U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB

               [ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the Three Months Ended:                                   September 30, 1998

                 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                              OF THE EXCHANGE ACT

For the transition period from:_______________to:________________

Commission file Number                                                   0-14039

                         AMERICAN GENERAL VENTURES, INC.
                         -------------------------------
             (Exact Name of Registrant as Specified in its Charter)

            NEVADA                                                11-2712721
            ------                                                ----------
(State or Other Jurisdiction of                                 I.R.S. Employer
Incorporated or Organization)                                 Identification No.

      3650 Austin Bluffs Parkway-Suite 138 Colorado Springs, Colorado 80918
      ---------------------------------------------------------------------
                    (Address of Principal Executive Offices)

                                 (719) 548-1616
                                 --------------
                        (Registrant's Telephone Number)

Check mark whether the registrant (1) has filed all reports required to be filed
by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934  during  the
preceding 12 months (or 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

          APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                        DURING THE PRECEDING FIVE YEARS:

Check mark whether the issuer has filed all documents and reports required to be
filed by  Sections  2, 12, or 15 (d) of the  Securities  Exchange  Act after the
distribution of securities under a plan confirmed by a court. Yes__ No__

                     APPLICABLE ONLY TO CORPORATE ISSUERS:

         State the number of shares outstanding of each issuer's classes
              of common stock, as of the latest practicable date.

Common Stock $.001 par value,                                   11,681,268
-----------------------------                                   ----------
     (title of class)                                     (Shares outstanding at
                                                            September 30, 1998)

<PAGE>


                        AMERICAN GENERAL VENTURES, INC.

                                  FORM 10-QSB

                   FOR THREE MONTHS ENDED SEPTEMBER 30, 1998


                                     INDEX


                         PART I - FINANCIAL INFORMATION


ITEM 1 - Financial Statements

                                                                            PAGE
     Balance Sheet as of                                                     
     September 30, 1998 & September 30,1997                                  3
                                                                              
     Income Statements for quarters ending                             
     September 30, 1998 & 1997                                               4
                                                                              
     Statement of Cash Flows for three months ended                             
     September 30, 1998 & 1997                                               5
                                                                             

ITEM 2 - Management Discussion and Analysis                                  6


                          PART II - OTHER INFORMATION

ITEMS 1-6                                                                    7


SIGNATURE PAGE                                                               8


                                       2
<PAGE>


                         AMERICAN GENERAL VENTURES, INC
                           CONSOLIDATED BALANCE SHEET
                    SEPTEMBER 30, 1998 & SEPTEMBER 30, 1997

                                  (UNAUDITED)

ASSETS                                                9-30-98          9-30-97
------                                                -------          -------

Current Assets:
        Cash                                            61,781           17,073
        Accounts Receivable, trade                      21,466           66,472
        Inventory                                      177,057          276,000
        Other Current Assets                               -0-              -0-
                                                    ----------       ----------
        Total Current Assets                           260,304          359,545

        Net Prop,Plant,Equip, net                       27,292           70,118
        Of accumulated depreciation
        of $46,391
        Goodwill, net of                                20,794           29,971
        amortization of $26,974
                                                    ----------       ----------
Total Assets                                           308,390          459,634
                                                    ==========       ==========

LIABILITIES and STOCKHOLDERS' EQUITY
------------------------------------

Current Liabilities:
        Notes Payable-Shareholders                     172,215              -0-
        Accounts Payable                               116,287          188,478
        Other Current Liabilities                       11,054            7,433
                                                    ----------       ----------
        Total Current Liabilities                      299,556          195,911

Long Term Liabilities:
        Long Term Debt                                     -0-           35,945
                                                    ----------       ----------
Total Liabilities                                      299,556          231,406

Stockholders' Equity:
        Common Stock, $001 par value                    11,681            9,200
        11,681,268 shares issued
        and outstanding
        Paid in Capital                              2,430,788        1,702,099
        Accumulated Deficit                         (1,588,400)      (1,478,265)
                                                    ----------       ----------
        Shareholder's equity                             8,834          228,228
       (deficit)
Total Liabilities & Equity                             308,390          459,634
                                                    ==========       ==========


                                       3
<PAGE>


                        AMERICAN GENERAL VENTURES, INC.
                         CONSOLIDATED INCOME STATEMENT
                     QTRS ENDING SEPTEMBER 30, 1998 & 1997

                                  (UNAUDITED)

                                                     3RD QTR           3RD QTR
                                                       1998              1997
                                                       ----              ----

REVENUES                                               385,961          109,385

Cost and Expenses:
        Cost of Sales                                  300,792           86,414
        Sell & General Admin                            44,326           73,372
        Interest                                         4,987              -0-
                                                    ----------       ----------
        Total Cost & Expenses                          350,105          159,786
                                                    ----------       ----------
Income (Loss) from Operations                           35,856          (50,401)

Interest Income                                            -0-              -0-

Net Income (Loss) Before Taxes                          35,856          (50,401)

Income Tax Expense                                         -0-              -0-

Net Income (Loss)                                       35,856          (50,401)

Net Income Per Common Share                                .00              .00

Weighted Average Common Shares                      11,318,734        9,200,000
Outstanding
                                                    ==========       ==========


                                       4
<PAGE>

                        AMERICAN GENERAL VENTURES, INC.
                             CONSOLIDATED CASH FLOW
               FOR THREE MONTHS ENDING SEPTEMBER 30, 1998 & 1997

                                  (UNAUDITED)

                                                          1998           1997
                                                          ----           ----

Cash Flow from Operating Activities
        Net Income (Loss)                                 35,856        (50,401)

Adjustments to Reconcile Net Income
to Net Cash:
        Inc (Dec) in Accounts Receivable                  21,466        162,256
        Inc (Dec) in Inventory                           177,057        (27,600)
        Inc (Dec) in Other Assets                            198         (2,479)
        Inc (Dec) in Accounts Payable                   (116,287)       (75,567)
        Inc (Dec) in Payroll Tax Payable                    (819)           -0-
        Inc (Dec) in Sales Tax Payable                      (980)           -0-
                                                        --------       --------
Net Cash Provided by (Used In)
Operating Activities                                      80,635         56,610

Cash Flow from Investing Activities:
        Inc (Dec) in Marketable Sec                          -0-            -0-
        Plant and Equipment                                  -0-            -0-
                                                        --------       --------
Net Cash Provided by (Used in)
Investing Activities                                         -0-            -0-

Cash Flow from Financing Activities:
        Inc (Dec) in Notes Payable                           -0-            -0-
        Inc (Dec) in Notes Pay-Walker                        -0-            -0-
                                                        --------       --------
Net Cash Provided by (Used in)
Financing Activities                                         -0-          6,209
                                                        --------       --------

        Inc (Dec) in Cash                                 80,635          6,209

        Cash (Beginning)                                  61,781         17,073

        Cash (Ending)                                     18,854         23,282



                                       5
<PAGE>


                        AMERICAN GENERAL VENTURES, INC.

                                  FORM 10-QSB

                   FOR THE THREE MONTHS ENDED SEPTEMBER, 1998

                  ITEM 2 - MANAGEMENT DISCUSSION AND ANALYSIS


Results of Operations

During the period  from July 1, 1998  through  September  30,  1998 the  Company
revenues were $385,961  compared with $109,385 for the same period in 1997.  The
increase in revenues was due to the Company's subsidiary ACI Micro Systems, Inc.
restructuring  its strategy by  concentrating  on online  sales.  In addition to
selling its products through Wal-Mart Online,  the Company developed its own web
site offering its branded computers at extremely  competitive price points.  The
combination  of  sales  through  Wal-Mart  Online  and the  Company's  web  site
increased it computer sales by more than 350 percent.

Net income for this period was $35,856  compared to a loss of ($50,401)  for the
same period in 1997.  The  increase  in income was due to the  increase in sales
generated  through  Wal-Mart  Online and the  Company's  web site.  During  this
current period  Wal-Mart  Online  introduced the Company's  build to order (BTO)
computer. The BTO accounted for an eighty percent increase in sales generated by
Wal-Mart Online.

The increase in profits was also due to the Company  reducing its costs incurred
by returns from Wal-Mart retail outlets. The company's strategy of marketing its
product solely through the internet has proven effective in reducing returns.

The  Company's  sales  through its own web site were nearly sixty percent of its
revenues.  The Company's  success in online sales is directly  correlated to its
banner ads that ran on Hotmail, the world's largest free e-mail company that was
recently  acquired  by  Microsoft.  The  Company  continues  to use  Hotmail  to
advertise  its products,  but plans to expand its banner ads on  additional  web
site promoters and expects that the additional exposure will result in increased
revenues and profits.

Working Capital and Capital Resources

Working capital at September 30, 1998 (current assets less current  liabilities)
totaled  $8,834  compared to $163,634 at June 30, 1997.  The decrease in working
capital was due to a decrease in inventory and an increase in short term debt to

                                       6
<PAGE>


its President Steven H. Walker.  In 1997, Dr. Walker  converted  $500,000 of the
Company's debt owed to him to equity.  He accepted the Company's common stock at
$1.00 per share to reduce the debt. In 1998, Dr. Walker  deferred his salary and
loaned the company  additional  funds to pay off debts owed to vendors  reducing
the Company's accounts payable to vendors by more than $80,000.

The Company has adopted a "just in time" method of  inventory  that has resulted
in the need for using capital to purchase  products  before they are sold.  This
strategy  allows the Company to increase its cash  position and reduces the cost
of inventory that depreciates rapidly in the computer industry.

The Company has  determined  that its working  capital is sufficient to continue
operations  and that no  significant  adjustments  were  necessary  during  this
current quarter.

PART II    OTHER INFORMATION

Item 1    Legal Proceedings

The Company's  subsidiary,  ACI Micro  Systems,  Inc. suit by Cal IC was settled
with no judgement against the Company. The settlement resulted in a reduction of
$20,000 claimed by Cal IC.

The Company was also  successful  in  reducing  the amount of a debt  claimed by
Worldnet from $110,000 to $32,000. Worldnet has been paid and the claim has been
satisfied.

Two other  suppliers  have  recently  made demands for payment.  Daytek  alleges
$27,000 is due and Altura PC Systems claims $21,350.  Both claims are in dispute
and negotiations will likely result in settlement of both at reduced amounts.

The Denver Regional office of the FCC has fined ACI Micro Systems,  Inc. $10,000
for not complying with rules and  regulations  that are no longer  applicable to
computer  manufacturers and resellers.  ACI Micro Systems, Inc. denies that they
were in violation  and have appealed the action to the FCC in  Washington,  D.C.
The fine was imposed more than five years ago and no  litigation  by the FCC has
been pursued.

Item 2    Changes in Securities - None

Item 3    Defaults Upon Senior Securities - None

Item 4    Submission  of  Matters  to  a  Vote  of  Securities   Holders  -  The
          shareholders  elected  three  directors  to  the  Company's  Board  of
          Directors. Steven H. Walker was elected as a Director and Chair of the
          Board.  Adrian  Belinne and  Christopher  Walker were also  elected as
          directors to the Board of Directors.

Item 5    Other Information - None

Item 6    Exhibits and Reports on Form 8-K - None


                                       7
<PAGE>




                                   SIGNATURES



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


                                           AMERICAN GENERAL VENTURES, INC.


                                           By: /s/ Steven H. Walker
                                              ----------------------------------
                                              Steven H. Walker, President/CEO

Date: October 19, 1998

                                       8