%	0.10%

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Note 11 - Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2013

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

Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]

	Number of Shares			Weighted- Average Price/ Share			Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
							(In Years)
Outstanding at December 31, 2011		2,814,888		$	8.60			9.52	$	21,122
Granted		352,785			12.90
Exercised		(96,488	)		8.36
Cancelled		(250,566	)		(9.00	)
Outstanding at December 31, 2012		2,820,619		$	9.11			8.62	$	8,687
Granted		1,923,206			19.46
Exercised		(588,769	)		8.69
Cancelled		(844,292	)		(11.16	)
Outstanding at December 31, 2013		3,310,764		$	14.67			8.63	$	9,717

Schedule of Share-based Compensation, Activity [Table Text Block]

	Number of Shares		Weighted- Average Price/ Share		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
					(In Years)
Vested and Exercisable at December 31, 2012		863,736	$	8.78		8.50	$	2,847
Unvested at December 31, 2012		1,956,883		9.25		8.61
Vested and Exercisable at December 31, 2013		894,813	$	9.38		7.61	$	5,358
Unvested at December 31, 2013		2,415,951		16.63		7.91

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

Year of Grant	Risk-free Interest Rate			Dividend Yield			Expected Term		Volatility Factor
							(In Years)
2011		1.26	%		0	%		4.7		50.0	%
2012		0.71	%		0	%		4.4		60.0	%
2013		1.02	%		0	%		4.9		57.0	%

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Note 8 - Long-term Debt (Details) - Debt (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Debt [Abstract]
Term loan	$ 15,000	$ 15,000
Debt discount on term loan	(82)	(131)
	14,918	14,869
Less current maturities	0	0
Total long-term debt, including accrued interest	$ 14,918	$ 14,869

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Note 15 - Warrants

12 Months Ended

Dec. 31, 2013

Warrants [Abstract]

Warrants [Text Block]

15. Warrants

During 2011, the Company issued warrants to purchase 88,240 shares of common stock in connection with its loan and security agreement. These warrants are exercisable at the fair market value as of the grant date for a period of seven years from the grant date. The grant date fair value of the warrants was $2.23 per share, using the Black-Scholes option-pricing model. On October 17, 2012, the holder of these warrants completed a net issuance exercise in accordance with the terms of their agreement, resulting in the issuance of 14,272 shares of common stock.

During 2010, the Company issued warrants to purchase 272,304 shares of common stock in connection with an amendment to its note payable. On March 7, 2012, the holder of these warrants completed a net issuance exercise in accordance with the terms of their agreement, resulting in the issuance of 120,096 shares of common stock.

A summary of warrant activity is as follows:

	Warrants			Weighted- Average Exercise Price
Outstanding at December 31, 2011		360,544		$	8.45
Issued		(360,544	)		8.45
Outstanding at December 31, 2012		—		$	—
Exercised
Outstanding at December 31, 2013		—		$	—

Outstanding warrants at December 31, 2011 had a weighted-average remaining contractual life of 5.7 years. There were no outstanding warrants as of December 31, 2012 or 2013.

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Note 2 - Net Loss Per Common Share (Tables)

12 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]

	December 31, 2013		December 31, 2012
Stock options		3,310,764		2,820,619

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Note 7 - Accrued Liabilities (Details) - Accrued Liabilities (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Accrued Liabilities [Abstract]
Accrued sales commissions	$ 2,570	$ 4,342
Sales and use tax	3,158	2,130
Accrued compensation	5,229	2,246
Uninvoiced accounts payable	2,977	2,372
Legal accrual	4,000
Other	3,836	2,968
Total accrued liabilities	$ 21,770	$ 14,058

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Note 2 - Net Loss Per Common Share (Details) (USD $)	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Earnings Per Share [Abstract]
Earnings Per Share, Basic and Diluted	$ 0.05	$ (0.23)	$ (0.25)	$ (0.14)	$ 0.04	$ (0.32)	$ (0.41)	$ (0.24)	$ (0.57)	$ (0.92)	$ (1.60)

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Consolidated Statements of Stockholders’ Equity (Deficit) (USD $) In Thousands	Convertible Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2010	$ 2	$ 33	$ 85,453	$ (1,822)	$ (117,423)	$ (33,757)
Net loss					(49,037)	(49,037)
Sale of preferred stock, net of costs	1		57,922			57,923
Preferred stock conversion	(3)	3
Issuance of common stock, net of costs		29	88,536			88,565
Repurchase of stock				(21,897)		(21,897)
Stock-based compensation			3,842			3,842
Issuance of warrants			197			197
Balance at Dec. 31, 2011		65	235,950	(23,719)	(166,460)	45,836
Net loss					(52,894)	(52,894)
Issuance of common stock, net of costs		1	8,626			8,627
Stock-based compensation			2,943			2,943
Exercise of stock options and warrants			807			807
Balance at Dec. 31, 2012		66	248,326	(23,719)	(219,354)	5,319
Net loss					(32,989)	(32,989)
Stock-based compensation			4,064			4,064
Exercise of stock options		1	5,115			5,116
Balance at Dec. 31, 2013		$ 67	$ 257,505	$ (23,719)	$ (252,343)	$ (18,490)

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Note 4 - Prepaid Expenses and Other Current Assets

12 Months Ended

Dec. 31, 2013

Disclosure Text Block Supplement [Abstract]

Other Assets Disclosure [Text Block]

4. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets were comprised of the following:

	December 31,
	2013		2012
Prepaid and deferred commissions	$	9,395	$	17,215
Other		4,256		2,595
Total prepaid expenses and other current assets	$	13,651	$	19,810

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Note 11 - Stock-Based Compensation (Details) - Stock Option Valuation Assumptions	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Stock Option Valuation Assumptions [Abstract]0
Risk-free interest rate	1.02%	0.71%	1.26%
Dividend yield	0.00%	0.00%	0.00%
Expected term	4 years 328 days	4 years 146 days	4 years 255 days
Volatility factor	57.00%	60.00%	50.00%

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Note 17 - Quarterly Financial Information (Unaudited) (Details) - Selected Quarterly Financial Data (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Selected Quarterly Financial Data [Abstract]
Total revenue	$ 68,756	$ 65,500	$ 59,215	$ 52,171	$ 46,179	$ 42,022	$ 36,504	$ 31,094	$ 245,642	$ 155,799	$ 90,043
Operating income (loss)	3,271	(13,028)	(13,855)	(7,469)	2,911	(18,020)	(22,930)	(12,994)	(31,081)	(51,033)	(44,160)
Net income (loss)	$ 2,803	$ (13,511)	$ (14,334)	$ (7,947)	$ 2,430	$ (18,487)	$ (23,387)	$ (13,450)	$ (32,989)	$ (52,894)	$ (49,037)
Net income (loss) per common share—basic and diluted (in Dollars per share)	$ 0.05	$ (0.23)	$ (0.25)	$ (0.14)	$ 0.04	$ (0.32)	$ (0.41)	$ (0.24)	$ (0.57)	$ (0.92)	$ (1.60)

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Note 3 - Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2013

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

			Fair Value Measurement at December 31, 2013 Using
	Carrying Value at December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Money market funds	$	655	$	655	$	—	$	—
Investments:
Certificates of deposit		13,750				13,734
Corporate bonds		7,305				7,303
Total assets	$	21,710	$	655	$	21,037	$	—

			Fair Value Measurement at December 31, 2012 Using
	Carrying Value at December 31, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Money market funds	$	1,183	$	1,183	$	—	$	—
Investments:
Certificates of deposit		2,640				2,639
Corporate bonds		7,820				7,816
Total assets	$	11,643	$	1,183	$	10,455	$	—

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Note 1 - Summary of Significant Accounting Policies (Details) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	0 Months Ended	1 Months Ended		12 Months Ended
	May 17, 2011	Mar. 15, 2011	May 31, 2012	Oct. 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Aug. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Number of Operating Segments					1
Stockholders' Equity Note, Stock Split				eight-for-one
Additional Shares of Common Stock for Each Share Held as a Result of Stock Split (in Shares)				7
Total Shares In the Secondary Public Offering (in Shares)			8,629,797
Stock Issued During Period, Shares, New Issues (in Shares)	90,486	757,724	703,235
Common Stock Sold by Selling Shareholders (in Shares)			7,926,562
Stock Issued From Partial Exercise of Over-Allotment Option Granted to Underwriters (in Shares)			189,374
Fees Resulting from Secondary Public Offering Transaction			$ 770
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs			81
Other General and Administrative Expense			689
Short-term Investments					21,055	10,460
Sales Commissions and Fees					9,395	17,215
Deferred Finance Costs, Noncurrent, Gross								944	1,074	328
Deferred Finance Costs, Noncurrent, Net					397	634
Amortization of Financing Costs					237	232	524
eCommerce [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Sales Revenue, Services, Net					$ 22,062	$ 14,475	$ 6,651
Annual or Multi-Year Members [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Estimated Average Membership Life Enrollment Fees are Deferred and Recognized on Straight-line Basis					76 months
Monthly Members [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Estimated Average Membership Life Enrollment Fees are Deferred and Recognized on Straight-line Basis					15 months
Data Acquisition Costs [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life					3 years	3 years
Minimum [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Property, Plant and Equipment, Useful Life					3 years
Maximum [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Property, Plant and Equipment, Useful Life					25 years

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Note 14 - Income Taxes

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

14. Income Taxes

As management believes that it is more likely than not that the Company will not realize the full amount of the net deferred tax assets, the Company has recorded a valuation allowance for the deferred tax assets as of December 31, 2013, 2012 and 2011, respectively.

The components of income tax expense are summarized as follows:

	2013		2012		2011
Current:
U.S. federal	$	—	$	—	$	—
State		34		—		39
		34		—		39
Deferred:
U.S. federal		4		2		7
State		2		3		(3	)
		6		5		4
Income tax expense	$	40	$	5	$	43

The reconciliation of income tax expense computed at the U.S. federal statutory rate to the Company’s effective tax rate for the years ended December 31, 2013, 2012 and 2011 is as follows:

	2013			2012			2011
U.S. federal income tax rate		34.0	%		34.0	%		34.0	%
State income taxes, net of federal benefit		6.4			5.7			5.6
Valuation allowance		(39.7	)		(39.1	)		(36.7	)
Other		(0.8	)		(0.6	)		(2.8	)
Effective income tax rate		(0.1	)%		0.0	%		0.1	%

Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2013 and 2012 are as follows:

	2013			2012
Deferred tax assets:
Current:
Deferred revenue	$	32,643		$	22,299
Non-current:
Intangibles — other		12,138			12,962
Net operating loss carryforwards		39,757			41,464
Equity compensation		1,999			1,388
Other		4,337			2,095
Total deferred tax assets		90,874			80,208
Valuation allowance		(87,006	)		(73,434	)
Total net deferred tax assets		3,868			6,774
Deferred tax liabilities:
Current:
Prepaids		(3,923	)		(7,010	)
Non-current:
Property and equipment		55			236
Goodwill		(169	)		(163	)
Total net deferred tax liabilities		(4,037	)		(6,937	)
Total net deferred tax liability	$	(169	)	$	(163	)

As of December 31, 2013, the Company had net operating loss carryforwards for federal and state income tax purposes of approximately $105,290 and $130,853, respectively. These net operating losses include an unrealized benefit of approximately $5,800 related to share-based compensation that will be recorded in equity when realized. The net operating loss carryforwards will expire in future years, primarily beginning in 2027. The net operating losses may be subject to annual limitations of use under Internal Revenue Code Section 382. The Company files income tax returns in the U.S. federal jurisdiction and in various state jurisdictions. Income tax returns for calendar 2010 to present are open for examination in the federal jurisdiction and in significant state jurisdictions.

A valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. The Company does not benefit from its deferred tax assets based on the deferred tax liabilities related to goodwill that are not expected to reverse during the carryforward period. As this deferred tax liability would not reverse until some future indefinite period when the intangibles are either sold or impaired, any resulting temporary differences cannot be considered a source of future taxable income to support realization of the deferred tax assets.

At December 31, 2013 and 2012, the Company did not have any material unrecognized income tax benefits recorded in its consolidated balance sheets.