Sirocco Energy

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
Efficient urban wind turbine. Save up to 82% on electricity costs.

We want to breathe clean air and drink clean water, we want our kids to live long and be healthy. It's impossible if we won't care about our resources, our nature. The transition to renewables will happen, it's obvious. The question is who will drive it? We want to change the urban landscape. Join us and let's make it green.

We created a new type of wind generator for urban energy production. The key feature of the technology is the ability to be installed near people. Low noise, low vibration, high efficiency.

Private houses, apartment buildings, shopping malls, electric vehicle charging stations, factories... we want to reach the state when seeing the Sirocco wind turbine is as usual as seeing a tree. We want to empower cities to function on renewable energy only.

Milestones

Sirocco Energy Inc. was incorporated in the State of Delaware in May 2021.

Since then, we have:

• Affordable, customizable, low noise turbine fit for urban & suburban use
• Successfully developed & patented technology after 6 years of R&D
• Twice as much energy as classical wind turbines of the same capacity
• 1200+ pre-orders valued at $80 million of potential revenue
• Over $1 million previously raised
• $144 billion market opportunity
• Wide applicability: commercial real estate, residential housing, EV charging stations

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 May 2021 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. Our gross margin was % in fiscal year 2022, compared to % in 2021.
• Assets. As of December 31, 2022, the Company had total assets of $568,565, including $4,367 in cash. As of December 31, 2021, the Company had $0 in total assets, including $0 in cash.
• Net Loss. The Company has had net losses of $138,788 and net income of $0 for the fiscal years ended December 31, 2022 and December 31, 2021, respectively.
• Liabilities. The Company's liabilities totaled $107,161 for the fiscal year ended December 31, 2022 and $0 for the fiscal year ended December 31, 2021.

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 $600,000 in equity and $110,400 in convertibles.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 18 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

Sirocco Energy Inc. cash in hand is $408,936.82, as of February 2023. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $30,000/month, for an average burn rate of $30,000 per month. Our intent is to be profitable in 18 months.

There are no material changes in our finances or operations that occurred since the date that our financials cover.

We expect to start generating revenue during the next 6-12 months. Our goal is to reach $3M yearly revenue once we would start booking it. The expenses will depend on the amount of funds raised. If we will not raise any funds, we would expect the expenses to be at $30k a month. If we would raise the minimum amount, we would expect the expenses to be $80k a month. If we will raise the full amount, we will invest much heavily in marketing and business development and would expect expenses to be $200k a month.

We are not yet profitable. We estimate that we will need around $8M in funding during the next 2 years in order to reach the point of profitability. We plan to raise Series A round during the next 16 months (after this raise).

Besides funds raised through Wefunder, we have a number of angel investors who invested in our Company during the pre-seed round. They confirmed that they will continue supporting us. Also, we have confirmation from Peak Capital Partners Fund that they are willing to continue investing in Sirocco Energy - they confirmed to invest $1M during this Reg CF capital raise.

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