The Company has two equity incentive plans: the 2011 Equity Incentive Plan (the “2011 Plan”) and the 2018 Equity Incentive Plan (the “2018 Plan”). To the extent that grants outstanding under the 2011 Plan terminate, cancel or are forfeited, the shares reserved for issuance under such grants are automatically transferred to the 2018 Plan and become available for subsequent grant thereunder.

Under the 2018 Plan, the Board or a committee of the Board, may grant incentive and nonqualified stock options, stock appreciation rights, restricted or unrestricted stock awards, restricted stock units (“RSUs”), phantom stock, performance awards or other stock-based awards to employees, directors and other individuals providing services to the Company. The purpose of the 2018 Plan is to promote the long-term growth and profitability of the Company by (i) providing employees with incentives to improve stockholder value and to contribute to the growth and financial success of the Company through their future services, and (ii) enabling the Company to attract, retain and reward the best‑available persons. The options granted under the 2018 Plan, may be granted at a price not less than the fair market value on the grant date.

The Board, or a committee of the Board, has granted options with an exercise price at or which approximates the fair value on the grant date to new hires, except for the out-of-the-money options granted to certain employees as discussed below. Grants of time-based awards generally vest over a four-year period for new hires and over a three-year period for subsequent grants to existing employees. The service condition for the majority of these awards is satisfied generally over the applicable vesting period. Options expire as determined by the Board, or committee of the Board, but not more than ten years after the date of the grant. In the second quarter of 2015, the Company began granting restricted stock units that contain both a service condition and Performance Vesting Condition. Both the service condition and Performance Vesting Condition must be met in order for these awards to vest and issue. The Performance Vesting Condition occurred upon the effectiveness of the registration statement for the Company's IPO, which was September 25, 2018.

As of March 31, 2019, 9,230,406 shares of common stock remain available for grant under the 2018 Plan.

The following is a summary of stock option activity for the current year period:

	Stock Options
	Number of Shares			Weighted Average Exercise Price		Aggregate Intrinsic Value (in thousands)		Weighted Average Remaining Contractual Term (in years)
Outstanding at December 31, 2018		18,452,375		$	14.39	$	8,482		7.5
Granted		2,225,766		$	12.35
Exercised		(1,327,784	)	$	10.86
Forfeited		(447,402	)	$	14.33
Expired		(886,650	)	$	15.99
Outstanding, vested and expected to vest at March 31, 2019		18,016,305		$	14.32	$	70,104		7.7
Vested and exercisable at March 31, 2019		9,234,768		$	14.72	$	32,262		6.7

As of March 31, 2019, included in other current assets is $6.8 million of proceeds receivable from stock option exercises. The proceeds receivable outstanding at the end of the first quarter were fully collected on April 2, 2019.

The following is a summary of restricted stock units for the current year period:

	Restricted Stock Units
	Number of Shares			Weighted Average Grant-Date Fair Value		Weighted Average Remaining Contractual Term (in years)
Unvested at December 31, 2018		5,752,046		$	12.77		1.2
Granted		3,820,944		$	14.01
Vested		(898,023	)	$	12.69
Forfeited		(316,238	)	$	13.15
Unvested at March 31, 2019		8,358,729		$	13.33		1.3

The Company used the Black-Scholes-Merton option pricing model to estimate the fair value of stock options granted using the following assumptions:

	Three Months Ended March 31,
	2019	2018
Expected life (in years)	5.9	5.8
Risk-free interest rate	2.5%	2.7%
Volatility	46%	43%
Dividend yield	—%	—%
Fair value of common stock	$12.35	$13.20

The Company sponsors the ESPP that allows employees to purchase shares of common stock at a discounted price from the fair market value of Company’s common stock at each purchase date. Except for the initial offering period, the ESPP provides for 24-month offering periods beginning May 22 and November 22 of each year, and each offering period will consist of four six-month purchase periods. The initial offering period began on September 25, 2018 and will end on November 22, 2020. On each purchase date, eligible employees will purchase the shares at a price per share equal to 85% of the lesser of (1) the fair market value of the Company’s common stock on the offering date, or (2) the fair market value of its common stock on the purchase date. As of March 31, 2019, 2,673,444 shares of common stock remain available for grant under the ESPP.

Stock-based compensation expense recognized in the condensed consolidated financial statements is as follows:

	Three Months Ended March 31,
(in thousands)	2019		2018
Cost of revenue	$	1,096	$	658
Research and development		4,766		3,447
Sales and marketing		2,780		768
General and administrative		6,469		3,667
Stock-based compensation expense, net of amounts capitalized		15,111		8,540
Capitalized stock-based compensation expense		953		328
Stock-based compensation expense	$	16,064	$	8,868

	Unrecognized stock-based compensation (in thousands)		Weighted average vesting period (in years)
Stock options	$	49,343		2.3
Restricted stock units (service-based)		55,568		2.9
Restricted stock units (performance-based)⁽¹⁾		19,784		1.4
ESPP		3,932		1.6
Total unrecognized stock-based compensation	$	128,627

(1)

The Performance Vesting Condition occurred upon the effectiveness of the registration statement for the Company's IPO, which was September 25, 2018. The remaining unrecognized stock-based compensation expense is recognized on an accelerated basis over the weighted-average remaining requisite service period.

In the United States, the Company offers its employees a defined contribution plan that qualifies as a deferred salary arrangement under Section 401 of the U.S. Internal Revenue Code (“401(k) Plan”). Under the 401(k) Plan, participating employees may defer a portion of their pretax earnings not to exceed the maximum amount allowed by the Internal Revenue Service. The Company currently provides a matching contribution of 25% of deferrals for eligible employees. Compensation expense for the Company's matching contributions was $1.0 million and $0.7 million during the three months ended March 31, 2019 and 2018, respectively.