Dave Inc./DE Fair Value Disclosure
Note 14 Fair Value of Financial Instruments
The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands):
December 31, 2025 |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
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||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investments |
|
$ |
— |
|
|
$ |
40,788 |
|
|
$ |
— |
|
|
$ |
40,788 |
|
Total assets |
|
$ |
— |
|
|
$ |
40,788 |
|
|
$ |
— |
|
|
$ |
40,788 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Warrant liabilities - public warrants |
|
$ |
6,217 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
6,217 |
|
Warrant liabilities - private warrants |
|
|
— |
|
|
|
— |
|
|
|
5,579 |
|
|
|
5,579 |
|
Earnout liabilities |
|
|
— |
|
|
|
— |
|
|
|
4,281 |
|
|
|
4,281 |
|
Total liabilities |
|
$ |
6,217 |
|
|
$ |
— |
|
|
$ |
9,860 |
|
|
$ |
16,077 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
December 31, 2024 |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
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||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marketable securities |
|
$ |
97 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
97 |
|
Investments |
|
|
— |
|
|
|
40,473 |
|
|
|
— |
|
|
|
40,473 |
|
Total assets |
|
$ |
97 |
|
|
$ |
40,473 |
|
|
$ |
— |
|
|
$ |
40,570 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Warrant liabilities - public warrants |
|
$ |
1,016 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
1,016 |
|
Warrant liabilities - private warrants |
|
|
— |
|
|
|
— |
|
|
|
916 |
|
|
|
916 |
|
Earnout liabilities |
|
|
— |
|
|
|
— |
|
|
|
996 |
|
|
|
996 |
|
Total liabilities |
|
$ |
1,016 |
|
|
$ |
— |
|
|
$ |
1,912 |
|
|
$ |
2,928 |
|
The Company had no assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2025 and 2024.
The Company also has financial instruments not measured at fair value. The Company has evaluated cash (Level 1), restricted cash (Level 1), accounts payable (Level 2), accrued expenses (Level 2) and ExtraCash receivables (Level 3) and believes the carrying value approximates the fair value due to the short-term nature of these balances. The fair value of the debt facility (Level 2) approximates its carrying value.
Marketable Securities:
The Company evaluated the quoted market prices in active markets for its marketable securities and has classified its securities as Level 1. The Company’s investments in marketable securities are exposed to price fluctuations. The fair value measurements for the securities are based upon the quoted prices of similar items in active markets multiplied by the number of securities owned.
Investments:
The following describes the valuation techniques used by the Company to measure the fair value of investments held as of December 31, 2025 and December 31, 2024.
U.S. Government Securities
The fair value of U.S. government securities is estimated by a third-party pricing service, who employs a rule-based, market-driven methodology to determine fair value for fixed-income instruments. U.S. government securities are categorized in Level 2 of the fair value hierarchy.
Corporate Bonds and Notes
The fair value of corporate bonds and notes is estimated by independent pricing services who use computerized valuation formulas to calculate current values. These securities are generally categorized in Level 2 of the fair value hierarchy or in Level 3 when market-based transaction activity is unavailable and significant unobservable inputs are used.
Asset-Backed Securities
The fair value of these asset-backed securities is estimated by independent pricing services who use computerized valuation formulas to calculate current values. These securities are generally categorized in Level 2 of the fair value hierarchy or in Level 3 when market-based transaction activity is unavailable and significant unobservable inputs are used.
Public Warrants:
As discussed further in Note 10, Warrant Liabilities, in January 2022, upon completion of the Business Combination, public warrants were automatically converted to warrants to purchase Common Stock of the Company. These public warrants met the definition of a derivative under ASC 815, and due to the terms of the warrants, were required to be liability classified. This warrant liability was initially recorded as a liability at fair value, with the offsetting entry recorded as a non-cash expense within the statement of operations. The derivative liability was subsequently recorded at fair value at each reporting period, with changes in fair value reflected in earnings. The gain (loss) related to the change in fair value of the public warrant liability for years ended December 31, 2025, 2024, and 2023 were ($5.2) million, ($0.9) million, and $0.1 million, respectively, and are presented within changes in fair value of public warrant liability in the consolidated statements of operations.
A roll-forward of the Level 1 public warrant liability is as follows (in thousands):
Opening value at January 1, 2024 |
|
|
|
|
|
$ |
97 |
|
Change in fair value during the period |
|
|
|
|
|
|
919 |
|
Ending value at December 31, 2024 |
|
|
|
|
|
|
1,016 |
|
Change in fair value during the period |
|
|
|
|
|
|
5,201 |
|
Ending value at December 31, 2025 |
|
|
|
|
|
$ |
6,217 |
|
Private Warrants:
As discussed further in Note 10, Warrant Liabilities, in January 2022, upon completion of the Business Combination, private warrants were automatically converted to warrants to purchase Common Stock of the Company. These private warrants met the definition of a derivative under ASC 815, and due to the terms of the warrants, were required to be liability classified. This warrant liability was initially recorded as a liability at fair value, with the offsetting entry recorded as a non-cash expense within the consolidated statement of operations. The derivative liability was subsequently recorded at fair value at each reporting period, with changes in fair value reflected in earnings. The gain (loss) related to the change in fair value of the private warrant liability for years ended December 31, 2025, 2024, and 2023 were ($4.7) million, ($0.8) million, and $0.1 million, respectively, and are presented within changes in fair value of private warrant liability in the consolidated statements of operations.
A roll-forward of the Level 3 private warrant liability is as follows (in thousands):
Opening value at January 1, 2024 |
|
|
|
|
|
$ |
105 |
|
|
|
|
|
|
|
811 |
|
|
Ending value at December 31, 2024 |
|
|
|
|
|
|
916 |
|
|
|
|
|
|
|
4,663 |
|
|
Ending value at December 31, 2025 |
|
|
|
|
|
$ |
5,579 |
|
The Company used a Black-Scholes option pricing model to determine the fair value of the private warrant liability. The following table presents the assumptions used to value the private warrant liability for the year ended December 31, 2025:
Exercise price |
|
|
|
|
|
$ |
368 |
|
Expected volatility |
|
|
|
|
|
|
73.34 |
% |
Risk-free interest rate |
|
|
|
|
|
|
3.48 |
% |
Remaining term |
|
|
|
|
|
1.01 years |
|
|
Dividend yield |
|
|
|
|
|
|
0 |
% |
Earnout Shares Liability:
As part of the recapitalization and business combination in January 2022, 49,563 shares of Class A Common Stock held by founders of VPCC are subject to forfeiture if the vesting condition is not met over the five year term following the Closing Date (“Founder Holder Earnout Shares”). These Founder Holder Earnout Shares were initially recorded as a liability at fair value and subsequently recorded at fair value at each reporting period, with changes in fair value reflected in earnings. The gain (loss) related to the change in fair value of the Founder Holder Earnout Shares liabilities for years ended December 31, 2025, 2024, and 2023 were ($3.3) million, ($1.0) million and $0.02 million, respectively, and are presented within changes in fair value of earnout liabilities in the consolidated statements of operations.
A roll-forward of the Level 3 Founder Holder Earnout Shares liability is as follows (in thousands):
Opening value at January 1, 2024 |
|
|
|
|
|
$ |
31 |
|
Change in fair value during the period |
|
|
|
|
|
|
965 |
|
Ending value at December 31, 2024 |
|
|
|
|
|
|
996 |
|
Change in fair value during the period |
|
|
|
|
|
|
3,285 |
|
Ending value at December 31, 2025 |
|
|
|
|
|
$ |
4,281 |
|
The Company used a Monte Carlo Simulation Method to determine the fair value of the Founder Holder Earnout Shares liability. The following table presents the assumptions used to value the Founder Holder Earnout Shares liability for the year ended December 31, 2025:
Exercise price |
|
|
|
|
|
$400-$480 |
|
|
Expected volatility |
|
|
|
|
|
|
69.7 |
% |
Risk-free interest rate |
|
|
|
|
|
|
3.50 |
% |
Remaining term |
|
|
|
|
|
1.01 years |
|
|
Dividend yield |
|
|
|
|
|
|
0 |
% |
There were no other assets or liabilities that were required to be measured at fair value on a recurring basis as of December 31, 2025 and December 31, 2024.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 2, 2026 | Showing above |
| 2024 | Mar 4, 2025 | |
| 2023 | Mar 5, 2024 | |
| 2022 | Mar 13, 2023 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.