hobbyDB

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

Built and Owned by Collectors like you.

Collectibles is a completely underserved, $500 billion market comprised of 75 million collectors. This market is ripe for disruption and with more than 80 years of combined experience, we know how to build THE resource for collectors that will become the next eBay/Etsy of the future.

Built by collectors for collectors (and now owned by collectors), hobbyDB is the ultimate home for collectors and fans worldwide. With a powerful and detailed database of collectibles super-powered with a price guide, you can explore any fandom, track your collection, and use our secure marketplace to safely buy and sell.

With more than 100 million items in the database and 20 million price points in our price guide we’ll be the Wikipedia/Kelly Blue Book of collecting. The default place everyone goes for information on collectibles and fandoms - and the most trusted collectors’ marketplace for 10 million users. With our user base growing fast and $1.35B worth of items in their collections already, we’re well on our way. These future projections cannot be guaranteed.

Milestones

Hobbydb Corp. was incorporated in the State of Delaware in October 2013.

Since then, we have:

- We believe we are poised to conquer an underserved, $500B market comprised of 75 million collectors
hobbyDB is home to 530,000 collectors who have collections worth $1.35 Billion
- $4 million in capital raised from Producer Adam Goldberg, Techstars, & 989 collectors just like you
- We power the databases and price guides behind brands such as Funko and Hard Rock International
- Funko is profitable for us, representing an annual contribution of $250,000 and growing
- CEO ran the largest set of collector forums & founded the biggest European eBay business w/ $40 million GMV
- User wish lists house 9 Million items worth $913 Million

Historical Results of Operations

- Revenues & Gross Margin. For the period ended December 31, 2021, the Company had revenues of $418,154 compared to the year ended December 31, 2020, when the Company had revenues of $430,152. Our gross margin was 84.35% in fiscal year 2021, compared to 76.32% in 2020.
- Assets. As of December 31, 2021, the Company had total assets of $341,404, including $112,406 in cash. As of December 31, 2020, the Company had $346,845 in total assets, including $106,993 in cash.
- Net Loss. The Company has had net losses of $162,993 and net losses of $285,630 for the fiscal years ended December 31, 2021 and December 31, 2020, respectively.
- Liabilities. The Company's liabilities totaled $197,108 for the fiscal year ended December 31, 2021 and $192,207 for the fiscal year ended December 31, 2020.

Related Party Transactions

Please refer to Question 26 of this Form C for information regarding related party transactions.

Liquidity & Capital Resources

To-date, the company has been financed with $498,497 in debt and $4,346,406 in equity.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 24 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

Hobbydb Corp. cash in hand is $56,412, as of December 2022. Over the last three months, revenues have averaged $35,300/month, cost of goods sold has averaged $4,246/month, and operational expenses have averaged $50,120/month, for an average burn rate of $19,066 per month. Our intent is to be profitable in 3 months.

Since the date our financials cover, we are almost done with integrating our 3 main websites (there is only one more site to integrate and this has been started) and building tools that allow our contributors to maintain many more parts of the site. We are continuing on this path and this crowdfunding is part of this strategy (we want the site to be owned by the customers that build the hobbyDB database).

In the next 3 - 6 months we have a number of major proposals outstanding that will give us step-ups in revenues and expect to close some of them. We also plan to transition back to final value fees which should help our marketplace revenue grow.   We expect (but do not guarantee) to be generating $95,000 in monthly revenues, and $68,000 in monthly expense six months from now.

We hit our first month of profitability in July 2021. Since then we increased development resources so that we can build and release features for the community faster.  We are not currently profitable.

Our assumption is that we do not need to raise further funding but will continue to do so as this is part of our vision of being owned by our most important users, our contributors.  We now have more than 900 shareholders that we could approach for additional funding in the case need to (we have a very loyal shareholder following as you can see from our past fundraising history further above).

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