Company: BLND
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001855747-25-000069
Chunk: 379

Company: Blend Labs, Inc.
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 1
Chunk 379
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 derivative instrument due to the options not being readily convertible to cash. The Company also has a call option to merge the issuer with the Company for aggregate consideration of $1.0 billion if exercised prior to November 18, 2029 or 11 times the issuer’s last 12 months of aggregate gross revenue if exercised on or after November 18, 2029. The value of the call option was determined to be inconsequential. At each reporting date, the Company evaluates the collectability of the notes receivable in accordance with ASC 326, Financial Instruments—Credit Losses. As of June 30, 2025, the Company determined that no credit loss existed for the convertible promissory notes, and no provision for expected credit losses was recognized.Investments in Non-Marketable Equity SecuritiesThe Company holds 103,611 shares of Series Growth 1a Preferred Stock received in exchange for an investment of cash in a privately-held company. This investment in the equity securities without readily determinable fair value is measured at cost, less impairment, if any, plus or minus observable price changes in orderly transactions of an identical or similar investment of the same issuer.As of June 30, 2025 and December 31, 2024, the carrying value of this investment was $9.8 million, inclusive of a cumulative upward adjustment of $7.3 million, of which $4.4 million was recognized in 2024 to reflect observable price changes. The Company determined the adjustment by measuring the security at fair value using the option pricing model (“OPM”) as of the date the observable transaction occurred. Observable transactions, such as the issuance of new equity by an investee, are indicators of investee enterprise value and are used to estimate the fair value of the Company’s investment in the equity security. An OPM is utilized to allocate value to the various classes of securities of the investee, including classes owned by the Company. Such information, available to the Company from the investee entity, is supplemented with the Company’s estimates such as volatility, expected time to liquidity and the rights and obligations of the securities the Company holds. The inputs to valuation techniques used to measure fair value of the Company’s non-marketable equity security are classified as Level 3 of the fair value hierarchy due to the use of significant unobservable inputs.The gain resulting from the adjustment to the carrying value of the non-marketable security is presented within other income (expense) in the unaudited condensed consolidated statements of operations and comprehensive income