UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549  FORM 10-QSB  (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended: March 31, 2008[   ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from N/A to N/A  Commission file number: 000-27145  IDEAEDGE, INC. (Name of small business issuer in its charter)  Colorado33-0756798(State or jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)  6440 Lusk Blvd., Suite 200San Diego California92121(Address and of principal executive offices)(Zip Code)   (858) 677-0080 (Issuers telephone number, including area code)   Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x    No  oIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  o   No  x At April 11, 2008, there were 37,759,761 shares outstanding of the issuer’s common stock, the only class of common equity, as adjusted for the March 12, 2008 3-for-1 forward split of our common stock.  Transitional Small Business Disclosure Format (Check one):  Yes  o   No  x     TABLE OF CONTENTS  PART I: Financial Information   Item 1  Financial Statements Consolidated Balance Sheet (unaudited) as of March 31, 2008 Consolidated Statement of Operations (unaudited) for the three and six months ended March 31, 2008 Consolidated Statement of Cash Flows (unaudited) for the three and six months ended March 31, 2008 Notes to Consolidated Financial Statements Item 2  Managements Discussion and Analysis of Financial Condition and Results of Operations Item 3  Controls and Procedures     PART II: Other Information  Item 1  Legal Proceedings Item 2  Sales of Unregistered Securities and Use of Proceeds Item 3  Defaults upon Senior Securities Item 4  Submission of Matters to a Vote of Security Holders Item 5  Other Information Item 6  Exhibits   Signatures  Exhibits    FORWARD LOOKING STATEMENTS  This quarterly report on Form 10-QSB includes forward-looking statements.   Forward-looking statements are those that predict or describe future events or trends and that do not relate solely to historical matters. You can generally identify forward looking statements as statements containing the words believe, expect, will, anticipate, intend, estimate, project, plan, assume or other similar expressions, or negatives of those expressions, although not all forward-looking statements contain these identifying words.  Such statements are based on management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. All statements other than historical facts contained or incorporated by reference in this report, including without limitation, statements under the heading ITEM 2MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION, below, regarding our future strategy, future operations, projected financial position, estimated future revenues, projected costs, future prospects, the future of our industries and results that might be obtained by pursuing management's current plans and objectives are forward-looking statements.  Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct. You should not place undue reliance on our forward-looking statements because the matters they describe are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. Our forward-looking statements are based on the information currently available to us and speak only as of the date of the filing of this report, or, in the case of forward-looking statements in documents incorporated by reference, as of the date of the date of the filing of the document that includes the statement. New risks and uncertainties arise from time to time, and it is impossible for us to predict these matters or how they may affect us. Over time, our actual results, performance or achievements will likely differ from the anticipated results, performance or achievements that are expressed or implied by our forward-looking statements, and such difference might be significant and materially adverse to our security holders. We do not undertake and specifically decline any obligation to update any forward-looking statements or to publicly announce the results of any revisions to any statements to reflect new information or future events or developments.  We have identified some of the important factors that could cause future events to differ from our current expectations and they include, but are not limited to, those items discussed under the heading "ITEM 2MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONRisk Factors," below.  Please consider our forward-looking statements in light of those risks as you read this report.    IDEAEDGE, INC.Consolidated Balance Sheet (unaudited)March 31, 2008AssetsCurrent assets:Cash$203,203Inventory2,500Other current assets32,750Total current assets238,453Property and equipment, net of accumulateddepreciation of $1,4048,963Prepaid licensing agreement835,856Intellectual property169,063Other assets5,688$1,258,023Liabilities and Stockholders' EquityCurrent liabilities:Accounts payable and accrued liabilities$223,037Accrued personnel compensation32,536Other current liabilities5,346Total current liabilities260,919Licensing agreement payable835,856Total liabilities1,096,775Commitments and contingenciesStockholders equity:Preferred stock; $0.001 par value; 10,000,000 sharesauthorized; no shares issued or outstandingCommon stock; $0.001 par value; 80,000,000 sharesauthorized; 37,759,761 shares issued and outstanding37,759Additional paid-in capital3,809,468Accumulated deficit(3,685,979)Total stockholders' equity161,248$1,258,023See accompanying notes.  1   IDEAEDGE, INC.Consolidated Statements of Operations (unaudited)Three months ended March 31, 2008Six months ended March 31, 2008Sales revenues$1,741$2,589Cost of sales23,13327,568Gross margin(21,392)(24,979)Operating expenses:Selling and marketing336,065599,873Loss due to impairment of prepaid licensing agreement1,445,7171,445,717General and administrative529,430982,910Total operating expenses2,311,2123,028,500Loss from operations(2,332,604)(3,053,479)Interest expense18,68846,357Net loss$(2,351,292)$(3,099,836)Basic and diluted net loss per share$(0.06)$(0.09)Basic and diluted weighted averagecommon shares outstanding37,397,02135,486,495See accompanying notes.  2   IDEAEDGE, INC.Consolidated Statement of Cash Flows (unaudited)For the six months ended March 31, 2008Cash flows from operating activities:Net loss$(3,099,836)Adjustments to reconcile net loss to cash flowsfrom operating activities:Depreciation expense1,349Stock-based compensation139,114Consulting services rendered in exchange for common stock351,634Loss due to impairment and amortization of gift card inventory180,300Loss due to impairment and amortization of license agreement1,446,187Accretion of interest on licensing agreement payable32,755Interest expense forgiven upon repayment or conversion of notes payable13,595Changes in operating assets and liabilities:Inventory(2,500)Other assets(146)Accounts payable and accrued liabilities196,648Accrued personnel compensation21,540Other liabilities5,234Cash flows from operating activities(714,126)Cash flows from investing activities:Purchases of property and equipment(8,388)Purchase of and costs incurred in connection with intellectual property(112,113)Cash flows from investing activities(120,501)Cash flows from financing activities:Proceeds from issuance of common stock1,033,717Repayments of bridge loans payable(416,500)Payments to affiliate for fund raising activites(100,000)Cash flows from financing activities517,217Change in cash during period(317,410)Cash, beginning of period520,613Cash, end of period$203,203Noncash investing and financing transactions:Common stock issued in exchange for future consulting services$351,634Common stock issued in exchange for fund raising$168,338Common stock issued in exchange for conversion of notes payable$666,000Common stock issued in exchange for debt extinguishment, net of costs$55,125Warrants issued in connection with purchase of intellectual property$56,950Accrued interest forgiven$43,495See accompanying notes.  3   IdeaEdge, Inc. Notes to Consolidated Financial Statements  1. Basis of Presentation IdeaEdge, Inc. (hereinafter referred to as we or the/our Company) is a Colorado corporation.  Through our subsidiary incorporated in the state of California, IdeaEdge, Inc. (IdeaEdge-CA), we develop, market and sell innovative prepaid gift card programs. We have prepared the accompanying unaudited consolidated financial statements in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-QSB.  Accordingly, they do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements.  In the opinion of our management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included.  Operating results for the three and six months ended March 31, 2008 are not necessarily indicative of the results that may be expected for the entire year. For further information, see our consolidated financial statements and related disclosures thereto for the year ended September 30, 2007 in our Annual Report on Form 10-KSB filed with the Securities and Exchange Commission. Through October 16, 2007, the Company was named VOS International, Inc. (VOS) and through its wholly-owned subsidiary VOS Systems, Inc. (VSI), was a consumer electronics products company.  On September 6, 2007, the Company entered into a Share Exchange Agreement (the Share Exchange Agreement) with IdeaEdge-CA and certain of its shareholders (the IdeaEdge Acquisition).  The closing of the Share Exchange Agreement occurred on October 16, 2007 (the Closing Date).  Pursuant to the terms of the Share Exchange Agreement, the Company issued one of its shares of common stock to the IdeaEdge-CA shareholders, in exchange for each share of stock of IdeaEdge-CA issued and outstanding as of the Closing Date, and 2,220,000 shares of Company common stock to the IdeaEdge-CA note holders, in exchange for $740,000 in promissory notes issued by IdeaEdge-CA as of the Closing Date.  A total of 24,079,998 shares were issued in connection with the IdeaEdge Acquisition. Upon the closing of the Share Exchange Agreement, our Companys former management and members of its Board of Directors resigned, and our shareholders elected two new directors who were members of IdeaEdge-CAs Board of Directors.  Also, in connection with the Share Exchange Agreement, our Company entered into an agreement effective October 16, 2007 with Allan Ligi (its former President) providing for the sale to Mr. Ligi of VSI, and the assumption by Mr. Ligi of all the liabilities of our Company and VSI through October 16, 2007.  In connection with the sale, we issued Mr. Ligi 5,680,383 shares of our common stock.  This sale represented our Companys complete exit from its former businesses carried on prior to October 16, 2007. The IdeaEdge Acquisition was characterized as a reverse merger, which is treated as a recapitalization for accounting purposes.  Application of reverse merger accounting results in IdeaEdge-CA being deemed to be the accounting acquirer and the continuing entity.  The operations of our Company prior to October 16, 2007 are those of IdeaEdge-CA.  The accumulated deficit of VOS through October 16, 2007 was offset against its additional paid-in capital.  The stockholders equity of VOS is carried forward as the stockholders equity of our Company from the date of the IdeaEdge Acquisition and thereafter.  No goodwill was recognized in connection with this recapitalization.  The accompanying financial statements include the accounts of our Company and IdeaEdge-CA as of and through March 31, 2008.  IdeaEdge-CAs operations commenced upon its corporate inception on April 3, 2007 and therefore no prior year operations exist for the three or six months ended March 31, 2007.  All intercompany amounts have been eliminated in consolidation. Effective October 16, 2007, our Company underwent a 25-for-1 reverse split of its shares of stock and amended its Articles of Incorporation.  Effective March 12, 2008, our Company underwent a 3-for-1 forward split of its shares of stock.  The accompanying financial statements have been retroactively adjusted to reflect such changes for the three and six months ended March 31, 2008.  Our Company emerged from the development stage during the three months ended December 31, 2007. Our financial statements have been prepared assuming that we will continue as a going concern.   However, we have incurred net losses and have yet to establish profitable operations.  These factors, among others, create a substantial doubt about our ability to continue as a going concern.  We are dependent upon sufficient future revenues, additional sales of our securities or obtaining debt financing to meet our cash requirements.  Barring our generation of revenues in excess of our costs and expenses or our obtaining additional funds from equity or debt financing, we will not have sufficient cash to continue to fund the operations of our Company through our year end of September 30, 2008. In response to our Companys current cash needs, we have instituted substantial reductions of spending including the reduction and deferral of a significant portion of our Companys employee compensation.  We also recently secured an agreement for the sale of 900,000 shares of restricted common stock for $0.33 per share.  The agreement requires the investor to make four investments of $75,000 during March, April, May and June 2008, for cash proceeds totaling $300,000.  The investor has made the required payments for March and April 2008 totaling $150,000.  The ultimate fulfillment of the investors commitment to make the balance of the committed investments totaling $150,000 is subject to his financial ability to make the committed payments at the dates indicated.  There can be no assurance that he will ultimately have the ability to make the remaining investments committed.  Longer term, we are attempting to raise additional equity financing through the sale of unregistered shares of our Companys common stock in order to finance our future investing and operating cash flow needs.  However, there can be no assurance as to whether, when, or upon what terms we will be able to consummate any such financing.  2. Summary of Significant Accounting Policies  Basis of Presentation  Our financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America.  Use of Estimates  The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.  Revenue Recognition  Revenue is recognized on the accrual basis of accounting when earned.  We are responsible for providing merchandise to customers who purchase our gift cards.  Accordingly, we recognize revenue at the time that the gift cards have been redeemed by customers in exchange for goods from our online Website, the product has been shipped, the selling price is fixed, collection is reasonably assured and when both title and risk of loss transfer to the customer, provided no significant obligations remain.  Cash received in connection with unredeemed gift cards sold is recorded as deferred revenue until such time as the corresponding gift cards are redeemed for merchandise.  Sales revenues include sales taxes collected from the customer.  The SEC's Staff Accounting Bulletin (SAB) No. 104, Revenue Recognition, provides guidance on the application of generally accepted accounting principles to selected revenue recognition issues.  We believe that our revenue recognition policy is appropriate and in accordance with generally accepted accounting principles and SAB No. 104.  Gift Cards  Gift cards were purchased in large volumes and issued to retail outlets for sale to customers who subsequently redeem them online in exchange for merchandise.  The cards have no value until the customer purchases them and they are activated.  We capitalized the cost of gift cards purchased and amortized their cost on a straight-line basis over the expected time they were available for sale.  Included in selling and marketing expense for the three and six months ended March 31, 2008 were charges totaling $232,145 and $292,245, respectively, in connection with the amortization and recognition of impairment of previously purchased gift cards.  Inventory  Inventory is stated at cost (first-in, first-out) and consists of merchandise purchased for customer redemptions from our Website.  We periodically reserve for inventory that we believe is obsolete or at a carrying value above its net realizable value.  At March 31, 2008, reserves for excess and obsolete inventory totaled $11,122.  Property and Equipment  Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets.  Costs incurred for maintenance and repairs are expensed as incurred and expenditures for major replacements and improvements are capitalized and depreciated over their estimated remaining useful lives.  Valuation of Long-Lived Assets  We account for long-lived assets in accordance with Statement of Financial Accounting Standards (SFAS) No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS No. 144).  The scope of SFAS No. 144 includes long-lived assets, or groups of assets, to be held and used as well as those which are to be disposed of by sale or by other method. SFAS No. 144 requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets carrying amount. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the estimated fair value of the assets.  We perform periodic reviews of the carrying value of our long-lived assets to be held and used, including certain identifiable intangible assets, on an annual basis during our fiscal fourth quarter or whenever evidence comes to our attention that such impairment might have occurred.  Income Tax Expense Estimates and Policies  As part of the income tax provision process of preparing our financial statements, we are required to estimate our Companys provision for income taxes.  This process involves estimating our current tax liabilities together with assessing temporary differences resulting from differing treatments of items for tax and accounting purposes.  These differences result in deferred tax assets and liabilities.  Management then assesses the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent believed that recovery is not likely, a valuation allowance is established.  Further, to the extent a valuation allowance is established and changes occur to this allowance in a financial accounting period, such changes are recognized in our tax provision in our consolidated statement of operations.  We use our judgment in making estimates to determine our provision for income taxes, deferred tax assets and liabilities and any valuation allowance is recorded against our net deferred tax assets.  There are various factors that may cause these tax assumptions to change in the near term, and we may have to record a future valuation allowance against our deferred tax assets.  We recognize the benefit of an uncertain tax position taken or expected to be taken on our income tax returns if it is more likely than not that such tax position will be sustained based on its technical merits.  Stock Based Compensation  We account for stock based compensation arrangements in accordance with the provisions of Statement of Financial Accounting Standards No. 123R (SFAS 123R) Share-Based Payment, which requires the measurement and recognition of compensation expense for all share-based payment awards to employees and directors based on estimated fair values.  We use the Black-Scholes option valuation model to estimate the fair value of our stock options at the date of grant.  The Black-Scholes option valuation model requires the input of subjective assumptions to calculate the value of stock options.  We use historical and comparable company data among other information to estimate the expected price volatility, the expected option life and the expected forfeiture rate.  Net Loss per Share  We calculate basic earnings per share (EPS) by dividing our net loss by the weighted average number of common shares outstanding for the period, without considering common stock equivalents.  Diluted EPS is computed by dividing net income or net loss by the weighted average number of common shares outstanding for the period and the weighted average number of dilutive common stock equivalents, such as options and warrants.  Options and warrants are only included in the calculation of diluted EPS when their effect is dilutive.  Financial Instruments  Our financial instruments are cash and cash equivalents, accounts receivable, accounts payable and notes payable. The recorded values of cash and cash equivalents, accounts receivable, and accounts payable approximate their fair values based on their short-term nature.  Advertising  We expense advertising costs as incurred.  We have no existing arrangements under which we provide or receive advertising services from others for any consideration other than cash.  Litigation  From time to time, we may become involved in disputes, litigation and other legal actions.  We estimate the range of liability related to pending litigation where the amount and range of loss can be estimated.  We record our best estimate of a loss when the loss is considered probable.  Where a liability is probable and there is a range of estimated loss with no best estimate in the range, we record a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements and (ii) the range of loss can be reasonably estimated.  3. Finder Agreement and Agreement for Investor Relations Services In May 2007, we entered into a nonexclusive Finder Agreement with RBW, Inc. (RBW) under which RBW is paid a finders fee of 10% of all funds raised by it on our Companys behalf.  We have incurred costs of $303,338 under this arrangement through March 31, 2008, $135,000 of which was paid in cash.  In February 2008, RBW converted the remaining outstanding balance owed to them by our Company of $168,338 into 336,675 shares of our common stock at the rate of $0.50 per share.  SPN Investments, Inc. (SPN) and our Company entered into a Consulting Agreement dated November 14, 2007 pursuant to which SPN provides investor relations and management consulting services to our Company through November 2008 in exchange for the issuance of 825,000 shares of our Companys common stock.  The sole shareholder of SPN is also the sole shareholder of RBW.  In connection with this arrangement, we will recognize a total of $924,000 of noncash consulting expense through November 2008, based on the closing price for our common stock of $1.12 on the date of the Consulting Agreement.  We have recognized consulting expense under the agreement of $231,000 and $351,634 for the three and six months ended March 31, 2008, respectively, and future amounts remaining to be recognized as of March 31, 2008 total $572,366.  4. Prepaid licensing agreement and licensing agreement payable On May 16, 2007, we entered into an agreement with FremantleMedia North America, Inc. (FremantleMedia) for an exclusive license right to American IdolTM branded prepaid gift cards for redemption of American IdolTM merchandise through a Licensor-approved website. The term of this agreement commenced on June 1, 2007 and will end on December 31, 2010.  $1,500,000 of advances was paid through March 31, 2008.  Future amounts under the license agreement are payable as follows: 1) $500,000 payable on or before March 10, 2010; and 2) $500,000 payable on or before December 31, 2010.  The advance payments are non-refundable and non-returnable but may be applied against any future royalties. The prepaid licensing agreement and resulting licensing agreement payable were recorded at the present value of payments due throughout the life of the agreement, discounted at an 8% rate.  The remaining liability corresponding to the remaining payments due in 2010 totals $835,856 at March 31, 2008.  Interest accreted on the liability and charged to operations totaled $16,451 and $32,755 for the three and six months ended March 31, 2008, respectively.  The initial asset in connection with the prepaid licensing agreement was recorded at a value of $2,282,043 and was to be charged to operations as gift cards are purchased by consumers and liabilities for royalties are incurred.  For the three months ended March 31, 2008, consumer purchases of American IdolTM branded gift cards were below a level that would result in more than an immaterial recovery of our Companys prepayments of advances to date. Accordingly, our management evaluated whether the asset represented by the prepaid licensing agreement was impaired.  Our evaluation was based on our best estimates of amounts to be due to the licensor for future royalties, compared with the remaining term of the licensing agreement.  Based on our evaluation, we determined that this asset is impaired because we could not support a value for the prepaid license in excess of the remaining liability for future payments on the royalty agreement.  This resulted in a charge to operations totaling $1,445,717 for the three and six months ended March 31, 2008, and represented the difference between the estimated net realizable value of the prepayments made in connection with the license agreement and the corresponding liability under the licensing agreement as of March 31, 2008.  We will continue to monitor the value of this asset in comparison with the related liability in order to determine if future charges for estimated impairment will be required.  5. Intellectual property On March 21, 2008, we entered into an agreement with an individual to purchase technology rights under a patent filed by him.  In exchange for the assignment of the patent application, we paid the individual $100,000 in cash and issued warrants to purchase up to 100,000 shares of our common stock for $0.71 per share.  The warrants have certain limitations as to the timing of their exercise and expire on December 31, 2013.  We valued the warrants using the Black-Scholes-Merton option pricing formula and using assumptions for our stocks volatility, warrant term and risk free interest rate of 37.96%, 5.75 years and 1.99%, determined their value to be $56,950 on the date of the agreement.  Our intellectual property has a total value of $169,123 at March 31, 2008 and includes legal fees incurred in connection with our purchased patent and another patent application.  We will amortize the cost of patents over their estimated useful life, commencing on the date the patent is granted. 6. Stock-based compensation and equity incentive plans On October 16, 2007, our stockholders approved the adoption of our IdeaEdge, Inc. 2007 Equity Incentive Plan (the Plan).  The Plan provides for granting of stock-based awards including: incentive stock options, non-statutory stock options, stock bonuses and rights to acquire restricted stock.  Intended Plan participants include employees, directors and consultants of our Company.  The total number of shares of common stock that may be issued pursuant to stock awards under the Plan shall not exceed in the aggregate, 1,800,000 shares of common stock of our Company. Through March 31, 2008, we granted a total of 1,260,000 incentive stock options to two employees and an advisor under the Plan.  For purposes of accounting for stock-based compensation, the fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing formula.  During the three and six months ended March 31, 2008, we recognized stock-based compensation expense totaling $73,959 and $139,114, respectively.   As of March 31, 2008, $414,086 of total unrecognized compensation expense related to unvested stock-based compensation is expected to be recognized over a weighted average period of 3.24 years.  The weighted average exercise price of stock options granted through March 31, 2008 was $0.93 per share.  7. Notes payable On September 30, 2007, we had $740,000 outstanding in convertible notes payable to investors.  The notes bore interest at 12% per annum and in connection with the IdeaEdge Acquisition on October 16, 2007, were converted by their holders into our common stock at the rate of one share per each dollar of principal outstanding on the notes.  Accrued interest totaling $26,519 was forgiven by the note holders and added to additional paid-in capital upon the conversion of the notes.  Interest expense in connection with these notes totaling $4,378 was recognized during the six months ended March 31, 2008.  8. Bridge loans payable In August 2007, we borrowed $577,750 from related parties to fund our operations.  Of these borrowings, $100,000 was repaid in September 2007, $255,000 was repaid in October 2007 and $61,250 was converted into common stock at the rate of $0.50 per share in December 2007 (net proceeds of $55,125 after fund raising costs).  The remaining balance totaling $161,500 was repaid in February 2008.  Interest in connection with these bridge loans totaling $16,976 was forgiven by the notes holders and added to additional paid-in capital upon the conversion of the notes.  9. Transactions with related parties In October 2007, we purchased marketing data with a total cost of $12,000 from a company which formerly employed our Chief Executive Officer and our Vice President of Business Development.  10. Income taxes We have recorded a valuation allowance against our entire deferred tax asset balance due to our lack of a history of earnings, the limitations on the use of our net operating loss carryforwards (NOL) as a result of the IdeaEdge acquisition and the future expiration of the NOL.  These factors give rise to substantial uncertainty as to whether our net deferred tax assets will be realized.  As a result of these provisions, our utilization of the NOL will likely be severely limited and a substantial portion of the NOL may expire unused.  11. Commitments and contingencies The Company signed a lease agreement for office space through June 30, 2009.  Rent expense totaled $8,137 and $14,604 for the three and six months ended March 31, 2008, respectively.  The lease (as modified) calls for minimum monthly rentals of $2,666 from October 1, 2007 to June 30, 2008 and $2,799 from July 1, 2008 to June 30, 2009, for a total future commitment as of March 31, 2008 of $34,134.  As noted above, our Company entered into an agreement effective October 16, 2007 with its former President that provided for his assumption of all the liabilities of our Company and VSI through October 16, 2007.  Should he fail to honor his obligations under the agreement, we could ultimately be responsible for these liabilities.   4


Item 2  Managements Discussion and Analysis of Financial Condition and Results of Operations  The following discussion and analysis is intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated.  The discussion should be read in conjunction with our consolidated financial statements and the notes presented herein.  In addition to historical information, the following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of certain factors discussed in this Quarterly Report and our other periodic reports filed with the Securities and Exchange Commission.  Overview and Financial Condition Our business, commencing with our October 16, 2007 acquisition of IdeaEdge-CA, is centered around the development, marketing and sale of innovative gift card programs.  As described above, our Companys operations which existed prior to October 16, 2007, as conducted by VSI, were sold to our former Chief Executive Officer.  Accordingly, the Companys financial condition and results of operations as they existed prior to the acquisition of IdeaEdge-CA and sale of VSI, are of limited value in understanding the future prospects and financial position of our Company.  We have accounted for the past operations of our Company in our accompanying financial statements in accordance with the presentation guidance appropriate to a reverse merger, which is to say that the operations prior to October 16, 2007 reflected in our financial statements are those of IdeaEdge-CA.  IdeaEdge-CAs operations commenced upon its corporate inception on April 3, 2007 and therefore no prior year operations exist for the three or six months ended March 31, 2007. Results of Operations Three and six months ended March 31, 2008 Sales Sales for the three and six months ended March 31, 2007 totaled $1,741 and $2,589, respectively.  Prior to the commencement of sales revenues, our company was focused primarily on the securing of retail outlets, establishing an online site at which cardholders can redeem their gift cards purchased for products and pursuing additional entertainment brands for future gift card programs.  Nevertheless, our sales through March 31, 2008 were significantly below our managements expectations.  We are currently evaluating our future course of action with respect to this gift card program in an attempt to optimize the value of our investment in the American IdolTM program.  Such steps may include discussions with other American IdolTM brand licensees to cooperate on joint promotions for future seasons as well as other attempts to repackage the gift card in order to increase consumer acceptance.  Cost of Sales Cost of sales for the three and six months ended March 31, 2008 was $23,133 and $27,568, respectively.  Our gross margins for these periods were negative and amounted to $(21,392) and $(24,979), respectively.  Due to the low volume of sales during the period, we did not cover the basic costs in connection with the maintenance of fulfillment capabilities required to allow for the redemption of the American IdolTM gift card.  Absent reaching a basic level of sales revenues substantially in excess of those experienced to date, we will not be able to generate a sufficiently positive gross margin in excess of our operating expenses nor generate operating income nor positive cash flows from operations.  Operating Expenses Selling and marketing expenses for the three and six months ended March 31, 2008 totaled $336,065 and $599,873, respectively.  Included in these expenses for the three and six months ended March 31, 2008, respectively, were employee compensation and related expenses of $47,027 and $91,277 (including deferred amounts totaling $7,197 for the three months ended March 31, 2008), payments to consultants for business development, marketing and merchandising services totaling $15,000 and $49,200, marketing and creative services of $15,687 and $45,655, noncash stock-based compensation expenses totaling $5,097 and $12,556, web development and maintenance expenses totaling $15,332 and $82,132 in connection with our gift card redemption and corporate websites, retail placement fees of $7,673 and $20,551, and amortizations and recognition of impairments of $224,645 and $284,745 to expense of previously purchased gift cards totaling $60,100.  We recorded a loss due to impairment of our prepaid license agreement with FremantleMedia totaling $1,445,717 for the three and six months ended March 31, 2008.  We recorded this charge because through March 31, 2008, consumer purchases of American IdolTM branded gift cards were below a level that would result in more than an immaterial recovery of our Companys prepayments of advances to date.  While we continue to seek other outlets for the American IdolTM gift card through potential partnerships with other brand licensees, there are currently no concrete prospects for a recovery of the amounts written down on the license agreement.  We will continue to monitor the value of this asset in comparison with the related liability in order to determine if future charges for estimated impairment will be required. General and administrative expenses for the three and six months ended March 31, 2008 totaled $529,430 and $982,910, respectively.  Included in these expenses for the three and six months ended March 31, 2008, respectively, were employee compensation and related charges of $165,830 and $312,672 (including deferred amounts of $25,340 in both periods), noncash stock-based compensation of $68,862 and $126,558, noncash charges in connection with the grant of common stock to SPN for investor relations services totaling $231,000 and $351,634, legal fees of $8,663 and $46,755, outside consulting of $21,215 (all incurred during the three months ended December 31, 2007) and facility related expenses of $8,647 and $15,617.  Operating expenses for the three and six months ended March 31, 2008 totaled $2,311,212 and $3,028,500.  Interest Expense For the three and six months ended March 31, 2008, interest expense totaled $18,688 and $46,357, respectively.  None of the interest expense recorded ultimately required the payment of cash.  Charges for the accretion of interest expense on the licensing agreement payable totaled $16,451 and $32,762 for the periods while the remaining balance of interest expense totaling $2,237 and $13,595 was later forgiven by the holders of notes payable and added to additional paid-in capital at the time the notes were repaid or converted into shares of our common stock.  Net Loss and Net Loss per Share For the three and six months ended March 31, 2008, our net loss totaled $2,351,292 and $3,099,836, respectively.  Our net loss was significantly in excess of our internal forecasts due primarily to the significant sales revenue shortfalls in connection with the disappointing sales of our gift cards offered for sale during the period.  Our basic and diluted net loss per share of $0.06 and $0.09 were identical due to the anti-dilutive effects of common stock equivalents during the six and nine months ended March 31, 2008.  Liquidity and Capital Resources  We have primarily financed our operations to date through the sale of unregistered common stock and previously with the issuance of notes payable converted into shares of our common stock.  At March 31, 2008, our total assets were $1,258,023 (including intangible assets totaling $1,004,919), working capital was a negative $22,466, total liabilities were $1,096,775 (including amounts due in connection with intangible assets totaling $923,356) and our stockholders equity totaled $161,248.  Our cash balance at March 31, 2008 totaled $203,203.  Subsequent to March 31, 2008, we received additional cash proceeds in connection with the sale of 225,000 shares of our unregistered common stock for cash to an investor for proceeds totaling $75,000.  We have a commitment from the investor for two additional investments of $75,000 in May 2008 and June 2008, although ultimate receipt of these amounts is contingent of the investors ability to make these investments.  There can be no assurance that we will receive the proceeds from these future investments.  Our total liabilities at March 31, 2008 included $32,536 in salary deferrals from our employees.  During the three months ended March 31, 2008, we repaid the balance of bridge loans outstanding totaling $161,500 outstanding at December 31, 2007.  The accrued interest in connection with the bridge loan was forgiven.  Also included in current liabilities at December 31, 2007 were amounts due to RBW in connection with fund raising activities totaling $155,814.  This balance and additional amounts incurred in connection with funds raised during the three months ended March 31, 2008, were converted into 336,675 restricted shares of our Companys common stock during February 2008 at the rate of $0.50 per share.  Amounts in connection with the licensing agreement payable totaling $835,856 at March 31, 2008 are not due until 2010.  Plan of Operations  In March 2008, we purchased the rights to a patent application dating back to 2001 covering group gift cards and eCards.  Going forward, we intend to develop a proprietary Social Network Enabled Gift Card (SNE Gift Card) platform that will enable multiple individuals to conveniently contribute to a group gift card.  We hope to integrate the popular gift card market with the fast-growing phenomenon of online social networks.  We plan to launch our SNE Gift Card platform in the autumn of this year.  We are dependent upon future revenues, additional sales of our securities or obtaining debt financing to meet our cash requirements.  Barring our obtaining additional funds from equity or debt financing, we estimate we do not have sufficient cash as of the date of this Quarterly Report to fund the operations of the Company through our fiscal year end of September 30, 2008.  In response to our Companys current cash needs, we have instituted substantial reductions of spending including the reduction and deferral of a significant portion of our Companys employee compensation.  We also have a commitment (as noted above) for an investor to make additional investments of $75,000 in May 2008 and June 2008 in exchange for 450,000 shares of our unregistered common stock, although there can be no assurance that proceeds from these investments will ultimately be received by our Company.  Longer term, we are attempting to raise additional equity financing through the sale of unregistered shares of our Companys common stock in order to finance our future investing and operating cash flow needs.  However, there can be no assurance as to whether, when, or upon what terms we will be able to consummate any such financing.  We currently have $835,856 capitalized as an asset in connection with prepayments and future payments to be made under our license agreement in connection with the American IdolTM gift card.  The amount is net of write-offs totaling $1,445,717 recorded in the three months ended March 31, 2008, as noted above.  Our management will continue to evaluate whether future additional write-offs of this asset will be appropriate.  As of March 31, 2008, we have written off all costs capitalized in connection with gift cards purchased and we have an insignificant amount of remaining net costs of inventory capitalized ($2,500).  We have no significant commitments or requirements in connection with the purchase of property and equipment for the foreseeable future.  Going Concern  As noted above, there exists an uncertainty about our ability to continue as a going concern.  This uncertainty may adversely affect our relationship with customers and suppliers and have an adverse effect on our ability to obtain future debt or equity financing to maintain our operations. Critical Accounting Policies  Managements discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements which are prepared in accordance with accounting principles that are generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, related disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  We continually evaluate our estimates and judgments and we base our estimates and judgments on historical experience and other factors that we believe to be reasonable under the circumstances.  Materially different results can occur as circumstances change and additional information becomes known.  RISK FACTORS Investment in our common stock involves a high degree of risk. You should carefully consider the risks described below together with all of the other information included in this quarterly report before making an investment decision. If any of the following risks actually occur, our business, financial condition or results of operations could suffer. In that case, the market price of our common stock could decline, and you may lose all or part of your investment.  Risks Related to Our Business  We have a very limited operating history.We completed our acquisition of IdeaEdge-CA on October 16, 2007.  IdeaEdge-CA was formed in April 2007 to pursue opportunities in the gift card industry.  We do not currently have significant operating revenues and have a very limited operating history.  We do not have any historical financial data upon which to base planned operations.  Because we have no operating history, our historical financial information is not a reliable indicator of future performance. Therefore, it is difficult to evaluate the business and prospects of our Company.  Failure to correctly evaluate our Companys prospects could result in an investors loss of a significant portion or all of his investment in our Company.  Our failure to obtain additional adequate financing would materially and adversely affect our business.We do not currently have sufficient revenues and gross margin to cover our operating expenses and have never been profitable. We cannot be certain that our Company will ever generate sufficient revenues and gross margin to achieve profitability.  Furthermore, we project that our current cash on hand and commitments for additional investment will not be sufficient to maintain our Companys operations through our September 30, 2008 fiscal year end.  Our failure to significantly increase revenues or to raise additional adequate and necessary financing or our failure to receive the balance of the proceeds of the investment commitment described above, would seriously harm our business and operating results.  We will have large fixed expenses, and expect to continue to incur capital, product development, administrative and other expenses.  If we fail to achieve sufficient revenues and gross margin, or our revenues grow more slowly than anticipated, or if our operating or capital expenses increase more than is expected or cannot be reduced in the event of lower revenues, our business will be materially and adversely affected and an investor could suffer the loss of a significant portion or all of his investment in our Company.  We face competition from others.We will face competition from other providers of gift cards and gift card services. Many of these providers have longer operating histories, greater name recognition and substantially greater financial, technical and marketing resources than us.  Many of these providers also have more extensive customer bases, broader customer relationships and broader industry alliances than us, including relationships with many of our potential customers.  Increased competition from any of these sources could result in our failure to achieve and maintain an adequate level of customers and market share to support the cost of our operations.  We rely on third-party suppliers and distributors.  We will be dependent on other companies to provide necessary products and services in connection with key elements of our business.  Any interruption in our ability to obtain these services, or comparable quality replacements, would severely harm our business and results of operations.  We will also be dependent on other companies to distribute and sell our products.  The failure by such third parties to distribute or sell our products in a timely manner would substantially harm our business and results of operations and an investor could suffer the loss of a significant portion or all of his investment in our Company.  Our ability to protect our intellectual property and proprietary technology through patents and other means is uncertain.Our future success will depend significantly on our ability to protect our proprietary rights to the intellectual property upon which our products and services will be based. Our pending U.S. patent application, which includes claims to material aspects of our products and services that are not currently protected by issued patents, may not issue as patents in a form that will be advantageous to us. Any patents we have obtained or do obtain may be challenged by re-examination or otherwise invalidated or eventually found unenforceable. Both the patent application process and the process of managing patent disputes can be time consuming and expensive. Competitors may attempt to challenge or invalidate our patents, or may be able to design alternative techniques or devices that avoid infringement of our patents, or develop products with functionalities that are comparable to ours. In the event a competitor infringes upon our patent or other intellectual property rights, litigation to enforce our intellectual property rights or to defend our patents against challenge, even if successful, could be expensive and time consuming and could require significant time and attention from our management. We may not have sufficient resources to enforce our intellectual property rights or to defend our patents against challenges from others.  We are dependent upon consumer tastes for our gift cards and products.The sale and marketing of gift cards involves substantial risks due in part because we are required to spend funds in connection with the sale of new merchants gift cards prior to knowing their commercial appeal in our channels of distribution.  It is impossible to predict the success of any gift card prior to its introduction to our sales channels. A gift cards acceptance by consumers and whether its generation of revenues will depend upon a variety of unpredictable factors, including:  Public taste, which is always subject to change;  The quantity and popularity of other gift cards available to the public; and  The fact that the distribution and sales method chosen for gift cards we market may be ineffective.  For any of these reasons, the gift cards we produce may be commercially unsuccessful.  Furthermore, the American IdolTM cards’ current sales performance through the date of this Quarterly Report has been far below our previous expectations, and the card has not been commercially successful.  If we are unable to market and sell gift cards which are commercially successful, we may not be able to recoup our expenses and/or generate sufficient revenues. In the event that we are unable to generate sufficient revenues, we may not be able to continue operating as a viable business and an investor could suffer the loss of a significant portion or all of his investment in our Company.  Financial Risks  Our financial statements have been prepared assuming that the Company will continue as a going concern. The factors described herein raise substantial doubt about our ability to continue as a going concern. Our financial statements do not include any adjustments that might result from this uncertainty. Our independent registered public accounting firm included an explanatory paragraph expressing doubt about our ability to continue as a going concern in their audit report for the fiscal year ended September 30, 2007.  We currently project that our cash on hand and existing commitments for additional investment will not be sufficient to maintain our Companys operations through our September 30, 2008 fiscal year end.  If we cannot generate the required revenues and gross margin to achieve profitability or obtain additional capital on acceptable terms, we will need to substantially revise our business plan or cease operations and an investor could suffer the loss of a significant portion or all of his investment in our Company.  We do not expect to pay dividends for the foreseeable future, and we may never pay dividends and, consequently, the only opportunity for investors to achieve a return on their investment is if a trading market develops and investors are able to sell their shares for a profit or if our business is sold at a price that enables investors to recognize a profit.We currently intend to retain any future earnings to support the development and expansion of our business and do not anticipate paying cash dividends for the foreseeable future. Our payment of any future dividends will be at the discretion of our Board of Directors after taking into account various factors, including but not limited to our financial condition, operating results, cash needs, growth plans and the terms of any credit agreements that we may be a party to at the time. In addition, our ability to pay dividends on our common stock may be limited by state law. Accordingly, we cannot assure investors any return on their investment, other than in connection with a sale of their shares or a sale of our business. At the present time there is a limited trading market for our shares. Therefore, holders of our securities may be unable to sell them. We cannot assure investors that an active trading market will develop or that any third party will offer to purchase our business on acceptable terms and at a price that would enable our investors to recognize a profit.  Our net operating loss carry-forward will be limited.  We have recorded a valuation allowance amounting to our entire net deferred tax asset balance due to our lack of a history of earnings, possible limitations on the use of tax loss carry-forwards, of the inability to use the net operating loss carry-forwards (NOL) of the VOS Subsidiary after its sale and the future expiration of the NOL.  This gives rise to uncertainty as to whether the net deferred tax asset is realizable.  Internal Revenue Code Section 382, and similar California rules, place a limitation on the amount of taxable income that can be offset by carry-forwards after a change in control (generally greater than a 50% change in ownership).  As a result of these provisions, it is likely that given our acquisition of IdeaEdge-CA, future utilization of the NOL will be severely limited.  Our inability to use our Companys historical NOL, or the full amount of the NOL, would limit our ability to offset any future tax liabilities with its NOL.  Corporate and Other Risks  Limitations on director and officer liability and indemnification of our officers and directors by us may discourage stockholders from bringing suit against an officer or director. Our Companys articles of incorporation and bylaws provide, with certain exceptions as permitted by governing state law, that a director or officer shall not be personally liable to us or our stockholders for breach of fiduciary duty as a director, except for acts or omissions which involve intentional misconduct, fraud or knowing violation of law, or unlawful payments of dividends. These provisions may discourage stockholders from bringing suit against a director for breach of fiduciary duty and may reduce the likelihood of derivative litigation brought by stockholders on our behalf against a director.  We are responsible for the indemnification of our officers and directors. Should our officers and/or directors require us to contribute to their defense, we may be required to spend significant amounts of our capital.Our articles of incorporation and bylaws also provide for the indemnification of our directors, officers, employees, and agents, under certain circumstances, against attorney's fees and other expenses incurred by them in any litigation to which they become a party arising from their association with or activities on behalf of our Company. This indemnification policy could result in substantial expenditures, which we may be unable to recoup. If these expenditures are significant, or involve issues which result in significant liability for our key personnel, we may be unable to continue operating as a going concern.  Our executive officers, directors and insider stockholders beneficially own or control a substantial portion of our outstanding common stock, which may limit your ability and the ability of our other stockholders, whether acting alone or together, to propose or direct the management or overall direction of our Company. Additionally, this concentration of ownership could discourage or prevent a potential takeover of our Company that might otherwise result in you receiving a premium over the market price for your shares. A substantial portion of our outstanding shares of common stock is beneficially owned and controlled by a group of insiders, including our directors and executive officers. Accordingly, any of our existing outside principal stockholders together with our directors, executive officers and insider shareholders would have the power to control the election of our directors and the approval of actions for which the approval of our stockholders is required. If you acquire shares of our common stock, you may have no effective voice in the management of our Company.  Such concentrated control of our Company may adversely affect the price of our common stock. Our principal stockholders may be able to control matters requiring approval by our stockholders, including the election of directors, mergers or other business combinations. Such concentrated control may also make it difficult for our stockholders to receive a premium for their shares of our common stock in the event we merge with a third party or enter into different transactions which require stockholder approval. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock.  The requirements in connection with being a public company may put us at a competitive disadvantage. The complexity of operating in a public company environment could impair our ability to comply with legal and regulatory requirements such as those imposed by Sarbanes-Oxley Act of 2002.  We may not be able to implement programs and policies in an effective and timely manner that adequately responds to the increased legal, regulatory compliance and reporting requirements associated with being a public company. Our failure to do so could lead to the imposition of fines and penalties and distract us from attending to the growth of our business.  Our internal controls over financial reporting may not be effective, and our independent auditors may not be able to certify as to their effectiveness, which could have a significant and adverse effect on our business. We are subject to various regulatory requirements, including the Sarbanes-Oxley Act of 2002. We, like all other public companies, must incur additional expenses and to a lesser extent the diversion of our managements time in our efforts to comply with Section 404 of the Sarbanes-Oxley Act of 2002 regarding internal controls over financial reporting. We have not evaluated our internal controls over financial reporting in order to allow management to report on, and our independent auditors to attest to, our internal controls over financial reporting, as required (or to be required) by Section 404 of the Sarbanes-Oxley Act of 2002 and the rules and regulations of the SEC, which we collectively refer to as Section 404. We have never performed the system and process evaluation and testing required in an effort to comply with the management assessment and auditor certification requirements of Section 404, the management assessment portion of which will initially apply to us as of September 30, 2008. The requirements of Section 404 may unduly divert managements time and resources for executing our business plan. If in the future, management identifies one or more material weaknesses, or our external auditors are unable to attest that our managements report is fairly stated or to express an opinion on the effectiveness of our internal controls, this could result in a loss of investor confidence in our financial reports, have an adverse effect on our stock price and/or subject us to sanctions or investigation by regulatory authorities.  Our compliance with the Sarbanes-Oxley Act and the U.S. Securities and Exchange Commission rules concerning internal controls may be time consuming, difficult and costly for us.It may be time consuming, difficult and costly for us to develop and implement the internal controls and reporting procedures required by the Sarbanes-Oxley Act. We may need to hire additional financial reporting, internal controls and other finance staff in order to develop and implement appropriate internal controls and reporting procedures. If we are unable to comply with the internal controls requirements of the Sarbanes-Oxley Act, we may not be able to obtain the independent accountant certifications that the Sarbanes-Oxley Act will in the future require publicly-traded companies with our capitalization to obtain.  We are dependent for our success on a few key executive officers. Our inability to retain those officers would impede our business plan and growth strategies, which would have a negative impact on our business and the value of your investment. Our success depends on the skills, experience and performance of key members of our management team.  We do not have long-term employment agreements with any of the members of our senior management team. Each of those individuals may voluntarily terminate his employment with the Company at any time. Were we to lose one or more of these key executive officers, we would be forced to expend significant time and money in the pursuit of a replacement, which would result in both a delay in the implementation of our business plan and the diversion of limited working capital. We do not maintain a key man insurance policy on any of our executive officers.  We may not be able to manage our growth effectively, which could adversely affect our operations and financial performance.The ability to manage and operate our business as we execute our growth strategy will require effective planning. Significant rapid growth could strain our internal resources, leading to a lower quality of customer service, reporting problems and delays in meeting important deadlines resulting in loss of market share and other problems that could adversely affect our financial performance. Our efforts to grow could place a significant strain on our personnel, management systems, infrastructure and other resources. If we do not manage our growth effectively, our operations could be adversely affected, resulting in slower growth and a failure to achieve or sustain profitability.  Capital Market Risks  Our common stock is thinly traded, so you may be unable to sell at or near ask prices or at all if you need to sell your shares to raise money or otherwise desire to liquidate your shares. There is limited market activity in our stock and we are too small to attract the interest of many brokerage firms and analysts. We cannot give you any assurance that a broader or more active public trading market for our common stock will develop or be sustained. While we are trading on the OTC Bulletin Board, the trading volume we will develop may be limited by the fact that many major institutional investment funds, including mutual funds, as well as individual investors follow a policy of not investing in Bulletin Board stocks and certain major brokerage firms restrict their brokers from recommending Bulletin Board stocks because they are considered speculative, volatile, thinly traded and the market price of the common stock may not accurately reflect the underlying value of our Company.  The market price of our common stock could be subject to wide fluctuations in response to quarterly variations in our revenues and operating expenses, announcements of new products or services by us, significant sales of our common stock, including short sales, the operating and stock price performance of other companies that investors may deem comparable to us, and news reports relating to trends in our markets or general economic conditions.  The application of the penny stock rules to our common stock could limit the trading and liquidity of the common stock, adversely affect the market price of our common stock and increase your transaction costs to sell those shares.  As long as the trading price of our common stock is below $5 per share, the open-market trading of our common stock will be subject to the penny stock rules, unless we otherwise qualify for an exemption from the penny stock definition. The penny stock rules impose additional sales practice requirements on certain broker-dealers who sell securities to persons other than established customers and accredited investors (generally those with assets in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 together with their spouse). These regulations, if they apply, require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the associated risks. Under these regulations, certain brokers who recommend such securities to persons other than established customers or certain accredited investors must make a special written suitability determination regarding such a purchaser and receive such purchasers written agreement to a transaction prior to sale. These regulations may have the effect of limiting the trading activity of our common stock, reducing the liquidity of an investment in our common stock and increasing the transaction costs for sales and purchases of our common stock as compared to other securities.  The stock market in general and the market prices for penny stock companies in particular, have experienced volatility that often has been unrelated to the operating performance of such companies. These broad market and industry fluctuations may adversely affect the price of our stock, regardless of our operating performance.  Stockholders should be aware that, according to SEC Release No. 34-29093, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (1) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (2) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker-dealers; and (5) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. The occurrence of these patterns or practices could increase the volatility of our share price.  We may not be able to attract the attention of major brokerage firms, which could have a material adverse impact on the market value of our common stock.Security analysts of major brokerage firms may not provide coverage of our common stock since there is no incentive to brokerage firms to recommend the purchase of our common stock. The absence of such coverage limits the likelihood that an active market will develop for our common stock. It will also likely make it more difficult to attract new investors at times when we require additional capital.  We may be unable to list our common stock on NASDAQ or on any securities exchange.Although we may apply to list our common stock on NASDAQ or the American Stock Exchange in the future, we cannot assure you that we will be able to meet the initial listing standards, including the minimum per share price and minimum capitalization requirements, or that we will be able to maintain a listing of our common stock on either of those or any other trading venue. Until such time as we qualify for listing on NASDAQ, the American Stock Exchange or another trading venue, our common stock will continue to trade on the OTC Bulletin Board or another over-the-counter quotation system, or on the pink sheets, where an investor may find it more difficult to dispose of shares or obtain accurate quotations as to the market value of our common stock. In addition, rules promulgated by the SEC impose various practice requirements on broker-dealers who sell securities that fail to meet certain criteria set forth in those rules to persons other than established customers and accredited investors.  Consequently, these rules may deter broker-dealers from recommending or selling our common stock, which may further affect the liquidity of our common stock. It would also make it more difficult for us to raise additional capital.  Future sales of our equity securities could put downward selling pressure on our securities, and adversely affect the stock price.There is a risk that this downward pressure may make it impossible for an investor to sell his or her securities at any reasonable price, if at all. Future sales of substantial amounts of our equity securities in the public market, or the perception that such sales could occur, could put downward selling pressure on our securities, and adversely affect the market price of our common stock.


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Item 3  Controls and Procedures Disclosure Controls and Procedures  We maintain disclosure controls and procedures and internal controls that are designed to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commissions rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures and internal controls, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, and not absolute, assurance of achieving the desired control objectives.  In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost benefit relationship of possible controls and procedures and internal controls. As required by the Securities and Exchange Commission Rule 13a-15(e) and Rule 15d-15(e), we are in the process of carrying out an evaluation, under the supervision of and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. We expect to have our evaluation completed prior to our year end on September 30, 2008. Changes in Internal Controls over Financial Reporting  There have not been any changes in our internal controls over financial reporting (as such term is defined in Rules 13a-15(f) and 15d - 15(f) under the Exchange Act) during the fiscal quarter ended March 31, 2008 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.  Limitations on Disclosure Controls and Procedures  Our management, including our chief executive officer and chief financial officer, does not expect that our disclosure controls or internal controls over financial reporting will prevent all errors or all instances of fraud.  A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met.  Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs.  Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected.  These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.  Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls.  Because of the small size of our current operations, supervision of financial controls is concentrated in a few individuals and we have limited opportunity to segregate duties or implement checks and balances.  The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and any design may not succeed in achieving its stated goals under all potential future conditions.  Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.  Because of the inherent limitation of a cost-effective control system, misstatements due to error or fraud may occur and not be detected.  Part II Item 1  Legal Proceedings From time to time and in the course of business, we may become involved in various legal proceedings seeking monetary damages and other relief.  The amount of the ultimate liability, if any, from such claims cannot be determined. However, in the opinion of our management, there are no legal claims currently pending or threatened against us that would be likely to have a material adverse effect on our financial position, results of operations or cash flows.   Item 2  Sales of Unregistered Securities and Use of Proceeds Since the IdeaEdge acquisition on October 16, 2007 and through May 3, 2008, we have issued a total of 2,883,522 shares of our unregistered common stock.  We received net cash proceeds totaling $688,963 for 1,599,348 shares of the common shares issued, cancellation of debt totaling $61,250 in exchange for 122,499 shares of common stock issued, the satisfaction of amounts due to SPN for fund raising commissions totaling $168,338 in exchange for 336,675 shares of common stock, and we issued 825,000 shares of common stock in connection with the prepayment of consulting services to SPN.  All cash proceeds from the sales of the common stock will be used for working capital to fund our operations. These issuances of the Companys shares of common stock were exempt from registration under the Securities Act pursuant to Section 4(2) thereof.  Item 3  Defaults Upon Senior Securities Not applicable. Item 4  Submission of Matters to a Vote of Security Holders Not applicable. Item 5  Other Information Not applicable.  Item 6  Exhibits See Exhibit Index immediately following signatures.


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SIGNATURES  In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.  IdeaEdge, Inc., a Colorado corporation  By: /s/ JAMES COLLAS James Collas, Chief Executive Officer  May 14, 2008  By: /s/ JONATHAN SHULTZ Jonathan Shultz, Chief Financial Officer  May 14, 2008  Exhibit Index Exhibit No.Description31.1*Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act, as amended, by Chief Executive Officer31.2*Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act, as amended, by Chief Financial Officer32.1*Certification pursuant to 18 U.S.C. §1350 by Chief Executive Officer32.2*Certification pursuant to 18 U.S.C. §1350 by Chief Financial Officer*Filed as an exhibit to this report


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