[PART I - FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company's cash position significantly increased due to its July 2023 IPO, despite wider net losses driven by higher operating expenses Condensed Balance Sheet Highlights (Unaudited) | Metric | Sep 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $5,815,008 | $981,125 | | Total current assets | $6,134,128 | $1,026,978 | | Total assets | $6,240,912 | $1,336,913 | | Total current liabilities | $216,695 | $204,896 | | Total liabilities | $244,353 | $811,535 | | Total stockholders' equity | $5,996,559 | $525,378 | Condensed Statement of Operations Highlights (Unaudited) | Metric | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Revenues | $1,652,965 | $1,691,826 | | Total operating expenses | $3,812,045 | $3,231,326 | | Loss from operations | $(2,159,080) | $(1,539,500) | | Net loss | $(2,196,565) | $(1,531,399) | | Net loss per common share | $(0.28) | $(0.22) | Condensed Statement of Cash Flows Highlights (Unaudited, Nine Months Ended) | Metric | Sep 30, 2023 | Sep 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(908,139) | $(774,196) | | Net cash used in investing activities | $(9,073) | $0 | | Net cash provided by financing activities | $5,751,095 | $343,991 | | Net change in cash | $4,833,883 | $(430,205) | [Notes to Condensed Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) The company raised **$5.0 million** from its July 2023 IPO and has sufficient cash to fund operations for at least one year despite recurring losses - The company completed its Initial Public Offering (IPO) on July 27, 2023, selling 1,412,500 shares of common stock at $4.00 per share, resulting in net proceeds of approximately **$5.0 million** after deducting underwriting discounts and offering expenses[30](index=30&type=chunk) - Despite a net loss of **$2.2 million** for the nine months ended September 30, 2023, management expects that its cash balance of **$5.8 million** will be sufficient to fund operating expenses and capital requirements for at least one year[31](index=31&type=chunk)[32](index=32&type=chunk) - Upon the IPO in July 2023, all remaining outstanding SAFEs were converted into 165,861 shares of common stock, and all shares of Series B Preferred Stock were converted into 500,000 shares of common stock[71](index=71&type=chunk)[79](index=79&type=chunk) - Total stock-based compensation for the nine months ended September 30, 2023, was **$1.43 million**, a significant increase from $0.67 million in the prior year, largely due to IPO-related issuances[84](index=84&type=chunk)[93](index=93&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q3 revenue grew 11% driven by higher transaction values, though operating expenses rose significantly due to IPO-related costs [Overview and Strategy](index=21&type=section&id=Overview%20and%20Strategy) The company operates a B2B fintech marketplace and plans to accelerate growth through content, platform enhancement, and performance marketing - The company's business model is a B2B fintech marketplace connecting commercial borrowers and lenders, earning a transaction fee of approximately **1% of the loan amount** at closing[104](index=104&type=chunk)[107](index=107&type=chunk) - Key strategic initiatives include accelerating content marketing, enhancing the product platform with data and features, and expanding performance marketing to new borrower segments[109](index=109&type=chunk)[114](index=114&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) Q3 revenue rose 11% to **$584k** on higher transaction values, while surging IPO-related expenses drove a higher net loss Q3 2023 vs Q3 2022 Performance | Metric | Q3 2023 | Q3 2022 | Change % | | :--- | :--- | :--- | :--- | | Revenues | $583,785 | $525,360 | 11% | | Total operating expenses | $2,222,431 | $1,127,452 | 97% | | Loss from operations | $(1,638,646) | $(602,092) | 172% | | Net loss | $(1,578,528) | $(267,642) | 490% | Nine Months 2023 vs 2022 Performance | Metric | Nine Months 2023 | Nine Months 2022 | Change % | | :--- | :--- | :--- | :--- | | Revenues | $1,652,965 | $1,691,826 | -2% | | Total operating expenses | $3,812,045 | $3,231,326 | 18% | | Loss from operations | $(2,159,080) | $(1,539,500) | 40% | | Net loss | $(2,196,565) | $(1,531,399) | 43% | - The **11% revenue increase in Q3 2023** was driven by a **78% increase in average revenue per transaction** ($9,673 vs $5,419 in Q3 2022), largely due to growth in Small Business Administration (SBA) loans[117](index=117&type=chunk) - The significant increase in operating expenses for both the three and nine-month periods was primarily attributed to higher stock-based compensation and professional fees related to the company's IPO[119](index=119&type=chunk)[121](index=121&type=chunk)[128](index=128&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) The company's cash position increased to **$5.8 million** following its IPO and a preferred stock sale, ensuring sufficient liquidity for one year - As of September 30, 2023, the company had **$5.8 million in cash and cash equivalents**, compared to $0.98 million at December 31, 2022[130](index=130&type=chunk) - Financing activities in 2023 included raising **$1.0 million** from the sale of Series B preferred stock and approximately **$5.0 million in net proceeds** from the IPO[130](index=130&type=chunk)[136](index=136&type=chunk) - Management believes its current capital is **sufficient to sustain the company's operating expenses for at least one year**[130](index=130&type=chunk) [Non-GAAP Financial Measures](index=28&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA loss improved to **$725k** for the nine-month period, excluding non-cash expenses like stock-based compensation - Adjusted EBITDA is presented as a key non-GAAP measure, calculated as net loss excluding stock-based compensation, depreciation, and other income/expense[137](index=137&type=chunk) Reconciliation of Net Loss to Adjusted EBITDA (Unaudited) | Metric | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net loss | $(2,196,565) | $(1,531,399) | | Share-based compensation | $1,434,464 | $673,572 | | Depreciation | $107 | $0 | | Other income (expense) | $(37,485) | $8,101 | | **Adjusted EBITDA** | **$(724,509)** | **$(865,928)** | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company identifies interest rate and inflation as primary market risks but reports no material impact on its operations to date - The company's primary market risks are identified as **interest rate and inflation risks**[152](index=152&type=chunk) - Management does not believe inflation has had a **material effect** on the company's results of operations during the periods presented[154](index=154&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to a material weakness in internal controls related to segregation of duties - Management concluded that as of September 30, 2023, the company's disclosure controls and procedures were **not effective** at the reasonable assurance level[156](index=156&type=chunk) - The ineffectiveness is due to a **material weakness** related to the inability to effectively segregate accounting duties, attributed to the company's limited size and resources[157](index=157&type=chunk) [PART II - OTHER INFORMATION](index=32&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no current legal proceedings - The company is not a party to any material legal proceedings[161](index=161&type=chunk) [Item 1A. Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors have been reported since the company's S-1 Registration Statement - As a smaller reporting company, Janover is not required to provide this information and reports **no material changes** from its Registration Statement[162](index=162&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company details unregistered equity sales, including a **$1 million** preferred stock sale and conversions of SAFEs and preferred stock to common stock - In April 2023, the company sold 1,000 shares of Series B Preferred Stock for an aggregate price of **$1,000,000**[163](index=163&type=chunk) - Upon the IPO in July 2023, all outstanding SAFEs were converted into 165,861 shares of common stock, and all Series B Preferred Stock was converted into 500,000 shares of common stock[164](index=164&type=chunk)[165](index=165&type=chunk) - In connection with the IPO, the company also issued 135,266 shares for services, 375,000 shares as direct offering costs, and an aggregate of 342,438 shares related to employee stock options[165](index=165&type=chunk)[166](index=166&type=chunk)[167](index=167&type=chunk) [Other Items and Exhibits](index=32&type=section&id=Other%20Items%20and%20Exhibits) The company reports no defaults or other material information and lists all exhibits filed with the report - The company reports no defaults upon senior securities (Item 3), no mine safety disclosures (Item 4), and no other information (Item 5)[168](index=168&type=chunk)[169](index=169&type=chunk) - Item 6 lists exhibits filed with the report, including corporate governance documents, equity plans, and required certifications[170](index=170&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2023 or ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _________ to __________ COMMISSION FILE NUMBER 001-41748 JANOVER INC. Boca Raton, FL 33487 (844) 885-6875 ___________________________________ Securities regist ...