Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

We are a 22 year old gourmet cookie company based in San Francisco. It all started with one cookie and our goal of making the best cookies around. Our first retail store showed to be successful so we opened a second retail store to also serve as a manufacturing hub for future expansion. We source the best ingredients when possible and never stop working on new flavors and products. Now we are looking to take the business beyond the Bay Area so everyone can enjoy our delicious cookies!

We plan to open two to three retail stores to further capture the local market and grow the brand. We also plan to grow our wholesale network and launch an e-commerce platform to get our cookies into everyone's homes.

Milestones

Anthony's Cookies was incorporated in the State of California in January 2015.  The company was originally formed as an LLC in 1998.

Since then, we have:

• To become a part of a proven company with solid growth.
• Strategic partnerships with brands such as Straus Creamery, Four Barrel Coffee, Valrhona Chocolate and Central Milling.

Historical Results of Operations

• Revenues & Gross Margin. For the period ended December 31, 2019, the Company had revenues of $712,646 compared to the year ended December 31, 2018, when the Company had revenues of $727,178. Our gross margin was 91.3% in fiscal year 2019, compared to 91.5% in 2018.
• Assets. As of December 31, 2019, the Company had total assets of $386,868, including $9,129 in cash. As of December 31, 2018, the Company had $448,418 in total assets, including $28,112 in cash.
• Net Loss. The Company has had net losses of $2,638 and net losses of $34,768 for the fiscal years ended December 31, 2019 and December 31, 2018, respectively.
• Liabilities. The Company's liabilities totaled $506,554 for the fiscal year ended December 31, 2019 and $565,467 for the fiscal year ended December 31, 2018.

Liquidity & Capital Resources

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is infinite as the business is currently profitable.

We plan to use the proceeds as set forth in this Form C under "Use of Funds". We don’t have any other sources of capital in the immediate future.

We will likely require additional financing in excess of the proceeds from the Offering in order to perform operations over the lifetime of the Company. We have no plans to raise further capital. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from the offering. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.

Runway & Short/Mid Term Expenses

Anthony's Cookies cash in hand is $18,765, as of December 2019. Over the last three months, revenues have averaged $67,000/month, cost of goods sold has averaged $5,750/month, and operational expenses have averaged $50,000/month, for an average net margin of $11,250 per month. We are currently profitable.

Our finances and operations have remained stable since the date that is covered by our financials.

We expect expenses to remain fairly stable while continuing to increase revenues over the next three to six months.   Six months following the raise, we hope that monthly revenues are at about $74k / month.  With the addition of new machinery to increase production we'll be able to push our cost of goods even lower allowing us to increase profits. We're a currently profitable business, and if needed will continue to grow based off of business profits.