0001601830-24-000019 | 10-K | XBRL Viewer | Recursion Pharmaceuticals INC

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Income Taxes - Effective Income Tax Rate Reconciliation (Details)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Effective tax rate	1.20%	0.00%	0.00%
Effective Income Tax Rate Reconciliation, Amount [Abstract]
Statutory tax rate	21.00%	21.00%	21.00%
R&D credit generation	3.10%	3.70%	3.20%
Orphan drug credit generation	2.10%	1.10%	1.10%
State taxes	16.40%	0.00%	0.00%
Stock based compensation	(0.10%)	0.80%	0.60%
Uncertain tax positions	(0.80%)	(0.30%)	(0.40%)
Other	1.00%	(0.80%)	(0.20%)
Change in valuation allowance	(41.50%)	(25.50%)	(25.30%)
Effective tax rate	1.20%	0.00%	0.00%

Supplemental Financial Information (Tables)

12 Months Ended

Dec. 31, 2023

Supplemental Financial Information [Abstract]

Schedule of Property and Equipment

The estimated useful lives by asset classification are generally as follows:


Office Equipment			5 years
Lab Equipment			7 years
Leasehold Improvements			Lesser of 15 years or the remainder of the lease

Property and Equipment


	December 31,
(in thousands)	2023		2022
Lab equipment	$	60,096	$	47,524
Leasehold improvements	45,929		41,872
Office equipment	22,126		20,164
Construction in progress	3,231		8,747
Property and equipment, gross	131,382		118,307
Less: Accumulated depreciation	(44,872)		(30,115)
Property and equipment, net	$	86,510	$	88,192

Schedule of Accrued Expenses and Other Liabilities

Accrued Expenses and Other Liabilities


	December 31,
(in thousands)	2023		2022
Accrued compensation	$	22,888	$	20,433
Accrued development expenses	6,077		3,372
Accrued early discovery expenses	2,570		3,192
Accrued construction	2,439		591
Materials received not invoiced	2,432		2,028
Accrued other expenses	10,229		3,288
Accrued expense and other liabilities	$	46,635	$	32,904

Schedule of Interest Income and Expense Disclosure

Interest Income (Expense), net


	Years ended December 31,
(in thousands)	2023		2022		2021
Interest expense	$	(97)	$	(55)	$	(2,952)
Interest income	19,116		6,254		73
Interest income (expense), net	$	19,019	$	6,199	$	(2,879)

Supplemental Financial Information

12 Months Ended

Dec. 31, 2023

Supplemental Financial Information [Abstract]

Supplemental Financial Information

Tempus agreement

In November 2023, Recursion entered into a five-year agreement with Tempus Labs, Inc. (Tempus) to purchase access to their records of patient-centric multimodal oncology data and use rights for therapeutic development purposes. This data will be used to improve the training of Recursion’s artificial intelligence and machine learning models and is expected to accelerate Recursion’s drug discovery process. Recursion is making annual payments, ranging between $22.0 million and $42.0 million, up to $160.0 million in aggregate, to Tempus in cash or equity at the Company’s option. The equity value is determined by using the seven-trading day period dollar volume-weighted average price (VWAP) for Recursion Class A common stock ending on the day immediately preceding the date that is five business days prior to the payment date.

Recursion is expensing the record purchases as “Research and Development” expenses in the Consolidated Statements of Operations as the records are purchased. To the extent that the Recursion payments to Tempus are greater than or less than the records purchased amount, Recursion records the applicable amount to “Other Current Assets” or “Accrued Expenses and Other Liabilities” on the Consolidated Balance Sheet, respectively. As of December 31, 2023, Recursion had recorded $16.0 million within “Other current assets” on the Consolidated Balance Sheet related to the Tempus agreement.

Property and Equipment


	December 31,
(in thousands)	2023		2022
Lab equipment	$	60,096	$	47,524
Leasehold improvements	45,929		41,872
Office equipment	22,126		20,164
Construction in progress	3,231		8,747
Property and equipment, gross	131,382		118,307
Less: Accumulated depreciation	(44,872)		(30,115)
Property and equipment, net	$	86,510	$	88,192

Depreciation expense on property and equipment was $15.9 million, $11.4 million and $8.8 million during the years ended December 31, 2023, 2022 and 2021, respectively. The Company recorded an impairment of $1.2 million and $2.8 million during the years ended December 31, 2023 and 2022, respectively, related to construction projects for leasehold improvements as the Company no longer intended to use them. The impairments were recorded in “General and Administrative” in the Consolidated Statements of Operations.

For the year ended December 31, 2023, the Company initiated and completed a project to upgrade the BioHive supercomputer for $1.7 million. The supercomputer was classified as office equipment in the above table. The increase in lab equipment from the prior year was driven by the completion of several labs in the headquarters expansion. The majority of the balance was included in construction in progress in the prior year.

For the year ended December 31, 2022, the increase in lab equipment from the prior year was driven by investments in the Company’s chemical technology, machine learning and transcriptomics platform. The increase in leasehold improvements from the prior year was primarily driven by the completion of the headquarters expansion. The construction in progress balance primarily related to lab equipment under construction.

Accrued Expenses and Other Liabilities


	December 31,
(in thousands)	2023		2022
Accrued compensation	$	22,888	$	20,433
Accrued development expenses	6,077		3,372
Accrued early discovery expenses	2,570		3,192
Accrued construction	2,439		591
Materials received not invoiced	2,432		2,028
Accrued other expenses	10,229		3,288
Accrued expense and other liabilities	$	46,635	$	32,904

Notes Payable

In January 2023, the Company entered into a financing agreement for borrowing $1.9 million as part of the supercomputer upgrade project. The debt will be repaid over a three-year period at a 7% interest rate. As of December 31, 2023, the outstanding balance was $606 thousand.

In 2018, the Company borrowed $992 thousand, which was available as part of a lease agreement for use on tenant improvements. The note will be repaid over a 10-year period at an 8% interest rate. As of December 31, 2023, the outstanding balance was $536 thousand.

Interest Income (Expense), net


	Years ended December 31,
(in thousands)	2023		2022		2021
Interest expense	$	(97)	$	(55)	$	(2,952)
Interest income	19,116		6,254		73
Interest income (expense), net	$	19,019	$	6,199	$	(2,879)

For the years ended December 31, 2023 and 2022, interest income primarily related to earnings on cash and cash equivalents in money market funds. For the year ended December 31, 2021, interest expense primarily related to changes in fair value of Series A and B warrants. Interest income and expense were included in “Other income (loss), net” on the Consolidated Statements of Operations.

Stock-Based Compensation - Schedule of Share-based Payment Award, Stock Options, Valuation Assumption (Details)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend yield	0.00%
Stock based compensation
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	5 years 9 months 18 days	6 years 2 months 12 days	6 years 3 months 18 days
Expected volatility	66.00%	63.00%	65.00%
Expected dividend yield	0.00%	0.00%	0.00%
Risk-free interest rate	3.60%	1.90%	1.10%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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+ Details

Cover - USD ($) $ in Millions	12 Months Ended
Cover - USD ($) $ in Millions	Dec. 31, 2023	Jan. 31, 2024	Jun. 30, 2023
Document Information [Line Items]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2023
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	001-40323
Entity Registrant Name	Recursion Pharmaceuticals, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-4099738
Entity Address, Address Line One	41 S Rio Grande Street
Entity Address, City or Town	Salt Lake City,
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84101
City Area Code	385
Local Phone Number	269 - 0203
Title of 12(b) Security	Class A Common Stock, par value $0.00001
Trading Symbol	RXRX
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false
Entity Public Float			$ 930.4
Documents Incorporated by Reference	DOCUMENTS INCORPORATED BY REFERENCE Portions of the definitive proxy statement for use in connection with the registrant’s 2024 Annual Meeting of Stockholders to be filed hereafter are incorporated by reference into Part III of this report.
Entity Central Index Key	0001601830
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	FY
Document Financial Statement Error Correction [Flag]	false
Class A
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		227,143,401
Class B
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		7,509,871

Supplemental Financial Information - Interest (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Supplemental Financial Information [Abstract]
Interest expense	$ (97)	$ (55)	$ (2,952)
Interest income	19,116	6,254	73
Interest income (expense), net	$ 19,019	$ 6,199	$ (2,879)

- Definition

Amount of the cost of borrowed funds accounted for as interest expense.

+ References + Details

Stock-Based Compensation - Schedule of Share-based Payment Arrangement, Option, Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Shares
Options, outstanding, number at beginning of period (in shares)	16,154,924
Granted (in shares)	5,083,268
Cancelled (in shares)	(1,460,517)
Exercised (in shares)	(4,820,058)
Options, outstanding, number at end of period (in shares)	14,957,617	16,154,924
Exercisable, (in shares)	9,844,841
Weighted-Average Exercise Price
Options, outstanding, at beginning of period (in dollars per share)	$ 5.10
Granted (in dollars per share)	6.23
Cancelled (in dollars per share)	8.67
Exercised (in dollars per share)	2.20
Options, outstanding, at end of period (in dollars per share)	6.13	$ 5.10
Exercisable (in dollars per share)	$ 5.07
Options, outstanding, weighted average remaining contractual life	7 years	7 years 6 months
Options, exercisable, weighted average remaining contractual life	6 years 3 months 18 days
Options, outstanding, intrinsic value	$ 72,416	$ 67,997
Exercise, intrinsic value	32,621
Exercisable, intrinsic value	$ 59,144

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Deferred tax assets
Net operating loss carryforwards	$ 117,877	$ 89,951
Research and development capitalization	105,503	39,095
Tax credit carryforwards	50,293	30,965
Unearned revenue	23,007	0
Lease liabilities	13,208	11,442
Reserves and accruals	4,744	3,622
Stock-based compensation	5,080	2,231
Definite lived intangibles	0	969
Other	485	433
Gross deferred tax assets	320,197	178,708
Valuation allowance	(304,618)	(166,775)
Net deferred tax asset	15,579	11,933
Deferred tax liabilities
Right-of-use assets	(8,942)	(9,982)
Definite lived intangibles	(5,272)	0
Depreciable assets	(2,704)	(1,951)
Deferred tax liabilities	(16,918)	(11,933)
Net deferred tax liability	$ (1,339)	$ 0

Supplemental Financial Information - Accruals (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Supplemental Financial Information [Abstract]
Accrued compensation	$ 22,888	$ 20,433
Accrued development expenses	6,077	3,372
Accrued early discovery expenses	2,570	3,192
Accrued construction	2,439	591
Materials received not invoiced	2,432	2,028
Accrued other expenses	10,229	3,288
Accrued expenses and other liabilities	$ 46,635	$ 32,904

Income Taxes - Income Tax Contingencies (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance at the beginning of the period	$ 2,762	$ 1,944
Increases for positions taken in current year	1,726	818
Increase for positions taken in prior year	929	0
Balance at the end of the period	$ 5,417	$ 2,762

Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

The Company has entered into various long-term real estate leases primarily related to office, research and development and operating activities. The Company’s leases have remaining terms from under 1 to 9 years and some of those leases include options that provide Recursion with the ability to extend the lease term for five years. The options are included in the lease term when it is reasonably certain that the option will be exercised.

For the year ended December 31, 2023, Recursion entered into lease modifications resulting in an increase to the right-of-use asset and lease liability of $3.4 million. The modifications had no impact to the Consolidated Statements of Operations. For the year ended December 31, 2022, Recursion entered into lease modifications resulting in a decrease to the right-of-use assets and lease liabilities of $2.7 million and $2.8 million, respectively. The modifications resulted in an insignificant impact to the Consolidated Statements of Operations.

In May 2022, the Company entered into a lease agreement for laboratory and office space in Toronto, Ontario with approximately 28,110 square feet (the “Toronto Lease”). This lease was separated into multiple lease components based on the intended use of the portions of the space. For some of those components, the right of use began May 2022 when the control of the assets was obtained. The right of use for the remaining component began in June 2023 when the control of the asset was obtained. The Toronto Lease terms for each component are ten years with a five-year renewal option. The Toronto Lease includes provisions for escalating rent payments and a tenant improvement allowance of up to $1.6 million. Total fixed payments are expected to be approximately $11.1 million with additional variable expenses, including building expenses.

See Note 7, “Commitments and Contingencies” for information on the Industry lease.

The components of the lease cost are as follows:


	Years ended December 31,
(in thousands)	2023		2022
Operating lease cost	$	8,144	$	7,793
Variable lease cost	2,116		1,070
Short-term lease cost	139		—
Lease cost	$	10,399	$	8,863

Lease term and discount rates were:


	Years ended December 31,
(in thousands)	2023		2022
Operating leases
Weighted-average remaining lease term (years)	6.7		7.6
Weighted-average discount rate	7.8	%	7.3	%

Maturities of operating lease liabilities as of December 31, 2023 were:


(in thousands)	Operating leases
2024	$	10,059
2025	10,399
2026	10,526
2027	10,769
2028	7,397
Thereafter	17,014
Total lease payments	66,164
Less: imputed interest	(16,634)
Present value of lease liabilities	$	49,530

Total rent expense was $6.4 million during the year ended December 31, 2021.

Common Stock	12 Months Ended
Common Stock	Dec. 31, 2023
Equity [Abstract]
Common Stock	Common Stock Each share of Class A common stock entitles the holder to one vote per share and each share of Class B common stock entitles the holder to 10 votes per share on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, as may be declared by the Company’s Board of Directors. As of December 31, 2023 and December 31, 2022, no dividends had been declared. At-The-Market Offering In August 2023, the Company entered into an Open Market Sales Agreement (the “Sales Agreement”) with Jefferies LLC (the “Sales Agent”), to provide for the offering, issuance and sale of up to an aggregate amount of $300.0 million of its Class A common stock from time to time in “at-the-market (ATM)” offerings. As of December 31, 2023, an amount of $219.4 million remained available for future sales under the Sales Agreement. The Company has sold 12.0 million shares and received net proceeds of $78.2 million under the agreement as of December 31, 2023. Recursion is not required to sell additional shares under the Sales Agreement. The Company pays the Sales Agent a commission of up to 3% of the aggregate gross proceeds received from all sales of Class A common stock. The Sales Agreement continues until the earlier of selling all shares available under the Sales Agreement or terminated by written notice from either of the parties. The ATM Offering is being made under a prospectus supplement dated August 8, 2023, and related prospectus filed with the Securities and Exchange Commission pursuant to our automatically effective shelf registration statement on Form S-3ASR (Registration No. 333-264845). NVIDIA Private Placement In July 2023, Recursion entered into a Stock Purchase Agreement for a private placement with NVIDIA Corporation (2023 Private Placement), pursuant to which the Company sold an aggregate of 7.7 million shares of the Company’s Class A common stock at a price of $6.49 per share for net proceeds of approximately $49.9 million. Valence Acquisition Exchangeable Shares In May 2023, in connection with the acquisition of Valence, the Company entered into an agreement to issue up to 5.9 million shares of Class A common stock (the “Exchange Shares”), that may be issued upon exchange, retraction or redemption of exchangeable shares of a subsidiary of Recursion. Each exchangeable share of the subsidiary of Recursion entitles the holder to exchange those shares on a one-for-one basis for Recursion’s Class A common stock. The shares are entitled to receive dividends economically equivalent to dividends declared by Recursion, are non-voting and are subject to customary adjustments for stock splits or other reorganizations. In addition, the Company may require all outstanding exchangeable shares to be exchanged into an equal number of Class A common stock upon the occurrence of certain events and at any time following the seventh anniversary of the closing of the Valence acquisition. The exchangeable shares are substantially the economic equivalent of the Class A shares and classified as common stock within the Company’s stockholders’ equity. The Company’s calculation of weighted-average shares outstanding includes the exchangeable shares. As of December 31, 2023, 3.6 million Exchangeable shares have been redeemed for Class A shares. 2022 Private Placement In October 2022, Recursion issued 15.3 million shares of the Company’s Class A common stock at a purchase price of $9.80 per share in a private placement (the 2022 Private Placement) to qualified institutional buyers and institutional accredited investors (the Purchasers) for net proceeds of $143.7 million, after deducting fees and offering costs of $6.6 million. Registration Rights Agreements Tempus agreement In November 2023, in connection with the Tempus Agreement, the Company agreed to prepare and file a registration statement (or a prospectus supplement to an effective registration statement on Form S-3ASR that will become automatically effective upon filing with the SEC pursuant to Rule 462(e)) with the SEC, for resale of the shares of Class A common stock issued or issuable under the Tempus Agreement. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in December 2023 to register shares issued to Tempus for the initial license fee under the Tempus Agreement for resale. After registration of any shares issued to Tempus under the Tempus Agreement, the Company has agreed to use commercially reasonable efforts to keep such registration statement effective until such date that all shares issued to Tempus covered by such registration statement have been sold or are able to be publicly sold by relying on Rule 144 of the Securities Act without registration. NVIDIA Private Placement In July 2023, in connection with the 2023 Private Placement with NVIDIA, the Company entered into a Registration Rights Agreement providing for the registration for resale of the shares of Class A common stock issued in such transaction. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in August 2023 to register the resale of the shares of Class A common stock issued to NVIDIA. The Company has agreed to use commercially reasonable efforts to keep the registration statement continuously effective until such date that all registrable securities under the agreement have been sold. In the event the holders cannot sell their shares due to certain circumstances causing the registration statement to be ineffective, the Company must pay each holder of shares outstanding on the date and each month thereafter 1% of the aggregate purchase price with the maximum payable amount of 5% of the aggregate purchase price. As of December 31, 2023, there was no accrued liability related to this agreement, as it was not probable that a payment would be required. Acquisitions In May 2023, in connection with the acquisition of Valence, the Company entered into a Registration Agreement providing for the registration for resale of the shares of Class A common stock and Exchange Shares issued or issuable in such transaction. A registration statement on Form S-3ASR (File No. 333-272281) was filed to register the shares for resale by the holders. The registration statement must remain effective for a period of not less than three years. In May 2023, in connection with the acquisition of Cyclica, the Company entered into a Registration Agreement providing for the registration for resale of the shares of Class A common stock issued in such transaction. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in June 2023 to register the shares for resale by the holders. The registration statement must be continuously effective until the earlier of the date that all shares have been sold thereunder or are able to be publicly sold by relying on Rule 144 of the Securities Act without registration. 2022 Private Placement In October 2022, in connection with the 2022 Private Placement, the Company entered into a Registration Rights Agreement providing for the registration for resale of the shares of Class A common stock issued in such transaction. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in October 2022 to register the resale of the shares of Class A common stock by the Purchasers. The agreement must remain effective until registrable securities covered by the agreement have been publicly sold by the holders or all shares cease to be registrable securities. In the event the holders cannot sell their shares due to certain circumstances causing the agreement to be ineffective, the Company must pay each holder of shares outstanding on the date and each month thereafter 1% of the aggregate purchase price paid by the holder without limit until the agreement is cured. As of December 31, 2023, there was no accrued liability related to this agreement, as it was not probable that a payment would be required. Initial Public Offering On April 20, 2021, the Company closed its initial public offering (IPO) and issued 27.9 million shares of its Class A common stock at a price of $18.00 per share for net proceeds of $462.4 million, after deducting underwriting discounts and commissions of $35.1 million and other offering costs of $4.3 million. Prior to the IPO, the Company had issued preferred stock as part of various financing events. In April 2021, all outstanding shares of convertible preferred stock converted into 115.6 million shares of Class A common stock as part of the IPO. There was no convertible preferred stock outstanding as of December 31, 2023, 2022 and 2021. No convertible preferred stock was issued during the years ended December 31, 2023, 2022 and 2021. The Company’s convertible preferred stock was classified outside of stockholders’ equity on the Consolidated Balance Sheets because the holders of such shares had liquidation rights in the event of a deemed liquidation that, in certain situations, were not solely within the control of the Company and would require the redemption of the then-outstanding convertible preferred stock. The convertible preferred stock was not redeemable, except in the event of a deemed liquidation event. Class A and B Common Shares Authorization In April 2021, the Company’s Board of Directors authorized two classes of common stock, Class A and Class B. The rights of the holders of Class A and B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to 10 votes per share and is convertible at any time into one share of Class A common stock. All Class B common stock is held by Christopher Gibson, Ph.D., the Company’s Chief Executive Officer (CEO), or his affiliates. As of December 31, 2023, Dr. Gibson and his affiliates held outstanding shares of Class B common stock representing approximately 25% of the voting power of the Company’s outstanding shares. This voting power may increase over time as Dr. Gibson vests in and exercises equity awards outstanding. If all the exchangeable equity awards held by Dr. Gibson had been fully vested, exercised and exchanged for shares of Class B common stock as of December 31, 2023, Dr. Gibson and his affiliates would hold approximately 26% of the voting power of the Company’s outstanding shares. As a result, Dr. Gibson will be able to significantly influence any action requiring the approval of Recursion stockholders, including the election of the Board of Directors; the adoption of amendments to the Company’s certificate of incorporation and bylaws; and the approval of any merger, consolidation, sale of all or substantially all of the Company’s assets, or other major corporate transaction.

- Definition

The entire disclosure for equity.

+ References

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+ Details

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Use of Estimates

The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP), which requires the Company to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ from those amounts. Significant estimates and assumptions include the estimated progress towards the satisfaction of performance obligations to record revenue, the valuation of goodwill and intangible assets, accrued research and development expenses and the fair value of stock-based awards issued.

Basis of Presentation

The consolidated financial statements include the accounts of Recursion and its wholly-owned subsidiaries that the Company controls. Intercompany balances and transactions have been eliminated in consolidation.

In April 2021, the Company completed a 1.5-for-1 forward stock split of common and convertible preferred stock. All shares presented within these consolidated financial statements were adjusted to reflect the forward stock split for all periods presented.

In April 2021, the Company’s Board of Directors authorized two classes of common stock, Class A and Class B. Certain shares of Class A were exchanged for Class B on a one-for-one basis. The creation and issuance of the Class B common stock did not affect the loss per share for the Class A or Class B shares for any period. The Company presented the 2021 net loss per share amounts as if the authorization and exchange occurred as of the start of the 2021 reporting period. All share amounts presented prior to the authorization are referred to as Class A common stock. See Note 8, “Common Stock” for additional details.

Segment Information

Recursion operates as a single operating segment. The Company’s chief operating decision maker is its chief executive officer, who allocates resources and assesses performance at the consolidated level.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents. These financial instruments are primarily held at two U.S. financial institutions that management believes are of high credit quality. Recursion’s primary bank accounts significantly exceed the federally insured limits.

The Company is dependent on third-party suppliers for certain research and development activities including preclinical and clinical testing. In particular, the Company relies and expects to continue to rely on a small number of these suppliers. These activities could be adversely affected by a significant interruption to Recursion’s third-party suppliers including a delay in the Company’s preclinical and clinical testing and the supply of certain consumable products and compounds.

Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents includes bank deposits held in checking accounts and money market funds. Short-term highly liquid investments with maturities of three months or less at the time of purchase are classified as cash and cash equivalents.

The Company is required to maintain a cash balance in a collateralized account to secure the Company’s credit cards. Additionally, the Company holds restricted cash related to an outstanding letter of credit issued by J.P. Morgan, which was obtained to secure certain Company obligations relating to tenant improvements. Recursion also holds restricted cash related to a Bill and Melinda Gates Foundation grant.

Property and Equipment

Property and equipment is carried at acquisition cost less accumulated depreciation. The cost of normal, recurring or periodic repairs and maintenance activities related to property and equipment are expensed as incurred.

Depreciation is computed using the straight-line method based on the estimated useful lives of the assets. The estimated useful lives by asset classification are generally as follows:


Office Equipment			5 years
Lab Equipment			7 years
Leasehold Improvements			Lesser of 15 years or the remainder of the lease

Property and equipment are reviewed for impairment as discussed below under Long-Lived Assets Impairment.

Long-Lived Assets Impairment

The Company reviews the carrying amounts of long-lived assets, other than goodwill and intangible assets not subject to amortization, for potential impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. In evaluating recoverability, Recursion groups assets and liabilities at the lowest level such that the identifiable cash flows relating to the group are largely independent of the cash flows of other assets and liabilities. The Company then compares the carrying amount of the asset or asset group with the projected undiscounted future cash flows to be generated by the asset or asset group. In the event impairment exists, an impairment charge is recorded as the amount by which the carrying amount of the asset or asset group exceeds the fair value.

Goodwill Impairment

Annually, the Company tests its goodwill for impairment by first assessing qualitative factors to determine whether it is more likely than not that the fair value is less than its carrying amount. Some of the factors considered in the assessment include general macro-economic conditions, conditions specific to the industry and market, cost factors, the overall financial performance and whether there have been sustained declines in the Company's share price. If the Company concludes it is more likely than not that the fair value of the reporting unit is less than its carrying amount, a quantitative impairment test is performed.

For its quantitative impairment tests, the Company uses an estimated future cash flow approach that requires significant judgment with respect to future volume, revenue and expense growth rates, changes in working capital use, the selection of an appropriate discount rate and other assumptions and estimates. The estimates and assumptions used are consistent with the Company's business plans and a market participant's views. The use of alternative estimates and assumptions could increase or decrease projected cash flows and the estimated fair value.

Business Combinations

Results of operations of acquired companies are included in the Recursion results of operations as of the respective acquisition dates. The purchase price of each acquisition is allocated to the net assets acquired based on estimates of their fair values at the date of acquisition. Any purchase price in excess of these net assets is recorded as goodwill. The allocation of purchase price in certain cases may be subject to revision based on the final determination of fair values during the measurement period, which may be up to one year from the acquisition date. Legal costs, due diligence costs, business valuation costs and all other business acquisition costs are expensed when incurred.

Accruals for Research and Development Expenses and Clinical Trials

As part of the process of preparing its financial statements, the Company is required to estimate its expenses resulting from obligations under contracts with vendors and clinical research organizations. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment terms that do not match the periods over which materials or services are provided for under such contracts. The Company’s policy is to record these expenses during the period in which services are performed and efforts are expended. The Company determines accrual estimates by taking into account discussions with applicable personnel and outside service providers as to the progress of clinical trials, or the services completed. During the course of a clinical trial, the Company adjusts its clinical expense recognition if actual results differ from its estimates. The Company makes estimates of its accrued expenses as of each Consolidated Balance Sheet date based on the facts and circumstances known to it at that time. The actual expenses could be different from the amounts accrued.

Leases

The Company rents facilities under operating lease agreements and recognizes rent expense on a straight-line basis over the term of the lease. Certain lease agreements contain tenant improvement allowances, rent holidays, scheduled rent increases and renewal options. Rent holidays and scheduled rent increases are included in the determination of rent expense. Certain leases also include provisions for variable lease payments which are based on, but not limited to, maintenance, insurance, taxes and usage-based amounts. Recursion recognizes these costs as they are incurred.

Right-of-use assets and lease liabilities are recognized based on the present value of lease payments over the lease term at the lease commencement date. Present value is determined using an incremental borrowing rate when the rate implicit in the lease is not readily determinable. The incremental borrowing rate is equal to the rate of interest that Recursion would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment. Renewals are not included in the determination of the lease term unless they are determined to be reasonably certain to be exercised at the commencement date of the lease. The Company recognizes rent expense beginning on the date the Company obtains the legal right to use and control the leased space. Recursion classifies leases as operating or finance at the lease commencement date. All outstanding leases are operating leases.

The Company has elected to apply the practical expedient for short-term leases whereby Recursion does not recognize a lease liability and right-of-use asset for leases with a term of less than 12 months. The Company has also elected to not separate consideration in the contract between lease and non-lease components of a contract that contains a lease. Right-of-use assets and lease liabilities are remeasured upon certain remeasurement events using the present value of remaining lease payments and estimated incremental borrowing rate upon lease modification. For operating leases that commenced prior to the Company’s adoption of Topic 842, Recursion measured the lease liabilities and right-of-use assets using the incremental borrowing rate as of January 1, 2022.

Revenue Recognition

Operating revenue has primarily been generated through research and development agreements (see Note 9, “Collaborative Development Contracts” for additional details). Revenue for research and development agreements is recognized as the Company satisfies a performance obligation by transferring the promised services to the customer. The Company recognizes revenue over time by measuring the progress toward complete satisfaction of the relevant performance obligation using an appropriate input or output method based on the services promised to the customer. This method of recognizing revenue requires the Company to make estimates of the work required to complete the performance obligation in order to determine the progress towards completion. A significant change in these estimates could have a material effect on the timing and amount of revenue recognized in future periods.

The Company may also provide options in its agreements under which a partner could request that Recursion provide additional services in the future. Recursion evaluates whether these options are material rights at the inception of the agreement. If the Company determines an option is a material right, Recursion will consider the option a separate performance obligation. Historically, the Company has concluded that options granted to license in the future or to provide additional services are not material rights because these items are contingent upon future events that may not occur and are not priced at a significant discount.

Cost of Revenue

Cost of revenue consists of the Company’s costs to provide services for drug discovery required under performance obligations with partnership customers. These primarily include materials costs, service hours performed by the Company’s employees and depreciation of property and equipment. Consumables purchased to be used in the future to satisfy performance obligations are recognized on the Consolidated Balance Sheet until consumed.

Research and Development

Research and development expenses comprise of costs incurred in performing research and development activities other than those performance pursuant to contracts with customers, including drug discovery and development studies, external research and the purchase of laboratory supplies. The Company recognizes expenses associated with third-party contracted services based on the completion of activities as specified in the applicable contracts. Upon the termination of contracts with third-parties, the Company’s financial obligations are generally limited to costs incurred or committed to date. Any advance payments for goods or services to be used or rendered in future research and product development activities are classified as prepaid expenses until the goods or services are rendered.

Stock-Based Compensation

The Company issues stock-based awards to employees and non-employees, generally in the form of stock options and restricted stock units (RSUs). Most of the Company’s stock-based awards have been made to employees.

Recursion measures compensation expense for equity awards at their grant-date fair value and recognizes compensation expense over the requisite service period, generally on a straight-line basis. For stock-based awards with a performance condition, Recursion recognizes stock-based compensation expense based on the probable outcome of the performance condition. Awards generally vest over four years for employees. Recursion recognizes the impact of forfeitures on stock-based compensation expense as they occur.

The grant date fair value of stock options is estimated using the Black-Scholes option pricing model, which requires inputs for the expected term, stock price volatility, dividend yield and the risk-free interest rate of the options. The expected term is based on the simplified method since the Company does not have sufficient historical exercise data to estimate the expected term. The volatility is based on an average peer historical volatility over the expected term of the option. The expected dividend yield is assumed to be zero as Recursion has never paid dividends and does not have current plans to pay dividends. The risk-free interest rate is based on the rates available at the time of the grant for zero-coupon U.S. government issues with a remaining term equal to the option's expected term.

The grant date fair value of RSUs is determined using the market price of the Company’s common stock at grant date. For stock-based awards with a market condition, the grant date fair value is determined using a Monte Carlo simulation and stock-based compensation expense is recognized using the accelerated attribution method over the implied service period. When a market condition is satisfied in a period before the end of the implied service period, any remaining unrecognized compensation cost is recognized. Stock-based compensation is recorded in cost of revenue, research and development expense and general and administrative expense based on the role of the employee.

Income Taxes

Income taxes are accounted for under the asset and liability method. Provisions for federal, state and foreign income taxes are calculated on reported pretax losses based on current tax laws. Deferred taxes are recognized using enacted tax rates on the future tax consequences of temporary differences, which are the differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases and the tax benefits of carryforwards. A valuation allowance is established or maintained when, based on currently available information, it is more likely than not that all or a portion of a deferred tax asset will not be realized.

For uncertain tax positions, Recursion determines whether the position is more-likely-than-not to be sustained upon examination based on the technical merits of the position. Any tax position that meets the more-likely-than-not recognition threshold is measured and recognized in the Consolidated Financial Statements at the largest amount that is greater than 50% likely of being realized upon ultimate settlement.

Recent Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-9, Income Taxes (Topic 740). The new standard updates disclosure requirements for Accounting Standards Codification (ASC) 740 primarily by requiring additional information in the income tax rate reconciliation and additional disclosures about income taxes paid. This standard will be effective for Recursion starting the annual period ending December 31, 2025. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments can be applied on a prospective or retrospective basis. The adoption of this standard will not impact Recursion’s consolidated balance sheet and statement of operations.

In November 2023, the FASB issued ASU No. 2023-7, Segment Reporting (Topic 280). The standard requires new disclosures related to ASC 280 including: disclosing significant segment expenses by category; requiring all the ASC 280 disclosures for Companies with a single reportable segment and; requiring an increased frequency of the ASC 280 disclosures. Recursion must apply the amendments retrospectively to each prior reporting period presented. This standard will be effective for Recursion starting the annual period ending December 31, 2024. Early adoption is permitted. The adoption of this standard will not impact Recursion’s consolidated balance sheet and statement of operations.

On January 1, 2022, Recursion adopted ASU No. 2016-02, Leases (Topic 842). Under ASC 842, lessees are required to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with terms greater than 12 months. The guidance also expanded the disclosure requirements of lease arrangements. The Company adopted ASC 842 using the modified retrospective method. Recursion elected the following practical expedients

when assessing the transition impact: i) not to reassess whether any expired or existing contracts as of the adoption date are or contain leases; ii) not to reassess the lease classification for any expired or existing leases as of the adoption date; and iii) not to reassess initial direct costs for any existing leases as of the adoption date.

Results for reporting periods beginning after December 31, 2021 are presented in accordance with the standard, while results for prior periods are not adjusted and continue to be reported in accordance with Recursion’s historical accounting. The January 1, 2022 adjustment to record lease right-of-use assets and lease liabilities was $32.9 million and $47.8 million, respectively. The impact to the consolidated statements of operations and cash flows was insignificant.

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2023
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events In January 2024, the Company entered into a lease agreement for office space with approximately 6,792 square feet (the “London Lease”). The London Lease term is five years. The lease includes provisions for escalating rent payments. Total fixed lease payments are expected to be approximately $7.9 million, additionally there will be variable expenses including building services charges related to the lease.

Common Stock (Details)					1 Months Ended		12 Months Ended
Common Stock (Details)	Aug. 08, 2023 USD ($) shares	Jul. 11, 2023 USD ($) $ / shares shares	May 16, 2023 shares	Apr. 20, 2021 USD ($) $ / shares shares	May 31, 2023	Oct. 31, 2022 USD ($) $ / shares shares	Dec. 31, 2023 USD ($) vote shares	Dec. 31, 2022 USD ($) shares	Jul. 31, 2023	Dec. 31, 2021 shares	Apr. 30, 2021 class	Dec. 31, 2020 shares
Class of Stock [Line Items]
Dividends declared							$ 0	$ 0
Common stock, conversion ratio							1
Percent of aggregate purchase price paid by the holder due if agreement is broken						1.00%
Registration rights agreement, accrued liability							$ 0
Convertible preferred stock outstanding (in shares) \| shares							0	0		0		112,088,065
Convertible preferred stock issued (in shares) \| shares							0	0		0
Number of classes of common stock authorized \| class											2
Christopher Gibson and his affiliates
Class of Stock [Line Items]
Affiliated holders, ownership percentage							0.25
Affiliated holders, potential ownership percentage when outstanding equity awards vest							0.26
Valence Discovery Inc
Class of Stock [Line Items]
Registration rights agreement, term					3 years
NVDIA Private Placement
Class of Stock [Line Items]
Percent of aggregate purchase price paid by the holder due if agreement is broken									1.00%
Registration rights agreement, accrued liability							$ 0
NVDIA Private Placement \| Maximum
Class of Stock [Line Items]
Percent of aggregate purchase price paid by the holder due if agreement is broken									5.00%
IPO
Class of Stock [Line Items]
IPO, number of shares issued (in shares) \| shares				27,900,000
IPO, net proceeds received				$ 462,400,000
Conversion of convertible securities (in shares) \| shares				115,600,000
Price per share (in dollars per share) \| $ / shares				$ 18.00
Stock issuance costs				$ 35,100,000
IPO, expenses costs				$ 4,300,000
Class A
Class of Stock [Line Items]
Vote per share of common stock (in votes) \| vote							1
Shares issued, price per share (in USD per share) \| $ / shares		$ 6.49
Proceeds from private placement of stock		$ 49,900,000
Common stock, conversion ratio			1
Class A \| At-The-Market Offering Program
Class of Stock [Line Items]
Sale of stock, value, authorized	$ 300,000,000
Sale of stock remaining value authorized	$ 219,400,000
IPO, number of shares issued (in shares) \| shares	12,000,000
IPO, net proceeds received	$ 78,200,000
Sale of stock, percentage of commission	3.00%
Class A \| NVDIA Private Placement
Class of Stock [Line Items]
Common stock issuance (in shares) \| shares		7,700,000
Class A \| 2022 Private Placement
Class of Stock [Line Items]
IPO, number of shares issued (in shares) \| shares						15,300,000
IPO, net proceeds received						$ 143,700,000
Price per share (in dollars per share) \| $ / shares						$ 9.80
Stock issuance costs						$ 6,600,000
Class B
Class of Stock [Line Items]
Vote per share of common stock (in votes) \| vote							10
Exchangeable Stock
Class of Stock [Line Items]
Conversion of convertible securities (in shares) \| shares							3,600,000
Exchangeable Stock \| Valence Discovery Inc
Class of Stock [Line Items]
Equity interests issuable (in shares) \| shares			5,900,000

Supplemental Financial Information - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended		12 Months Ended
	Nov. 30, 2023	Jan. 31, 2023	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Depreciation			$ 15,900	$ 11,400	$ 8,800
Impairment of leasehold improvements			1,200	2,800
Purchases of property and equipment			11,955	$ 37,059	$ 39,798
Notes payable
Property, Plant and Equipment [Line Items]
Proceeds from long-term debt		$ 1,900
Debt instrument, term		3 years
Debt Instrument, interest rate		7.00%
Notes Payable			606
Notes payable \| Station 41 lease
Property, Plant and Equipment [Line Items]
Proceeds from long-term debt						$ 992
Debt instrument, term						10 years
Debt Instrument, interest rate						8.00%
Notes Payable			536
BioHive Supercomputer
Property, Plant and Equipment [Line Items]
Purchases of property and equipment			1,700
Other Current Assets
Property, Plant and Equipment [Line Items]
License agreement, prepaid expenses			$ 16,000
Tempus Labs, Inc
Property, Plant and Equipment [Line Items]
License agreement, term	5 years
Trading period used for equity value determination	7 days
Tempus Labs, Inc \| Minimum
Property, Plant and Equipment [Line Items]
Annual payments	$ 22,000
Tempus Labs, Inc \| Maximum
Property, Plant and Equipment [Line Items]
Annual payments	42,000
Aggregate amount payable in cash or equity	$ 160,000

Income Taxes - Income Tax Provision Components (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Federal	$ (82,707)	$ (61,225)	$ (47,138)
State	(54,634)	(3,188)	684
Foreign	(4,564)	(471)	(149)
Change in valuation allowance	137,843	64,884	46,603
Total tax benefit	$ (4,062)	$ 0	$ 0

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Consolidated Statements of Operations - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Revenue
Revenue	$ 44,575	$ 39,843	$ 10,178
Operating costs and expenses
Cost of revenue	42,587	48,275	0
Research and development	241,226	155,696	135,271
General and administrative	110,822	81,599	57,682
Total operating costs and expenses	394,635	285,570	192,953
Loss from operations	(350,060)	(245,727)	(182,775)
Other income (loss), net	17,932	6,251	(3,704)
Loss before income tax benefit	(332,128)	(239,476)	(186,479)
Income tax benefit	4,062	0	0
Net loss	$ (328,066)	$ (239,476)	$ (186,479)
Per share data
Net loss per share of Class A, B and Exchangeable common stock, basic (in dollars per share)	$ (1.58)	$ (1.36)	$ (1.49)
Net loss per share of Class A, B and Exchangeable common stock, diluted (in dollars per share)	$ (1.58)	$ (1.36)	$ (1.49)
Weighted-average shares (Class A, B and Exchangeable) outstanding, basic (in shares)	207,853,702	175,537,487	125,348,110
Weighted-average shares (Class A, B and Exchangeable) outstanding, diluted (in shares)	207,853,702	175,537,487	125,348,110
Operating revenue
Revenue
Revenue	$ 43,876	$ 39,681	$ 10,000
Grant revenue
Revenue
Revenue	$ 699	$ 162	$ 178

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Stock-based Compensation Expenses

The following table presents the classification of stock-based compensation expense for employees and non-employees within the Consolidated Statements of Operations:


	Years ended December 31,
(in thousands)	2023		2022		2021
Cost of revenue	$	5,326	$	2,755	$	—
Research and development	21,992		10,065		4,841
General and administrative	24,361		14,052		8,989
Total	$	51,679	$	26,872	$	13,830

Schedule of Share-based Payment Arrangement, Option, Activity

Stock option activity during the year ended December 31, 2023 was as follows:


(in thousands except share and per share amounts)	Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
Outstanding as of December 31, 2022	16,154,924	$	5.10	7.5	$	67,997
Granted	5,083,268	6.23
Cancelled	(1,460,517)	8.67
Exercised	(4,820,058)	2.20			32,621
Outstanding as of December 31, 2023	14,957,617	$	6.13	7.0	$	72,416
Exercisable as of December 31, 2023	9,844,841	$	5.07	6.3	$	59,144

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The following weighted-average assumptions were used to calculate the grant-date fair value of stock options:


	Years ended December 31,
	2023		2022		2021
Expected term (in years)	5.8		6.2		6.3
Expected volatility	66	%	63	%	65	%
Expected dividend yield	—		—		—
Risk-free interest rate	3.6	%	1.9	%	1.1	%

Schedule of Nonvested RSU Activity

The following table summarizes Recursion’s RSU activity during the year ended December 31, 2023:


	Stock units	Weighted-average grant date fair value
Outstanding as of December 31, 2022	6,894,525	$	8.17
Granted	14,332,216	8.61
Vested	(3,385,863)	8.52
Forfeited	(2,617,114)	8.29
Outstanding as of December 31, 2023	15,223,764	$	8.39

Supplemental Financial Information - PPE (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 131,382	$ 118,307
Less: Accumulated depreciation	(44,872)	(30,115)
Property and equipment, net	86,510	88,192
Lab equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	60,096	47,524
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	45,929	41,872
Office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	22,126	20,164
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 3,231	$ 8,747

Leases - Components of Lease Cost (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Leases [Abstract]
Operating lease cost	$ 8,144	$ 7,793
Variable lease cost	2,116	1,070
Short-term lease cost	139	0
Lease cost	$ 10,399	$ 8,863

Subsequent Events (Details) $ in Thousands	1 Months Ended
Subsequent Events (Details) $ in Thousands	Jan. 31, 2024 USD ($) ft²	Dec. 31, 2023 USD ($)
Subsequent Event [Line Items]
Total lease payments		$ 66,164
Subsequent Event \| London Lease
Subsequent Event [Line Items]
Square footage of leased space (in square feet) \| ft²	6,792
Lease term	5 years
Total lease payments	$ 7,900

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities
Net loss	$ (328,066)	$ (239,476)	$ (186,479)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	24,402	11,756	8,405
Stock-based compensation	53,503	27,909	14,842
Asset impairment	1,188	2,806	0
Lease expense	8,063	7,730	0
Loss on debt extinguishment	0	0	827
Other, net	3,387	830	4,097
Changes in operating assets and liabilities:
Other receivables and assets	(7,756)	(2)	(5,376)
Unearned revenue	(41,076)	110,320	(10,000)
Accounts payable	(987)	1,767	1,745
Accrued development expense	2,705	522	561
Accrued expenses and other current liabilities	6,719	(576)	12,764
Operating lease liabilities	(9,862)	(7,110)	0
Net cash used in operating activities	(287,780)	(83,524)	(158,614)
Cash flows from investing activities
Net cash and restricted cash acquired in the acquisition of a business	1,844	0	0
Purchases of property and equipment	(11,955)	(37,059)	(39,798)
Purchase of an intangible asset	(597)	(300)	0
Purchases of investments	0	0	(301,137)
Sales and maturities of investments	480	230,608	69,191
Net cash provided by (used in) investing activities	(10,228)	193,249	(271,744)
Cash flows from financing activities
Proceeds from issuance of common shares, net of issuance costs	128,093	143,711	462,901
Proceeds from equity incentive plans and warrants	12,806	10,724	8,437
Repayment of long-term debt	(766)	(90)	(12,798)
Net cash provided by financing activities	140,133	154,345	458,540
Effect of exchange rate changes on cash, cash equivalents and restricted cash	188	(307)	0
Net change in cash, cash equivalents and restricted cash	(157,687)	263,763	28,182
Cash, cash equivalents and restricted cash, beginning of period	559,112	295,349	267,167
Cash, cash equivalents and restricted cash, end of period	401,425	559,112	295,349
Supplemental disclosure of non-cash investing and financing information
Issuance of shares for the acquisitions of businesses and tempus agreement	89,269	0	0
Right-of-use asset additions and modifications	4,968	3,950	0
Accrued property and equipment	2,439	591	7,749
Conversion of preferred stock to common stock	0	0	448,312
Deferred issuance costs recorded in equity	0	0	547
Supplemental disclosure of cash flow information
Cash paid for operating leases	9,862	7,110	0
Cash paid for interest	96	55	680
Tempus agreement
Supplemental disclosure of non-cash investing and financing information
Issuance of shares for the acquisitions of businesses and tempus agreement	$ 22,000	$ 0	$ 0

Commitments and Contingencies (Details)	Dec. 31, 2023 USD ($)	Oct. 27, 2023 claim	Dec. 31, 2022 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Loss contingency accrual \| $	$ 0		$ 0
Number of pending claims \| claim		4

Stock-Based Compensation

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

In April 2021, the Board of Directors and the stockholders of the Company adopted the 2021 Equity Incentive Plan (the 2021 Plan). Under the 2021 Plan, 16.2 million shares of Class A common stock were reserved. Additionally, shares were reserved for all outstanding awards under the previous 2016 Plan. The Company may grant stock options, restricted stock units (RSUs), stock appreciation rights, restricted stock awards and other forms of stock-based compensation.

As of December 31, 2023, 10.9 million shares of Class A common stock were available for grant.

The following table presents the classification of stock-based compensation expense for employees and non-employees within the Consolidated Statements of Operations:


	Years ended December 31,
(in thousands)	2023		2022		2021
Cost of revenue	$	5,326	$	2,755	$	—
Research and development	21,992		10,065		4,841
General and administrative	24,361		14,052		8,989
Total	$	51,679	$	26,872	$	13,830

Stock Options

Stock options are primarily granted to executive leaders at the Company, generally vest over four years and expire no later than 10 years from the date of grant. Stock option activity during the year ended December 31, 2023 was as follows:


(in thousands except share and per share amounts)	Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
Outstanding as of December 31, 2022	16,154,924	$	5.10	7.5	$	67,997
Granted	5,083,268	6.23
Cancelled	(1,460,517)	8.67
Exercised	(4,820,058)	2.20			32,621
Outstanding as of December 31, 2023	14,957,617	$	6.13	7.0	$	72,416
Exercisable as of December 31, 2023	9,844,841	$	5.07	6.3	$	59,144

The fair value of options granted to employees is calculated on the grant date using the Black-Scholes option valuation model. The weighted-average grant-date fair values of stock options granted during the years ended December 31, 2023, 2022 and 2021 were $5.64, $6.57 and $7.66, respectively.

The following weighted-average assumptions were used to calculate the grant-date fair value of stock options:


	Years ended December 31,
	2023		2022		2021
Expected term (in years)	5.8		6.2		6.3
Expected volatility	66	%	63	%	65	%
Expected dividend yield	—		—		—
Risk-free interest rate	3.6	%	1.9	%	1.1	%

As of December 31, 2023, $32.6 million of unrecognized compensation cost related to stock options is expected to be recognized as expense over approximately the next two years.

RSUs

Equity awards granted to employees primarily consist of RSUs and generally vest over four years. The weighted-average grant-date fair value of RSUs generally is determined based on the number of units granted and the quoted price of Recursion’s common stock on the date of grant.

The following table summarizes Recursion’s RSU activity during the year ended December 31, 2023:


	Stock units	Weighted-average grant date fair value
Outstanding as of December 31, 2022	6,894,525	$	8.17
Granted	14,332,216	8.61
Vested	(3,385,863)	8.52
Forfeited	(2,617,114)	8.29
Outstanding as of December 31, 2023	15,223,764	$	8.39

The fair market value of RSUs vested was $26.9 million during the year ended December 31, 2023. As of December 31, 2023, $119.5 million of unrecognized compensation cost related to RSUs is expected to be recognized as expense over approximately the next three years.

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2023	Dec. 31, 2022
Common stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Common stock, shares authorized (in shares)	2,000,000,000	2,000,000,000
Common stock, shares issued (in shares)	234,270,384	191,022,864
Common sock, shares outstanding (in shares)	234,270,384	191,022,864
Class A
Common stock, shares authorized (in shares)	1,989,032,117	1,989,032,117
Common stock, shares issued (in shares)	226,264,764	183,209,655
Common sock, shares outstanding (in shares)	226,264,764	183,209,655
Class B
Common stock, shares authorized (in shares)	10,967,883	10,967,883
Common stock, shares issued (in shares)	7,544,871	7,813,209
Common sock, shares outstanding (in shares)	7,544,871	7,813,209
Exchangeable Stock
Common stock, shares issued (in shares)	460,749	0
Common sock, shares outstanding (in shares)	460,749	0

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2023

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables summarize the Company’s assets and liabilities that are measured at fair value on a recurring basis:


			Basis of fair value measurement
(in thousands)	December 31, 2023		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	322,653	$	322,653	$	—	$	—
Restricted cash	9,860		9,860		—		—
Total assets	$	332,513	$	332,513	$	—	$	—


			Basis of fair value measurement
(in thousands)	December 31, 2022		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	404,613	$	404,613	$	—	$	—
Restricted cash	9,200		9,200		—		—
Total assets	$	413,813	$	413,813	$	—	$	—

Schedule of Fair Value Disclosure of Asset and Liability Not Measured at Fair Value

The following tables summarize the Company’s financial instruments that are not measured at fair value:


	Book values				Fair values
(in thousands)	December 31, 2023		December 31, 2022		December 31, 2023		December 31, 2022
Liabilities
Current portion of notes payable	$	41	$	97	$	41	$	97
Notes payable, net of current portion	1,101		536		1,101		536
Total liabilities	$	1,142	$	633	$	1,142	$	633

Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill

The following table summarizes the changes in the carrying amount of goodwill:


(in thousands)
Balance as of December 31, 2022	$	801
Additions from acquisitions	51,255
Balance as of December 31, 2023	$	52,056

The additions to goodwill relate to the acquisition of Cyclica and Valence during the year ended December 31, 2023. See Note 4, “Acquisitions” for additional details. There were no changes to the carrying amount of goodwill during the years ended December 31, 2022 and 2021. No goodwill impairment was recorded during the years ended December 31, 2023, 2022 and 2021.

Intangible Assets, Net

The following table summarizes intangible assets:


	December 31, 2023						December 31, 2022
(in thousands)	Gross carrying amount		Accumulated Amortization		Net carrying amount		Gross carrying amount		Accumulated Amortization		Net carrying amount
Definite-lived intangible assets	$	44,426	$	(8,969)	$	35,457	$	1,211	$	(809)	$	402
Indefinite-lived intangible assets	986		—		986		904		—		904
Intangible assets, net	$	45,412	$	(8,969)	$	36,443	$	2,115	$	(809)	$	1,306

The definite-lived intangible assets balance increased during the year ended December 31, 2023 due to the Company’s acquisitions. See Note 4, “Acquisitions” for additional details on the intangible assets acquired.

Amortization expense was $8.5 million, $379 thousand and $304 thousand during the years ended December 31, 2023, 2022 and 2021, respectively. Amortization expense was included in “Research and Development” in the Consolidated Statements of Operations. Amortization expense for the definite-lived intangible assets will be recognized over approximately the next 2.8 years.

The estimated annual amortization expense for the definite-lived intangible assets recorded as of December 31, 2023 is as follows:


(in thousands)	2024		2025		2026		2027		2028
Estimated annual amortization expense	$	13,379	$	13,116	$	7,672	$	1,283	$	7

The indefinite-lived intangible assets primarily represent the Recursion domain name that the Company purchased. No indefinite-lived intangible asset impairment charges were recorded during the years ended December 31, 2023, 2022 and 2021.

Collaborative Development Contracts	12 Months Ended
Collaborative Development Contracts	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Collaborative Development Contracts	Collaborative Development Contracts Roche and Genentech Description In December 2021, Recursion entered into a collaboration and license agreement with Roche and Genentech (collectively referred to as Roche). Recursion is constructing, using the Company’s imaging technology and proprietary machine-learning algorithms, unique maps of the inferred relationships amongst perturbation phenotypes in a given cellular context with the goal to discover and develop therapeutic small molecule programs in a gastrointestinal cancer indication and in key areas of neuroscience. Roche and Recursion will collaborate to select certain novel inferences with respect to small molecules or targets generated from the Phenomaps for further validation and optimization as collaboration programs. Roche and Recursion may also combine sequencing datasets from Roche with Recursion’s Phenomaps and collaborate to generate new algorithms to produce multi-modal maps from which additional collaboration programs may be initiated. For every collaboration program that successfully identifies potential therapeutic small molecules or validates a target, Roche will have an option to obtain an exclusive license to develop and commercialize such potential therapeutic small molecules or to exploit such target in the applicable exclusive field. Pricing In January 2022, Recursion received a $150.0 million non-refundable upfront payment from the Company’s collaboration with Roche. Recursion is eligible for additional milestone payments based on performance progress of the collaboration. Each of the Phenomaps requested by Roche and created by Recursion may be subject to either an initiation fee, acceptance fee or both. Such fees could exceed $250.0 million for 16 accepted Phenomaps. In addition, for a period of time after Roche’s acceptance of certain Phenomaps, Roche will have the option to obtain, subject to payment of an exercise fee, rights to use outside the collaboration the raw images generated in the course of creating those Phenomaps. If Roche exercises its external use option for all 12 eligible Phenomaps, Roche’s associated exercise fee payments to Recursion could exceed $250.0 million. Under the collaboration, Roche may initiate up to 40 programs, each of which, if successfully developed and commercialized, could yield more than $300.0 million in development, commercialization and net revenue milestones for Recursion, as well as tiered royalties on net revenue. Accounting This agreement represents a transaction with a customer and therefore is accounted for in accordance with ASC 606. Recursion has determined that it has three performance obligations, one related to gastrointestinal cancer and two in neuroscience. These performance obligations are for performing research and development services for Roche to identify targets and medicines. The performance obligations also include potential licenses related to the intellectual property. The Company concluded that licenses within the contract are not distinct from the research and development services as they are interrelated due to the fact that the research and development services significantly impact the potential licenses. Any additional services are considered customer options and will be considered as separate contracts for accounting purposes. The Company has determined the transaction price to be $150.0 million, for the initial performance obligations, comprised of the upfront payment. Recursion will fully constrain the amounts of variable consideration to be received from potential milestones considering the stage of development and the risks associated with the remaining development required to achieve each milestone. Recursion will re-evaluate the transaction price each reporting period. The transaction price was allocated to the performance obligations based on the estimated relative stand-alone selling price of each performance obligation as determined using an expected cost plus margin approach. The Company recognizes revenue over time based on costs incurred relative to total expected costs to perform the research and development services. Recursion determined that this method provides a faithful depiction of the transfer of control to the customer. This method of recognizing revenue requires the Company to make estimates of total costs to provide the services required under the performance obligations. Significant inputs used to determine the total costs included the length of time required, service hours performed by Company employees and materials costs. A significant change in these estimates could have a material effect on the timing and amount of revenue recognized in future periods. Recursion has estimated the completion of the performance obligations by 2026. Bayer AG Description In August 2020, the Company entered into a Research Collaboration and Option Agreement (the Bayer Agreement) with Bayer AG (Bayer) pursuant to which the Company and Bayer initiated research projects related to fibrosis across multiple organ systems, including the lung, liver and heart. Under the agreement, the Company contributed compounds from its proprietary library and Bayer contributed compounds from its proprietary library and contributed scientific expertise throughout the collaboration. The Company worked with Bayer to identify potential candidates for development. Under the agreement, Bayer had the first option for licenses to potential candidates. Pricing In October 2020, the Company received a $30.0 million non-refundable upfront payment. Each such license potentially could have resulted in option exercise fees and development and commercial milestone payments payable to the Company, with an aggregate value of up to approximately $100.0 million (for an option on a lead series) or up to approximately $120.0 million (for an option on a development candidate), as well as tiered royalties for each such license, ranging from low- to mid-single digit percentages of sales, depending on commercial success. Accounting The Company determined that it had one performance obligation under the agreement, which was to perform research and development services for Bayer. Recursion determined the transaction price to be $30.0 million, comprised of the upfront payment. The Company allocated the amount to the single performance obligation. The Company recognized revenue over time by measuring progress towards completion of the performance obligation. This method of recognizing revenue required the Company to make estimates of the total time to provide the services required under the performance obligation. For the year ended December 31, 2021, the costs of providing the services for this agreement were insignificant and were included within “Research and Development” in the Consolidated Statement of Operations. Recursion completed its performance obligation services in 2023. Additional Revenue Disclosures Revenues from two customers exceeded 10% of total revenues and those two customers represent primarily all of Recursion’s operating revenue during the years ended December 31, 2023 and 2022. Revenues from one customer exceeded 10% of total revenues and that one customer represented all of Recursion’s operating revenue during the year ended December 31, 2021. Of the revenue recognized during the year ended December 31, 2023, primarily all of it was included in the unearned revenue balance as of December 31, 2022. Of the revenue recognized during the year ended December 31, 2022, $10.0 million was included in the unearned revenue balance as of December 31, 2021. Revenue recognized was from upfront payments received at the inception of the related contracts, which decreased the initial unearned revenue recognized. As of December 31, 2023, the Company had $9.8 million of costs incurred to fulfill a contract on its Consolidated Balance Sheet within “Other current assets.” Unearned revenue was classified as short-term and long-term on the Consolidated Balance Sheets based on the Company’s estimate of revenue that will be recognized during the next twelve months.

Leases (Tables)

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Schedule of Components of Lease Cost, Supplemental Cash Flow Information Related to Leases, Lease Term and Discount Rates

The components of the lease cost are as follows:


	Years ended December 31,
(in thousands)	2023		2022
Operating lease cost	$	8,144	$	7,793
Variable lease cost	2,116		1,070
Short-term lease cost	139		—
Lease cost	$	10,399	$	8,863

Lease term and discount rates were:


	Years ended December 31,
(in thousands)	2023		2022
Operating leases
Weighted-average remaining lease term (years)	6.7		7.6
Weighted-average discount rate	7.8	%	7.3	%

Schedule of Maturities of Operating Lease Liabilities

Maturities of operating lease liabilities as of December 31, 2023 were:


(in thousands)	Operating leases
2024	$	10,059
2025	10,399
2026	10,526
2027	10,769
2028	7,397
Thereafter	17,014
Total lease payments	66,164
Less: imputed interest	(16,634)
Present value of lease liabilities	$	49,530

Insider Trading Arrangements	3 Months Ended	12 Months Ended
Insider Trading Arrangements	Dec. 31, 2023 shares	Dec. 31, 2023 shares
Trading Arrangements, by Individual
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Christopher Gibson [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On December 27, 2023, Christopher Gibson, Chief Executive Officer and a member of our Board of Directors, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 620,015 shares of the Company’s Class A common stock until March 6, 2025.
Name	Christopher Gibson
Title	Chief Executive Officer and a member of our Board of Directors
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	December 27, 2023
Arrangement Duration	435 days
Aggregate Available	620,015	620,015

Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Change in carrying amount of goodwill	$ 0	$ 0
Goodwill impairment	0	0	$ 0
Intangible Assets, Net
Gross carrying amount	44,426,000	1,211,000
Accumulated Amortization	(8,969,000)	(809,000)
Net carrying amount	35,457,000	402,000
Indefinite-lived intangible assets	986,000	904,000
Intangible assets, gross	45,412,000	2,115,000
Intangible assets, net	36,443,000	1,306,000
Amortization expense	$ 8,500,000	379,000	304,000
Amortization period of definite-lived intangible assets	2 years 9 months 18 days
Impairment of indefinite-lived intangible assets	$ 0	$ 0	$ 0

Acquisitions - Narrative (Details) - USD ($) shares in Thousands				12 Months Ended
	Dec. 31, 2023	May 25, 2023	May 16, 2023	Dec. 31, 2023
Valence Discovery Inc
Business Acquisition [Line Items]
Net revenues				$ 0
Operating loss				6,800,000
Valence Discovery Inc \| Technology-Based Intangible Assets
Business Acquisition [Line Items]
Useful life			4 years
Valence Discovery Inc \| Stock based compensation
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)			792
Valence Discovery Inc \| Class A
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)			2,200
Valence Discovery Inc \| Exchangeable Stock
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)			4,400
Cyclica Inc
Business Acquisition [Line Items]
Operating loss				$ 9,600,000
Cyclica Inc \| Technology-Based Intangible Assets
Business Acquisition [Line Items]
Useful life		3 years
Cyclica Inc \| Stock based compensation
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)		1,000
Cyclica Inc \| Class A
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)	182	5,800

Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands	1 Months Ended	12 Months Ended
	Apr. 30, 2021 class	Dec. 31, 2023 USD ($) financial_institution	Dec. 31, 2022 USD ($)	Jan. 01, 2022 USD ($)
Class of Stock [Line Items]
Stock split, conversion ratio	1.5
Number of classes of common stock authorized \| class	2
Number of financial institutions where financial instruments are primarily held \| financial_institution		2
Vesting period		4 years
Expected dividend yield		0.00%
Operating lease right-of-use assets		$ 33,663	$ 33,255	$ 32,900
Present value of lease liabilities		$ 49,530		$ 47,800
Common Stock (Class A, B and Exchangeable)
Class of Stock [Line Items]
Stock split, conversion ratio	1

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
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Reference 2: http://www.xbrl.org/2003/role/recommendedDisclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Goodwill and Intangible Assets - Schedule of Carrying Amount of Goodwill (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2023 USD ($)
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 801
Additions from acquisitions	51,255
Goodwill, Ending Balance	$ 52,056

- Definition

Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.

+ References + Details

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Use of Estimates

Basis of Presentation

Segment Information

Concentration of Credit Risk

Cash, Cash Equivalents and Restricted Cash

Property and Equipment

Depreciation is computed using the straight-line method based on the estimated useful lives of the assets. The estimated useful lives by asset classification are generally as follows:


Office Equipment			5 years
Lab Equipment			7 years
Leasehold Improvements			Lesser of 15 years or the remainder of the lease

Property and equipment are reviewed for impairment as discussed below under Long-Lived Assets Impairment.

Long-Lived Assets Impairment

Goodwill Impairment

Business Combinations

Accruals for Research and Development Expenses and Clinical Trials/ Research and Development

Accruals for Research and Development Expenses and Clinical Trials

Research and Development

Leases

Revenue Recognition

Cost of Revenue

Stock-Based Compensation

Income Taxes

Recent Accounting Pronouncements

Leases - Lease Term and Discount Rates (Details)	Dec. 31, 2023	Dec. 31, 2022
Leases [Abstract]
Weighted-average remaining lease term (years)	6 years 8 months 12 days	7 years 7 months 6 days
Weighted-average discount rate	7.80%	7.30%

Acquisitions (Tables)

12 Months Ended

Dec. 31, 2023

Business Combination and Asset Acquisition [Abstract]

Schedule of Business Acquisitions, by Acquisition

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	11,096
Fair value of Exchangeable stock	22,473
Fair value of equity awards issued to Valance equity award holders	1,933
Deferred liabilities for additional consideration	396
Total consideration	$	35,898

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	49,915
Cash	6,505
Fair value of equity awards issued to Cyclica equity award holders	3,852
Deferred liabilities for additional consideration	344
Total consideration	$	60,617

Schedule of Fair Value Of Assets Acquired and Liabilities Assumed

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	4,235
Other receivables	536
Intangible asset - technology	15,000
Accounts payable and accrued liabilities	(872)
Deferred income taxes	(3,265)
Total identifiable net assets	$	15,634
Goodwill	20,264
Total assets acquired and liabilities assumed	$	35,898

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	2,429
Restricted cash	1,685
Other receivables	741
Investments	1,000
Other current assets	385
Intangible assets - technology	28,000
Accounts payable and accrued liabilities	(579)
Unearned revenue	(1,754)
Deferred income taxes	(2,075)
Other liabilities, current	(66)
Other liabilities, non-current	(139)
Total identifiable net assets	$	29,627
Goodwill	30,990
Total assets acquired and liabilities assumed	$	60,617

Schedule of Business Acquisitions, Pro Forma Information

The following table presents the unaudited pro forma combined results of operations of Recursion, Valence and Cyclica as if the acquisitions had occurred on January 1, 2022:


	Years ended December 31,
(in thousands)	2023		2022
Net revenue	$	44,861	$	40,517
Net loss	(336,603)		(273,889)

Employee benefit plans (Details) - USD ($) $ in Millions	12 Months Ended
Employee benefit plans (Details) - USD ($) $ in Millions	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Retirement Benefits [Abstract]
Employee benefit plan, percentage of maximum annual contributions per employee	4.00%
Employee benefit plan, percentage of matching contribution	100.00%
Employee benefit plan, employer matching contribution, percentage of employees' gross pay	4.00%
Employee benefit plan, employer expenses	$ 3.8	$ 3.6	$ 2.1

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Income Tax Provision Components

The provision for income taxes consisted of the following components (all deferred):


	Years ended December 31,
(in thousands)	2023		2022		2021
Federal	$	(82,707)	$	(61,225)	$	(47,138)
State	(54,634)		(3,188)		684
Foreign	(4,564)		(471)		(149)
Change in valuation allowance	137,843		64,884		46,603
Total tax benefit	$	(4,062)	$	—	$	—

Schedule of Effective Income Tax Rate Reconciliation

The Company’s effective tax rate of 1% during the year ended December 31, 2023 and 0% during the years ended December 31, 2022 and 2021 differs from the statutory U.S. federal rate as follows:


	Years ended December 31,
	2023		2022		2021
Statutory tax rate	21.0	%	21.0	%	21.0	%
R&D credit generation	3.1	%	3.7	%	3.2	%
Orphan drug credit generation	2.1	%	1.1	%	1.1	%
State taxes	16.4	%	—	%	—	%
Stock based compensation	(0.1)	%	0.8	%	0.6	%
Uncertain tax positions	(0.8)	%	(0.3)	%	(0.4)	%
Other	1.0	%	(0.8)	%	(0.2)	%
Change in valuation allowance	(41.5)	%	(25.5)	%	(25.3)	%
Effective tax rate	1.2	%	—	%	—	%

Schedule of Deferred Tax Assets and Liabilities

Significant components of deferred tax assets and liabilities were as follows:


	December 31,
(in thousands)	2023		2022
Deferred tax assets
Net operating loss carryforwards	$	117,877	$	89,951
Research and development capitalization	105,503		39,095
Tax credit carryforwards	50,293		30,965
Unearned revenue	23,007		—
Lease liabilities	13,208		11,442
Reserves and accruals	4,744		3,622
Stock-based compensation	5,080		2,231
Definite lived intangibles	—		969
Other	485		433
Gross deferred tax assets	320,197		178,708
Valuation allowance	(304,618)		(166,775)
Net deferred tax asset	15,579		11,933
Deferred tax liabilities
Right-of-use assets	(8,942)		(9,982)
Definite lived intangibles	(5,272)		—
Depreciable assets	(2,704)		(1,951)
Deferred tax liabilities	(16,918)		(11,933)
Net deferred tax liability	$	(1,339)	$	—

Summary of Income Tax Contingencies

Reserves for uncertain tax positions against the credit carryforwards were as follows:


	December 31,
(in thousands)	2023		2022
Balance at the beginning of the period	$	2,762	$	1,944
Increases for positions taken in current year	1,726		818
Increase for positions taken in prior year	929		—
Balance at the end of the period	$	5,417	$	2,762

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Schedule of Property and Equipment

The estimated useful lives by asset classification are generally as follows:


Office Equipment			5 years
Lab Equipment			7 years
Leasehold Improvements			Lesser of 15 years or the remainder of the lease

Property and Equipment


	December 31,
(in thousands)	2023		2022
Lab equipment	$	60,096	$	47,524
Leasehold improvements	45,929		41,872
Office equipment	22,126		20,164
Construction in progress	3,231		8,747
Property and equipment, gross	131,382		118,307
Less: Accumulated depreciation	(44,872)		(30,115)
Property and equipment, net	$	86,510	$	88,192

Fair Value Measurements

12 Months Ended

Dec. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

The fair value hierarchy consists of the following three levels:

•Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets that the company has the ability to access;

•Level 2 — Valuations based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuations in which all significant inputs are observable in the market; and

•Level 3 — Valuations using significant inputs that are unobservable in the market and include the use of judgment by the company's management about the assumptions market participants would use in pricing the asset or liability.

The following tables summarize the Company’s assets and liabilities that are measured at fair value on a recurring basis:


			Basis of fair value measurement
(in thousands)	December 31, 2023		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	322,653	$	322,653	$	—	$	—
Restricted cash	9,860		9,860		—		—
Total assets	$	332,513	$	332,513	$	—	$	—


			Basis of fair value measurement
(in thousands)	December 31, 2022		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	404,613	$	404,613	$	—	$	—
Restricted cash	9,200		9,200		—		—
Total assets	$	413,813	$	413,813	$	—	$	—

In addition to the financial instruments that are recognized at fair value on the Consolidated Balance Sheet, the Company has certain financial instruments that are recognized at amortized cost or some basis other than fair value. The carrying amount of these instruments are considered to be representative of their approximate fair values.

The following tables summarize the Company’s financial instruments that are not measured at fair value:


	Book values				Fair values
(in thousands)	December 31, 2023		December 31, 2022		December 31, 2023		December 31, 2022
Liabilities
Current portion of notes payable	$	41	$	97	$	41	$	97
Notes payable, net of current portion	1,101		536		1,101		536
Total liabilities	$	1,142	$	633	$	1,142	$	633

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Pay vs Performance Disclosure - USD ($) $ in Thousands	12 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Pay vs Performance Disclosure
Net loss	$ (328,066)	$ (239,476)	$ (186,479)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
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Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Statement of Comprehensive Income [Abstract]
Net loss	$ (328,066)	$ (239,476)	$ (186,479)
Unrealized gain (loss) on investments	0	87	(162)
Net realized loss on investments reclassified into net loss	0	39	36
Other comprehensive income (loss)	0	126	(126)
Comprehensive loss	$ (328,066)	$ (239,350)	$ (186,605)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Net Loss Per Share - Schedule of Basic and Diluted Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Earnings Per Share [Abstract]
Net loss	$ (328,066)	$ (239,476)	$ (186,479)
Weighted average common shares outstanding, basic (in shares)	207,853,702	175,537,487	125,348,110
Weighted average common shares outstanding, diluted (in shares)	207,853,702	175,537,487	125,348,110
Net loss per share, basic (in dollars per shares)	$ (1.58)	$ (1.36)	$ (1.49)
Net loss per share, diluted (in dollars per shares)	$ (1.58)	$ (1.36)	$ (1.49)

- Definition

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- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 391,565	$ 549,912
Restricted cash	3,231	1,280
Other receivables	3,094	2,753
Other current assets	40,247	15,869
Total current assets	438,137	569,814
Restricted cash, non-current	6,629	7,920
Property and equipment, net	86,510	88,192
Operating lease right-of-use assets	33,663	33,255
Intangible assets, net	36,443	1,306
Goodwill	52,056	801
Other assets, non-current	261	0
Total assets	653,699	701,288
Current liabilities
Accounts payable	3,953	4,586
Accrued expenses and other liabilities	46,635	32,904
Unearned revenue	36,426	56,726
Notes payable	41	97
Operating lease liabilities	6,116	5,952
Total current liabilities	93,171	100,265
Unearned revenue, non-current	51,238	70,261
Notes payable, non-current	1,101	536
Operating lease liabilities, non-current	43,414	44,420
Deferred tax liabilities	1,339	0
Total liabilities	190,263	215,482
Commitments and contingencies (Note 7)
Stockholders’ equity
Common stock, $0.00001 par value; 2,000,000,000 shares (Class A 1,989,032,117 and Class B 10,967,883) authorized as of December 31, 2023 and December 31, 2022; 234,270,384 shares (Class A 226,264,764, Class B 7,544,871 and Exchangeable 460,749) and 191,022,864 (Class A 183,209,655 and Class B 7,813,209 and Exchangeable —) issued and outstanding as of December 31, 2023 and December 31, 2022, respectively	2	2
Additional paid-in capital	1,431,056	1,125,360
Accumulated deficit	(967,622)	(639,556)
Total stockholders’ equity	463,436	485,806
Total liabilities and stockholders’ equity	$ 653,699	$ 701,288

Employee benefit plans	12 Months Ended
Employee benefit plans	Dec. 31, 2023
Retirement Benefits [Abstract]
Employee benefit plans	Employee benefit plansThe Company maintains defined contribution benefit plans for its eligible employees. The plans generally allows employees to make contributions up to a specified percentage of their compensation. The Company generally contributes up to 4% of employee base salary, by matching 100% of the first 4% of annual base salary contributed by each employee. Additionally, the Company generally contributes a certain amount to the defined contribution plans for employees that worked at the Company during the year. Employer expenses were $3.8 million, $3.6 million and $2.1 million during the years ended December 31, 2023, 2022 and 2021, respectively.

- Definition

The entire disclosure for retirement benefits.

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-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (r)(2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480506/715-20-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 20
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480126/715-20-S99-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 715
-SubTopic 60
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480266/715-60-50-3

+ Details

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Indemnification The Company has agreed to indemnify its officers and directors for certain events or occurrences, while the officer or director is or was serving at the Company’s request in such capacity. The Company purchases directors and officers liability insurance coverage that provides for reimbursement to the Company for covered obligations and this is intended to limit the Company’s exposure and enable it to recover a portion of any amounts it pays under its indemnification obligations. The Company had no liabilities recorded for these agreements as of December 31, 2023 and December 31, 2022, as no amounts were probable. Employee Agreements The Company has signed employment agreements with certain key employees pursuant to which, if their employment is terminated following a change of control of the Company, the employees are entitled to receive certain benefits, including accelerated vesting of equity incentives. Legal Matters The Company may, from time to time, be involved in various legal proceedings arising in the normal course of business. An unfavorable resolution of any such matter could materially affect the Company’s future financial position, results of operations or cash flows. In February 2021, the Company entered into a lease agreement for laboratory and office space (the Industry Lease) with Industry Office SLC, LLC (the landlord). In March 2023, the Company sent a letter to the landlord detailing numerous construction delays and irregularities, deficiencies and deviations from applicable structural drawings and/or non-conforming conditions with applicable building codes. On June 23, 2023, the landlord filed a lawsuit against the Company (Industry Office SLC, LLC v. Recursion Pharmaceuticals, Inc., Case No. 230904627) in the Third District Court for Salt Lake County, State of Utah (the Court), alleging anticipatory repudiation and breach of contract. The Plaintiff seeks monetary damages and attorney’s fees. In July 2023, the Company filed a motion to dismiss. In September 2023, Recursion was granted its motion to dismiss, and the Court provided the landlord until October 23, 2023, to amend and re-file the dismissed complaint. On October 23, 2023, the landlord filed an amended complaint again alleging anticipatory repudiation, breach of contract and breach of the implied covenant of good faith and fair dealing (the Amended Complaint), and seeks monetary damages and attorney’s fees. In November 2023, the Company filed a motion to dismiss the Amended Complaint. The Court set a hearing on the Company’s motion to dismiss on March 29, 2024. As of December 31, 2023, the Company had no liability recorded for these events as an unfavorable outcome was not probable. In connection with the Industry Lease, in September 2023, the Company filed claims in the Court against the landlord alleging, among other things, breach of contract and fraudulent misrepresentation (the Counterclaims). In October 2023, the landlord filed an answer and denied the Company’s allegations asserted in the Counterclaims. The Company and the landlord are currently engaged in discovery. On October 27, 2023, the Company filed a motion for partial judgment on the pleadings, seeking judgment on one of its four counterclaims. The Court set a hearing on the Company’s motion for partial judgment on the pleadings on March 29, 2024.The Company is unable to estimate the possible amount or range of amounts associated with the Counterclaims.

Audit Information	12 Months Ended
Audit Information	Dec. 31, 2023
Audit Information [Abstract]
Auditor Name	Ernst & Young LLP
Auditor Location	Salt Lake City, Utah
Auditor Firm ID	42

Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	$ 9,860	$ 9,200
Total assets	332,513	413,813
Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	322,653	404,613
Level 1
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	9,860	9,200
Total assets	332,513	413,813
Level 1 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	322,653	404,613
Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	0	0
Total assets	0	0
Level 2 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	0	0
Level 3
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	0	0
Total assets	0	0
Level 3 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	$ 0	$ 0

Leases - Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jan. 01, 2022
Leases [Abstract]
2024	$ 10,059
2025	10,399
2026	10,526
2027	10,769
2028	7,397
Thereafter	17,014
Total lease payments	66,164
Less: imputed interest	(16,634)
Present value of lease liabilities	$ 49,530	$ 47,800

Collaborative Development Contracts (Details) $ in Thousands	1 Months Ended		12 Months Ended
	Jan. 31, 2022 USD ($) phenomap program performance_obligation	Oct. 31, 2020 USD ($) performance_obligation	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Dec. 31, 2021
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Unearned revenue			$ 36,426	$ 56,726
Two Customers \| Revenue Benchmark \| Customer Concentration Risk
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Concentration risk, percentage			100.00%	100.00%
One Customer \| Revenue Benchmark \| Customer Concentration Risk
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Concentration risk, percentage					100.00%
Collaborative arrangement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Unearned revenue			$ 10,000
Roche and Genentech \| Collaborative arrangement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Remaining unearned revenue	$ 150,000
Number of performance obligations under the agreement \| performance_obligation	3
Remaining performance obligation revenue	$ 150,000
Unearned revenue			$ 9,800
Roche and Genentech \| Collaborative arrangement \| Phenomaps Creation
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series	$ 250,000
Number of eligible phenomaps \| phenomap	16
Roche and Genentech \| Collaborative arrangement \| Phenomaps Raw Images
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series	$ 250,000
Number of eligible phenomaps \| phenomap	12
Roche and Genentech \| Collaborative arrangement \| Developed And Commercialized Programs
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series	$ 300,000
Number of projects that may be initiated \| program	40
Roche and Genentech \| Collaborative arrangement \| Gastrointestinal Cancer
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of performance obligations under the agreement \| performance_obligation	1
Roche and Genentech \| Collaborative arrangement \| Neuroscience
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of performance obligations under the agreement \| performance_obligation	2
Bayer AG \| Collaborative arrangement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series		$ 100,000
Number of performance obligations under the agreement \| performance_obligation		1
Remaining performance obligation revenue		$ 30,000
Non-refundable upfront payment received		30,000
Research project, fees and milestones payments receivable for an option on a development candidate		$ 120,000

Acquisitions - Schedule of Business Acquisitions, Pro Forma Information (Details) - Recursion, Valence And Cyclica - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Business Acquisition [Line Items]
Net revenue	$ 44,861	$ 40,517
Net loss	$ (336,603)	$ (273,889)

Acquisitions

12 Months Ended

Dec. 31, 2023

Business Combination and Asset Acquisition [Abstract]

Acquisitions

Valence Discovery Inc.

On May 16, 2023, Recursion acquired all of the outstanding equity interests in Valence Discovery Inc. (Valence), a privately-held machine learning (ML) / artificial intelligence (AI) digital chemistry company. The integration of Valence’s AI-based chemistry engine into Recursion’s operating system will allow Recursion to expand its technology-enabled drug discovery process. This will accelerate Recursion’s digital chemistry capabilities and its drug discovery process.

The acquisition of Valence was accounted for as a business combination using the acquisition method of accounting. The aggregate upfront consideration for the acquisition of Valence consisted of 2.2 million shares of Recursion Class A common stock, 4.4 million shares of a subsidiary of Recursion, exchangeable for shares of

Recursion’s Class A common stock, 792 thousand shares issuable upon exercise of stock options held by Valence equity award holders and deferred liabilities for additional consideration. An insignificant number of the aforementioned shares of consideration had not yet been issued as of December 31, 2023.The final number of shares to be issued has not yet been finalized and so are subject to change.

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	11,096
Fair value of Exchangeable stock	22,473
Fair value of equity awards issued to Valance equity award holders	1,933
Deferred liabilities for additional consideration	396
Total consideration	$	35,898

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	4,235
Other receivables	536
Intangible asset - technology	15,000
Accounts payable and accrued liabilities	(872)
Deferred income taxes	(3,265)
Total identifiable net assets	$	15,634
Goodwill	20,264
Total assets acquired and liabilities assumed	$	35,898

The intangible asset related to Valence’s ML and AI digital chemistry platform. The estimated fair value of the intangible asset was determined using a cost approach. This valuation technique provides the fair value of an asset based on estimates of the total costs to develop the technology. Significant inputs used to determine the total cost includes the length of time required, service hours performed by Company employees and the estimated obsolescence. The technology intangible asset is being amortized on a straight-line basis over its four-year useful life.

Goodwill was calculated as the excess of the consideration transferred over the net assets recognized. The goodwill recognized represents the assembled workforce and expected synergies, including the ability to: (i) leverage Valence’s digital chemistry platform across Recursion’s business; (ii) leverage Valence’s ML and AI capabilities; (iii) integrate Recursion’s data and operating system into Valence’s platform; and (iv) accelerate Recursion’s pipeline. Goodwill was also impacted by the establishment of a deferred tax liability for the acquired identifiable intangible assets which have no tax basis. The goodwill is not deductible for tax purposes.

Recursion’s consolidated statement of operations for the year ended December 31, 2023 included no net revenue and a $6.8 million operating loss associated with Valence’s operations. As the acquisition occurred in May 2023, the Company is still finalizing the allocation of the purchase price to the individual assets acquired and liabilities assumed. The allocation of the purchase price included in the current period balance sheet is based on the best estimate of management and is preliminary and subject to change. The primary areas subject to change relate to the valuation of the intangible asset, other receivables and deferred taxes. To assist management in the allocation, the Company engaged external specialists. The Company will finalize the amounts recognized as the information necessary to complete the analysis is obtained. The Company expects to finalize these amounts as soon as possible but no later than one year from the acquisition date.

Cyclica Inc.

On May 25, 2023, Recursion acquired all of the outstanding equity interests in Cyclica Inc. (Cyclica), a privately-held Company that has built a digital chemistry software suite which enables mechanism of action deconvolution and generative chemistry suggestions based on desired targets. Cyclica’s platform is expected to enhance the optimization of Recursion’s compounds for efficacy while minimizing liabilities through generative machine learning approaches.

The acquisition of Cyclica was accounted for as a business combination using the acquisition method of accounting. The aggregate upfront consideration for the acquisition of Cyclica consisted of 5.8 million shares of Recursion Class A common stock, cash payments, 1.0 million shares issuable upon exercise of stock options held by Cyclica equity award holders and deferred liabilities for additional consideration. Approximately 182 thousand of the aforementioned shares of Class A common stock consideration had not yet been issued as of December 31, 2023.

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	49,915
Cash	6,505
Fair value of equity awards issued to Cyclica equity award holders	3,852
Deferred liabilities for additional consideration	344
Total consideration	$	60,617

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	2,429
Restricted cash	1,685
Other receivables	741
Investments	1,000
Other current assets	385
Intangible assets - technology	28,000
Accounts payable and accrued liabilities	(579)
Unearned revenue	(1,754)
Deferred income taxes	(2,075)
Other liabilities, current	(66)
Other liabilities, non-current	(139)
Total identifiable net assets	$	29,627
Goodwill	30,990
Total assets acquired and liabilities assumed	$	60,617

The intangible assets are related to Cyclica’s digital chemistry platforms. The estimated fair value of the intangible assets were determined using a cost approach. This valuation technique provides the fair value of an asset based on estimates of the total costs to develop the technology. Significant inputs used to determine the total cost includes the length of time required, service hours performed by Company employees and the estimated obsolescence. The technology intangible assets are being amortized on a straight-line basis over their three-year useful lives.

Goodwill was calculated as the excess of the consideration transferred over the net assets recognized. The goodwill recognized represents the assembled workforce and expected synergies, including the ability to: (i) leverage Cyclica’s digital chemistry platform across Recursion’s business; (ii) leverage Cyclica’s ML and AI capabilities; (iii) integrate Recursion’s data and operating system into Cyclica’s platform; and (iv) accelerate Recursion’s pipeline. Goodwill was also impacted by the establishment of a deferred tax liability for the acquired identifiable intangible assets. The goodwill is not deductible for tax purposes.

Recursion’s consolidated statement of operations for the year ended December 31, 2023 included immaterial net revenue and a $9.6 million operating loss associated with Cyclica’s operations. As the acquisition occurred in May 2023, the Company is still finalizing the allocation of the purchase price to the individual assets acquired and liabilities assumed. The allocation of the purchase price included in the current period balance sheet is based on the best estimate of management and is preliminary and subject to change. The primary areas subject to change relate to the valuation of the intangible assets, other receivables and deferred taxes. To assist management in the allocation, the Company engaged external specialists. The Company will finalize the amounts recognized as the information necessary to complete the analysis is obtained. The Company expects to finalize these amounts as soon as possible but no later than one year from the acquisition date.

Pro forma financial information

The following table presents the unaudited pro forma combined results of operations of Recursion, Valence and Cyclica as if the acquisitions had occurred on January 1, 2022:


	Years ended December 31,
(in thousands)	2023		2022
Net revenue	$	44,861	$	40,517
Net loss	(336,603)		(273,889)

The unaudited pro forma financial information was prepared using the acquisition method of accounting and was based on the historical financial information of Recursion, Valence and Cyclica. In order to reflect the occurrence of the acquisitions on January 1, 2022 as required, the unaudited pro forma financial information includes adjustments to reflect the incremental amortization expense to be incurred based on the fair values of the identifiable intangible assets acquired, the additional stock compensation expense associated with the issuance of equity compensation related to the acquisitions and the reclassification of acquisition costs incurred during the year ended December 31, 2023 to the year ended December 31, 2022. The unaudited pro forma financial information is not necessarily indicative of what the consolidated results of operations would have been had the acquisitions been completed on January 1, 2022. In addition, the unaudited pro forma financial information is not a projection of the future results of operations of the combined company nor does it reflect the expected realization of any cost savings or synergies associated with the acquisitions.

Description of the Business	12 Months Ended
Description of the Business	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of the Business	Description of the Business Recursion Pharmaceuticals, Inc. (Recursion, the Company, we or our) was originally formed as a limited liability company on November 4, 2013 under the name Recursion Pharmaceuticals, LLC. In September 2016, the Company converted to a Delaware corporation and changed its name to Recursion Pharmaceuticals, Inc. Recursion is a clinical stage TechBio company decoding biology to industrialize drug discovery. The Recursion Operating System (OS), a platform built across diverse technologies, enables the Company to map and navigate trillions of biological and chemical relationships within the Recursion Data Universe, one of the world’s largest proprietary biological and chemical datasets. The Company integrates physical and digital components as iterative loops of atoms and bits scaling wet lab biology and chemistry data organized into virtuous cycles with computational tools to rapidly translate in silico hypotheses into validated insights and novel chemistry. As of December 31, 2023, the Company had an accumulated deficit of $967.6 million. The Company expects to incur substantial operating losses in future periods and will require additional capital to advance its drug candidates. The Company does not expect to generate significant revenue until the Company successfully completes significant drug development milestones with its subsidiaries or in collaboration with third parties, which the Company expects will take a number of years. In order to commercialize its drug candidates, the Company or its partners need to complete clinical development and comply with comprehensive regulatory requirements. The Company is subject to a number of risks and uncertainties similar to those of other companies of the same size within the biotechnology industry, such as the uncertainty of clinical trial outcomes, uncertainty of additional funding and a history of operating losses. The Company has funded its operations to date primarily through the issuance of convertible preferred stock and the issuance of Class A common stock (see Note 8, “Common Stock” for additional details). Additionally, the Company has received payments from its strategic partnerships (see Note 9, “Collaborative Development Contracts” for additional details). Recursion will likely be required to raise additional capital. As of December 31, 2023, the Company did not have any unconditional outstanding commitments for additional funding. If the Company is unable to access additional funds when needed, it may not be able to continue the development of its products or the Company could be required to delay, scale back or abandon some or all of its development programs and other operations. The Company’s ability to access capital when needed is not assured and, if not achieved on a timely basis, could materially harm its business, financial condition and results of operations. Recursion believes that the Company’s existing cash and cash equivalents will be sufficient to fund the Company’s operating expenses and capital expenditures for at least the next 12 months.

Net Loss Per Share

12 Months Ended

Dec. 31, 2023

Earnings Per Share [Abstract]

Net Loss Per Share

For the years ended December 31, 2023, 2022 and 2021, Recursion calculated net loss per share of Class A, Class B and Exchangeable common stock using the two-class method. Basic net loss per share is computed using the weighted-average number of shares outstanding during the period. Diluted net loss per share is computed using the weighted-average number of shares and the effect of potentially dilutive securities outstanding during the period. Potentially dilutive securities consist of stock options and other contingently issuable shares. For periods presented in which the Company reports a net loss, all potentially dilutive shares are anti-dilutive and as such are excluded from the calculation. For the years ended December 31, 2023, 2022 and 2021, the Company reported a net loss and therefore basic and diluted loss per share were the same.

The rights, including the liquidation and dividend rights, of the holders of the Company’s Class A, Class B and Exchangeable common stock and the Exchangeable common shares are identical, except with respect to voting. As a result, the undistributed earnings for each period are allocated based on the contractual participation rights of the Class A and Class B common stock and the Exchangeable common shares as if the earnings for the period had been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis and the resulting amount per share for Class A, Class B and Exchangeable common stock was the same during the years ended December 31, 2023, 2022 and 2021.

The following tables set forth the computation of basic and diluted net loss per share of Class A, Class B and Exchangeable common stock during 2023, 2022 and 2021:


	Years ended December 31,
(in thousands, except share amounts)	2023		2022		2021
Numerator:
Net loss	(328,066)		(239,476)		(186,479)
Denominator:
Weighted average common shares outstanding	207,853,702		175,537,487		125,348,110
Net loss per share, basic and diluted	$	(1.58)	$	(1.36)	$	(1.49)

The Company excluded the following potential common shares from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:


	Years ended December 31,
	2023	2022	2021
Stock based compensation	9,848,141	10,966,651	15,381,210
Tempus agreement	1,073,834	—	—
Convertible preferred stock	—	—	34,615,890
Warrants	—	—	151,745
Total	10,921,975	10,966,651	50,148,845

Acquisitions - Schedule of Business Acquisitions, by Acquisition (Details) - USD ($) $ in Thousands	May 25, 2023	May 16, 2023
Valence Discovery Inc
Business Acquisition [Line Items]
Deferred liabilities for additional consideration		$ 396
Total consideration		35,898
Valence Discovery Inc \| Employee Stock
Business Acquisition [Line Items]
Fair value of equity interests issued, value		1,933
Valence Discovery Inc \| Class A
Business Acquisition [Line Items]
Fair value of equity interests issued, value		11,096
Valence Discovery Inc \| Exchangeable Stock
Business Acquisition [Line Items]
Fair value of equity interests issued, value		$ 22,473
Cyclica Inc
Business Acquisition [Line Items]
Cash	$ 6,505
Deferred liabilities for additional consideration	344
Total consideration	60,617
Cyclica Inc \| Employee Stock
Business Acquisition [Line Items]
Fair value of equity interests issued, value	3,852
Cyclica Inc \| Class A
Business Acquisition [Line Items]
Fair value of equity interests issued, value	$ 49,915

Leases - Narrative (Details) $ in Millions	1 Months Ended	12 Months Ended
Leases - Narrative (Details) $ in Millions	May 31, 2022 USD ($) ft²	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Lessor, Lease, Description [Line Items]
Operating lease, renewal term		5 years
Increase (decrease) in operating lease right-of-use assets		$ 3.4	$ (2.7)
Decrease in operating lease liabilities			$ 2.8
Rent expense				$ 6.4
Toronto Lease
Lessor, Lease, Description [Line Items]
Operating lease, renewal term	5 years
Square footage of leased space (in square feet) \| ft²	28,110
Lease term	10 years
Tenant improvement allowance	$ 1.6
Expected fixed lease payments	$ 11.1
Minimum
Lessor, Lease, Description [Line Items]
Remaining operating lease term		1 year
Maximum
Lessor, Lease, Description [Line Items]
Remaining operating lease term		9 years

Fair Value Measurements - Asset and Liability Not Measured at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Book values
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Total liabilities	$ 1,142	$ 633
Book values \| Notes payable
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Current portion of notes payable	41	97
Notes payable, net of current portion	1,101	536
Fair values
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Total liabilities	1,142	633
Fair values \| Notes payable
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Current portion of notes payable	41	97
Notes payable, net of current portion	$ 1,101	$ 536

Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity - USD ($) $ in Thousands	Total	Tempus agreement	Series A and Series B Warrants	Convertible Preferred Stock	Common Stock (Class A, B and Exchangeable)	Common Stock (Class A, B and Exchangeable) Tempus agreement	Common Stock (Class A, B and Exchangeable) Series A and Series B Warrants	Additional Paid-in-Capital	Additional Paid-in-Capital Tempus agreement	Additional Paid-in-Capital Series A and Series B Warrants	Accumulated Deficit	Accumulated other comprehensive loss
Temporary equity, shares outstanding at beginning of period (in shares) at Dec. 31, 2020	112,088,065
Temporary equity, carrying amount attributable to parent at beginning of period at Dec. 31, 2020	$ 448,312
Increase (Decrease) in Temporary Equity [Roll Forward]
Conversion of preferred stock to common stock (in shares)				(112,088,065)
Conversion of preferred stock to common stock				$ (448,312)
Temporary equity, shares outstanding at end of period (in shares) at Dec. 31, 2021	0
Temporary equity, carrying amount attributable to parent at end of period at Dec. 31, 2021	$ 0
Beginning balance (in shares) at Dec. 31, 2020					22,314,685
Beginning balance at Dec. 31, 2020	(206,289)				$ 0			$ 7,312			$ (213,601)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Comprehensive loss	(186,605)										(186,479)	(126)
Common stock issuance (in shares)					27,878,787
Common stock issuance	462,354				$ 1			462,353
Conversion of preferred stock to common stock (in shares)					115,598,018		343,609
Conversion of preferred stock to common stock	448,312		$ 3,512		$ 1			448,311		$ 3,512
Stock option exercises and other (in shares)					4,137,363
Stock option exercises and other	6,812							6,812
Stock based compensation	14,842							14,842
Ending balance (in shares) at Dec. 31, 2021					170,272,462
Ending balance at Dec. 31, 2021	$ 542,938				$ 2			943,142			(400,080)	(126)
Temporary equity, shares outstanding at end of period (in shares) at Dec. 31, 2022	0
Temporary equity, carrying amount attributable to parent at end of period at Dec. 31, 2022	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Comprehensive loss	(239,350)										(239,476)	126
Common stock issuance (in shares)					15,336,734
Common stock issuance	143,711							143,711
Stock option exercises and other (in shares)					5,413,668
Stock option exercises and other	10,598							10,598
Stock based compensation	$ 27,909							27,909
Ending balance (in shares) at Dec. 31, 2022	191,022,864				191,022,864
Ending balance at Dec. 31, 2022	$ 485,806				$ 2			1,125,360			(639,556)	0
Temporary equity, shares outstanding at end of period (in shares) at Dec. 31, 2023	0
Temporary equity, carrying amount attributable to parent at end of period at Dec. 31, 2023	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Comprehensive loss	(328,066)										(328,066)
Common stock issuance (in shares)					19,658,963	3,225,902
Common stock issuance	$ 128,093	$ 22,000						128,093	$ 22,000
Stock option exercises and other (in shares)	4,820,058				9,058,817
Stock option exercises and other	$ 12,831							12,831
Stock based compensation	53,503							53,503
Common stock and stock options issued for acquisitions (in shares)					11,303,838
Common stock and stock options issued for acquisitions	$ 89,269							89,269
Ending balance (in shares) at Dec. 31, 2023	234,270,384				234,270,384
Ending balance at Dec. 31, 2023	$ 463,436				$ 2			$ 1,431,056			$ (967,622)	$ 0

Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The following table summarizes the changes in the carrying amount of goodwill:


(in thousands)
Balance as of December 31, 2022	$	801
Additions from acquisitions	51,255
Balance as of December 31, 2023	$	52,056

Schedule of Finite-lived Intangible Assets

The following table summarizes intangible assets:


	December 31, 2023						December 31, 2022
(in thousands)	Gross carrying amount		Accumulated Amortization		Net carrying amount		Gross carrying amount		Accumulated Amortization		Net carrying amount
Definite-lived intangible assets	$	44,426	$	(8,969)	$	35,457	$	1,211	$	(809)	$	402
Indefinite-lived intangible assets	986		—		986		904		—		904
Intangible assets, net	$	45,412	$	(8,969)	$	36,443	$	2,115	$	(809)	$	1,306

The estimated annual amortization expense for the definite-lived intangible assets recorded as of December 31, 2023 is as follows:


(in thousands)	2024		2025		2026		2027		2028
Estimated annual amortization expense	$	13,379	$	13,116	$	7,672	$	1,283	$	7

Schedule of Indefinite-lived Intangible Assets

The following table summarizes intangible assets:


	December 31, 2023						December 31, 2022
(in thousands)	Gross carrying amount		Accumulated Amortization		Net carrying amount		Gross carrying amount		Accumulated Amortization		Net carrying amount
Definite-lived intangible assets	$	44,426	$	(8,969)	$	35,457	$	1,211	$	(809)	$	402
Indefinite-lived intangible assets	986		—		986		904		—		904
Intangible assets, net	$	45,412	$	(8,969)	$	36,443	$	2,115	$	(809)	$	1,306

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 24
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482548/350-20-55-24

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
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-Paragraph 1
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
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-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-Name Accounting Standards Codification
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-Paragraph 1A
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1A

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-2

+ Details

Stock-Based Compensation - Schedule of Share-based Payment, Award, ESPP, Valuation Assumptions (Details)	12 Months Ended
	Dec. 31, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend yield	0.00%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Stock-Based Compensation - Summary of Stock-based Compensation Expenses (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	$ 51,679	$ 26,872	$ 13,830
Cost of revenue
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	5,326	2,755	0
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	21,992	10,065	4,841
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	$ 24,361	$ 14,052	$ 8,989

Income Taxes

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

The provision for income taxes consisted of the following components (all deferred):


	Years ended December 31,
(in thousands)	2023		2022		2021
Federal	$	(82,707)	$	(61,225)	$	(47,138)
State	(54,634)		(3,188)		684
Foreign	(4,564)		(471)		(149)
Change in valuation allowance	137,843		64,884		46,603
Total tax benefit	$	(4,062)	$	—	$	—

The Company’s effective tax rate of 1% during the year ended December 31, 2023 and 0% during the years ended December 31, 2022 and 2021 differs from the statutory U.S. federal rate as follows:


	Years ended December 31,
	2023		2022		2021
Statutory tax rate	21.0	%	21.0	%	21.0	%
R&D credit generation	3.1	%	3.7	%	3.2	%
Orphan drug credit generation	2.1	%	1.1	%	1.1	%
State taxes	16.4	%	—	%	—	%
Stock based compensation	(0.1)	%	0.8	%	0.6	%
Uncertain tax positions	(0.8)	%	(0.3)	%	(0.4)	%
Other	1.0	%	(0.8)	%	(0.2)	%
Change in valuation allowance	(41.5)	%	(25.5)	%	(25.3)	%
Effective tax rate	1.2	%	—	%	—	%

Significant components of deferred tax assets and liabilities were as follows:


	December 31,
(in thousands)	2023		2022
Deferred tax assets
Net operating loss carryforwards	$	117,877	$	89,951
Research and development capitalization	105,503		39,095
Tax credit carryforwards	50,293		30,965
Unearned revenue	23,007		—
Lease liabilities	13,208		11,442
Reserves and accruals	4,744		3,622
Stock-based compensation	5,080		2,231
Definite lived intangibles	—		969
Other	485		433
Gross deferred tax assets	320,197		178,708
Valuation allowance	(304,618)		(166,775)
Net deferred tax asset	15,579		11,933
Deferred tax liabilities
Right-of-use assets	(8,942)		(9,982)
Definite lived intangibles	(5,272)		—
Depreciable assets	(2,704)		(1,951)
Deferred tax liabilities	(16,918)		(11,933)
Net deferred tax liability	$	(1,339)	$	—

Significant judgment is required in determining the Company’s provision for income taxes, recording valuation allowances against deferred tax assets and evaluating the Company’s uncertain tax positions. Due to net losses since inception and the uncertainty of realizing the deferred tax assets, the Company has a full valuation allowance against all entities in a net deferred tax asset position. To the extent that the Company generates positive income and expects, with reasonable certainty, to continue to generate positive income, the Company may release all, or a portion of, the valuation allowance in a future period. This release would result in the recognition of all, or a portion of, the Company’s deferred tax assets, resulting in a decrease to income tax expense for the period such release is made. As of December 31, 2023 and 2022, the Company’s valuation allowance was $304.6 million and $166.8 million, respectively, which increased by approximately $137.8 million and $64.7 million during the years ended December 31, 2023 and 2022, respectively.

Net operating losses (NOLs) and tax credit carry-forwards are subject to review and possible adjustment by the Internal Revenue Service (“IRS”) and may become subject to annual limitation due to ownership changes that have occurred previously or that could occur in the future under Section 382 of the Internal Revenue Code, as amended and similar state provisions. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period. The Company is conducting a study to assess whether a change of ownership has occurred or whether there have been multiple ownership changes since inception. If the Company has experienced a change of ownership, as defined by Section 382, at any time since inception, utilization of the net operating loss carryforwards or research and development tax credit carryforwards would be subject to an annual limitation under Section 382, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term tax-exempt rate and then could be subject to additional adjustments, as required. Any limitation may result in expiration of a portion of the net operating loss carryforwards or research and development tax credit carryforwards before utilization. Further, until a study is completed and any limitation is known, no amounts are being presented as an uncertain tax position.

As of December 31, 2023 and 2022, the Company had federal NOL carryforwards of $412.0 million and $414.4 million, respectively, available to reduce taxable income, of which $18.6 million expire beginning 2036 and $393.4 million do not expire. The Company had state NOL carryforwards of $398.6 million and $61.5 million as of

December 31, 2023 and 2022, respectively, available to reduce future state taxable income, of which $334.0 million expire beginning 2031 and $64.6 million do not expire. The Company had foreign NOL carryforwards of $19.5 million as of December 31, 2023, available to reduce future foreign taxable income, which expire beginning in 2032.

As of December 31, 2023, the Company also had federal and state research and development credit carryforwards of $30.3 million and $6.9 million respectively. As of December 31, 2022, the Company had federal and state research and development credit carryforwards of $21.3 million and $5.6 million, respectively. The federal research and development credit carryforwards expire beginning in 2036 and the state credit carryforwards expire beginning in 2030. The Company also had federal Orphan Drug credits of $17.9 million and $6.8 million as of December 31, 2023 and 2022, respectively, which will begin expiring in 2039.

Reserves for uncertain tax positions against the credit carryforwards were as follows:


	December 31,
(in thousands)	2023		2022
Balance at the beginning of the period	$	2,762	$	1,944
Increases for positions taken in current year	1,726		818
Increase for positions taken in prior year	929		—
Balance at the end of the period	$	5,417	$	2,762

The Company recognizes benefits of uncertain tax positions if it is more likely than not that such positions will be sustained upon examination based solely on their technical merits, as the largest amount of benefit that is more likely than not to be realized upon the ultimate settlement. It is the Company’s policy to include penalties and interest expense related to income taxes as a component of Other income (loss), net as necessary.

The Company files income tax returns in the United States, Canada, United Kingdom, Utah, California and Massachusetts. The Company is not currently under examination in any of these jurisdictions. The Company is subject to income tax examinations on all federal returns since the 2016 tax return.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1
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-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
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-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
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-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Apr. 30, 2021	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, vesting period		4 years
Options granted in period, weighted average grant date fair value (in dollars per share)		$ 5.64	$ 6.57	$ 7.66
Options, granted in period (in shares)		5,083,268
Share-based payment arrangement, expense		$ 51,679	$ 26,872	$ 13,830
Unvested stock options, unamortized stock-based compensation cost		$ 32,600
Unvested stock options, unamortized stock-based compensation cost, weighted average period recognition		2 years
Restricted stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unvested stock options, unamortized stock-based compensation cost, weighted average period recognition		3 years
Fair market value of vested shares		$ 26,900
Unrecognized compensation cost		$ 119,500
Granted (in shares)		14,332,216
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, vesting period	4 years
Employee Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, vesting period		4 years
Stock options, expiration period		10 years
2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, capital shares reserved for future issuance (in shares)	16,200,000
Number of shares available for grant (in shares)		10,900,000

Summary of Significant Accounting Policies - Estimated Useful Lives (Details)	Dec. 31, 2023
Office Equipment
Property, Plant and Equipment [Line Items]
Useful life	5 years
Lab Equipment
Property, Plant and Equipment [Line Items]
Useful life	7 years
Leasehold Improvements
Property, Plant and Equipment [Line Items]
Useful life	15 years

Stock-Based Compensation - Schedule of RSU Activity (Details) - Restricted stock	12 Months Ended
	Dec. 31, 2023 $ / shares shares
Stock units
Beginning balance, outstanding (in shares) \| shares	6,894,525
Granted (in shares) \| shares	14,332,216
Vested (in shares) \| shares	(3,385,863)
Forfeited (in shares) \| shares	(2,617,114)
Ending balance, outstanding (in shares) \| shares	15,223,764
Weighted-average grant date fair value
Beginning balance, outstanding Weighted average grant date fair value (in dollars per share) \| $ / shares	$ 8.17
Granted (in dollars per share) \| $ / shares	8.61
Vested (in dollars per share) \| $ / shares	8.52
Forfeited (in shares) \| $ / shares	8.29
Ending balance, outstanding Weighted average grant date fair value (in dollars per share) \| $ / shares	$ 8.39

Income Taxes - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Income Tax Contingency [Line Items]
Valuation allowance	$ 304,618	$ 166,775
Change in valuation allowance	137,800	64,700
Orphan Drug credit carryforward
Income Tax Contingency [Line Items]
Tax credit carryforwards	17,900	6,800
Federal
Income Tax Contingency [Line Items]
Operating loss carryforwards	412,000	414,400
Operating loss carryforwards subject to expiration	18,600
Operating loss carryforwards not subject to expiration	393,400
Federal \| Research tax credit carryforward
Income Tax Contingency [Line Items]
Tax credit carryforwards	30,300	21,300
State and local
Income Tax Contingency [Line Items]
Operating loss carryforwards	398,600	61,500
Operating loss carryforwards subject to expiration	334,000
Operating loss carryforwards not subject to expiration	64,600
State and local \| Research tax credit carryforward
Income Tax Contingency [Line Items]
Tax credit carryforwards	6,900	$ 5,600
Foreign Tax Authority
Income Tax Contingency [Line Items]
Operating loss carryforwards	$ 19,500

Description of the Business (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ 967,622	$ 639,556

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Net Loss Per Share - Schedule of Antidilutive Securities Excluded from Computation of Net Loss Per Share (Details) - shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	10,921,975	10,966,651	50,148,845
Stock based compensation
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	9,848,141	10,966,651	15,381,210
Tempus agreement
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	1,073,834	0	0
Convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	0	0	34,615,890
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	0	0	151,745

Goodwill and Intangible Assets - Schedule of Indefinite-lived Intangible Assets (Details) $ in Thousands	Dec. 31, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2024	$ 13,379
2025	13,116
2026	7,672
2027	1,283
2028	$ 7

Net Loss Per Share (Tables)

12 Months Ended

Dec. 31, 2023

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Net Loss per Share

The following tables set forth the computation of basic and diluted net loss per share of Class A, Class B and Exchangeable common stock during 2023, 2022 and 2021:


	Years ended December 31,
(in thousands, except share amounts)	2023		2022		2021
Numerator:
Net loss	(328,066)		(239,476)		(186,479)
Denominator:
Weighted average common shares outstanding	207,853,702		175,537,487		125,348,110
Net loss per share, basic and diluted	$	(1.58)	$	(1.36)	$	(1.49)

Schedule of Antidilutive Securities Excluded from Computation of Net Loss Per Share

The Company excluded the following potential common shares from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:


	Years ended December 31,
	2023	2022	2021
Stock based compensation	9,848,141	10,966,651	15,381,210
Tempus agreement	1,073,834	—	—
Convertible preferred stock	—	—	34,615,890
Warrants	—	—	151,745
Total	10,921,975	10,966,651	50,148,845

Acquisitions - Summarizes Of Fair Value Of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Dec. 31, 2023	May 25, 2023	May 16, 2023	Dec. 31, 2022
Business Acquisition [Line Items]
Goodwill	$ 52,056			$ 801
Valence Discovery Inc
Business Acquisition [Line Items]
Cash			$ 4,235
Other receivables			536
Intangible assets - technology			15,000
Accounts payable and accrued liabilities			(872)
Deferred income taxes			(3,265)
Total identifiable net assets			15,634
Goodwill			20,264
Total assets acquired and liabilities assumed			$ 35,898
Cyclica Inc
Business Acquisition [Line Items]
Cash		$ 2,429
Restricted cash		1,685
Other receivables		741
Investments		1,000
Other current assets		385
Intangible assets - technology		28,000
Accounts payable and accrued liabilities		(579)
Unearned revenue		(1,754)
Deferred income taxes		(2,075)
Other liabilities, current		(66)
Other liabilities, non-current		(139)
Total identifiable net assets		29,627
Goodwill		30,990
Total assets acquired and liabilities assumed		$ 60,617