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

KarbonPay automates the calculations of payroll data, across multiple countries and languages.

In five years, we hope to be operational in ~25 countries, as a primary payroll provider. We will have integrations with the biggest and best HR and accounting software tools in order to provide customers with the most seamless, automated payroll experience.

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

Milestones

KarbonPay, LLC was organized in the State of Texas in December 2019.

Since then, we have:

• Global network of customers established, & partnerships in negotiation worth an annual ~ $50-75M.
• Software poised to disrupt an industry expected to reach $38. 4 Billion by 2027.
• CEO grew revenues at previous company by 120,000%, from $500 to $600,000, in under 2 years.
• COVID has led to a pressing need for remote payroll services & a unique market opportunity.
• Innovative, cloud-based platform addresses increasing demands for cost reduction & time efficiency.
• Experienced team—incl. founder who has run payroll in 14 countries globally in the past 5 years.
• Clear route to market with Xero integration already secured.

Historical Results of Operations

Our company was organized in December 2019 and has limited operations upon which prospective investors may base an evaluation of its performance.

• Revenues & Gross Margin. For the period ended December 31, 2019, the Company had revenues of $0.
• Assets. As of December 31, 2019, the Company had total assets of $0, including $0 in cash.
• Net Loss. The Company has had net losses of $2,500 for 2019.
• Liabilities. The Company's liabilities totaled $0 for 2019.

Liquidity & Capital Resources

To-date, the company has been financed with $165,000 in equity.

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 18 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

KarbonPay, LLC cash in hand is $12,329.40, as of October 2020. Over the last three months, revenues have averaged $10/month, cost of goods sold has averaged $3/month, and operational expenses have averaged $13,500/month, for an average burn rate of $13,493 per month. Our intent is to be break even in 9 months.

Since our entity was formed on 12/31/2019, our expenditure has increased during the fiscal year 2020.

In the next 3 - 6 months we are expecting (but cannot guarantee) monthly revenues of $32,000, and annual revenues of $384,000.  Our revenue forecasts are based on getting fully-funded, continuing our existing growth rates, and charging full price (we technically received our first revenues last month as we have live, paying (monthly) beta users - they are currently heavily discounted.) Currently we have ~ 45 paying customers, and are onboarding more companies every week.  During the same period, we expect monthly expenses to be about $55k.  We hope to be break even 9 months from now.

In terms of other forms of capital, we have access to a business line of credit, though we have not used it to date and prefer not to.