MDB Capital Holdings, LLC 10-Q for FY2024 Q3

MDB Capital Holdings, LLC (MDBH)

10-Q 2024-11-12 For: 2024-09-30

Added on April 10, 2026

About this 10-Q

MDB Capital Holdings, LLC filed this 10-Q on November 12, 2024, covering the quarter ended September 30, 2024 (FY2024 Q3).

Headline figures

Quarter ended September 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $7.74M; compared with a net loss of $3.01M a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Common Shares, representing Limited Liability Interests		MDBH		Nasdaq Capital Markets

Large Accelerated Filer	☐	Accelerated Filer	☐
Non-accelerated Filer	☐	Smaller Reporting Company	☒
		Emerging Growth Company	☒

		Page Number
PART I	FINANCIAL INFORMATION	3

Item 1	Unaudited Condensed Consolidated Financial Statements	3

Condensed Consolidated Balance Sheets –September 30, 2024 and December 31, 2023		3

Unaudited Condensed Consolidated Statements of Operations – Three and Nine Months Ended September 30, 2024 and 2023		4

Unaudited Condensed Consolidated Statements of Changes in Equity – Three and Nine Months Ended September 30, 2024 and 2023		5

Unaudited Condensed Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2024 and 2023		6

Notes to Unaudited Condensed Consolidated Financial Statements		7

Item 2	Management’s Discussion and Analysis of Financial Conditions and Results of Operations	32

Item 3	Quantitative and Qualitative Disclosures About Market Risk	45

Item 4	Controls and Procedures	45

PART II	OTHER IFNORMATION	46

Item 1	Legal Proceedings	46

Item 1A	Risk Factors	46

Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	46

Item 3	Defaults upon Senior Securities	46

Item 4	Mine Safety Disclosures	46

Item 5	Other Information	46

Item 6	Exhibits	46

	September 30, 2024			December 31, 2023
	(Unaudited)
Cash and cash equivalents	$	16,679,428		$	6,109,806
Cash segregated in compliance with regulations		1,584,734			1,247,881
Grants receivable		553,963			882,319
Clearing deposits		516,774			260,000
Prepaid expenses and other current assets		428,692			523,788
Investment securities, at amortized cost (U.S. Treasury Bills)		5,084,197			24,658,611
Investment securities, at fair value (held by our licensed broker dealer) (Note 2)		5,566,955			5,771,634
Investment securities, at cost less impairment		200,000			200,000
Deferred offering cost		587,368			69,303
Deferred costs related to deferred revenue		110,958			75,328
Property and equipment, net		835,753			866,490
Operating lease right-of-use assets, net		2,062,015			2,320,119
Total assets	$	34,210,837		$	42,985,279

LIABILITIES AND EQUITY
Accounts payable	$	1,044,209		$	578,214
Accrued expenses		304,271			1,105,078
Payables to non-customers		21			1,405,293
Payables to customers		2,361,514			-
Deferred grant reimbursement		137,035			140,703
Deferred revenue		-			20,000
Operating lease liabilities		2,181,780			2,415,889
Total liabilities		6,028,830			5,665,177
Commitments and Contingencies (Note 9)`		-			-
Equity:
Preferred shares, 10,000,000 authorized shares at no par value; 0 issued and outstanding		-			-
Class A common shares, 95,000,000 authorized shares at no par value; 4,295,632 and 4,295,632 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively		-			-
Class B common shares, 5,000,000 authorized shares at no par value; 5,000,000 shares issued and outstanding		-			-
Common stock, value		-			-

Paid-in-capital		60,314,806			49,405,779
Accumulated deficit		(31,318,226	)		(12,092,927	)
Total MDB Capital Holdings, LLC Members’ equity		28,996,580			37,312,852
Non-controlling interest		(814,573	)		7,250
Total equity		28,182,007			37,320,102
Total liabilities and equity	$	34,210,837		$	42,985,279

	2024			2023			2024			2023
	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Operating income:
Unrealized gain (loss) on investment securities, net (from our licensed broker dealer) (Notes 1 and 2)	$	(718,491	)	$	(786,906	)	$	(566,215	)	$	696,965
Realized loss on investment securities, net (from our licensed broker dealer)		-			-			-			-
Fee income		-			-			1,303,398			4,233,120
Other operating income		104,246			11,502			276,633			140,873
Total operating income (loss), net		(614,245	)		(775,404	)		1,013,816			5,070,958

Operating costs:
General and administrative costs:
Compensation		5,170,772			1,337,771			15,188,205			3,183,515
Operating expense, related party		489,954			273,821			1,115,200			829,474
Professional fees		850,013			459,585			2,409,722			1,241,089
Information technology		236,469			93,326			651,856			408,875
Clearing and other charges		876			3,316			229,338			382,994
General and administrative-other		633,799			327,896			1,972,556			883,233
Total general and administrative costs		7,381,883			2,495,715			21,566,877			6,929,180
Research and development costs, net of grants amounting to $489,798 and $743,320, for the three months ended September 30 and $1,807,706 and $2,265,408, for the nine months ended September 30		723,487			27,936			1,238,463			67,095
Total operating costs		8,105,370			2,523,651			22,805,340			6,996,275
Net operating loss		(8,719,615	)		(3,299,055	)		(21,791,524	)		(1,925,317	)
Other income:
Interest income		279,125			176,300			937,985			548,479
Net loss before income taxes		(8,440,490	)		(3,122,755	)		(20,853,539	)		(1,376,838	)
Income taxes		-			63,559			2,143			384,143
Net loss		(8,440,490	)		(3,186,314	)		(20,855,682	)		(1,760,981	)
Less: Net loss attributable to non-controlling interests		(705,057	)		(177,853	)		(1,630,383	)		(341,631	)
Net loss attributable to MDB Capital Holdings, LLC	$	(7,735,433	)	$	(3,008,461	)	$	(19,225,299	)	$	(1,419,350	)
Net loss per share attributable to MDB Capital Holdings, LLC:
Net loss per Class A common share – basic and diluted	$	(0.83	)	$	(0.49	)	$	(2.07	)	$	(0.24	)
Weighted average of Class A common shares outstanding – basic and diluted		4,295,632			2,828,241			4,295,632			2,696,121
Net loss per Class B common share – basic and diluted	$	(0.83	)	$	(0.32	)	$	(2.07	)	$	(0.15	)
Weighted average of Class B common shares outstanding – basic and diluted		5,000,000			5,000,000			5,000,000			5,000,000

	Shares		Amount		Shares		Amount		Capital		Deficit			Interest			Equity
	Class A Common Shares				Class B Common Shares				Paid-In		Accumulated			Non-controlling			Total
	Shares		Amount		Shares		Amount		Capital		Deficit			Interest			Equity

Balance, December 31, 2023		4,295,632	$	-		5,000,000	$	-	$	49,405,779	$	(12,092,927	)	$	7,250		$	37,320,102
Stock-based compensation		-		-		-		-		3,669,998		-			142,810			3,812,808
Net loss		-		-		-		-		-		(7,215,425	)		(393,903	)		(7,609,328	)
Balance, March 31, 2024		4,295,632	$	-		5,000,000	$	-	$	53,075,777	$	(19,308,352	)	$	(243,843	)	$	33,523,582
Stock-based compensation		-		-		-		-		3,489,868		-			348,275			3,838,143
Net loss		-		-		-		-		-		(4,274,441	)		(531,423	)		(4,805,864	)
Balance, June 30, 2024		4,295,632	$	-		5,000,000	$	-	$	56,565,645	$	(23,582,793	)	$	(426,991	)	$	32,555,861
Stock-based compensation		-		-		-		-		3,749,161		-			317,277			4,066,636
Ownership change of non-controlling interest		-		-		-		-		-		-			198			198
Net loss		-		-		-		-		-		(7,735,433	)		(705,057	)		(8,440,490	)
Balance, September 30, 2024		4,295,632	$	-		5,000,000	$	-	$	60,314,806	$	(31,318,226	)	$	(814,573	)	$	28,182,007

	September 30, 2024		December 31, 2023
Investment securities, at fair value:
Common stock of publicly traded companies	$	2,516,170	$	2,603,579
Warrants of publicly traded companies		3,050,785		3,168,055
Investment securities, at fair value	$	5,566,955	$	5,771,634

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	Amortized Cost as of September 30, 2024		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value (Level 1) as of September 30, 2024
U.S Treasury Bills maturing 10/11/24	$	5,084,197	$	1,160	$	-	$	5,085,357
Total assets	$	5,084,197	$	1,160	$	-	$	5,085,357

Assets	Classification	Level 1		Level 2		Level 3		Total

Investment Securities (held by our licensed broker dealer)	Equity securities–- common stock	$	2,516,170	$	-	$	-	$	2,516,170

Investment Securities (held by our licensed broker dealer)	Warrants		-		304,730		2,746,055		3,050,785

Total assets measured at fair value (held by our licensed broker dealer)		$	2,516,170	$	304,730	$	2,746,055	$	5,566,955


December 31, 2023	$	3,133,458
Beginning Balance	$	3,133,458

Receipt from investment banking fees		-
Realized gains		-
Unrealized losses		(387,403	)
Sales or distribution
Purchases		-
September 30, 2024	$	2,746,055
Ending Balance	$	2,746,055


December 31, 2022	$	-
Beginning Balance	$	-
Receipt from investment banking fees		2,645,620
Realized gains		-
Unrealized gains		652,925
Sales or distribution		(165,087	)
Purchases		-
December 31, 2023	$	3,133,458
Ending Balance	$	3,133,458

Laboratory equipment		5 years
Furniture and fixtures		7 years
Leasehold improvements		Lesser of the lease duration or the life of the improvements

Balance as of December 31, 2022	$	-
Amounts billed but not recognized		-
Revenue recognized		-
Balance as of March 31, 2023		-
Amounts billed but not recognized		-
Revenue recognized		-
Balance as of June 30, 2023		-
Amounts billed but not recognized		100,000
Revenue recognized		80,000
Balance as of December 31, 2023		20,000
Amounts billed but not recognized		-
Revenue recognized		-
Balance as of March 31, 2024		20,000
Amounts billed but not recognized		-
Revenue recognized		20,000
Balance as of June 30, 2024	$	-
Amounts billed but not recognized		-
Revenue recognized		-
Balance as of September 30, 2024	$	-

	2024			2023

Balance at beginning of period	$	882,319		$	809,532
Grant costs expensed		1,756,852			2,180,581
Grants for equipment purchased		6,379			-
Grant fees		50,854			84,827
Grant funds received		(2,142,441	)		(2,398,488	)
Balance at end of period	$	553,963		$	676,452

ASSETS	Broker Dealer & Intellectual Property Service		Technology Development		Other		Eliminations		Consolidated
Long-lived assets	$	96,147	$	2,137,774	$	663,847	$	-	$	2,897,768
Total assets	$	23,477,369	$	3,495,387	$	7,238,081	$	-	$	34,210,837

	2024			2023
	Nine Months Ended September 30,
	2024			2023

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(20,855,682	)	$	(1,760,981	)
Adjustments to reconcile net loss to net cash used in operating activities:
Unrealized (gain) loss on investment securities, net		566,215			(696,965	)
Stock-based compensation		11,717,587			462,467
Accretion of investments at amortized cost (U.S Treasury Bills)		(533,790	)		(431,776	)
Purchases from sale of investment securities, at fair value (made by our licensed broker dealer)		-			(1,587,500	)
Proceeds from sale of investment securities, at fair value (made by our licensed broker dealer)		-			632,851
Deferred income tax		-			225,874
Warrants issued as part of an investment banking deal		-			165,087
Income recognized from warrants received		(359,605	)		(2,645,620	)
Depreciation of property and equipment		130,937			137,972
Deferred costs related to revenue		(35,630	)		-
Accretion of deferred grant reimbursement		(40,904	)		(38,880	)
Deferred revenue		(20,000	)		100,000
Change in ROU Asset		258,104			166,957
Change in lease liability		(234,109	)		(96,971	)
Changes in operating assets and liabilities:
(Increase) decrease in -
Grants receivable		328,356			133,080
Prepaid expenses and other current assets		95,096			(251,718	)
Clearing deposits		(256,774	)		-
Increase (decrease) in -
Accounts payable		464,044			341,348
Payables to non-customers		21			-
Payables to customers		956,221			-
Income taxes payable		-			158,269
Accrued expenses		(800,807	)		(100,481	)
Net cash used in operating activities		(8,620,720	)		(5,086,987	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds of investments securities, at amortized cost (U.S Treasury Bills)		37,874,534			15,078,020
Purchases of investments securities, at amortized cost (U.S Treasury Bills)		(17,766,330	)		(5,953,312	)
Deferred grant reimbursement		37,256			(22,455	)
Purchases of property and equipment		(100,200	)		(355,634	)
Net cash provided by investing activities		20,045,260			8,746,619

	Broker Dealer & Intellectual Property Service			Technology Development			Other			Eliminations			Consolidated
Operating income:
Unrealized gain on investment securities, net (from our licensed broker dealer)	$	(718,491	)	$	-		$	-		$	-		$	(718,491	)
Fee income		-												-
Other operating income		104,246			-			-			-			104,246
Total operating income, net		(614,245	)		-			-			-			(614,245	)

Operating costs:
General and administrative costs:
Compensation		854,973			546,097			3,769,702			-			5,170,772
Operating expense, related party		405,771			-			84,183			-			489,954
Professional fees		190,277			445,532			214,204			-			850,013
Information technology		195,304			15,661			25,504			-			236,469
Clearing and other charges		876			-			-			-			876
General and administrative-other		166,771			56,941			410,087			-			633,799
General and administrative costs		1,813,972			1,064,231			4,503,680			-			7,381,883
Research and development costs		-			723,487			-			-			723,487
Total operating costs		1,813,972			1,787,718			4,503,680			-			8,105,370
Net operating loss		(2,428,217	)		(1,787,718	)		(4,503,680	)		-			(8,719,615	)
Other income and expense:
Less: interest expense		183,625			45,568			-			(229,193	)		-
Interest income		106,298			921			401,099			(229,193	)		279,125
Loss before income taxes		(2,505,544	)		(1,832,365	)		(4,102,581	)		-			(8,440,490	)
Income tax expense		-			-			-			-			-
Net loss		(2,505,544	)		(1,832,365	)		(4,102,581	)		-			(8,440,490	)
Less net loss attributable to non-controlling interests		-			(705,057	)		-			-			(705,057	)
Net loss attributable to MDB Capital Holdings, LLC	$	(2,505,544	)	$	(1,127,308	)	$	(4,102,581	)	$	-		$	(7,735,433	)

	Broker Dealer & Intellectual Property Service			Technology Development			Other			Consolidated
Operating income:
Unrealized loss on investment securities, net (from our licensed broker dealer)	$	(786,906	)	$	-		$	-		$	(786,906	)
Other operating income		11,502			-			-			11,502
Total operating loss, net		(775,404	)		-			-			(775,404	)

Operating costs:
General and administrative costs:
Compensation		793,061			119,146			425,564			1,337,771
Operating expense, related party		223,254			-			50,567			273,821
Professional fees		108,959			92,506			258,120			459,585
Information technology		71,988			7,012			14,326			93,326
Clearing and other charges		3,316			-			-			3,316
General and administrative-other		63,266			145,243			119,387			327,896
Total general and administrative costs		1,263,844			363,907			867,964			2,495,715
Research and development costs		-			27,936			-			27,936
Total operating costs		1,263,844			391,843			867,964			2,523,651
Net operating loss		(2,039,248	)		(391,843	)		(867,964	)		(3,299,055	)
Other income:
Interest income		28,110			-			148,190			176,300
Net loss before income taxes		(2,011,138	)		(391,843	)		(719,774	)		(3,122,755	)
Income taxes		-			63,559			-			63,559
Net loss		(2,011,138	)		(455,402	)		(719,774	)		(3,186,314	)
Less net loss attributable to non-controlling interests		-			(177,853	)		-			(177,853	)
Net loss attributable to MDB Capital Holdings, LLC	$	(2,011,138	)	$	(277,549	)	$	(719,774	)	$	(3,008,461	)

	For the Nine Months Ended September 30,
	2024			2023

Non-controlling net loss	$	(4,201,352	)	$	(874,631	)
Weighted average non-controlling percentage		38.81	%		39.06	%
Net loss non-controlling interest	$	(1,630,383	)	$	(341,631	)
Prior period balance		7,250			468,665
Ownership change of non-controlling interest		198			-
Stock-based compensation		808,362			174,413
Ending period balance	$	(814,573	)	$	301,447

	Time-Based					Performance-Based
	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value		Number of Restricted Stock Units		Weighted Average Grant Date Fair Value
Restricted stock units outstanding at September 30, 2023		3,675,000		$	10.00		2,000,000	$	7.91
Granted		-			-		-		-
Exercised		-			-		-		-
Expired		-			-		-		-
Restricted stock units outstanding at December 31, 2023		3,675,000		$	10.00		2,000,000	$	7.91
Granted		295,000			8.71		-		-
Exercised		-			-		-		-
Expired		-			-		-		-
Forfeited		(100,000	)		10.00		-		-
Restricted stock units outstanding at September 30, 2024		3,870,000		$	9.90		2,000,000	$	7.91

Restricted stock units at September 30, 2023		-		$	-		-	$	-
Restricted stock units at September 30, 2024		-		$	-		-	$	-

	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)
Stock options outstanding at January 1, 2023		533,680		$	2.44		4.83
Granted		51,940			3.32		7.00
Exercised		-			-		-
Expired		-			-		-
Stock options outstanding at September 30, 2023		585,620		$	2.44		4.83
Granted		457,067			3.32		7.00
Exercised		-			-		-
Expired		-			-		-
Stock options outstanding at December 31, 2023		1,042,687		$	1.43		5.47
Granted		725,878			7.00		7.00
Exercised		(3,376	)		-		-
Expired		(12,206	)		2.44		-
Stock options outstanding at September 30, 2024		1,752,983			4.57		6.01

Stock options exercisable at September 30, 2023		288,959		$	2.52		4.54
Stock options exercisable at September 30, 2024		638,144		$	4.62		6.01

	Class A common shares			Class B common shares			Class A common shares			Class B common shares
	For the Three Months Ended
	September 30, 2024						September 30, 2023
	Class A common shares			Class B common shares			Class A common shares			Class B common shares
Net loss attributable to MDB Capital Holdings, LLC	$	(3,574,644	)	$	(4,160,789	)	$	(1,390,249	)	$	(1,618,212	)

Weighted average shares outstanding – basic and diluted		4,295,632			5,000,000			2,828,241			5,000,000

Net loss per share – basic and diluted	$	(0.83	)	$	(0.83	)	$	(0.49	)	$	(0.32	)

	●	A payment of $250,000 when a licensed product reaches $1,000,000 in cumulative net sales.
	●	A payment of $350,000 when a second licensed product reaches $ 2,000,000 in cumulative net sales.

	September 30, 2024			December 31, 2023

Operating leases:
Right-of-use assets	$	2,062,015		$	2,320,119
Operating lease liabilities	$	2,181,780		$	2,415,889

Weighted average remaining lease term in years		4.85			5.33
Weighted average discount rate		7.66	%		7.40	%

Cash paid for amounts included in the measurement of lease liabilities	$	366,948		$	206,837
Right-of-use assets obtained in exchange for lease liabilities	$	-		$	1,018,002

Operating lease cost	$	132,839		$	146,836
Short-term lease costs		258,104			275,589
Total operating lease costs	$	390,943		$	422,425

Year	Amount
Remainder of 2024	$	124,676
2025		503,684
2026		516,001
2027		528,586
2028		541,674
Thereafter		451,600
Total	$	2,666,221
Less effects of discounting		(484,441	)
Total operating lease liabilities	$	2,181,780

	2024			2023			$ Change			% Change
Operating income:
Unrealized loss on investment securities, net (from our licensed broker dealer)	$	(718,491	)	$	(786,906	)	$	68,415			8.7	%
Fee income		-			-			-			0.0	%
Other operating income		104,246			11,502			92,744			806.3	%
Total operating loss, net		(614,245	)		(775,404	)		161,159			20.8	%

Operating costs:
General and administrative costs:
Compensation		5,170,772			1,337,771			3,833,001			286.5	%
Operating expense, related party		489,954			273,821			216,133			78.9	%
Professional fees		850,013			459,585			390,428			85.0	%
Information technology		236,469			93,326			143,143			153.4	%
Clearing and other charges		876			3,316			(2,440	)		(73.6	)%
General and administrative-other		633,799			327,896			305,903			93.3	%
Total general and administrative costs		7,381,883			2,495,715			4,886,168			195.8	%
Research and development costs, net of grants amounting to $489,798 and $704,162		723,487			27,936			695,551			2,489.8	%
Total operating costs		8,105,370			2,523,651			5,581,719			221.2	%
Net operating income (loss)		(8,719,615	)		(3,299,055	)		(5,420,560	)		(164.3	)%
Other income:
Less: interest expense		-
Interest income		279,125			176,300			102,825			58.3	%
Loss before income taxes		(8,440,490	)		(3,122,755	)		(5,317,735	)		170.3	%
Income taxes		-			63,559			(63,559	)		(100.0	)%
Net loss		(8,440,490	)		(3,186,314	)		(5,254,176	)		(164.9	)%
Less net (loss) attributable to non-controlling interests		(705,057	)		(177,853	)		(527,204	)		(296.4	)%
Net income (loss) attributable to MDB Capital Holdings, LLC	$	(7,735,433	)	$	(3,008,461	)	$	(4,726,972	)		(157.1	)%

	●	Compensation Expense: The majority of the increase in compensation expense was due to the recognition of restricted stock units, as well as the ongoing recruitment of additional employees in the latter half of 2023, specifically within the technology segment, to support expected operational growth.
	●	Related Party Operating Expenses: The rise in related party operating expenses was due to outsourcing support services in anticipation of upcoming self-clearing operations within the broker-dealer and intellectual property service segments for 2024.
	●	Professional Fees: Professional fees saw an increase from previous periods, driven by higher costs in legal, tax, audit, and consulting services. This rise in expenses was primarily linked to the audit fees, tax return preparations, and K-1s associated with fiscal year 2023 reporting, along with initiation of the self-clearing operations.
	●	Information Technology Costs: Information technology costs saw an increase from previous periods, driven by higher costs associated with the initiation of the self-clearing operations, as well as increased cloud computing costs.
	●	Clearing and Other Charges: Clearing and other charges fluctuate with broker dealer activity, generally correlating to fee income. For the three-month periods ended September 30, 2024 and 2023, respectively, there was limited activity. A decrease in fee income for the nine-month period ended September 30, 2024 as compared to the nine-month period ended September 30, 2023 resulted in a corresponding decrease in fee income for the current period.
	●	Other General and Administrative Costs: The primary driver of the increase in other general and administrative costs was the issuance of restricted stock options to the board of directors, as well as higher rent expenses in the technology segment compared to the previous period.

	●	Compensation Expense: The increase in compensation expense was driven by an increase in salaries in early 2024.
	●	Related Party Operating Expenses: There was an increase in related party operating expenses as outsourcing support was increased within the broker-dealer and intellectual property service segment.
	●	Professional Fees: There was an increase in professional fees compared to the previous periods, primarily due to increased consulting, legal, and tax. Furthermore, there was an increase in consulting fees associated with the implementation of self-clearing operations.
	●	Information Technology Costs: Information technology costs saw an increase from previous periods, driven by higher costs with the initiation of self-clearing operations and increased cloud computing costs.
	●	Clearing and Other Charges: Clearing and other charges fluctuate with broker dealer activity, generally correlating to fee income. For the three-month periods ended September 30, 2024 and 2023, respectively, there was limited activity. A decrease in fee income for the nine-month period ended September 30, 2024 as compared to the nine-month period ended September 30, 2023 resulted in a corresponding decrease in fee income for the current period.
	●	Other General and Administrative Costs: The rise in other general and administrative costs was due to higher expenses in advertising and promotions, increased spending on travel and conferences, as well as rent allocation to the broker-Dealer.

	●	Compensation Expense: The increase in compensation expense stemmed from the recruitment of additional administrative staff, who are not research and development related and therefore not covered by grants, in the latter half of 2023.
	●	Professional Fees: The increase in professional fees compared to previous periods was due to higher legal, tax, audit, and consulting costs associated with completing year-end financial audits and preparing for the initial public offering.
	●	Information Technology Costs: The increase in information technology costs are due to the increase of personnel and hardware and software needs to support new personnel.
	●	Other General and Administrative Costs: There was a slight decrease in other general and administrative costs due to cost savings measures.

	September 30, 2024 (unaudited)			December 31, 2023			$ Change			% Change
ASSETS
Cash and cash equivalents	$	16,679,428		$	6,109,806		$	10,569,622			173.3	%
Cash segregated in compliance with regulations		1,584,734			1,247,881			336,853			27.0	%
Grants receivable		553,963			882,319			(328,356	)		(37.2	)%
Clearing deposits		516,774			260,000			256,774			98.8	%
Prepaid expenses and other current assets		428,692			523,788			(95,096	)		(18.2	)%
Investment securities, at amortized cost (U.S. Treasury Bills)		5,084,197			24,658,611			(19,574,414	)		(79.4	)%
Investment securities, at fair value (held by our licensed broker dealer)		5,566,955			5,771,634			(204,679	)		(3.5	)%
Investment securities, at cost less impairment		200,000			200,000			-			0.0	%
Deferred offering cost		587,368			69,303			518,065			747.5	%
Deferred costs related to deferred revenue		110,958			75,328			35,630			47.3	%
Property and equipment, net		835,753			866,490			(30,737	)		5.1	%
Operating lease right-of-use assets, net		2,062,015			2,320,119			(258,104	)		(11.1	)%
Total assets	$	34,210,837		$	42,985,279		$	(8,774,442	)		(20.4	)%

LIABILITIES AND EQUITY
Accounts payable	$	1,044,209		$	578,214		$	465,995			80.6	%
Accrued expenses		304,271			1,105,078			(800,807	)		(72.5	)%
Payables to non-customers		21			1,405,293			(1,405,272	)		(100.0	)%
Payables to customers		2,361,514			-			2,361,514			100.0	%
Deferred grant reimbursement		137,035			140,703			(3,668	)		(2.6	)%
Deferred revenue		-			20,000			(20,000	)		(100.0	)%
Operating lease liabilities		2,181,780			2,415,889			(234,109	)		(9.7	)%
Total liabilities		6,028,830			5,665,177			363,653			6.4	%
Equity:
Paid-in-capital		60,314,806			49,405,779			10,909,027			22.1	%
Accumulated deficit		(31,318,226	)		(12,092,927	)		(19,225,299	)		159.0	%
Total MDB Capital Holdings, LLC Members’ equity		28,996,580			37,312,852			(8,316,272	)		(22.3	)%
Non-controlling interest		(814,573	)		7,250			(821,823	)		(11,335.5	)%
Total equity		28,182,007			37,320,102			(9,138,095	)		(24.5	)%
Total liabilities and equity	$	34,210,837		$	42,985,279		$	(8,774,442	)		(20.4	)%

	Nine-Months Ended September 30,
	2024			2023

Net cash used in operating activities	$	(8,620,720	)	$	(5,086,987	)
Net cash provided by investing activities		20,045,260			8,746,619
Net cash (used in) provided by financing activities		(518,065	)		17,833,294
Net increase in cash and cash equivalents	$	10,906,475		$	21,492,926

	MDB CAPITAL HOLDINGS, LLC
	(the “Registrant”)

Dated: November 12, 2024	By:	/s/ Christopher A. Marlett
		Christopher A. Marlett
		Chief Executive Officer
		(Principal Executive Officer)

Dated: November 12, 2024	By:	/s/ Jeremy W. James
		Jeremy W. James
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

Exhibit
Number		Description of Exhibit

31.1 *		Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 *		Certification of Principal Financial and Accounting Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Principal Financial and Accounting, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*		Inline XBRL Instance Document

101.SCH*		Inline XBRL Taxonomy Schema

101.CAL*		Inline XBRL Taxonomy Calculation Linkbase

101.DEF*		Inline XBRL Taxonomy Definition Linkbase

101.LAB*		Inline XBRL Taxonomy Label Linkbase

101.PRE*		Inline XBRL Taxonomy Presentation Linkbase

104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

		/s/ Christopher A. Marlett
	Name:	Christopher A. Marlett,
		Chief Executive Officer
	Date:	November 12, 2024

		/s/ Jeremy W. James
	Name:	Jeremy W. James,
		Chief Financial Officer
	Date:	November 12, 2024