SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

| X |  QUARTERLY  REPORT  PURSUANT  TO  SECTION  13 OR 15(d)  OF THE  SECURITIES
       EXCHANGE ACT OF 1934 [FEE REQUIRED]


FOR THE QUARTERLY PERIOD ENDED        JUNE 30, 2000
                               --------------------


| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934 [NO FEE REQUIRED]

For the transition period from _______________ to _______________

                           COMMISSION FILE NO. 0-20190

                                  PIRANHA, INC.
                                  -------------
             (Exact name of registrant as specified in its charter)

DELAWARE                                                              36-3859518
------------------                                            ------------------
(State or other jurisdiction of                                 (I.R.S. Employer
incorporation or organization)                               Identification No.)

                 6060 N. CENTRAL EXPRESSWAY, DALLAS, TEXAS 75206
             ------ -----------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (214) 800-2835

                          Registrant's telephone number

                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

As of August 14, 2000,  9,172,054 shares of Common Stock,  $.001 par value, were
issued and outstanding.

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]






<PAGE>






                    INDEX TO QUARTERLY REPORT ON FORM - 10QSB

PAGE NO.

PART I   FINANCIAL INFORMATION

Item 1.  Consolidated Financial Statements

                    Balance Sheet                                              3

                    Statements of Operations                                   4

                    Statements of Cash Flows                                   5
                    Notes to Financial Statements                              6

Item 2.  Management's Discussion and Analysis or Plan of Operation             8


PART II  OTHER INFORMATION

Item 1.  Legal Proceedings                                                     9

Item 2.  Changes in Securities                                                 9

Item 3   Defaults Upon Senior Securities                                       9

Item 4.  Submission of Matters to a Vote of Security Holders                   4

Item 5.  Other Information                                                    10

Item 6.  Exhibits and Reports on Form 8-K                                     10


This Quarterly Report on Form 10-QSB contains forward-looking  statements within
the  meaning of Section  21E of the  Securities  and  Exchange  Act of 1934,  as
amended,  and  Section 27A of the  Securities  Act of 1933,  as  amended.  These
statements involve risks and  uncertainties,  including these risks discussed in
the section  entitled "Item 6,  Management's  Discussion and Analysis or Plan of
Operations"  and  elsewhere in the Quarterly  Report on Form 10-QSB.  The actual
results  that the  Company  achieves  may  differ  materially  from the  results
discussed or implied in such  forward-looking  statements  due to such risks and
uncertainties.  Words such as "believes,"  "anticipates,"  "expects,"  "future,"
"intends,"   "may"  and   similar   expressions   are   intended   to   identify
forward-looking  statements, but are not the exclusive means of identifying such
statements.  The  Company  undertakes  no  obligation  to  revise  any of  these
forward-looking statements.

                                       1
<PAGE>



PART I            FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

See attached financial statements.

<PAGE>

                         PIRANHA, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                  JUNE 30, 2000
                                   (UNAUDITED)

  ASSETS


   Cash                                                    $            583,689
   U.S. Government securities                                         2,298,325
   Marketable securities                                                168,483
   Accounts receivable                                                   20,000
   Prepaid expenses and deposits                                        143,492
                                                              ------------------

            TOTAL CURRENT ASSETS                                      3,213,989

   Property and Equipment                                               922,194

   Goodwill                                                           1,750,000

   Intangible and other Assets                                       11,555,638

                                                              ------------------

                                                           $         17,441,821
                                                              ==================



                      LIABILITIES AND STOCKHOLDERS' EQUITY


   Accounts payable                                        $          1,020,422
   Dividends payable                                                    196,800
   Accrued liabilities                                                1,005,640
   Stockholder loans and other notes payable                            214,421
                                                              ------------------

            TOTAL CURRENT LIABILITIES                                 2,437,283




   Preferred stock                                          $           462,500
   Common stock, $.001 par value, 100,000,000 shares authorized;
            9,086,054 shares issued and outstanding                       9,086
   Additional paid-in capital                                        36,529,051
   Stock subscription receivable                                        (44,500)
   Accumulated deficit                                              (21,951,599)
                                                              ------------------

            TOTAL STOCKHOLDERS' EQUITY                               15,004,538
                                                              ------------------

                                                            $         17,441,821
                                                              ==================







               See notes to the consolidated financial statements


                                       3

<PAGE>

                         PIRANHA, INC, AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>


                                              THREE MONTHS ENDED JUNE 30,  SIX MONTHS ENDED JUNE 30,
                                              --------------------------   --------------------------
                                                 2000           1999          2000           1999
                                              ------------   -----------   ------------   -----------
 <S>                                         <C>           <C>           <C>            <C>

   REVENUES                                   $   48,095    $        -    $    48,095    $        -
                                              ------------   -----------   ------------   -----------
   COSTS AND EXPENSES

     General and administrative                 2,655,482                    3,791,370
     Depreciation                                  34,651                       49,708
                                              ------------   -----------   ------------   -----------

        Total Costs and Expenses                2,690,133                    3,841,078
                                              ------------   -----------   ------------   -----------


   Loss before interest                        (2,642,038)                  (3,792,983)

     Interest income                               30,687                       30,687
     Interest (expense)                           (10,260)                     (21,580)
                                              ------------   -----------   ------------   -----------

   Loss from continuing operations             (2,621,611)                  (3,783,876)

   Loss from discontinued operations                    0        (7,015)             0       (14,182)
                                              ------------   -----------   ------------   -----------

   Net loss                                    (2,621,611)       (7,015)    (3,783,876)      (14,182)

   Preferred stock dividends                      (13,450)      (40,950)       (31,900)      (81,900)
                                              ------------   -----------   ------------   -----------

   Net loss applicable to common stock        $(2,635,061)   $  (47,965)   $(3,815,776)   $  (96,082)
                                              ============   ===========   ============   ===========



   Basic and Diluted Loss Per Common Share:

   Loss from continuing operations            $     (0.30)   $    (0.01)   $     (0.49)   $    (0.02)

   Loss from discontinued operations                 0.00          0.00           0.00          0.00

   Net loss per common share
                                              ------------   -----------   ------------   -----------
         - basic and diluted                  $     (0.30)   $    (0.01)   $     (0.49)   $    (0.02)
                                              ============   ===========   ============   ===========



   Weighted average common shares outstanding   8,726,821     4,979,632      7,795,345     4,979,632
                                              ============   ===========   ============   ===========


</TABLE>




               See notes to the consolidated financial statements


                                       4


<PAGE>
                         PIRANHA, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
<TABLE>
<CAPTION>


                                                                                           SIX  MONTHS ENDED JUNE 30,
                                                                                       ----------------------------------
                                                                                            2000               1999
                                                                                       ----------------   ---------------
<S>                                                                                  <C>                <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                                             $    (3,783,876)   $      (14,182)
  Adjustments to reconcile net loss
   to net cash used in operations:
   Depreciation                                                                                 49,708
   Loss from discontinued operations                                                                              14,182
  Changes in assets and liabilities:
     Increase in accounts receivable                                                           (20,000)
     Increase in prepaid expenses                                                             (130,097)
     Decrease in stock subscription receivable                                                 800,000
     Increase in goodwill and other assets                                                     (17,513)
     Decrease in accounts payable and accrued liabilities                                     (316,713)
     Decrease in stockholder loans and other notes payable                                    (612,740)
                                                                                       ----------------   ---------------

NET CASH USED IN OPERATING ACTIVITIES                                                       (4,031,231)                0
                                                                                       ----------------   ---------------

CASH FLOWS USED IN INVESTING ACTIVITIES:
  Acquisition of property and equipment                                                       (923,659)
  Investment in marketable securities                                                         (168,483)
  Investment in U.S. Government securities                                                  (1,006,817)
                                                                                       ----------------   ---------------
      TOTAL CASH FLOWS USED IN INVESTING ACTIVITIES                                         (2,098,959)                0

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of common stock                                                     6,380,000
                                                                                       ----------------   ---------------
      TOTAL CASH FLOWS FROM FINANCING ACTIVITES                                              6,380,000                 0

NET INCREASE IN CASH                                                                           249,810                 0

CASH AT BEGINNING OF YEAR                                                                      333,879                 0
                                                                                       ----------------   ---------------

CASH AT END OF PERIOD                                                                $         583,689    $            0
                                                                                       ================   ===============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

  Cash paid during the period for interest                                           $           2,210    $            0
                                                                                       ================   ===============

  Cash paid during the period for income taxes                                       $               0    $            0
                                                                                       ================   ===============


NON-CASH FINANCING AND INVESTING ACTIVITIES:

  Issuance of common stock upon conversion of accounts payable                       $         171,405     $           0
                                                                                       ================   ===============

  Issuance of common stock for acquisitions                                                  1,750,000                 0
                                                                                       ================   ===============

  Issuance of common stock upon conversion of preferred stock                        $       2,037,750     $           0
                                                                                       ================   ===============

</TABLE>


               See notes to the consolidated financial statements


                                       5







<PAGE>


                        PIRANHA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                  JUNE 30, 2000

                                   (UNAUDITED)

NOTE 1 - BASIS OF PRESENTATION:

The accompanying  unaudited financial  statements reflect all adjustments which,
in the opinion of management, are necessary for a fair presentation of financial
position and the results of operations for the interim  periods  presented.  The
results of operations for any interim periods are not necessarily  indicative of
the results attainable for a full fiscal year.

These  statements  have been prepared by the Company and are unaudited.  Certain
information and footnote  disclosures  normally included in financial statements
prepared in accordance with generally accepted  accounting  principals have been
omitted. As such, these financial  statements should be read in conjunction with
the audited  financial  statements  and notes thereto  included in the Company's
Annual Report on Form 10-KSB for the year ended December 31, 1999.

NOTE 2 - LITIGATION

In July  1994,  the  Company  discharged  four  officers  of its  Dream  Factory
subsidiary.  The officers who were  discharged  commenced an action  against the
Company seeking damages arising out of the alleged wrongful termination of their
employment.  The Company  subsequently  settled the claims of two officers.  The
Company is engaged in settlement negotiations with the remaining two officers, a
husband  and wife and has accrued a  provision  of $700,000 in its  consolidated
financial  statements.  The  remaining  cases are pending in  Connecticut  state
court.

The  Company  was a  defendant  in the case of  Benjamin  B.  LeCompte,  III,  a
stockholder, v. Classics International Entertainment, Inc., in the United States
District Court for the Northern  District of Illinois,  Eastern  Division.  This
case  involved a claim by LeCompte  that the Company owed him 573,066  shares of
Common Stock  pursuant to an alleged  conversion of a promissory  note into said
shares. The note, in the principal amount of $200,000,  and the accrued interest
thereon, are included in the accompanying  consolidated financial statements. On
April 3, 2000,  this case was dismissed for lack of  jurisdiction.  On April 12,
2000,  LeCompte filed an action against the Company in the Circuit Court of Cook
County,  Illinois,  asserting substantially the same claims as in the case which
was dismissed. The Company believes this action is without merit, and intends to
vigorously defend itself in this matter.

The Company is subject to various  federal,  state and local laws  affecting its
business,  and believes that it is in material  compliance  with all  applicable
laws and regulations.

                                       6
<PAGE>



NOTE 3 - PREFERRED STOCK

At June 30, 2000 Preferred  Stock  consisted of 5,000,000  authorized  shares of
which the following were issued and outstanding:


                                                                   Common Shares
 PREFERRED STOCK                                                     Issuable on
 ---------------                                        Amount        Conversion

Series  A, 9%  cumulative,  convertible,  redeemable;
10,000 shares issued and outstanding              $     50,000             2,866


Series  B, 9%  cumulative,  convertible,  redeemable;
412,500 shares issued and outstanding                  412,500           165,445
                                                       -------           -------
            TOTAL                                 $    462,500           168,311
                                                       =======           =======



NOTE 4 - CHANGES IN COMMON STOCK

During  the period  covered by this  Report an  aggregate  of 500,423  shares of
Company  Common  Stock were  offered  and sold  without  registration  under the
Securities Act of 1933, as amended ("Act"), as not involving any public offering
in reliance upon the exemption  from  registration  contained in Section 4(2) of
the Act.

On March 13, 2000 an aggregate  of 2,866 shares of Common Stock were  authorized
for  issuance  on  conversion  of  10,000  shares of the  Company's  Series A 9%
Convertible Cumulative Redeemable Preferred Stock.

On March 15, 2000 an aggregate of 10,000 shares of Common Stock were  authorized
for   issuance  to  Piranha   Propellers   in  exchange   for  the  domain  name
"piranha.com."

On March 15, 2000 an aggregate of 10,500 shares of Common Stock were  authorized
for issuance to two individuals for services previously rendered.

In May 2000 an  aggregate  of 133,333  shares of Common Stock were issued to The
Interpublic Group of Companies, Inc.

On or about June 15, 2000 an  aggregate  of 324,224  shares of Common Stock were
issued to an individual  on conversion of $500,000 of the Company's  Series C 4%
Convertible Cumulative Redeemable Preferred Stock.

On June 19, 2000 an  aggregate  of 19,500  shares of Common Stock were issued to
four  persons or entities in exchange  for the  cancellation  of amounts due for
services.

NOTE 5 - SUBSEQUENT EVENTS

In August,  2000 an aggregate of 446,827 shares of Common Stock were  authorized
for  issuance to various  parties in exchange  for  $3,301,000  cash  previously
received subsequent to June 30, 2000.

                                       7
<PAGE>



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Piranha  has become a  technology-based  company  with a line of  digital  asset
management  products  being  developed  for  sale  and/or  licensing.  The  data
compression  software  products  under the Piranha brand are designed to improve
Internet  speed and to provide  image  clarity at  compression  rates  which the
Company believes are higher than those presently available in the marketplace on
a variety of  platforms.  These  compression  products  are directed to Internet
applications such as full motion streaming video, lossless image and text string
compression and highly compressed, high resolution static images.

The  Company  currently  anticipates  that its  available  funds and  resources,
including  product  sales which  commenced  the week of June 19,  2000,  will be
sufficient  to meet its  anticipated  needs  for  working  capital  and  capital
expenditures  for the  next  twelve  months.  The  Company  may  need  to  raise
additional  funds in the future in order to fund more aggressive brand promotion
and more rapid  expansion,  to develop new or enhanced  products,  to respond to
competitive pressures or to acquire complementary businesses or technologies. If
additional  funds are raised through the issuance of equity or convertible  debt
securities,  the percentage ownership of the stockholders of the Company will be
reduced,  stockholders  may  experience  dilution and such  securities  may have
rights, preferences or privileges senior to those of the rights of the Company's
Common  Stock.  There can be no  assurance  that  additional  financing  will be
available on terms  favorable to the Company,  or at all. If adequate  funds are
not available or not available on acceptable  terms, the Company may not be able
to fund its  expansion,  promote its brand names as the  Company  desires,  take
advantage  of  unanticipated  acquisition  opportunities,   develop  or  enhance
products or respond to competitive  pressures.  Any such inability  could have a
material  adverse  effect on the Company's  business,  results of operations and
financial condition.

The Company is  continuously  involved in the  development  of new  products and
related   technology.   The   Company's   products   are   designed  to  support
business-to-business, e-commerce and Internet related activities associated with
advanced business-to-consumer on-line shopping applications.  Products currently
under  development are expected to provide a methodology to support the emerging
e-commerce  market demand for solutions to the traditional  bottlenecks and time
delays  associated  with the  e-commerce  shopping  experience  that the Company
believes are superior to those presently  available.  The Company  believes that
its  Piranha  Stream  technology  will  provide  the first real  video-on-demand
solution for the Internet.

The Company may experience rapid growth,  which would place a significant strain
on the Company's managerial, financial and operational resources. The Company is
required to manage multiple  relationships with numerous outside parties.  These
requirements  WILL BE  EXACERBATED IN THE EVENT OF FURTHER growth of the Company
or in the number of third  party  relationships,  and there can be no  assurance
that the Company's  systems,  procedures or controls will be adequate to support
the Company's  operations or that Company  management will be able to manage any
growth effectively. To effectively manage its potential growth, the Company must
continue to implement  and improve its  operational,  financial  and  management
information  systems  and to expand,  train and manage its  employee  base.  The
Company anticipates that the number of its employees will increase significantly
in the next twelve months.

To date, the Company has not incurred any significant  problems  associated with
the inability of software  applications  and  operational  programs not properly
recognizing  calendar  dates  in the  year  2000  in the  following  areas:  (1)
accounting and reporting  systems,  (2) office automation and contact management
software,  (3) systems of third party  vendors  incorporated  into the Company's
developmental products, and (4) the Company's developmental products.


                                       8
<PAGE>



PART II  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

In July  1994,  the  Company  discharged  four  officers  of its  Dream  Factory
subsidiary.  The officers who were  discharged  commenced an action  against the
Company seeking damages arising out of the alleged wrongful termination of their
employment.  The Company  subsequently  settled the claims of two officers.  The
Company is engaged in settlement negotiations with the remaining two officers, a
husband and wife. The Company is engaged in settlement negotiations with the two
remaining officers,  a husband and wife, and has accrued a provision of $700,000
in its  consolidated  financial  statements.  The remaining cases are pending in
Connecticut state court.

The  Company  was a  defendant  in the case of  Benjamin  B.  LeCompte,  III,  a
stockholder, v. Classics International Entertainment, Inc., in the United States
District Court for the Northern  District of Illinois,  Eastern  Division.  This
case  involved a claim by LeCompte  that the Company owed him 573,066  shares of
Common Stock  pursuant to an alleged  conversion of a promissory  note into said
shares. The note, in the principal amount of $200,000,  and the accrued interest
thereon, are included in the accompanying  consolidated financial statements. On
April 3, 2000 this case was  dismissed  for lack of  jurisdiction.  On April 12,
2000,  LeCompte filed an action against the Company in the Circuit Court of Cook
County,  Illinois,  asserting substantially the same claims as in the case which
was dismissed. The Company believes this action is without merit, and intends to
vigorously defend itself in this matter.

The Company is subject to various  federal,  state and local laws  affecting its
business,  and believes that it is in material  compliance  with all  applicable
laws and regulations.

ITEM 2.  CHANGES IN SECURITIES

During  the period  covered by this  Report an  aggregate  of 500,434  shares of
Company  Common  Stock were  offered  and sold  without  registration  under the
Securities Act of 1933, as amended ("Act"), as not involving any public offering
in reliance upon the exemption  from  registration  contained in Section 4(2) of
the Act.

On March 13, 2000 an aggregate  of 2,866 shares of Common Stock were  authorized
for  issuance  on  conversion  of  10,000  shares of the  Company's  Series A 9%
Convertible Cumulative Redeemable Preferred Stock.

On March 15, 2000 an aggregate of 10,000 shares of Common Stock were  authorized
for   issuance  to  Piranha   Propellers   in  exchange   for  the  domain  name
"piranha.com."

On March 15, 2000 an aggregate of 10,500 shares of Common Stock were  authorized
for issuance to two individuals for services previously rendered.

In May 2000 an  aggregate  of 133,333  shares of Common Stock were issued to The
Interpublic Group of Companies, Inc.

On or about June 15, 2000 an  aggregate  of 324,224  shares of Common Stock were
issued to an individual  on conversion of $500,000 of the Company's  Series C 4%
Convertible Cumulative Redeemable Preferred Stock.

On June 19, 2000 an  aggregate  of 19,500  shares of Common Stock were issued to
four  persons or entities in exchange  for the  cancellation  of amounts due for
services.

ITEM 3   .        DEFAULTS UPON SENIOR SECURITIES

Not applicable.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.



                                       9
<PAGE>



ITEM 5.  OTHER INFORMATION

Not Applicable.


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

The exhibits designated with an asterisk (*) have previously been filed with the
Commission and are incorporated by reference.

EXHIBIT NO.       DESCRIPTION

*10.10        Lease Agreement for 2425 N. Central Expressway, Richardson, Texas.

*10.11        Lease Agreement for 33 N. LaSalle, Chicago, Illinois.

*10.13        Lease Agreement for 5250 Northland Drive,  Grand Rapids, Michigan.

 27           Financial Data Schedule

(b) Reports on Form 8-K:

A report on Form 8-K was filed on April 28, 2000.

A report on Form 8-K was filed on May 26, 2000.

A report on Form 8-K was filed on June 27, 2000.


<PAGE>



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly  caused  this  report to be signed  on its  behalf by the  undersigned,
thereunto duly authorized.

                                                              PIRANHA, INC.


SIGNATURE                                   TITLE

/s/ Edward W. Sample         Chairman of the Board and Chief Executive Officer
Edward W. Sample             (Principal Executive Officer)

/s/ Richard S. Berger       Chief Financial Officer, Secretary and Director
Richard S. Berger           (Principal Financial and Accounting Officer)

/s/ Michael Steele          Director
Michael Steele

/s/Joseph H. Sherrill, Jr.  Director
Joseph H. Sherrill, Jr.

/s/Arthur R. Tauder         Director
Arthur R. Tauder

/s/ W. Barger Tygart        Director
W. Barger Tygart

Dated: August 14, 2000