Netcapital Inc.
For the period ended Oct 31, 2025. Filed Dec 15, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Oct 31, 2025 · Filed Dec 15, 2025
NCPL$1.26-3.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-07-31; filed 2025-09-22.
0001493152-25-014479
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-10-31; filed 2025-12-15.
0001493152-25-027769
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 83 previous paragraphs and 63 current paragraphs.
19 unchanged; 19 reworded; 24 added; 42 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 4 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (24)
Current report
For the three months ended October 31, 2025, the Company had one customer that constituted 23% of revenues, a second customer that constituted 13% of revenues and a third customer that accounted for 10% of revenues. For the six months ended October 31, 2025, the Company had one customer that constituted 58% of revenues. For the three and six months ended October 31, 2024, the Company had one customer that constituted 44% and 24% of revenues, respectively.
Current report
Plans to Expand Platform
Current report
On November 19, 2025, the Company announced plans to expand its platform to include support for compliant blockchain-based digital assets, amid accelerating interest in tokenized securities and tokenized real-world assets (RWAs) like real estate. As of the date of this report, the expansion has not yet occurred.
Current report
Rivetz Asset Purchase
Current report
On December 3, 2025, the Company purchased substantially all of Rivetz Corp.’s (“Rivetz”) assets related to its “Rivetz Network” which develops technology combining hardware-based cybersecurity with blockchain services for mobile and other computing devices (the “Purchased Assets”) pursuant to an asset purchase agreement for 950,000 shares of the Company’s common stock, par value $0.001 per share. In addition, the Company assumed only specified liabilities of Rivetz relating to the Purchased Assets and certain contracts, subject to an aggregate cap of $100,000 for liabilities other than those arising under assumed contracts. All other liabilities of Rivetz, including liabilities relating to Rivetz tokens, employee-related obligations, and indebtedness for borrowed money, remain with Rivetz.
Current report
Kay Resignation and Separation Agreement
Current report
On December 3, 2025, Martin Kay resigned as Chief Executive Officer, director and all other officer, director, board and committee positions with the Company pursuant to a CEO Separation, Severance and Consulting Agreement (the “Separation Agreement”) with the Company. In consideration of Mr. Kay’s service and execution of the Separation Agreement, the Company agreed to pay Mr. Kay a one-time severance payment equal to 3-months’ salary ($98,750). All options previously granted to Mr. Kay shall be fully vested and Mr. Kay shall have 4 years from the date of the Separation Agreement to exercise his options. Mutual releases and non-disparagement clauses were also agreed to by the parties in the Separation Agreement. The Company also agreed to engage Mr. Kay as a consultant for a period of 12 months following the date of the Separation Agreement under which Mr. Kay will be paid $10,000 per month.
Current report
Appointment of Chief Executive Officer and Employment Agreement
Current report
On December 7, 2025, the Company appointed Rich Wheeless as its Chief Executive Officer and entered into an employment agreement with Rich Wheeless (the “Employment Agreement”), pursuant to which Mr. Wheeless will serve as the Company’s Chief Executive Officer for a twelve-month term commencing on December 7, 2025, unless earlier terminated in accordance with its terms. Under the Employment Agreement, Mr. Wheeless is entitled to an annual base salary of $180,000, payable in accordance with the Company’s regular payroll practices. He is eligible to receive periodic bonuses throughout the year, or additional salary in excess of the base salary, in each case as may be approved by the Company’s Board of Directors or its Compensation Committee. Mr. Wheeless will also be eligible to receive one or more grants of stock options under the Company’s stock option plan, subject to approval by the Company’s Board of Directors or its Compensation Committee and a majority of the Company’s shareholders, with the amount, timing and terms of any such grants to be determined in the sole discretion of the Board or such committee. For the period of his employment and for two years thereafter, Mr. Wheeless is subject to certain non-competition and non-solicitation covenants, including restrictions on engaging in or assisting competitive businesses and on soliciting certain customers, clients, suppliers and employees of the Company and its affiliates, subject to customary limited exceptions. The Agreement also contains customary provisions relating to non-disparagement, remedies, severability, waiver, governing law and other matters.
Current report
Appointment of General Counsel
Current report
Our revenues for the three months ended October 31, 2025, decreased by $119,452, or approximately 70%, to $51,076, as compared to $170,528 during the three months ended October 31, 2024. The decrease in revenues was attributed to the lack of new issuers signing up for funding portal services. Only five new issuers launched a crowdfunding campaign in the three months ended October 31, 2025, as compared to 16 offerings launched in the three months ended October 31, 2024.
Current report
In the three months ended October 31, 2025, we recorded $51,076 in funding portal revenues, consisting of portal fees of $14,461, listing fees of $35,000, and equity fees of $1,510, as compared to funding portal revenues of $170,528 in the three months ended October 31, 2024, consisting of portal fees of $108,124, listing fees of $47,500 and equity fees of $14,748. Two issuers successfully closed offerings in the three months ended October 31, 2025, as compared to 13 issuers in the three months ended October 31, 2024. The components of revenue were as follows:
Current report
Rent expense increased by $1,858, or approximately 10%, to $21,300 for the three months ended October 31, 2025, as compared to $19,442 during the three months ended October 31, 2024. The increase was primarily attributed to a new office-space agreement.
Current report
General and administrative expenses decreased by $302,102, or approximately 20%, to $1,202,288 for the three months ended October 31, 2025, from $1,504,390 during the three months ended October 31, 2024. The decrease was primarily attributable to lower legal costs in fiscal 2026.
Current report
Consulting expense increased by $8,990, or approximately 11%, to $88,635 for the three months ended October 31, 2025, from $79,645 during the three months ended October 31, 2024. The increase was primarily attributed to corporate needs due to lack of hiring full-time employees.
Current report
Interest expense increased by $2,603 to $12,204, or approximately 27%, for the three months ended October 31, 2025, as compared to $9,601 during the three months ended October 31, 2024, due to short-term borrowings in April and May 2025.
Current report
Comparison of the Six Months Ended October 31, 2025 and 2024
Current report
Our revenues for the six months ended October 31, 2025, decreased by $71,621, or approximately 23%, to $241,134, as compared to $312,755 during the six months ended October 31, 2024.
Current report
In the six months ended October 31, 2025, we recorded $241,134 in funding portal revenues, consisting of portal fees of $137,189, listing fees of $40,000, and equity fees of $63,705, as compared to funding portal revenues of $312,755 in the six months ended October 31, 2024, consisting of portal fees of $197,553, listing fees of $90,000 and equity fees of $24,875. The decrease in revenues was primarily attributed to a decrease in the number of issuers raising capital on the funding portal’s platform. New offerings launched amounted to 10 issuers in the six months ended October 31, 2025, as compared to 37 issuers in the six months ended October 31, 2024. Five issuers successfully closed offerings in the six months ended October 31, 2025, as compared to 17 issuers in the six months ended October 31, 2024.The components of revenue were as follows:
Current report
Cost of revenues decreased by $20,715 to $9,286, or approximately 69%, for the six months ended October 31, 2025 from $30,001 during the six months ended October 31, 2024. The decrease was primarily attributed to lower revenues.
Current report
Rent expense increased by $5,594, or approximately 15%, to $44,152 for the six months ended October 31, 2025, as compared to $38,558 during the six months ended October 31, 2024. The increase was primarily attributed to a new office-space agreement.
Current report
General and administrative expenses decreased by $109,312, or approximately 4%, to $2,782,232 for the six months ended October 31, 2025, from $2,891,544 during the six months ended October 31, 2024. The decrease was primarily attributable to lower legal costs in fiscal 2026.
Current report
Consulting expense decreased by $16,340, or approximately 9%, to $160,686 for the six months ended October 31, 2025 from $177,026 during the six months ended October 31, 2024. The decrease was primarily attributed to our efforts to control expenses associated with overseas programmers.
Current report
Interest expense increased by $28,206 to $48,271, or approximately 141%, for the six months ended October 31, 2025, as compared to $20,065 during the six months ended October 31, 2024. The increase resulted from short-term borrowings in April and May 2025 that were paid off in September 2025.
Removed paragraphs (42)
Previous report
Our consulting group, Netcapital Advisors helps companies at all stages to raise capital. Netcapital Advisors provides strategic advice, technology consulting and digital marketing services to assist with fundraising campaigns on the Netcapital platform. The company also acts as an incubator and accelerator for select disruptive start-ups.
Previous report
Netcapital Advisors’ services include:
Previous report
Seidenberg Settlement Agreement
Previous report
On September 16, 2025, the Company entered into a settlement agreement with Ivan Seidenberg (the “Seidenberg Settlement Agreement”) to settle the $209,272 outstanding under the April 29, 2025 $200,000 note issued to him (the “Seidenberg Note”) on such date, which amount includes accrued interest of $9,272. Under the terms of the Seidenberg Settlement Agreement the parties agreed that the Seidenberg Note was fully paid in complete satisfaction upon the Company paying $104,636 and issuance of $104,636 of the Company’s common stock (46,258 shares at a price equal to 2.262 per share, which price represents the “Minimum Price” as defined under Nasdaq Rule 5635(d)).
Previous report
Hesse Settlement Agreement
Previous report
On September 16, 2025, the Company entered into a settlement agreement with Daniel R. Hesse Revocable Trust (“Hesse”) dated October 12, 2006(the “Hesse Settlement Agreement”) to settle the $418,148 outstanding under the May 1, 2025 $400,000 note issued to Hesse (the “Hesse Note”) on such date, which amount includes accrued interest of $18,148. Under the terms of the Hesse Settlement Agreement the parties agreed that the Hesse Note was fully paid in complete satisfaction upon the Company paying $209,074 and issuance of $209,074 of the Company’s common stock (92,428 shares at a price of equal to 2.262 per share, which price represents the “Minimum Price” as defined under Nasdaq Rule 5635(d)).
Previous report
July 2025 Warrant Exercises
Previous report
In July 2025, the Company issued an aggregate of 269,257 shares of its common stock to warrant holders that exercised warrants to purchase 418,510 shares of common stock on a net exercise basis.
Previous report
July 2025 Registered Direct Offering and Concurrent Private Placement #2
Previous report
On July 16, 2025, the Company entered into a securities purchase agreement (the “July 2025 Purchase Agreement #2”) with certain institutional investors, pursuant to which the Company agreed to sell 641,712 shares (the “July 2025 Shares #2”) of its common stock, at a purchase price of $7.00 per share (the “July 2025 Offering #2”) for gross proceeds of approximately $3 million, prior to deducting placement agent’s fees and other offering expenses payable by the Company. The Company intends to use approximately $250,000 of the net proceeds from the July 2025 Offering #2 for the repayment of certain outstanding promissory notes the remainder for working capital and other general corporate purposes. The July 2025 Shares #2 were offered pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-267921), which was declared effective by the Securities Exchange Commission on October 26, 2022.
Previous report
Concurrently with the sale of July 2025 Shares #2 pursuant to the July 2025 Purchase Agreement #2 in a private placement, for each July 2025 Share #2 purchased by the investors, such investors received an unregistered warrant (the “July 2025 Investor Warrants #2”) to purchase one share of Common Stock, or 641,712 shares in the aggregate. The July 2025 Investor Warrants #2 have an exercise price of $4.55 per share and are exercisable immediately upon issuance for a twenty-four month period following the date of effectiveness of resale registration statement providing for a resale of the shares underlying the July 2025 Investor Warrants #2, which resale registration statement is required to be filed within 30-days of the July 2025 Purchase Agreement #2.
Previous report
In connection with the July 2025 Offering #2, the Company paid H.C. Wainwright & Co. LLC, as placement agent (“Wainwright”) an aggregate cash fee equal to 7.5% of the gross proceeds from the sale of securities in the July 2025 Offering #2 and a management fee equal to 1.0% of the gross proceeds raised in the July 2025 Offering #2. The Company also issued Wainwright (or its designees) a warrant (the “Placement Agent Warrants #2”) to purchase up to 7.5% of the aggregate number of July 2025 Shares #2 sold in the offering, or warrants to purchase up to 48,128 shares of the Company’s common stock, at an exercise price equal to 125.0% of the offering price per share of the Company’s common stock, or $5.8438 per share. In addition, upon the cash exercise of July 2025 Warrants #2, the Company also agreed to issue Wainwright (or its designees) additional Placement Agent Warrants #2 to purchase an amount of share of Common Stock equal to 7.5% of the aggregate number of July 2025 Investor Warrants Shares #2 issued upon cash exercise of the July 2025 Investor Warrants #2. The Placement Agent Warrants #2 are (or will be) exercisable immediately upon issuance for a period of five years following the commencement of the sales pursuant to the July 2025 Offering #2.
Previous report
The closing of the sales of these securities under the July 2025 Purchase Agreement #2 took place on July 17, 2025.
Previous report
July 2025 Registered Direct Offering and Concurrent Private Placement #1
Previous report
On July 2, 2025, the Company entered into a securities purchase agreement (the “July 2025 Purchase Agreement #1”) with certain institutional investors, pursuant to which it agreed to sell 714,286 shares (the “July 2025 Shares #1”) of its common stock, at a purchase price of $7.00 per share (the “July 2025 Offering #1”) for gross proceeds of approximately $5 million, prior to deducting placement agent’s fees and other offering expenses payable by the Company. The Company used approximately $320,000 of the net proceeds from the July 2025 Offering #1 for the repayment of certain outstanding promissory notes and intend to use the remainder for working capital and other general corporate purposes. The July 2025 Shares #1 were offered pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-267921), which was declared effective by the Securities Exchange Commission on October 26, 2022.
Previous report
Concurrently with the sale of July 2025 Shares #1 pursuant to the July 2025 Purchase Agreement #1 in a private placement, for each July 2025 Share #1 purchased by the investors, such investors received an unregistered warrant (the “July 2025 Investor Warrants #1”) to purchase one share of the Company’s common stock, or 714,286 shares in the aggregate. The July 2025 Investor Warrants #1 have an exercise price of $6.88 per share and are exercisable immediately upon issuance for a twenty-four month period following the date of effectiveness of resale registration statement providing for a resale of the shares underlying the July 2025 Investor Warrants #1, which resale registration statement is required to be filed within 30 days of the July 2025 Purchase Agreement #1.
Previous report
In connection with the July 2025 Offering #1, the Company paid Wainwright, as placement agent an aggregate cash fee equal to 7.5% of the gross proceeds from the sale of securities in the July 2025 Offering #1 and a management fee equal to 1.0% of the gross proceeds raised in the July 2025 Offering #1. We also issued Wainwright (or its designees) a warrant (the “Placement Agent Warrants #1”) to purchase up to 7.5% of the aggregate number of July 2025 Shares #1 sold in the offering, or warrants to purchase up to 53,571 shares of Common Stock, at an exercise price equal to 125.0% of the offering price per share of the Company’s common stock, or $8.75 per share. In addition, upon the cash exercise of July 2025 Warrants #1, the Company also agreed to issue Wainwright (or its designees) additional Placement Agent Warrants to purchase an amount of share of Common Stock equal to 7.5% of the aggregate number of July 2025 Investor Warrants Shares #2 issued upon cash exercise of the July 2025 Investor Warrants #1. The Placement Agent Warrants #! are (or will be) exercisable immediately upon issuance for a period of five years following the commencement of the sales pursuant to the July 2025 Offering #1.
Previous report
The closing of the sales of these securities under the July 2025 Purchase Agreement #1 took place on July 7, 2025.
Previous report
Horizon License
Previous report
On June 26, 2025, we entered into a Horizon Software Agreement (the “Horizon Agreement’) with Horizon Globex GmbH, a company incorporated in Switzerland (“Horizon”) pursuant to which Horizon granted us a royalty free, paid-up, non-exclusive, perpetual, irrevocable, unrestricted license to use the Licensed Software (as defined in the Horizon Agreement) with our branding and image, in the United States to provide capital-raising and secondary trading services to its clients in consideration for the issuance of 500,0000 shares (the “Horizon Shares”) of our common stock to Horizon or its affiliate. The Horizon Agreement may be terminated by either party upon a default in the performance of any material obligation under the Agreement is not cured within 30-days after receipt of such notice. In addition, the Horizon Agreement may be terminated immediately by either party in the event the other party files or has filed against it any petition for relief under any bankruptcy statute or similar statute of any jurisdiction, or an order for relief in any bankruptcy or reorganization proceeding is entered against the other party and such order remains undischarged for a period of sixty (60) days; or a receiver is appointed for the other Party; or the other party is dissolved or liquidated, or ceases to carry on its business, or makes an assignment for the benefit of its creditors.
Previous report
ATM Increase
Previous report
June 2025 Private Placement
Previous report
On June 6, 2025, our board of directors approved an amendment (the “Plan Amendment”) to the Netcapital 2023 Omnibus Equity Incentive Plan (the “Plan”)subject to stockholder approval, to: (i) increase the number of shares authorized for issuance under the Plan to 1,547,556 shares, and (ii) crease the evergreen limit from 5% to 10% of our outstanding shares, to allow for greater flexibility in future equity awards.
Previous report
Formation of Advisory Boards
Previous report
On June 6, 2025, our Board of Directors approved the formation of two strategic advisory boards: the Crypto Advisory Board and the Game Advisory Board.
Previous report
We entered into advisory agreements with each member of the Crypto and Game Advisory Boards. Under these advisory agreements, each advisor will provide us with sector-specific strategic guidance, marketing insight, partnership referrals, and other advisory services relevant to their industry expertise. The initial term of each advisory agreement is eighteen months and may be extended by mutual agreement of the parties. In consideration of the services rendered under these advisory agreements, we issued a total of 783,722 non-qualified stock options to the advisors of the Crypto and Game Advisory Boards under the Plan as amended by the Plan Amendment. Such options are not exercisable unless and until our stockholders approve the Plan Amendment.
Previous report
May 2025 Note Financings
Previous report
In May 2025, we completed the sale of debt pursuant to two separate securities purchase agreements with 1800 Diagonal Lending LLC, a Virginia limited liability company, under which it issued the following convertible promissory notes:
Previous report
On May 1, 2025, we completed a private financing transaction with a single accredited investor and issued an unsecured, non-convertible promissory note in the principal amount of $400,000. The note was issued at a 50% OID for gross proceeds of $200,000. The note bears interest at 8% per annum, matures three months from the issuance date, and is prepayable at any time without penalty. In the event of default, the interest rate increases to 20% per annum. The note is due on August 1, 2025
Previous report
The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and related notes to the financial statements included elsewhere in this Form 10-Q. This discussion contains forward-looking statements that relate to future events or our future financial performance. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.
Previous report
Our revenues for the three months ended July 31, 2025, increased by $47,831, or approximately 34%, to $190,058 as compared to $142,227 during the three months ended July 31, 2024. The increase in revenues was primarily attributed to an increase in portal fees and an increase in revenues for the services that we provide in exchange for equity securities during the quarter ended July 31, 2025, as compared to the quarter ended July 31, 2024. One issuer, that accounted for 73% of our revenues in the three months ended July 31, 2025, was responsible for the increase. That issuer successfully raised approximately $5 million from March 24, 2025 to May 30, 2025.
Previous report
Revenue from portal fees increased by $33,299, or approximately 37%, in the three months ended July 31, 2025, to $122,728, from $89,429 in the three months ended July 31, 2024. Revenue from portal fees consists of a 4.9% fee of the total capital raised by an issuer plus fixed miscellaneous charges for administrative fees, such as a rolling close, or the filing of an amended offering statement. The increase in portal fees is attributable to one major customer, as noted above. Similarly, the increase in the 1% equity fee charged to issuers, from $10,127 in fiscal 2024 to $62,195 in fiscal 2025, is attributable to one customer. The total number of issuers on the funding portal in the three months ended July 31, 2025 and 2024 that successfully closed an offering was 3 and 11, respectively.
Previous report
The number of successful closings in a quarter is defined as an issuer that raised more than the targeted amount in its offering statement and stopped selling securities on our funding portal (a “Final Closing”). This number is not necessarily an indicator of quarterly revenue because an issuer may have several rolling closes in previous quarters before the Final Closing, and the funding portal receives its 4.9% portal fee for each rolling close.
Previous report
Revenue from listing fees decreased by $37,500, or approximately 88%, to $5,000 in the three months ended July 31, 2025 as compared to $42,500 in the three months ended July 31, 2024. Listing fees are typically $5,000 per issuer, and they are the first form of revenue earned by our funding portal when an issuer signs a contract with us to sell securities on the funding portal. The drop in listing fees is attributable to a decrease in new offerings launched. For the three months ended July 31, 2025, we launched 5 new offerings, as compared to 13 offerings launched in the three months ended July 31, 2024.
Previous report
Marketing expense increased by $4,540, or approximately 66%, to $11,438 for the three months ended July 31, 2025, as compared to $6,898 during the three months ended July 31, 2024. The increase in expense was primarily attributed to new marketing efforts in the July 31, 2025 quarter to take advantage of additional cash resources.
Previous report
Rent expense increased by $3,736, or approximately 20%, to $22,852 for the three months ended July 31, 2025, as compared to $19,116 during the three months ended July 31, 2024. The increase was primarily attributed to a month-to-month rent agreement that we now have, as compared to an annual agreement in the prior fiscal year.
Previous report
General and administrative expenses increased by $188,250, or 14%, to $1,568,506 for the three months ended July 31, 2025, from $1,380,256 during the three months ended July 31, 2024. The increase was primarily attributed to increased legal costs. We incurred approximately $1,077,587 in legal costs in the three months ended July 31, 2025, of which approximately 60% were related to legal fees responding to regulatory matters as compared to approximately $442,288 in legal costs in the three months ended July 31, 2024 of which approximately 60% were related to legal fees responding to regulatory matters.
Previous report
Consulting expense decreased by $25,330, or 26%, to $72,051 for the three months ended July 31, 2025 from $97,381 during the three months ended July 31, 2024. The decrease was primarily attributed to a decrease in individual contractors used by the Company.
Previous report
Amortization expense amounted to $8,869 for each of the three months ended July 31, 2025 and 2024. There were no additions to or deletions of the intangible assets that are being amortized during these periods.
Previous report
Interest expense increased by $25,603 to $36,067, or approximately 245%, for the three months ended July 31, 2025, as compared to $10,464 during the three months ended July 31, 2024. The increase in interest expense was attributed to increased debt amounts from notes that were sold in March, April and May of 2025.
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Reworded paragraphs (19)
Previous wording
This quarterly report on Form 10-Q and other reports filed by Netcapital Inc. (the “Company”) from time to time with the U.S. Securities and Exchange Commission (collectively, the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the Filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to the Company or the Company’s management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Unless the context otherwise requires, references in this prospectus to the “Company,” “we,” “us,” and “our” refer to Netcapital Inc. and its subsidiaries.
Current wording
This quarterly report on Form 10-Q and other reports filed by Netcapital Inc. (the “Company”) from time to time with the U.S. Securities and Exchange Commission (collectively, the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the Filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to the Company or the Company’s management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Unless the context otherwise requires, references in this Quarterly Report to the “Company,” “we,” “us,” and “our” refer to Netcapital Inc. and its subsidiaries.
Previous wording
Netcapital Inc. is a fintech company with a scalable technology platform that allows private companies to raise capital online from accredited and non-accredited investors. We give virtually all investors the opportunity to access investments in private companies. We believe our model is disruptive to traditional private equity investing and is based on Title III, Regulation Crowdfunding (“Reg CF”) of the Jumpstart Our Business Startups Act (“JOBS Act”). We generate fees from listing private companies on our funding portal located at www.netcapital.com. Our consulting group, Netcapital Advisors Inc. (“Netcapital Advisors”), which is a wholly owned subsidiary, provides marketing and strategic advice to companies in exchange for cash fees and previously also received equity positions in certain select portfolio companies. The Netcapital funding portal is registered with the SEC, is a member of the Financial Industry Regulatory Authority (“FINRA”), a registered national securities association, and provides investors with opportunities to invest in private companies. In addition, we recently expanded our model to include Regulation A (“Reg A”) offerings, which are conducted by our wholly owned subsidiary Netcapital Securities Inc. “(“Netcapital Securities”), which is a licensed broker-dealer with FINRA. Both A and Reg CF offerings are made available to investors via the Company’s website, www.netcapital.com.
Current wording
Netcapital Inc. is a fintech company with a scalable technology platform that allows private companies to raise capital online from accredited and non-accredited investors. We give virtually all investors the opportunity to access investments in private companies. We believe our model is disruptive to traditional private equity investing and is based on Title III, Regulation Crowdfunding (“Reg CF”) of the Jumpstart Our Business Startups Act (“JOBS Act”). We generate fees from listing private companies on our funding portal located at www.netcapital.com. The Netcapital funding portal is registered with the SEC, is a member of the Financial Industry Regulatory Authority (“FINRA”), a registered national securities association, and provides investors with opportunities to invest in private companies. In addition, we recently expanded our model to include Regulation A (“Reg A”) offerings, which are conducted by our wholly owned subsidiary Netcapital Securities Inc. “(“Netcapital Securities”), which is a licensed broker-dealer with FINRA. Both Reg A and Reg CF offerings are made available to investors via the Company’s website, www.netcapital.com.
Previous wording
We provide private company investment access to accredited and non-accredited investors through (i) our online portal (www.netcapital.com), which is operated by our wholly owned subsidiaries Netcapital Funding Portal, Inc and (ii) our broker-deal subsidiary, Netcapital Securities. The Netcapital funding portal charges a $5,000 listing fee, a 4.9% portal fee for capital raised at closing, and beginning in fiscal year 2024, a 1% success fee paid for with equity of the funding portal customer. In addition, the portal generates fees for other ancillary services, such as rolling closes. Netcapital Advisors previously generated fees and equity stakes from consulting in select portfolio (“Portfolio Companies”) and non-portfolio clients. With respect to services for Reg A offerings, Netcapital Securities charges a listing fee of $25,000 and a success fee of 4.9% of the capital raised by an issuer under Reg A.
Current wording
We provide private company investment access to accredited and non-accredited investors through (i) our online portal (www.netcapital.com), which is operated by our wholly owned subsidiaries Netcapital Funding Portal, Inc and (ii) our broker-deal subsidiary, Netcapital Securities. The Netcapital funding portal charges a $5,000 listing fee, a 4.9% portal fee for capital raised at closing, and beginning in fiscal year 2024, a 1% success fee paid for with equity of the funding portal customer. In addition, the portal generates fees for other ancillary services, such as rolling closes. Netcapital Advisors previously generated fees and equity stakes from consulting in select portfolio companies (“Portfolio Companies”) and non-portfolio clients. With respect to services for Reg A offerings, Netcapital Securities charges a listing fee of $25,000 and a success fee of 4.9% of the capital raised by an issuer under Reg A.
Previous wording
We generated revenues of $190,058, with costs of service of $7,409, in the three months ended July 31, 2025 for a gross profit of $182,649 (consisting of $62,195 in equity securities for payment of services and $127,863 in cash-based revenues, offset by $7,409 for costs of services), as compared to revenues of $142,227, with costs of service of $10,220, in the three months ended July 31, 2024 for a gross profit of $132,007 (consisting of $10,127 in equity securities for payment of services and $132,100 in cash-based revenues, offset by $10,220 for costs of services). The total number of offerings on the Netcapital funding portal in the three months ended July 31, 2025 and 2024 that closed was 3 and 16, respectively, of which 0 and 4 offerings hosted on the Netcapital funding platform in the three months ended July 31, 2025 and 2024, respectively, terminated their listings without raising the required minimum amount of capital.
Current wording
We generated revenues of $241,134, with costs of service of $9,286, in the six months ended October 31, 2025, for a gross profit of $231,848 as compared to revenues of $312,755, with costs of service of $30,001, in the six months ended October 31, 2024, for a gross profit of $282,754.
Previous wording
In fiscal 2025 and 2024, the average amount raised in an offering on the Netcapital funding portal was $215,745 and $280,978, respectively. The total number of offerings on the Netcapital funding portal in fiscal 2025 and 2024 that closed was 70 in each fiscal year, of which 21 and 17 offerings hosted on the Netcapital funding platform in fiscal 2025 and 2024, respectively, terminated their listings without raising the required minimum dollar amount of capital.
Current wording
The total number of offerings on the Netcapital funding portal in fiscal 2025 and 2024 that closed was 70 in each fiscal year, of which 21 and 17 offerings hosted on the Netcapital funding platform in fiscal 2025 and 2024, respectively, terminated their listings without raising the required minimum dollar amount of capital. For the three- and six-months periods ended October 31, 2025, 5 and 10 issuers have launched an offering on the portal, respectively, as compared to 16 and 37 issuers that launched an offering in the three- and six-month periods ended October 31, 2024, respectively. As of the date of this report, we have minority equity positions in 19 Portfolio Companies that have utilized the funding portal to facilitate their offerings, which equity was received as payment for services.
Previous wording
Netcapital.com is an SEC-registered funding portal that enables private companies to raise capital online, while investors are able to invest from almost anywhere in the world, at any time, with just a few clicks. Securities offerings on the portal are accessible through individual offering pages, where companies include product or service details, market size, competitive advantages, and financial documents. Companies can accept investments from virtually anyone, including friends, family, customers, and employees. Customer accounts on our platform are not permitted to hold or use digital securities to make an investment.
Current wording
Netcapital funding portal is an SEC-registered funding portal that enables private companies to raise capital online, while investors are able to invest from almost anywhere in the world, at any time, with just a few clicks. Securities offerings on the portal are accessible through individual offering pages, where companies include product or service details, market size, competitive advantages, and financial documents. Companies can accept investment from virtually anyone, including friends, family, customers, employees, etc.
Previous wording
Amendment to Netcapital 2023 Omnibus Equity Incentive Plan
Current wording
On December 7, 2025, the Board appointed Kevin Kilduff, as its General Counsel. In addition, on December 7, 2025 the Company granted Mr. Kilduff 1,000,000 shares of its common stock (“Restricted Stock”) as a Restricted Stock Award under the Company’s 2023 Omnibus Equity Incentive Plan (the “Plan”) in accordance with NASDAQ Listing Rule 5635(c)(4) to Kevin Kilduff to induce him to accept employment with the Company as its General Counsel. The shares of Restricted Stock will have voting rights upon issuance and will vest in whole or in part on March 15, 2027 with the number of shares of Restricted Stock that will vest on the vesting date will be determined based on the Company’s revenue during the period beginning on February 1, 2026 and ending on January 31, 2027. Specifically, in the event that the revenue during the measuring period is below $900,000, none of the shares of Restricted Stock shall vest and in the event that the revenue during the measuring period is at least equal to $1,500,000, one hundred percent (100%) of the shares of Restricted Stock shall vest as of the vesting date, with pro-rata vesting for results between the minimum and maximum revenue targets. The Restricted Stock Award will be an Exempt Award (as defined in the Plan) under the Plan by reason of being an award granted as an inducement grant pursuant to NASDAQ Listing Rule 5635(c), as this award is specifically made to induce Mr. Kilduff to become an employee of the Company.
Previous wording
Costs of revenues decreased by $2,811 to $7,409, or approximately 28% for the three months ended July 31, 2025 from $10,220 during the three months ended July 31, 2024. The decrease was attributed to a decrease in costs from the escrow bank that the funding portal uses.
Current wording
Cost of revenues decreased by $17,904 to $1,877, or approximately 91% for the three months ended October 31, 2025, from $19,781 during the three months ended October 31, 2024. The decrease was attributed to lower revenues.
Previous wording
Payroll and payroll related expenses increased by $656,857, or approximately 58%, to $1,793,450 for the three months ended July 31, 2025, as compared to $1,136,593 during the three months ended July 31, 2024. The increase was attributed to the salary increases and bonuses for certain key positions, to assist with employee retention, during the quarter ended July 31, 2025.
Current wording
Payroll and payroll related expenses increased by $106,732, or approximately 14%, to $856,433 for the three months ended October 31, 2025, as compared to $749,701 during the three months ended October 31, 2024. The increase was attributed to the salary increases for certain key positions, to assist with employee retention.
Previous wording
The Company owned 8,989 shares of a funding portal issuer at a cost of $5.00 per share. On May 30, 2025, the issuer closed an offering at a price of $10.00 per share. As a result, the Company marked its investment to market and recorded an unrealized gain of $44,945 in the first quarter of fiscal 2026. No unrealized gains or losses were recorded in the first quarter of fiscal 2025.
Current wording
The Company owned 8,989 shares of a funding portal issuer at a cost of $5.00 per share. On May 30, 2025, the issuer closed an offering at a price of $10.00 per share. As a result, the Company marked its investment to market and recorded an unrealized gain of $44,945 in the six-month period ended October 31, 2025. No unrealized gains or losses were recorded in the first two quarters of fiscal 2025.
Previous wording
Accretion expense amounted to $356,404 in the three months ended July 31, 2025. There was no accretion in the three months ended July 31, 2024. The Company sold 4 notes, and each note contained an original issuance discount that was accreted in three months ended July 31, 2025.
Current wording
Accretion on short-term notes increased to $356,413 for the six months ended October 31, 2025. There was no accretion on short-term notes recorded during the six months ended October 31, 2024. During 2025, the Company sold 4 notes, and each note contained an original issuance discount that was accreted during the six months ended October 31, 2025.
Previous wording
As of July 31, 2025, we had cash and cash equivalents of $4,562,491 and working capital of $186,766 as compared to cash and cash equivalents of $289,428 and negative working capital of $5,096,155 as of April 30, 2025.
Current wording
As of October 31, 2025, we had cash and cash equivalents of $1,684,188 and negative working capital of $1,500,153 as compared to cash and cash equivalents of $289,428 and negative working capital of $5,096,155 as of April 30, 2025.
Previous wording
We have been successful in raising capital by completing public offerings of our common stock.
Current wording
We have been successful in raising capital by completing offerings of our common stock.
Previous wording
On July 16, 2025, we entered into a securities purchase agreement with certain institutional investors, pursuant to which we agreed to sell 641,712 shares of our common stock, at a purchase price of $4.675 per share for gross proceeds of approximately $3 million, prior to deducting placement agent’s fees and other offering expenses payable by us. Each share of commons stock was also sold with a warrant to purchase one share of common stock with an exercise price of $4.55 per share. The shares were offered pursuant to our shelf registration statement on Form S-3 (File No. 333-267921), which was declared effective by the Securities Exchange Commission on October 26, 2022. This offering closed in July 17, 2025.
Current wording
On July 16, 2025, we entered into a securities purchase agreement with certain institutional investors, pursuant to which we agreed to sell 641,712 shares of our common stock, at a purchase price of $4.675 per share for gross proceeds of approximately $3 million, prior to deducting placement agent’s fees and other offering expenses payable by us. Each share of commons stock was also sold with a warrant to purchase one share of common stock with an exercise price of $4.55 per share. The shares were offered pursuant to our shelf registration statement on Form S-3 (File No. 333-267921), which was declared effective by the Securities Exchange Commission on October 26, 2022. This offering closed on July 17, 2025.
Previous wording
On July 2, 2025, we entered into a securities purchase agreement with certain institutional investors, pursuant to which we agreed to sell 714,286 shares of our common stock, at a purchase price of $7.00 per share for gross proceeds of approximately $5 million, prior to deducting placement agent’s fees and other offering expenses payable by us. Each share of commons stock was also sold with a warrant to purchase one share of common stock with an exercise price of $6.88 per share. We used approximately $320,000 of the net proceeds for repayment of outstanding promissory notes and intend to use the remainder for working capital and other general corporate purposes. The shares were offered pursuant to our shelf registration statement on Form S-3 (File No. 333-267921), which was declared effective by the Securities Exchange Commission on October 26, 2022.
Current wording
On July 2, 2025, we entered into a securities purchase agreement with certain institutional investors, pursuant to which we agreed to sell 714,286 shares of our common stock, at a purchase price of $7.00 per share for gross proceeds of approximately $5 million, prior to deducting placement agent’s fees and other offering expenses payable by us. Each share of commons stock was also sold with a warrant to purchase one share of common stock with an exercise price of $6.88 per share. We used approximately $320,000 of the net proceeds for repayment of outstanding promissory notes and intend to use the remainder for working capital and other general corporate purposes. The shares were offered pursuant to our shelf registration statement on Form S-3 (File No. 333-267921), which was declared effective by the Securities Exchange Commission on October 26, 2022. The offering closed on July 7, 2025.
Previous wording
On June 10, 2025, we entered into subscription agreements with ten accredited investors to issue an aggregate of 118,750 shares of common stock at a purchase price of $4.00 per share (the “Purchase Price”) in a private placement, for gross proceeds of $475,000. The Company has agreed to file a registration statement on providing for the resale of the Shares within 60 calendar days of the initial closing of the private placement (the “Filing Date”) and to use reasonable best efforts to cause the Resale Registration Statement to be declared effective by the SEC within 90 calendar days following the final closing of the private placement date of the Filing Date. The subscription agreements include a price adjustment provision whereby if the Company issues additional shares at a price lower than the Purchase Price during the period beginning on the date of the subscription agreements and prior to April 19, 2026, investors will receive additional shares to reflect the lower price, subject to the minimum price as defined under Nasdaq Rule 5635(d) on the date the subscription agreements were signed, which was $2.56. The Company intends to use the net proceeds from the offering for general corporate purposes.
Current wording
On June 10, 2025, we entered into subscription agreements with ten accredited investors to issue an aggregate of 118,750 shares of common stock at a purchase price of $4.00 per share (the “Purchase Price”) in a private placement, for gross proceeds of $475,000. The Company agreed to file a registration statement providing for the resale of the Shares within 60 calendar days of the initial closing of the private placement (the “Filing Date”) and to use reasonable best efforts to cause the resale registration statement to be declared effective by the SEC within 90 calendar days following the final closing of the private placement date of the Filing Date. The resale registration statement is not yet effective. The subscription agreements include a price adjustment provision whereby if the Company issues additional shares at a price lower than the Purchase Price during the period beginning on the date of the subscription agreements and prior to April 19, 2026, investors will receive additional shares to reflect the lower price, subject to the minimum price as defined under Nasdaq Rule 5635(d) on the date the subscription agreements were signed, which was $2.56. On September 16, 2025, the Company issued a total of 59,147 shares of common stock to the investors in the June 10, 2025 private placement in consideration of the adjustment provision contained in their subscription agreements The Company used the net proceeds from the offering for general corporate purposes.
Previous wording
Net cash used in operating activities amounted to $4,214,258 and $1,963,645 for the three months ended July 31, 2025 and 2024, respectively. The principal sources of cash from operating activities in the three months ended July 31, 2025 were an increase in accretion of short-term notes of $356,413 and stock-based compensation of $516,073. However, the sources of cash were offset by a net loss of $3,642,052, a receipt of equity in lieu of cash of $62,195, and a decrease in accounts payable and accrued expenses of $1,041,094.
Current wording
Net cash used in operating activities amounted to $6,792,561 and $3,451,087 for the six months ended October 31, 2025 and 2024, respectively. The principal source of cash used in operating activities in the six months ended October 31, 2025 was a decrease in accounts payable and accrued expenses of $1,734,036 . The principal sources of cash from operating activities in the six months ended October 31, 2025 was a non-cash item, stock-based compensation of $655,444 and an increase in accretion of short-term notes of $356,413. These amounts were offset by a loss of $5,771,541. The principal source of cash from operating activities in the six months ended October 31, 2024 was a non-cash item, stock-based compensation of $278,742 and an increase in accounts payable and accrued expenses of $911,387. These amounts were offset by a loss of $4,747,671.
Previous wording
For the three months ended July 31, 2025, net cash provided by financing activities amounted to $8,487,321, which consisted of proceeds from the sale of common stock of $8,507,171, proceeds from short-term notes of $300,000, and payment of short-term notes of $319,850. For the three months ended July 31, 2024, net cash provided by financing activities amounted to $1,955,644, which consisted of proceeds from the exercise of warrants.
Current wording
For the six months ended October 31, 2025, net cash provided by financing activities amounted to $8,187,321, which consisted of proceeds from the sale of common stock of $8,507,171 and proceeds from short-term notes of $300,000. However, this was off-set by payment of short-term notes of $619,850. For the six months ended October 31, 2024, net cash provided by financing activities amounted to $3,934,644, which consisted of proceeds from the sale of common stock of $1,979,000 and proceeds from the exercise of warrants of $1,955,644.
Previous wording
In the three months ended July 31, 2025 and 2024, there were no expenditures for capital assets. We do not anticipate any capital expenditures in fiscal 2026.
Current wording
In the six months ended October 31, 2025 and 2024, there were no expenditures for capital assets. We do not anticipate any capital expenditures in fiscal 2026.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Payroll and payroll related expenses increased by $763,589, or approximately 41%, to $2,649,883 for the six months ended October 31, 2025, as compared to $1,886,294 during the six months ended October 31, 2024. The increase was attributed to the salary increases and bonuses for certain key positions, to assist with employee retention.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
On June 23, 2025, we filed a prospectus supplement under our At-The-Market-Offering Agreement with Wainwright for an aggregate of $975,000 of additional shares of our common stock. From June 23, 2025 to June 25, 2025, we sold 229,404 shares of our common stock through Wainwright at an average price of approximately $4.25 per share, resulting in aggregate gross proceeds of approximately $974,747, for which it paid Wainwright approximately $29,242 in commissions and other issuance costs of $1,438, resulting in net proceeds to the Company of approximately $944,067.
Previous report — wording carried elsewhere
On June 10, 2025, we entered into subscription agreements (the “Subscription Agreements”) with ten accredited investors to issue an aggregate of 118,750 shares (the “June 2025 Shares”) of our common stock at a purchase price of $4.00 per share (the “Purchase Price”) in a private placement, for gross proceeds of $475,000. We agreed to file a registration statement on providing for the resale of the Shares (the “Resale Registration Statement”) within 60 calendar days of the initial closing of the private placement (the “Filing Date”) and to use reasonable best efforts to cause the Resale Registration Statement to be declared effective by the SEC within 90 calendar days following the final closing of the private placement date of the Filing Date. Until the June 2025 shares are sold in accordance with applicable law, the Subscriber agrees to vote the shares in favor of all resolutions recommended by our Board of Directors, and to deliver any proxy or voting instruction required by us to effectuate this obligation. The Subscription Agreements include a price adjustment provision whereby if the Company issues additional shares at a price lower than the Purchase Price during the period beginning on the date of the Subscription Agreements and prior to the date that is 6-months following the Filing Date, investors will receive additional shares to reflect the lower price, subject to the minimum price as defined under Nasdaq Rule 5635(d) on the date the Subscription Agreements were signed, which was $2.56. The Company intends to use the net proceeds from the offering for general corporate purposes.
Previous report — wording carried elsewhere
Management’s Discussion and Analysis of Financial Condition and Results of Operations