Fair Value Measurements

12 Months Ended

Dec. 31, 2020

Disclosure Text Block Supplement [Abstract]

Fair Value Measurements

17. FAIR VALUE MEASUREMENTS

The Company applies fair value accounting for all financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, the Company considers all related factors of the asset by market participants in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk.

The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2—Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; and

Level 3—Inputs for the asset or liability that are not based on observable market data.

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, member contribution receivable, notes receivable, due from related parties, investments, accounts payable and accrued liabilities, notes payable, derivative liability, liability for acquisition of noncontrolling interest and contingent consideration payable.

The following tables summarizes the Company’s financial instruments which are measured at fair value as of December 31, 2020:

	As of December 31, 2020
	Level 1		Level 2		Level 3			Total
Cash and Cash Equivalents	$	83,757,785	$	—	$	—		$	83,757,785
Investments		923,581		—		39,871,225			40,794,806
Contingent Consideration Payable		—		—		(27,100,000	)		(27,100,000	)
Warrant Liability		—		—		(39,454,000	)		(39,454,000	)
	$	84,681,366	$	—	$	(26,682,775	)	$	57,998,591

The following tables summarizes the Company’s financial instruments which are measured at fair value as of December 31, 2019:

	As of December 31, 2019
	Level 1		Level 2		Level 3			Total
Cash and Cash Equivalents	$	46,667,334	$	—	$	—		$	46,667,334
Notes Receivable		—		—		815,937			815,937
Investments		—		—		14,068,821			14,068,821
Liability of Redemption of Noncontrolling Interest		—		—		(5,500,000	)		(5,500,000	)
Contingent Consideration Payable		—		—		(58,936,739	)		(58,936,739	)
Warrant Liability		—		—		(15,879,843	)		(15,879,843	)
	$	46,667,334	$	—	$	(65,431,824	)	$	(18,764,490	)

As of December 31, 2019, the Company held an equity investment in a privately held entity that was acquired by a publicly traded entity during 2020. As a result of the acquisition, the Company received shares of the acquiring entity in exchange for the shares in the privately held entity. Further, the transaction resulted in a transfer of the investment from Level 3 to Level 1. As of December 31, 2020, the value of the Level 1 investment was $923,581.

There were no transfers between fair value levels during the period ended December 31, 2019.