SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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

                         AMENDMENT NO. 1 ON FORM 10-Q/A
                                  TO FORM 10-Q

(Mark One)

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

For the quarterly period ended              March 31, 2000
                               -------------------------------------------------

                                       OR

[ ]      TRANSITION  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE  SECURITIES
         EXCHANGE ACT OF 1934.

For the transition period from ___________________ to ___________________

                           Commission File No. 0-26072

                                   THCG, INC.
             (Exact Name of Registrant as Specified in Its Charter)


                   Delaware                                       87-0415597
         (State or Other Jurisdiction                         (I.R.S. Employer
       of Incorporation or Organization)                     Identification No.)

    512 Seventh Avenue, 17th Floor, New York, NY                    10018
      (Address of Principal Executive Office)                     (Zip Code)

       Registrant's telephone number, including area code: (212) 223-0440

         Indicate by check |X| 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 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 ___

         As  of  November  10,  2000,  there  were  13,335,317   shares  of  the
registrant's Common Stock outstanding.

<PAGE>

THCG, Inc.

Amendment  No. 1 on Form  10-Q/A  to the  Quarterly  Report on Form 10-Q for the
Quarterly Period Ended March 31, 2000

Explanatory Note

         On November 14, 2000,  THCG, Inc. (the "Company") filed Amendment No. 2
on Form 10-K/A to its Annual Report on Form 10-K for the year ended December 31,
1999. The Amendment included restated  financial  statements for the fiscal year
ended December 31, 1999 (the "1999 Restatement").

         The 1999  Restatement  related solely to the values  assigned to Walnut
Financial  Services,  Inc. ("WFS") and Mercury Coast, Inc.  ("Mercury Coast") in
connection  with the Company's  acquisition of these two companies in 1999. Both
acquisitions  were  accounted  for, and continue in the 1999  Restatement  to be
accounted for, using the purchase method.

         In the financial  statements  included in the Company's original Annual
Report on Form 10-K for the year ended December 31, 1999, the calculation of the
equity  consideration  paid for each of these  acquisitions was calculated based
upon the market price of the Company's common stock at the time the transactions
closed.  However, the Company subsequently  determined that the more appropriate
valuation date is the date of the  announcement of the  transaction  rather than
the closing date. The 1999 Restatement reduced the equity consideration paid for
WFS and  Mercury  Coast  and the  related  amount  of  goodwill  and  associated
amortization  charge.  The Company is revising its interim financial  statements
for the three months ended March 31, 2000 and the six months ended June 30, 2000
to reflect the changes to goodwill and the amortization charge for those periods
required by the change made in the 1999  Restatement.  These revisions will also
reflect a corresponding  reduction in  Stockholders'  Equity and a corresponding
increase in Net Income and Earnings Per Share.

         The Financial  Statements,  Notes to Consolidated  Financial Statements
and  Management  Discussion  and Analysis of Financial  Condition and Results of
Operations in this filing have been accordingly revised.

         The items amended are as follows:

         Part I, Item 1             Financial Statements
         Part I, Item 2             Management's   Discussion  and  Analysis  of
                                    Financial    Condition    and   Results   of
                                    Operations
         Part II, Item 6            Exhibits and Reports on Form 8-K


                                       2

<PAGE>

                                TABLE OF CONTENTS

PART I.  FINANCIAL INFORMATION

Item 1.      Financial Statements                                          Page

             Consolidated Statements of Financial Condition -
               as of  March 31, 2000 (unaudited) and December 31, 1999........5

             Consolidated Statements of Operations - for the three
               months ended March 31, 2000 (unaudited) and March 31, 1999
               (unaudited)....................................................6

             Consolidated Statement of Changes in Stockholders'
                Equity - for the three months ended March 31, 2000
                (unaudited) ..................................................7

             Consolidated Statements of Cash Flows - for the three
                 months ended March 31, 2000 (unaudited) and March 31, 1999
                 (unaudited)..................................................8

             Notes to Consolidated Financial Statements (unaudited)...........9

Item 2.      Management's Discussion and Analysis of Financial
               Condition and Results of Operations...........................12


PART II. OTHER INFORMATION

Item 6.      Exhibits........................................................15


                                      -3-

<PAGE>

                                     PART I

                              FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                  The following  Consolidated Financial Statements of THCG, Inc.
and its  subsidiaries  are  presented  on pages 5  through 9 hereof as set forth
below:

Consolidated Statements of Financial Condition - as of
  March 31, 2000 (unaudited) and December 31, 1999............................5

Consolidated Statements of Operations - for the three
  months ended March 31, 2000 (unaudited) and March 31, 1999
  (unaudited).................................................................6

Consolidated Statement of Changes in Stockholders' Equity -
  for the three months ended March 31, 2000 (unaudited) ......................7

Consolidated Statements of Cash Flows - for the three
  months ended  March 31, 1999 (unaudited) and March 31, 2000
  (unaudited).................................................................8

Notes to Consolidated Financial Statements (unaudited)........................9


                                      -4-

<PAGE>
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
   (in thousands, except share and per share data)

                                                                                      March 31,              December 31,
                                                                                        2000                    1999
                                                                                     (unaudited)
                                                                               ------------------         --------------
                                                                                       (Note 1)               (Note 1)
ASSETS
<S>                                                                                     <C>                    <C>
  Cash and cash equivalents                                                             $6,552                 $1,592
  Marketable securities                                                                    683                  2,812
  Nonmarketable securities, partnership, limited liability company and other
    interests (See Note 2)                                                              20,757                  7,104
  Ownership interest in company accounted for on the equity method
    (See Note 4)                                                                         5,025                  -----
  Fees and other receivables, net of allowance                                             793                    352
  Prepaid expenses and other assets                                                        262                    279
  Loan receivable, related party                                                           589                    312
  Furniture, fixtures and equipment - net                                                   77                    104
  Goodwill and other intangible assets, net of accumulated amortization                 15,719                 16,610
  Assets of discontinued operations (See Note 3)                                          ----                  6,537
                                                                                 -------------             ----------
   Total Assets                                                                        $50,457                $35,702
                                                                                 =============             ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable, accrued expenses and other                                          $2,076                 $1,933
  Loan payable                                                                            ----                    565
  Notes payable                                                                           ----                    600
  Deferred income taxes payable                                                          1,916                    495
                                                                                 -------------             ----------
   Total Liabilities                                                                     3,992                  3,593
                                                                                 -------------             ----------
Stockholders' Equity
  Common stock,  $.01 par value,  50,000,000 shares  authorized;  12,603,969 and
   11,751,113 issued and outstanding at March 31, 2000 and December 31,
   1999, respectively                                                                      126                    118
  Additional paid-in capital                                                            81,457                 68,777
  Deferred compensation                                                                (27,167)               (27,294)
  Accumulated deficit                                                                   (7,951)                (9,492)
                                                                                 -------------             ----------
   Total Stockholders' Equity                                                           46,465                 32,109
                                                                                 -------------             ----------
   Total Liabilities and Stockholders' Equity                                         $ 50,457               $ 35,702
                                                                                 =============             ==========
</TABLE>

See Notes to Consolidated Financial Statements


                                      -5-

<PAGE>
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)                      Three Months Ended
                                                        -------------------------------------------
                                                               March 31,              March 31,
                                                                2000                    1999
                                                             (unaudited)             (unaudited)
                                                        -------------------       -----------------
Revenues                                                       (Note 1)
<S>                                                              <C>                     <C>
Venture service fees                                             $ 1,483                 $  266
Realized and unrealized gains on investments                      12,812                   ----
                                                           -------------             ----------
    Total Revenues                                                14,295                    266

Expenses
Selling, general and administrative                                3,007                    503
Equity-based compensation                                          2,087                  -----
Amortization of acquired intangibles                                 891                  -----
                                                           -------------             ----------
    Total Expenses                                                 5,985                    503

Income (loss) from continuing operations                           8,310                   (237)
Provision for income taxes                                         3,583                     12
                                                           -------------             ----------

Net income (loss) from continuing operations                       4,727                   (249)
Loss from discontinued operations                                 (3,186)                  ----
                                                           -------------             ----------
Net income (loss)                                               $  1,541               $   (249)
                                                           =============             ==========

Basic Earnings Per Share
Basic income (loss) per share from continuing
    Operations                                                   $  0.39               $  (0.07)
Basic loss per share from discontinued
    Operations                                                     (0.26)                  ----
                                                           -------------             ----------
Basic income (loss) per share                                    $  0.13               $  (0.07)
                                                           =============             ==========
Shares Used In Calculation                                    12,139,524              3,723,000
                                                           =============             ==========

Diluted Earnings Per Share
Diluted income (loss) per share from continuing
    Operations                                                  $   0.31               $ (0.07)
Diluted (loss) per share from discontinued
    Operations                                                     (0.21)                 ----
                                                           -------------             ----------
Diluted income (loss) per share                                 $   0.10               $ (0.07)
                                                           =============             ==========
Shares Used In Calculation                                    15,374,696             3,723,000
                                                           =============             ==========
</TABLE>

See Notes to Consolidated Financial Statements

                                      -6-

<PAGE>
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(in thousands, except share data)

                                                 Common Stock     Additional
                                              Number of             Paid-in      Deferred    Accumulated
                                                Shares    Amount    Capital    Compensation    Deficit      Total
                                             ------------------------------------------------------------------------

<S>            <C>                            <C>           <C>        <C>         <C>          <C>          <C>
Balance, December 31, 1999                     11,751,113    $118      $68,777     ($27,294)     ($9,492)    $32,109

Proceeds from exercise of warrants for
   common stock                                   633,373       6        5,694           ---         ---      $5,700

Proceeds from exercise of options for
   common stock                                     1,000     ---            3           ---         ---          $3

Issuance of common stock in connection
   with investment                                218,483       2        5,023           ---         ---      $5,025

Deferred compensation for stock options
   issued to employees                                ---     ---        1,960       (1,960)         ---         ---
Amortization of deferred compensation                 ---     ---          ---        2,087          ---      $2,087
Net Income                                                                                         1,541      $1,541
                                             ------------------------------------------------------------------------
Balance, March 31, 2000                        12,603,969    $126      $81,457     ($27,167)     ($7,951)    $46,465
                                             ========================================================================
</TABLE>

See Notes to Consolidated Financial Statements


                                      -7-

<PAGE>
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)                                                             For the Three Months Ended
                                                                     -------------------------------------
                                                                       March 31,              March 31,
                                                                         2000                   1999
                                                                      (unaudited)            (unaudited)
                                                                     --------------         --------------
Cash flows from operating activities:
<S>                                                                     <C>                    <C>
Net income (loss)                                                       $ 1,541                 $(249)
Adjustment to reconcile net income (loss) to net cash used in
continuing operating activities-
Loss from discontinued operations                                         3,186                   ---
Net change in unrealized appreciation of investments                    (12,631)                  ---
Equity-based compensation                                                 2,087                   ---
Depreciation and amortization                                                41                     4
Amortization of intangible assets                                           891                   ---
Bad debt expense                                                            201                   ---
Deferred income tax provision                                             1,421                   ---

Changes in operating assets and liabilities:
Fees and other receivables                                                 (642)                  200
Loan receivable-officer                                                     (89)                  ---
Prepaid expenses and other assets                                            17                  (199)
Due from related parties                                                   (188)                  ---
Accounts payable, accrued expenses and other                              1,945                  (181)
                                                                    ------------          ------------
Net cash used in operating activities                                    (2,220)                 (425)
                                                                    ------------          ------------

Cash flows from investing activities:
Proceeds from sale of marketable securities                               2,903                   ---
Investments                                                              (1,385)                  ---
Purchase of furniture and equipment                                         (14)                  ---
                                                                    ------------          ------------
Net cash provided by investing activities                                 1,504                   ---
                                                                    ------------          ------------

Cash flows from financing activities:
Proceeds from the exercise of warrants for common stock                   5,700                   ---
Proceeds from the exercise of options for common stock                        3                   ---
                                                                    ------------          ------------
Net cash provided by financing activities                                 5,703                   ---
                                                                    ------------          ------------
Net cash used in discontinued operations                                    (27)                  ---
                                                                    ------------          ------------

Net increase (decrease) in cash and cash equivalents                      4,960                  (425)
Cash and cash equivalents - January 1,                                    1,592                   610
                                                                    ------------          ------------
Cash and cash equivalents - March 31,                                    $6,552                 $ 185
                                                                    ===========           ===========
Supplemental disclosure of cash flow information:
   Cash paid:
      Interest                                                              $27                   ---
      Taxes                                                                 ---                   $48
Supplemental disclosure of noncash investing and financing activities
   Issuance of stock in connection with Global Credit Services, Inc.     $5,025                   ---
</TABLE>

See Notes to Consolidated Financial Statements

                                      -8-

<PAGE>

                                   THCG, Inc.
                   Notes to CONSOLIDATED financial statements
                                 March 31, 2000

NOTE 1 - BASIS OF PRESENTATION

         The accompanying consolidated financial statements as of March 31, 2000
are  unaudited;  however,  in the opinion of the  management  of THCG,  Inc.,  a
Delaware  corporation  (the "Company" or "THCG"),  such  statements  include all
adjustments  (consisting of normal  recurring  accruals)  necessary to present a
fair  statement  of the  information  presented  therein.  The balance  sheet at
December  31, 1999 was derived  from the audited  financial  statements  at such
date.

         Pursuant to  accounting  requirements  of the  Securities  and Exchange
Commission  (the  "SEC")  applicable  to  Quarterly  Reports on Form  10-Q,  the
accompanying financial statements and these Notes do not include all disclosures
required by  generally  accepted  accounting  principles  for audited  financial
statements. Accordingly, these statements should be read in conjunction with the
Company's  audited  financial  statements  included in  Amendment  No. 2 on Form
10-K/A to its Annual Report on Form 10-K for the fiscal year ended  December 31,
1999.

         Results  of  operations  for  interim   periods  are  not   necessarily
indicative of those to be achieved for fiscal years.

         The  financial  statements  of the Company  include the accounts of its
wholly owned  subsidiaries,  Mercury Coast Inc. ("Mercury Coast") and Tower Hill
Securities,  Inc. ("Tower Hill  Securities") and its wholly owned  subsidiaries,
THCG LLC and THCG Ventures  LLC.  THCG Ventures LLC is a management  company for
two related venture capital companies, THCG Venture Partners I LLC ("Venture I")
and THCG Partners LLC. THCG Ventures LLC has a 0.45%  member's  interest in THCG
Partners LLC. THCG Partners LLC and THCG LLC have a 15.1% and a 9.9%  membership
interest,  respectively, in Venture I. All significant intercompany accounts and
transactions are eliminated in consolidation.  Pacific Financial  Services Corp.
("Pacific  Financial") and Inland Financial Corporation ("Inland Financial") are
wholly  owned   subsidiaries   of  the  Company  whose   operations   have  been
discontinued. See Note 3 of the Notes to Consolidated Financial Statements.

Revised Financial Statement

         Initially,  the calculations of the equity  consideration  paid for the
acquisitions of WFS and Mercury Coast,  Inc.  ("Mercury  Coast") were based upon
the market price of the common stock at the time the transactions closed. In the
case of WFS, the average of the high and low sales prices of WFS common stock on
November  1,  1999  ($3.625)  was  used to  calculate  equity  consideration  of
$13,367,000.  In the case of Mercury  Coast,  the  calculation  was based on the
average price of the Company's  common stock over the four days  commencing  two
days prior to the close of the  transaction  on December  29,  1999  ($29.69 per
share), resulting in equity consideration of $20,782,000.

         The Company has determined that the more appropriate  valuation date is
the date of the announcement of the transaction rather than the closing date. As
a result, the equity  consideration in the WFS transaction has been recalculated
based on the  closing  price of WFS  common  stock on August  4,  1999  ($2.19),
resulting in equity consideration of $8,593,000. The equity consideration in the
Mercury Coast  transaction has been  recalculated  based on the closing price of
THCG  common   stock  on  December  8,  1999   ($18.25),   resulting  in  equity
consideration of $12,732,000.

         The  effect  of  changing  the  values  of these  transactions  is that
Goodwill and Other  Intangible  Assets on the  Consolidated  Balance Sheet as at
December  31,  1999 has been  reduced to  $16,610,000  (net of  amortization  of
$86,000),  from $29,266,000 (net of amortization of $254,000) and  Stockholders'
Equity  has  been  reduced  to  $32,109,000  from   $44,765,000.   Consequently,
Amortization of Acquired Intangibles on the Consolidated Statement of Operations
for the three months ended March 31, 2000 has also been reduced to $891,000 from
$1,532,000.  The result of these  changes has been that net income for the three
months ended March 31, 2000 has been  increased  to  $1,541,000  from  $900,000;
Basic  Income Per Share has been  increased  to $0.13 from  $0.07;  and  Diluted
Income Per Share has been increased to $0.10 from $0.06.

                                      -9-

<PAGE>

NOTE 2 - PARTNERSHIP, LIMITED LIABILITY COMPANY AND OTHER INTERESTS

         THCG owns 100% of the general partner of Walnut Growth  Partners,  L.P.
("WGP").  The general partner owns 1% of WGP and manages WGP's assets, for which
services it is entitled to management  fees and additional  compensation  in the
form of a carried  interest equal to 20% of the profits of WGP after the limited
partner's capital is returned.

         On February 11, 2000, webMethods, Inc. ("webMethods"), a company in the
WGP  portfolio,  issued  stock to the public at $35.00  per share.  The price of
webMethods'  stock has been  extremely  volatile.  On March 31, 2000,  the stock
price of  webMethods  was  $241.38  per share.  The price of  webMethods'  stock
declined to as low as $44.50 per share on April 17, 2000. On September 29, 2000,
the price of webMethods' stock was $115.125 per share.

         Given  that the WGP  position  in  webMethods  is  subject to a lock-up
agreement and that market sentiment towards Internet companies has changed, THCG
has reduced  the value of its  interest  in and  unrealized  profit from the WGP
portfolio.  As of March 31,  2000,  THCG's  interest  in WGP was valued at $13.8
million,  assuming a webMethods  stock price of  approximately  $100. This value
reflects a permanent impairment of $20.4 million.

         Venture I  increased  the  number of its  investments  during the first
quarter.  As of  March  31,  2000,  THCG's  interest  in these  venture  partner
companies through Venture I and THCG Partners LLC aggregated $1.7 million.

         On February 7, 2000,  THCG  exchanged  $5.0 million of its common stock
for a 25% interest in Global Credit Services, Inc. ("Global Credit") and Venture
I simultaneously  invested in Global Credit. THCG is accounting for its holdings
in Global Credit using the equity method of accounting.

NOTE 3 - DISCONTINUED OPERATIONS

         Two of THCG's  subsidiaries,  Pacific  Financial and Inland  Financial,
engage in the factoring business in the state of Washington.  THCG has completed
a  strategic  review  and has  concluded  that  the  factoring  business  is not
consistent with THCG's current focus and corporate objectives. Accordingly, THCG
is winding down the operations of these two  subsidiaries  and has accounted for
these businesses as discontinued operations.

                                                                    Total
                            Inland            Pacific            Discontinued
                           Financial          Financial           Operations
                           ----------         ---------          ------------

Total Assets               $1,988,000          $4,549,000         $6,537,000
Total Liabilities             770,000           2,197,000          2,967,000
                           ----------          ----------         ----------
Net Assets                 $1,218,000          $2,352,000         $3,570,000
                           ==========          ==========         ==========


NOTE 4 - SUBSEQUENT EVENTS

         On April 11, 2000, THCG announced the acquisition of $300,000 of assets
of certain  businesses  operated  under the Giza Group  ("Giza") name in Israel.
Zinook Ltd.  ("Zinook")  is the entity's  new name.  The  transaction  closed on
September  1,  2000 and is being  accounted  for using  the  purchase  method of
accounting.  The  businesses  acquired  are the  investment  banking  and equity
research  operations  of Giza.  THCG issued  750,000  shares of common  stock in
connection with the acquisition.

         On August 2, 2000, THCG issued 5,000 shares of its Series A Convertible
Participating Preferred Stock (the "Preferred Stock") and a related Warrant (the
"Warrant")  in a private  placement  to Castle  Creek  Technology  Partners  LLC
("Castle Creek"),  a private investment fund focused primarily on the technology
sector. The gross proceeds of the offering were $5.0 million.


                                      -10-

<PAGE>

         The  Preferred   Stock  is   convertible   (subject  to   anti-dilution
protections)  into THCG common  stock,  par value  $0.01 per share (the  "Common
Stock"),  at a fixed  conversion  price of $5.039 per share at any time prior to
December 29, 2000. Thereafter,  the conversion price will be the lower of $5.039
per share and 90% of the prevailing  market price of the Common Stock,  provided
that regardless of the market price for the Common Stock, a maximum of 2,529,568
shares of Common Stock are issuable upon  conversion of the Preferred  Stock. If
the  market  price of the Common  Stock is  greater  than 200% of the then fixed
conversion  price of the Preferred Stock for at least 10 consecutive days and if
certain  other  conditions  are met,  THCG may cause the  Preferred  Stock to be
automatically  converted into Common Stock.  Unless previously  converted by the
holder, the Preferred Stock  automatically  converts into Common Stock on August
2, 2003,  and is subject to optional  redemption  by THCG at any time subject to
the payment of premiums and the satisfaction of other conditions.

         A premium  is  payable  quarterly  on the  Preferred  Stock on the last
business day of each calendar quarter in an amount equal to 10% per annum of the
stated value of the Preferred  Stock ($5.0  million).  The premium is payable in
cash until THCG's  registration  statement described below is declared effective
and thereafter,  if the conditions  described in the certificate of designations
are  satisfied,  the  premium  is  payable,  at  THCG's  election,  in cash,  in
additional  shares of common  stock  (valued  at a price per share  equal to the
market price, as defined in the certificate of designations, of the common stock
on the date the  premium is paid) or in  additional  shares of  Preferred  Stock
valued at its stated value.

         The Warrant has a four-year term and entitles the holder to purchase up
to 396,899  shares of Common Stock at a fixed exercise price of $5.039 per share
throughout the term of the Warrant  (subject to anti-dilution  protections).  If
the  market  price of the Common  Stock is  greater  than 200% of the then fixed
exercise  price of the Warrant for at least 10  consecutive  days and if certain
other  conditions  are met,  THCG may  cause  the  Warrant  to be  automatically
exercised for Common Stock.

         Pursuant to a registration rights agreement,  THCG filed a registration
statement  under the Securities Act of 1933, as amended,  registering for resale
by the holders  thereof the Common Stock  underlying the Preferred Stock and the
Warrant.  The registration  statement has not yet been declared effective.  THCG
may be  required  to pay  Castle  Creek  certain  amounts  as  specified  in the
registration  rights  agreement  if the  registration  statement is not declared
effective within 120 days of August 2, 2000 and is not maintained effective.

         On September 30, 2000, THCG  negotiated the termination  WGP. THCG owns
100% of the  general  partner of WGP.  The general  partner  owned 1% of WGP and
managed WGP's assets,  for which services it was entitled to management fees and
additional  compensation  in the form of a carried  interest equal to 20% of the
profits of WGP after the limited partner's capital was returned.

         As a result of the termination of WGP, THCG received  133,932 shares of
webMethods and WGP's positions in private companies.  THCG is currently settling
the compensation due to a former employee.  This  compensation  will approximate
10% of the positions received by THCG in the liquidation of WGP.

         On October 23, 2000,  THCG announced a plan to repurchase up to 500,000
shares of its stock from time-to-time in open market  transactions at prevailing
market prices.  As of November 8, 2000, THCG had repurchased  52,100 shares at a
cost of approximately $102 thousand.


                                      -11-

<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

         As used in this Item 2, "we," "our" and "us" refer to THCG.

Forward-Looking Statements

         This Quarterly Report on Form 10-Q contains a number of forward-looking
statements  within the meaning of Section 27A of the  Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Specifically, all statements
other  than  statements  of  historical  facts  included  in  this  Report,   or
incorporated  herein by reference,  regarding our financial  position,  business
strategy and the plans and  objectives of management  for future  operations are
forward-looking  statements.  These forward-looking  statements are based on the
beliefs of management,  as well as assumptions made by and information currently
available to  management.  When used in this Report,  including the  information
incorporated  by  reference,  the  words  "anticipate,"  "believe,"  "estimate,"
"expect," "may," "will," "continue," "intend" and "plan" and words or phrases of
similar import, as they relate to our financial position,  business strategy and
plans,  or objectives of  management,  are intended to identify  forward-looking
statements.  These  cautionary  statements  reflect our current  view  regarding
future events and are subject to risks, uncertainties and assumptions related to
various  factors  which include but may not be limited to those listed under the
heading  "Factors  Affecting  our  Future   Performance"  and  other  cautionary
statements in our Annual Report on Form 10-K for our fiscal year ended  December
31, 1999, filed with the SEC, which information is incorporated into this Report
by reference.

         Although we believe that our  expectations  are  reasonable,  we cannot
assure you that our expectations  will prove to be correct.  Based upon changing
conditions,  should any one or more of these risks or uncertainties materialize,
or should any underlying  assumptions  prove incorrect,  actual results may vary
materially  from  those  described  in this  Report  as  anticipated,  believed,
estimated,  expected,  intended  or  planned.  All  subsequent  written and oral
forward-looking  statements  attributable  to us (or to  persons  acting  on our
behalf)  are  expressly   qualified  in  their  entirety  by  these   cautionary
statements.

Overview

         We are an active Internet  accelerator  providing V3 global  enterprise
enhancing  services--a  seamless  integration  of venture  development,  venture
banking and venture  funding  services--both  to  companies  in which we acquire
direct or  indirect  equity  interests  as well as to third  parties to which we
provide  services  in  exchange  for fees.  We are  penetrating  new  markets by
developing our international  operations and by expanding our global coverage of
the  Internet  industry.  Our venture  partner and venture  portfolio  companies
include  advanced  technology  and  service  companies,  established  "brick and
mortar"   companies   implementing   an   Internet-based   strategy  and  global
Internet-based  businesses.  By providing our venture partner companies with our
unique V3  services  offerings,  we  believe  that we help our  venture  partner
companies focus on their core  strengths,  so that they may bring their products
and services to market more rapidly.

         On November 1, 1999, Walnut Financial Services, Inc. ("Walnut Financial
Services")  acquired Tower Hill  Securities.  However,  for financial  statement
purposes,  Tower Hill Securities  acquired Walnut Financial  Services and is the
surviving  entity.  Tower Hill  Securities  is the  successor to Hambro  America
Securities, Inc., the former U.S. investment banking subsidiary of Hambros, plc,
a  British  merchant  banking  firm.  In  March  1998,  the  investment  banking
operations  of Hambros,  plc were sold to Societe  Generale,  a French bank.  On
April 1, 1998, Joseph D. Mark and Adi Raviv, the principal  executives of Hambro
America Securities, Inc., acquired the company from Societe Generale.

         As part of our new business strategy, on December 29, 1999, we acquired
Mercury  Coast,  a  corporation  engaged in the business of  providing  business
acceleration  services,  including strategic planning,  operations and marketing
consulting services, to Internet-based businesses.

                                      -12-

<PAGE>

         The  financial   statements   contained  in  this  Report  reflect  the
operations of THCG for the three months ended March 31, 2000 and the  operations
of Tower Hill Securities for the three months ended March 31, 1999.

Three  Months  Ended March 31, 2000 as compared to the Three  Months Ended March
31, 1999

Revenues

         Revenues for the three  months ended March 31, 2000  increased to $14.3
million  from $266  thousand  for the three  months  ended March 31,  1999.  The
increase  in revenues  was  primarily  due to  significant  appreciation  of our
venture  partner and  venture  portfolio  company  securities  portfolio  and an
increase in the sales of our venture banking services.

         Venture  service  fees  for the  three  months  ended  March  31,  2000
increased to $1.5  million  from $266  thousand for the three months ended March
31, 1999.  The increase in these fees was  primarily  due to an increase in fees
earned from providing our venture banking services.

         Appreciation  in  securities  and interest  income  consists of the net
increases  (decreases) in the value of the venture partner and venture portfolio
company  securities  that we  acquired  or  that we  received  in  exchange  for
services,  as well as interest  income.  Appreciation  in  securities  was $12.8
million  for the  three  months  ended  March 31,  2000.  The  increase  was due
primarily  to the  $12.3  million  increase  in the  value of our  wholly  owned
subsidiary that is the general partner of Walnut Growth Partners,  L.P. ("WGP").
See  Note 2 of the  Notes  to  Consolidated  Financial  Statements.  Tower  Hill
Securities was not engaged in these activities  during the comparable  period in
1999.

Expenses

         Selling, general and administrative expenses for the three months ended
March 31, 2000 increased to $3.0 million from $503 thousand for the three months
ended  March  31,  1999.   The  increase  was  primarily  due  to  increases  in
compensation  and related  benefits  and  professional  fees.  Compensation  and
related  benefits  expense  increased  to $1 million for the three  months ended
March 31, 2000 from $306  thousand  for the three  months  ended March 31, 1999.
Compensation  expenses included bonuses to professionals related to the improved
results from our venture banking  services,  as well as our hiring of additional
employees to provide venture  development  and venture  banking  services to our
venture partner  companies.  Professional  fees for the three months ended March
31, 2000  increased to $1.3 million from $20 thousand for the three months ended
March 31, 1999. The increase in professional fees primarily related to fees paid
to legal and accounting  professional  services firms for services in connection
with the preparation  and filing of documents with the SEC and for  professional
fees related to our provision of venture funding services,  which services Tower
Hill Securities did not provide prior to 1999.

         Equity-based compensation for the three months ended March 31, 2000 was
$2.1 million. There was no equity-based  compensation for the three months ended
March 31, 1999.

         Amortization  for the three  months  ended March 31, 2000  increased to
$891  thousand  from $7 hundred for the three months  ended March 31, 1999.  The
increase in amortization  expenses is primarily  related to the  amortization of
goodwill from our merger with Walnut Financial  Services on November 1, 1999 and
the acquisition of Mercury Coast on December 29, 1999.

         Our  provision  for income  taxes for the three  months ended March 31,
2000  increased  to $3.6  million  from $12  thousand for the three months ended
March 31, 1999.  This  increase was  primarily due to the increase in net income
for the three month period ended March 31, 2000.

         We  incurred  a loss in the three  months  ended  March  31,  2000 from
discontinued operations of $5.4 million ($3.2 million after-tax).  We decided to
discontinue the accounts receivable factoring business.  See Note 3 of the Notes
to Consolidated Financial Statements.

                                      -13-

<PAGE>

Liquidity and Capital Resources

         Our  business  is  capital   intensive.   In  the  future,   we  expect
periodically  to raise funds to acquire  equity  interests in and  establish new
partner companies,  to support our operations and expand our venture development
and venture  banking  services,  and to support the operations and growth of our
partner companies.  Our future capital requirements will depend in large part on
the number of partner  companies in which we acquire equity  interests and which
we  establish,  the  amounts of capital  we provide to these  companies  and the
timing of these payments. Our plans and the related capital requirements will be
dependent  on various  factors,  such as  developments  in our  markets  and the
availability  of  acquisition  and  entrepreneurial  opportunities.  If  we  are
successful  in  selling   additional  equity   securities,   our  then  existing
stockholders may suffer  significant  dilution.  However,  we may not be able to
obtain financing on acceptable terms, or at all, when we need it. If we require,
but are  unable to obtain,  additional  financing  in the  future on  acceptable
terms, or at all, we will not be able to continue our business strategy, respond
to changing business or economic conditions, withstand adverse operating results
or compete  effectively,  and our  business,  financial  condition and operating
results may be materially and adversely affected as a result.

         In February,  2000,  we called for the  redemption  of our  outstanding
Class A Warrants (the  "Warrants"),  thereby causing the holders to exercise all
of the Warrants for $9 per share of common  stock.  This resulted in proceeds to
us of approximately  $5.7 million.  We issued 633,373 new shares of common stock
upon exercise of the Warrants.  We filed a  registration  statement with the SEC
covering  the resale of these  shares for a period of 90 days.  This period will
end on August 7, 2000.

         During the three months  ended March 31,  2000,  cash used in operating
activities was $2.2 million compared to $425 thousand for the three months ended
March 31, 1999.

         Cash  provided by financing  activities  was $5.7 million for the three
months  ended March 31, 2000  compared to none for the three  months ended March
31,  1999.  This  consisted  primarily  of  proceeds  from the  exercise  of the
Warrants.  We intend to  continue to raise  capital to finance  our  strategy of
building dominant venture partner companies.

         Certain of our venture partner companies have the right to require that
we purchase  additional  equity  interests  in these  companies  in an aggregate
amount of cash approximating $350 thousand.

New Accounting Pronouncements

         In December 1999, the SEC issued Staff Accounting  Bulletin ("SAB") No.
101,  "Revenue  Recognition in Financial  Statements." SAB No. 101 expresses the
views of the SEC staff in applying generally accepted  accounting  principles to
certain revenue recognition issues. In June 2000, the SEC issued SAB No. 101B to
defer the effective date of the  implementation  of SAB No. 101 until the fourth
quarter  of fiscal  2000.  Management  is  currently  evaluating  the  impact of
adopting  this SAB,  but does not  believe  that  this SAB will have a  material
impact on its financial position or its results of operations.


                                      -14-

<PAGE>

                                     PART II

                                OTHER INFORMATION


ITEM 6.           EXHIBITS

         (a)      Exhibits

         The following exhibit replaces the previously filed Exhibit No. 27.1 in
its entirety:


                  Exhibit No.            Description
                  -----------            -----------

                  27.1                   Financial Data Schedule.



                                      -15-

<PAGE>

                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934,  the  registrant  has duly caused this  Amendment No. 1 on
Form  10-Q/A to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                           THCG, INC.

                                           By: /s/  Adi Raviv
                                               ---------------------------------
                                           Name:   Adi Raviv
                                           Title:  Co-Chairman of the Board of
                                                   Directors and Chief Financial
                                                   Officer

Date:  November 14, 2000


                                      -16-

<PAGE>


                                  EXHIBIT LIST

Exhibit No.               Description
-----------               -----------

27.1                      Financial Data Schedule.


                                      -17-