Driven

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

The Company began by creating a unique drive system for time-trial bikes but pivoted in mid-2022 to design and manufacture an e-bike drive system called the ‘Driven Core Drive.’ The Driven Core Drive is lighter than most drive-systems in e-bikes, has fewer gears, requires almost no maintenance, is highly efficient (greater battery range), utilizes regenerative braking, and ships with the three most common motor-bolt-patterns in the e-bike market. 

Milestones

Driven Technologies, Inc. was incorporated in the State of Delaware in November 2020. Patents mentioned in this Form C are in Driven Technologies, Inc.'s name.

Since then, we have:

• Driven is led by bike-industry professionals with dozens of successful products in the market.
• Two patents awarded, 3 provisional patents. The Driven system is truly novel to micromobility.
• Extended battery range of 10 – 19% - more efficiency is better for riders and the environment.
• Extremely low maintenance (every 10,000 miles).
• A single, bolt-on solution – no more cobbling together of chains/derailleurs/motors.
• The e-bike market is experiencing hyper-growth. Now a $30B + market with almost a 15% CAGR.
• Led by seasoned bike-industry professionals with dozens of successful products in the market.
• Spun out of CeramicSpeed, already raised ~$2M from bike industry and crowd funding investors.

The Company is subject to risks and uncertainties common to early-stage companies. Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future.

Historical Results of Operations

Our company was organized in November 2020 and has limited operations upon which prospective investors may base an evaluation of its performance.

• Revenues & Gross Margin. For the period ended December 31, 2022, the Company had revenues of $0 compared to the year ended December 31, 2021, when the Company had revenues of $0.
• Assets. As of December 31, 2022, the Company had total assets of $842,453, including $156,674 in cash. As of December 31, 2021, the Company had $1,083,764 in total assets, including $555,647 in cash.
• Net Loss. The Company has had net losses of $933,020 and net losses of $365,344 for the fiscal years ended December 31, 2022 and December 31, 2021, respectively.
• Liabilities. The Company's liabilities totaled $1,654,594 for the fiscal year ended December 31, 2022 and $962,009 for the fiscal year ended December 31, 2021.

Liquidity & Capital Resources

To-date, the company has been financed with $1,882,207 in convertibles.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 6 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. We plan to raise capital in 12 months. 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

Driven Technologies, Inc. cash in hand is $168,000, as of July 2023. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $69,000/month, for an average burn rate of $69,000 per month. Our intent is to be profitable in 18 months.

Since the date of our financials, we have completed the 3rd version of our prototype which incorporates 3 different drive methods.  The Driven drivetrain can now be produced using a chain, belt, or shaft drive to accommodate customers' needs.  We attended Eurobike, the largest cycling trade show in Europe and received significant positive feedback and multiple inquiries about forming strategic partnerships.

We are not yet profitable.  Driven is a pre-revenue company focused on commercializing our disruptive e-bike drive train technology to bring to market.  We expect expenses to average $80k/month as we further develop the technology and begin to spend money on marketing.

We are aiming to start generating revenues in July of 2024. We project generating $4M in revenue in 2024 at -14% EBITDA.

Our current forecast requires an incremental $5M in capital to become profitable by December of 2024.  The 2 major categories for funding include standing up a sales and marketing team and then having the working capital to meet customer demand.

Aside from Wefunder, we have secured additional funding through our major investor, CeramicSpeed, to get us through our short-term funding requirements.

All projections in the above narrative are forward-looking and not guaranteed.