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 provide users a complimentary appetizer when they dine at our partner restaurants.

Our focus is to unquestionably become the go-to platform for people who want enjoy restaurants. Within the first 5 years we aim to have expanded to every major metro region in the US.

Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future, if any.

Milestones

App App, Inc. was incorporated in the State of Delaware in October 2017.

Since then, we have:

• 90+ partner restaurants in NYC including: Sen Sakana, Sparks Steakhouse, Obica Mozzarella Bar, and Le Rivage.
• Version 2 released October 6th, 2019
• 250+ Monthly Active Users.
• User spend per appetizer redemption is ~$45 at partner restaurants.
• We DO NOT pay for appetizers; they are covered 100% by the restaurants.

Historical Results of Operations

Our company was organized in October 2017 and has limited operations upon which prospective investors may base an evaluation of its performance.

• Revenues & Gross Margin. For the period ended December 31, 2018, the Company had revenues of $2,331.70 compared to the year ended December 31, 2017, when the Company had revenues of $0. Our gross margin was 100.0% in fiscal year 2018, compared to % in 2017.
• Assets. As of December 31, 2018, the Company had total assets of $23,570.57, including $6,925.36 in cash. As of December 31, 2017, the Company had $33,370.05 in total assets, including $24,970.05 in cash.
• Net Loss. The Company has had net losses of $24,799.48 and net losses of $14,371.09 for the fiscal years ended December 31, 2018 and December 31, 2017, respectively.
• Liabilities. The Company's liabilities totaled $30,000 for the fiscal year ended December 31, 2018 and $15,000 for the fiscal year ended December 31, 2017.

Related Party Transaction

Refer to Question 26 of this Form C for disclosure of all related party transactions.

Liquidity & Capital Resources

To-date, the company has been financed with $10,000 in debt and $276,233 in SAFEs.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 4 months before we need to raise further capital.

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. 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

App App, Inc. cash in hand is $173,887, as of September 2019. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $27,000/month, for an average burn rate of $27,000 per month. Our intent is to be profitable in 24 months.

We have raised a successful round via equity crowdfunding that closed on July 31, 2019.  This lead to the hiring of two new employees as well as the ability to more forward with development of the newest version of AppApp.  Due to this, salaries have increased recently compared to the past as well as a bump in developmental costs to contractors, which will reduce over time.

We have released our new version in October 2019 and have been promoting it to drive user growth and get additional feedback.  The full product is slated to be finished by end of year 2019 with all features, including our premium upgrade feature for users.  The premium feature ($10/month subscription) will be our primary driver of revenues.  I do not expect expenses to change much over the next 3 months, but as part of our raise, expand our business development team to increase our restaurant offerings.  We will also be increasing our marketing spend as more features roll out over the next few months.