**Quarterly        Report Pursuant To Section 13 or 15(d) Of The Securities Exchange Act Of        1934**

**For        The Quarterly Period Ended**
**June 30, 2007**

**Commission        File Number:**
**0-52589**

**ANCHOR        FUNDING SERVICES, INC.**

|  **Delaware**                                              |  **20-5456087**                                              |
|-----------------------------------------------------------------|-------------------------------------------------------------------|
|  (State                  of jurisdiction of Incorporation) |   (I.R.S.                  Employer Identification No.) |

**10801        Johnston Road, suite 210**

**Charlotte,        NC 28226**

**(866)        789-3863**

**Not        Applicable**

----

**ANCHOR        FUNDING SERVICES, INC.**

**Form        10-QSB Quarterly Report**

**Table        of Contents**

|                                                           |                                                                                                                                                            |  **Page** |
|----------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------|
| **PART                  I. FINANCIAL INFORMATION**   |
|                                                           |                                                                                                                                                            |           |
| Item                  1.              |  Financial                  Statements (Unaudited)                                                                                                         |           |
|                                                           |                                                                                                                                                            |           |
|                                                           | Condensed                      Balance Sheet as of June 30, 2007                                                                                                | 3              |
|                                                           |                                                                                                                                                            |           |
|                                                           | Condensed                    Statements of Operations for the Three and six months ended June                    30, 2007                    and 2006           | 4              |
|                                                      |                                                                                                                                                            |           |
|                                                           | Condensed                    Statements of Cash Flows for the six months ended June 30, 2007                    and  June                    30, 2006 | 5              |
|                                                                |                                                                                                                                                            |           |
|                                                           | Notes                      to Condensed Financial Statements                                                                                                    | 7              |
|                                                           |                                                                                                                                                            |           |
| Item                    2.                                     | Management's                    Discussion and Analysis of Financial Condition and Results of                    Operations                                     | 22             |
|                                                           |                                                                                                                                                            |           |
| Item                    3.                                     | Controls                    and Procedures                                                                                                                      | 31             |
|                                                           |                                                                                                                                                            |           |
| **PART                    II. OTHER INFORMATION**         |                                                                                                                                                            |
|                                                           |                                                                                                                                                            |           |
| Item                    1.                                     | Legal                    Proceedings                                                                                                                            | 31             |
|                                                           |                                                                                                                                                            |           |
| Item                    2.                                     | Changes                    in Securities                                                                                                                        | 31             |
|                                                           |                                                                                                                                                            |           |
| Item                    3.                                     | Defaults                    Upon Senior Securities                                                                                                              | 31             |
|                                                           |                                                                                                                                                            |           |
| Item                    4.                                     | Submissions                    of Matters to a Vote of Security Holders                                                                                         | 31             |
|                                                           |                                                                                                                                                            |           |
| Item                    5.                                     | Other                    Information                                                                                                                            | 31             |
|                                                           |                                                                                                                                                            |           |
| Item                    6.                                     | Exhibits                                                                                                                                                        | 32             |
|                                                           |                                                                                                                                                            |           |
| **Signatures**                                                 |                                                                                                                                                            | 33             |

----

**PART        I. FINANCIAL INFORMATION**

| **ANCHOR                    FUNDING SERVICES, INC.**                              |   |
|-----------------------------------------------------------------------------------|--------|
|                                                                              |   |   |   |   |   |   |
| **CONSOLIDATED                    BALANCE SHEETS**                                |   |
|                                                                              |   |   |   |   |   |   |
| **ASSETS**                                                                        |   |
|                                                                              |   | June |   |   | December |   |
|                                                                              |   |   | 30,                    2007 |   |   |   | 31,                    2006 |   |
|                                                                              |   | (Unaudited) |   |   | (Audited) |   |
| CURRENT                    ASSETS:                                                |   |   |   |   |   |   |   |   |
|   Cash                                                                  |   | $ | 4,751,826 |   |   | $ | 55,771 |   |
|   Retained                    interest in purchased accounts receivable |   |   | 897,861 |   |   |   | 467,419 |   |
|   Due                    from financial institution                     |   |   | 36,405 |   |   |   | - |   |
|   Prepaid                    expenses and other                         |   |   | 39,133 |   |   |   | 41,134 |   |
|     Total                    current assets                   |   |   | 5,725,225 |   |   |   | 564,324 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| PROPERTY                    AND EQUIPMENT, net                                    |   |   | 30,913 |   |   |   | 4,010 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| SECURITY                    DEPOSITS                                              |   |   | 18,965 |   |   |   | - |   |
|                                                                              |   |   |   |   |   |   |   |   |
|                                                                              |   | $ | 5,775,103 |   |   | $ | 568,334 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| **LIABILITIES                    AND STOCKHOLDERS' EQUITY**                       |   |
|                                                                              |   |   |   |   |   |   |   |   |
| CURRENT                    LIABILITIES:                                           |   |   |   |   |   |   |   |   |
|   Due                    to financial institution                       |   | $ | - |   |   | $ | 44,683 |   |
|   Accounts                    payable                                   |   |   | 38,081 |   |   |   | 39,218 |   |
|   Due                    to related company                             |   |   | 2,768 |   |   |   | 21,472 |   |
|   Accrued                    payroll and related taxes                  |   |   | 78,728 |   |   |   | 37,796 |   |
|   Accrued                    expenses                                   |   |   | 5,300 |   |   |   | - |   |
|   Dividends                    payable                                  |   |   | 132,860 |   |   |   | - |   |
|     Total                    current liabilities              |   |   | 257,737 |   |   |   | 143,169 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| COMMITMENTS                    AND CONTINGENCIES                                  |   |   |   |   |   |   |   |   |
|                                                                              |   |   |   |   |   |   |   |   |
| MEMBERS'                    EQUITY                                                |   |   | - |   |   |   | 418,895 |   |
| PREFERRED                    STOCK                                                |   |   | 6,712,500 |   |   |   | - |   |
| COMMON                    STOCK                                                   |   |   | 11,795 |   |   |   | 3,795 |   |
| ADDITIONAL                    PAID IN CAPITAL                                     |   |   | (758,322 | ) |   |   | 4,580 |   |
| ACCUMULATED                    DEFICIT                                            |   |   | (448,607 | ) |   |   | (2,105 | ) |
|                                                                              |   |   | 5,517,366 |   |   |   | 425,165 |   |
|                                                                              |   |   |   |   |   |   |   |   |
|                                                                              |   | $ | 5,775,103 |   |   | $ | 568,334 |   |
|                                                                              |   |   |   |   |   |   |   |   |
|                                                                              |   |   |   |   |   |   |   |   |

----

| **ANCHOR                    FUNDING SERVICES, INC.**                   |   |                                                                                              |       |   |                                                                                                |   |    |
|------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------|------------|--------|-----------------------------------------------------------------------------------------------------|--------|---------|
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |
| **UNAUDITED                    CONSOLIDATED STATEMENTS OF OPERATIONS** |   |                                                                                              |       |   |                                                                                                |   |    |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |
|                                                                   |   |                    **For                    the quarters ending June 30,**    |       |   |                    **For                    the six months ending June 30,**    |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |
|                                                                   |   | 2007                                                                                              |       |   | 2006                                                                                                |   |    | 2007 |   |   | 2006 |   |
| FINANCE                    REVENUES                                    |   | $                                                                                                 | 81,514     |   |                                                                                                | $      | 180,267 |   |   | $ | 152,650 |   |   | $ | 403,041 |   |
| INTEREST                    EXPENSE - financial institution            |   |                                                                                              | (17,195    | )      |                                                                                                |   | (42,272 | ) |   |   | (21,365 | ) |   |   | (105,804 | ) |
| INTEREST                    INCOME                                     |   |                                                                                              | 68,584     |   |                                                                                                |   | -       |   |   |   | 97,529 |   |   |   | - |   |
| INTEREST                    EXPENSE, net - related parties             |   |                                                                                              | -          |   |                                                                                                |   | (13,556 | ) |   |   | - |   |   |   | (32,471 | ) |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| NET                    FINANCE REVENUES                                |   |                                                                                              | 132,903    |   |                                                                                                |   | 124,439 |   |   |   | 228,814 |   |   |   | 264,766 |   |
| PROVISION                    FOR CREDIT LOSSES                         |   |                                                                                              | -          |   |                                                                                                |   | -       |   |   |   | - |   |   |   | - |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| FINANCE                    REVENUES, NET OF INTEREST EXPENSE           |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|  AND                    CREDIT LOSSES                             |   |                                                                                              | 132,903    |   |                                                                                                |   | 124,439 |   |   |   | 228,814 |   |   |   | 264,766 |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| OPERATING                    EXPENSES                                  |   |                                                                                              | 297,432    |   |                                                                                                |   | 45,191  |   |   |   | 559,456 |   |   |   | 104,876 |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| NET                    INCOME (LOSS) BEFORE INCOME TAXES               |   |                                                                                              | (164,529   | )      |                                                                                                |   | 79,248  |   |   |   | (330,642 | ) |   |   | 159,890 |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| INCOME                    TAX (PROVISION) BENEFIT:                     |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   Current                                                    |   |                                                                                              | -          |   |                                                                                                |   | -       |   |   |   | - |   |   |   | - |   |
|   Deferred                                                   |   |                                                                                              | 4,000      |   |                                                                                                |   | -       |   |   |   | 17,000 |   |   |   | - |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   Total                                                      |   |                                                                                              | 4,000      |   |                                                                                                |   | -       |   |   |   | 17,000 |   |   |   | - |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| NET                    INCOME (LOSS)                                   |   |                                                                                              | (160,529   | )      |                                                                                                |   | 79,248  |   |   |   | (313,642 | ) |   |   | 159,890 |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| DEEMED                    DIVIDEND ON CONVERTIBLE PREFERRED STOCK      |   |                                                                                              | (132,860   | )      |                                                                                                |   | -       |   |   |   | (132,860 | ) |   |   | - |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| NET                    INCOME (LOSS) ATTRIBUTABLE TO COMMON            |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   SHAREHOLDER                                                |   | $                                                                                                 | (293,389   | )      |                                                                                                | $      | 79,248  |   |   | $ | (446,502 | ) |   | $ | 159,890 |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| NET                    INCOME (LOSS) ATTRIBUTABLE TO COMMON            |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   SHAREHOLDER,                    per share                  |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   Basic                                                      |   | $                                                                                                 | (0.02      | )      |                                                                                                | N/A    |    |   | $ | (0.04 | ) |   | N/A |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   Dilutive                                                   |   | $                                                                                                 | (0.02      | )      |                                                                                                | N/A    |    |   | $ | (0.03 | ) |   | N/A |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
| WEIGHTED                    AVERAGE NUMBER OF SHARES OUTSTANDING       |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   Basic                                                      |   |                                                                                              | 11,820,555 |   |                                                                                                | N/A    |    |   |   | 10,450,389 |   |   | N/A |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|   Dilutive                                                   |   |                                                                                              | 18,530,308 |   |                                                                                                | N/A    |    |   |   | 15,661,991 |   |   | N/A |   |
|                                                                   |   |                                                                                              |       |   |                                                                                                |   |    |   |   |   |   |   |   |   |   |   |
|                                                                        |   |                                                                                              |       |   |                                                                                                |   |    |   |   |

----

| **ANCHOR                    FUNDING SERVICES, INC.**                                      |   |
|----------------------------------------------------------------------------------------------------------------------------------------|--------|
| **UNAUDITED                    CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY**          |   |
| **For                    the six months ended June 30, 2007**                             |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                   |   | Members' |   |   | Preferred |   |   | Common |   |   | Additional |   |   | Accumulated |   |
|                                                                                                                                   |   | Equity |   |   | Stock |   |   | Stock |   |   | Paid                    in Capital |   |   | Deficit |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                    December 31, 2006                                                                                          |   | $ | 418,895 |   |   | $ | - |   |   | $ | 3,795 |   |   | $ | 4,580 |   |   | $ | (2,105 | ) |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| To                    record the exchange of 8,000,000 common shares of BTHC                    XI, Inc.                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| stock                    for 100,000 membership units of Anchor Funding Services,                    LLC                               |   |   | (418,895 | ) |   |   | - |   |   |   | 8,000 |   |   |   | 410,895 |   |   |   | - |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| To                    record issuance of 1,342,500 shares of convertible preferred                    stock                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and                    related costs of raising this capital                                                                           |   |   | - |   |   |   | 6,712,500 |   |   |   | - |   |   |   | (1,206,483 | ) |   |   | - |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| To                    record issuance of 1,960,000 in stock options                                                                    |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 32,686 |   |   |   | - |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred                    stock dividends                                                                                           |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (132,860 | ) |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                    loss for the six months ended June 30, 2007                                                                     |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (313,642 | ) |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                    June 30, 2007                                                                                              |   | $ | - |   |   | $ | 6,712,500 |   |   | $ | 11,795 |   |   | $ | (758,322 | ) |   | $ | (448,607 | ) |
|                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| **ANCHOR                    FUNDING SERVICES, INC.**                                                                                              |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                              |   |   |   |   |   |   |
| **UNAUDITED                    CONSOLIDATED STATEMENTS OF CASH FLOWS**                                                                            |   |
|                                                                                                                                              |   |   |   |   |   |   |
| **For                    the six months ended June 30,**                                                                                          |   |
|                                                                                                                                              |   |   |   |   |   |   |
| CASH                    FLOWS FROM OPERATING ACTIVITIES:                                                                                          |   | 2007 |   |   | 2006 |   |
|   Net                    income (loss):                                                                                                 |   | $ | (313,642 | ) |   | $ | 159,890 |   |
|   Adjustments                    to reconcile net income (loss) to net cash                                                             |   |   |   |   |   |   |   |   |
|     used                    in operating activities:                                                                          |   |   |   |   |   |   |   |   |
|     Depreciation                    and amortization                                                                          |   |   | 4,295 |   |   |   | 3,120 |   |
|     Compensation                    expense related to issuance of stock options                                              |   |   | 49,686 |   |   |   | - |   |
|     Benefit                    for income taxes                                                                               |   |   | (17,000 | ) |   |   | - |   |
|     (Increase)                    decrease in retained interest in purchased                                                  |   |   | (430,442 | ) |   |   | 237,987 |   |
|        accounts                    receivable                                                                  |   |   |   |   |   |   |   |   |
|     Decrease                    in prepaid expenses and other                                                                 |   |   | 2,001 |   |   |   | 5,002 |   |
|     Increase                    in security deposits                                                                          |   |   | (18,965 | ) |   |   | - |   |
|     (Decrease)                    increase in accounts payable                                                                |   |   | (1,137 | ) |   |   | 175 |   |
|     Decrease                    in due to related company                                                                     |   |   | (18,704 | ) |   |   | 140,179 |   |
|     Increase                    (decrease) in accrued payroll and related taxes                                               |   |   | 40,932 |   |   |   | (4,371 | ) |
|     Increase                    in accrued expenses                                                                           |   |   | 5,300 |   |   |   | - |   |
|       Net                    cash (used in) provided by operating activities                                   |   |   | (697,676 | ) |   |   | 541,982 |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
| CASH                    FLOWS FROM INVESTING ACTIVITIES:                                                                                          |   |   |   |   |   |   |   |   |
|   Purchases                    of property and equipment                                                                                |   |   | (31,198 | ) |   |   | (1,008 | ) |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
| CASH                    FLOWS FROM FINANCING ACTIVITIES:                                                                                          |   |   |   |   |   |   |   |   |
|   Payments                    to financial institution, net                                                                             |   |   | (81,088 | ) |   |   | (435,237 | ) |
|   Repayments                    on subordinated related party demand notes payable                                                      |   |   | - |   |   |   | (15,781 | ) |
|   Proceeds                    from sale of preferred stock                                                                              |   |   | 6,712,500 |   |   |   | - |   |
|   Payments                    made related to sale of preferred stock                                                                   |   |   | (1,206,483 | ) |   |   | - |   |
|       Net                    cash provided by (used in) financing activities                                        |   |   | 5,424,929 |   |   |   | (451,018 | ) |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
| INCREASE                    IN CASH                                                                                                               |   |   | 4,696,055 |   |   |   | 89,956 |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
| CASH,                    beginning of period                                                                                                      |   |   | 55,771 |   |   |   | 30,240 |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
| CASH,                    end of period                                                                                                            |   | $ | 4,751,826 |   |   | $ | 120,196 |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |
| The                    accompanying notes to financial statements are an integral part                    of these                    statements. |   |

----

**ANCHOR        FUNDING SERVICES, INC.**

**Notes        To Condensed Financial Statements**

**Three        and Six Months Ended June 30, 2007 and 2006**

**(Unaudited)**

**1.**
**BACKGROUND        AND DESCRIPTION OF BUSINESS:**

|   | The                  consolidated financial statements include the accounts of BTHC                  XI, Inc.                  and its wholly owned subsidiary, Anchor Funding Services, LLC (“the                  Company”).  In April of 2007, BTHC XI, Inc. changed its name to                  Anchor Funding Services, Inc.  All significant intercompany                  balances and transactions have been eliminated in                  consolidation. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | BTHC                  XI, Inc. is a Delaware corporation.  BTHC XI, Inc. has no                  operations; substantially all operations of the Company are the                  responsibility of Anchor Funding Services,                  LLC. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Anchor                  Funding Services, LLC is a North Carolina limited liability                  company.    Anchor Funding Services, LLC was formed                  for the purpose of providing factoring and back office services                  to                  businesses located throughout the United States of                  America. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | On                  January 31, 2007, BTHC XI, Inc acquired Anchor Funding Services,                  LLC by                  exchanging shares in BTHC XI, Inc. for all the outstanding membership                  units of Anchor Funding Services, LLC (See Note                  8).   Anchor Funding Services, LLC is considered the                  surviving entity therefore these financial statements include the                  accounts                  of BTHC XI, Inc. and Anchor Funding Services, LLC since January                  1,                  2007. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**2.**
**SUMMARY        OF SIGNIFICANT ACCOUNTING POLICIES:**

|   | **Estimates                  –** The preparation of financial statements in conformity                  with                  generally accepted accounting principles requires management to                  make                  estimates that affect the reported amounts of assets and liabilities                  and                  disclosure of contingent assets and liabilities at the date of                  the                  financial statements and the reported amounts of revenues and expenses                  during the reporting period.  Actual results could differ from                  those estimates. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Revenue                  Recognition –**Revenue is recognized when the fee is earned and                  consists primarily of non-refundable transaction (factor commission)                  and                  time-based fees. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Non-refundable                    factor commissions are collected when a Company funds a purchased                    accounts                    receivable and when the accounts receivable is collected. The                    Company uses                    the cost-recovery method of accounting for these commissions.                    Under this                    method, commissions are recognized as revenue when all amounts                    funded have                    been collected from the account debtor.The                    majority of the Company’s customers are only charged time-based fees.                    These fees are earned by the Company from the time an accounts                    receivable                    is purchased until the Company collects on the purchased accounts                    receivable. The Company does withhold a portion of these fees                    when the                    purchased accounts receivable is funded. The withheld amount                    is deferred                    and amortized into revenue over an estimated deferral                    period. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  term of the factoring and security agreement is typically one year,                  unless                  terminated in writing by the customer ninety days prior to the                  agreement’s                  anniversary date. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | **Retained                  Interest in Purchased Accounts Receivable –**Retained interest in                  purchased accounts receivable represents the gross amount of invoices                  purchased from factoring customers less amounts maintained in a                  reserve                  account, less unearned factor commissions and time based fees,                  plus earned uncollected time based fees.  The Company purchases                  a customer’s accounts receivable and advances them a percentage of the                  invoice total.  The difference between the purchase price, less                  unearned factor commission, and amount advanced is maintained in                  a reserve                  account.  The reserve account is used to offset any potential                  losses the Company may have related to the purchased accounts                  receivable. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Property                  and Equipment –** Property and equipment, consisting primarily of                  computers and software, are stated at cost.  Depreciation is                  provided over the estimated useful lives of the depreciable assets                  using                  the straight-line method.  Estimated useful lives range from 2                  to 5 years. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | **Advertising                  Costs –** The Company charges advertising costs to expense as                  incurred.  Total advertising costs were as                  follows: |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

|   |    For                    the six months ending June 30,     |   |
|--------|-----------------------------------------------------------------------------|--------|
|   | 2007                                                                        |   |   | 2006 |   |
|   |                                                                        |   |   |   |   |
|   | $                                                                           | 87,000 |   |   | $ | 31,500 |   |
|   |                                                                        |   |   |   |   |   |   |
|   |     For                    the quarters ending June 30, |   |
|   | 2007                                                                        |   |   | 2006 |   |
|   |                                                                        |   |   |   |   |   |   |
|   | $                                                                           | 55,200 |   |   | $ | 15,800 |   |

|   | **Earnings                  per Share –** The Company computes net income per share in                  accordance with SFAS No. 128 “Earnings Per Share.”  Basic net                  income per share is computed by dividing the net income for the                  period by                  the weighted average number of common shares outstanding during                  the                  period.  Dilutive net income per share includes the potential                  impact of dilutive securities, such as convertible preferred stock,                  stock                  options and stock warrants.  The dilutive effect of stock                  options and warrants is computed using the treasury stock method,                  which                  assumes the repurchase of common shares at the average market                  price. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Stock                  Based Compensation until December 31, 2005 -** In December 2004,                  the Financial Accounting Standards Board (“FASB”) issued Statement of                  Financial Accounting Standard (“SFAS”) No. 123(R), “Accounting for                  Stock-Based Compensation.” SFAS No. 123(R) establishes standards for the                  accounting for transactions in which an entity exchanges its equity                  instruments for goods or services. This statement focuses primarily                  on                  accounting for transactions in which an entity obtains employee                  services                  in share-based payment transactions. SFAS No. 123(R) requires that                  the                  fair value of such equity instruments be recognized as an expense                  in the                  historical financial statements as services are performed. Prior                  to SFAS                  No. 123(R), only certain pro forma disclosures of fair value were                  required. The provisions of this statement were effective for the                  first                  interim reporting period that began after December 15, 2005. The                  Company                  adopted the provisions of SFAS No.123(R) in the first quarter of                  fiscal                  2006. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | See                  Note 9 for the SFAS No. 123(R) impact on the operating results                  for the                  quarter and six months ended June 30, 2007.  The adoption of                  SFAS No. 123(R) had no impact on the Company’s operating results for the                  quarter and six months ended June 30,                  2006. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Recent                  Accounting Pronouncements–** |
|--------|--------------------------------------------------------------|

*Fair Value        Measurements*

*Considering the Effects of Prior        Year Misstatements when Quantifying Misstatements in Current Year Financial        Statements*

----

*The Fair Value Option for        Financial Assets and Financial Liabilities – Including an amendment of FASB        Statement No. 115.*
*Accounting for Certain Investments in Debt        and Equity Securities*

|   | **Fair                  Value of Financial Instruments –** The carrying value of cash                  equivalents, retained interest in purchased accounts receivable,                  due                  from/to financial institution, accounts payable and accrued liabilities                  approximates their fair value. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Cash                  and cash equivalents –** Cash and cash equivalents consist                  primarily of highly liquid cash investment funds with original                  maturities                  of three months or less when                  acquired. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Income                  Taxes –** Effective January 31, 2007, the Company became a “C”                  corporation for income tax purposes.  In a “C” corporation                  income taxes are provided for the tax effects of transactions reported                  in                  the financial statements plus deferred income taxes related to                  the                  differences between financial statement and taxable                  income. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  primary difference between financial statement and taxable income                  for the                  Company are compensation costs related to the issuance of stock                  options                  and net operating loss carryforwards.  The deferred tax asset                  represents the future tax return consequences of utilizing this                  net                  operating loss.   Deferred tax assets are reduced by a                  valuation reserve, when management is uncertain if the net operating                  loss                  carryforwards will ever be                  utilized. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

** **

----

**3.**
**RETAINED        INTEREST IN PURCHASED ACCOUNTS RECEIVABLE:**

|   | Retained                  interest in purchased accounts receivable consists of the                  following: |
|--------|-----------------------------------------------------------------------------------------------------------------|

|                                                               |   | June                    30, 2007 |      |   | December                    31, 2006 |   |
|--------------------------------------------------------------------|--------|----------------------------------|-----------|--------|--------------------------------------|--------|
| Purchased                    accounts receivable outstanding       |   | $                                | 1,107,181 |   |                                 | $      | 614,034 |   |
| Reserve                    account                                 |   |                             | (210,102  | )      |                                 |   | (172,779 | ) |
|                                                               |   |                             | 897,079   |   |                                 |   | 441,255 |   |
| Unearned                    factor commissions and time based fees |   |                             | (12,537   | )      |                                 |   | (5,673 | ) |
| Earned                    but uncollected fee income               |   |                             | 13,319    |   |                                 |   | 31,837 |   |
|                                                               |   |                             |      |   |                                 |   |   |   |
|                                                               |   | $                                | 897,861   |   |                                 | $      | 467,419 |   |

|   | Total                  accounts receivable purchased were as                  follows: |
|--------|----------------------------------------------------------------------------------------|

|   |    For                    the six months ending June 30, |                                                                  |
|--------|-------------------------------------------------------------------------|-----------------------------------------------------------------------|
|   | 2007                                                                    |                                                                  |   | 2006 |   |
|   |                                                                    |                                                                  |   |   |   |
|   | $                                                                       | 4,370,000                                                             |   |   | $ | 7,644,000 |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   |                                                                    |    For                    the quarters ending June 30, |   |
|   | 2007                                                                    |                                                                  |   | 2006 |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   | $                                                                       | 2,779,000                                                             |   |   | $ | 2,067,000 |   |

----

|   | Retained                  interest in purchased accounts receivable consists of United States                  companies in the following                  industries: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|           |   | June                    30, 2007 |    |   | December                    31, 2006 |   |
|----------------|--------|----------------------------------|---------|--------|--------------------------------------|--------|
| Staffing       |   | $                                | 603,380 |   |                                 | $      | 397,061 |   |
| Transportation |   |                             | 4,676   |   |                                 |   | (52,854 | ) |
| Publishing     |   |                             | 13,497  |   |                                 |   | 45,971 |   |
| Construction   |   |                             | 52,711  |   |                                 |   | 26,591 |   |
| Service        |   |                             | 244,619 |   |                                 |   | 14,951 |   |
| Other          |   |                             | (21,804 | )      |                                 |   | 9,535 |   |
|           |   |                             |    |   |                                 |   |   |   |
|           |   | $                                | 897,079 |   |                                 | $      | 441,255 |   |

**4.**
**PROPERTY        AND EQUIPMENT:**

|   | Property                  and equipment consist of the                  following: |
|--------|------------------------------------------------------------------------------------|

|                                             |   | June                    30, 2007 |    |   | December                    31, 2006 |   |
|--------------------------------------------------|--------|----------------------------------|---------|--------|--------------------------------------|--------|
| Furniture                    and fixtures        |   | $                                | 10,712  |   |                                 | $      | 1,235 |   |
| Computers                    and software        |   |                             | 37,252  |   |                                 |   | 15,531 |   |
|                                             |   |                             | 47,964  |   |                                 |   | 16,766 |   |
| Less                    accumulated depreciation |   |                             | (17,051 | )      |                                 |   | (12,756 | ) |
|                                             |   |                             |    |   |                                 |   |   |   |
|                                             |   | $                                | 30,913  |   |                                 | $      | 4,010 |   |

**5.  DUE        FROM/TO FINANCIAL INSTITUTION:**

|   | The                  Company had an agreement with a financial institution under which                  the                  institution financed their purchased accounts receivable.  The                  institution received a fee of .3 percent of the receivables financed                  plus                  interest as described below.  The Company terminated this                  agreement on July 16, 2007. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Borrowings                  were made at the request of the Company.  The amount eligible to                  be borrowed was the lower of $1,000,000 or a borrowing base formula                  as                  defined in the agreement.  The interest on borrowings was paid                  monthly at a rate ranging from the institution’s prime rate plus 1% to                  12.75%. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | As                  of June 30, 2007, the financial institution had collected more                  cash from                  previously factored receivables than was loaned to fund current                  factored                  receivables.  The excess collected is recorded as a receivable                  from the financial institution. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  agreement was collateralized by all current and future Company                  assets and                  was guaranteed by the Company’s majority                  shareholders. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**6.**
**CAPITAL        STRUCTURE:**

|   | The                  Company’s capital structure consists of preferred and common stock as                  described below: |
|--------|------------------------------------------------------------------------------------------------------------------------------------|

|   | **Preferred                  Stock –** The Company is authorized to issue 10,000,000 shares                  of                  $.001 par value preferred stock.  The Company’s Board of                  Directors determines the rights and preferences of its preferred                  stock. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | On                  January 31, 2007, the Company filed a Certificate of Designation                  with the                  Secretary of State of Delaware.  Effective with this filing,                  2,000,000 preferred shares became Series 1 Convertible Preferred                  Stock.  Series 1 Convertible Preferred Stock will rank senior to                  Common Stock. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Series                  1 Convertible Preferred Stock is convertible into 5 shares of the                  Company’s Common Stock.  The holder of the Series 1 Convertible                  Preferred Stock has the option to convert the shares to Common                  Stock at                  any time.  Upon conversion all accumulated and unpaid dividends                  will be paid as additional shares of Common                  Stock. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  dividend rate on Series 1 Convertible Preferred Stock is                  8%.  Dividends are paid annually on December 31st in the form of                  additional Series 1 Convertible Preferred Stock unless the Board                  of                  Directors approves a cash dividend.  Dividends on Series 1                  Convertible Preferred Stock shall cease to accrue on the earlier                  of                  December 31, 2009, or on the date they are converted to Common                  Shares.  Thereafter, the holders of Series 1 Convertible                  Preferred Stock have the same dividend rights as holders of Common                  Stock,                  as if the Series 1 Convertible Preferred Stock had been converted                  to                  Common Stock. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Common                  Stock –** The Company is authorized to issue 40,000,000 shares                  of                  $.001 par value Common Stock.  Each share of Common Stock                  entitles the holder to one vote at all stockholder                  meetings.  Dividends on Common Stock will be determined annually                  by the Company’s Board of                  Directors. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The                  changes in Series 1 Convertible Preferred Stock and Common Stock                  shares                  for the six months ended June 30, 2007 is summarized as                  follows: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                                                                             |   |                                    |       |   |                                 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|------------|--------|--------------------------------------|--------|
|                                                                                                                                                             |   | Series                    1 Convertible |       |   | Common                               |   |
|                                                                                                                                                             |   | Preferred                    Stock      |       |   | Stock                                |   |
| Balance,                    December 31, 2006                                                                                                                    |   |                                    | -          |   |                                 |   | 3,820,555 |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Shares                    issued in exchange for                                                                                                                 |   |                                    |       |   |                                 |   |   |   |
| the                    membership units of                                                                                                                       |   |                                    |       |   |                                 |   |   |   |
| Anchor                    Funding Services, LLC                                                                                                                  |   |                                    | -          |   |                                 |   | 8,000,000 |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Shares                    issued in connection                                                                                                                   |   |                                    |       |   |                                 |   |   |   |
| with                    sale of Series 1 Convertible                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Preferred                    Stock                                                                                                                               |   |                                    | 1,342,500  |   |                                 |   | - |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Balance,                    June 30, 2007                                                                                                                        |   |                                    | 1,342,500  |   |                                 |   | 11,820,555 |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| As                    of June 30, 2007 and December 31, 2006 the components of additional                    paid                    in capital were as follows: |   |                                    |       |   |                                 |   |   |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
|                                                                                                                                                             |   | June                    30, 2007        |       |   | December                    31, 2006 |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Consideration                    received in excess of                                                                                                           |   |                                    |       |   |                                 |   |   |   |
|   common                    stock's par value                                                                                                          |   | $                                       | 490,475    |   |                                 | $      | 79,580 |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Equity                    issuance fees                                                                                                                          |   |                                    | (1,344,178 | )      |                                 |   | (75,000 | ) |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Stock                    warrants                                                                                                                                |   |                                    | 62,695     |   |                                 |   | - |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
| Stock                    options, net of $17,000                                                                                                                 |   |                                    |       |   |                                 |   |   |   |
|   deferred                    income tax benefit                                                                                                       |   |                                    | 32,686     |   |                                 |   | - |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
|                                                                                                                                                             |   |                                    |       |   |                                 |   |   |   |
|                                                                                                                                                             |   | $                                       | (758,322   | )      |                                 | $      | 4,580 |   |

----

|   |   |
|--------|--------|

|   |  |
|--------|--|

|   |   |
|--------|--------|

|   | **7.  RELATED                  PARTY TRANSACTIONS:** |
|--------|----------------------------------------------------------------|

|   | **Due                  from/to Related Company –** Prior to December 31, 2006, the Company                  had borrowing and loan transactions with a limited liability company                  (LLC)                  related through common ownership.  These amounts were unsecured,                  interest bearing (at 10 percent), and payable on demand.  The                  Company recorded the following interest income (expense) amounts                  related                  to this activity: |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|      |   |    For                    the six months ending June 30, |   |
|-----------|--------|-------------------------------------------------------------------------|--------|
|      |   | 2007                                                                    |   |   | 2006 |   |
| Income    |   | $                                                                       | -      |   |   | $ | 12,551 |   |
| (Expense) |   |                                                                    | -      |   |   |   | (45,022 | ) |
|      |   |                                                                    |   |   |   |   |   |   |
|      |   | $                                                                       | -      |   |   | $ | (32,471 | ) |
|      |   |                                                                    |   |   |   |   |   |   |

|      |   | For                      the quarter ending June 30, |   |
|-----------|--------|------------------------------------------------------|--------|
|      |   | 2007                                                 |   |   | 2006 |   |
| Income    |   | $                                                    | -      |   |   | $ | 12,551 |   |
| (Expense) |   |                                                 | -      |   |   |   | (26,107 | ) |
|      |   |                                                 |   |   |   |   |   |   |
|      |   | $                                                    | -      |   |   | $ | (13,556 | ) |
|      |   |                                                 |   |   |   |   |   |   |

|   | **Administrative                  Charges –** The Company uses the administrative staff and                  facilities of the LLC referred to above.  The services provided                  by the LLC consist primarily of rent, credit, collection, invoicing,                  payroll and bookkeeping.  The Company pays the LLC a fee for                  these services.  The fee is computed as a percentage of accounts                  receivable purchased by the Company.  The administrative fee                  charged by the LLC was as follows: |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |    For                    the six months ending June 30, |                                                                 |
|--------|-------------------------------------------------------------------------|----------------------------------------------------------------------|
|   | 2007                                                                    |                                                                 |   | 2006 |   |
|   |                                                                    |                                                                 |   |   |   |
|   | $                                                                       | 14,000                                                               |   |   | $ | 16,500 |   |
|   |                                                                    |                                                                 |   |   |   |   |   |
|   |                                                                    |                                                                 |   |   |   |   |   |
|   |                                                                    |    For                    the quarter ending June 30, |   |
|   |                                                                    |                                                                 |   |   |   |   |   |
|   | 2007                                                                    |                                                                 |   | 2006 |   |
|   |                                                                    |                                                                 |   |   |   |   |   |
|   | $                                                                       | 7,100                                                                |   |   | $ | 8,800 |   |

|   | In                    connection with the Company’s relocation (See Note 14) to their Charlotte,                    NC facility, the Company is no longer using the administrative                    services of                    the related LLC. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**8.  EXCHANGE        TRANSACTION:**

|   | On                  January 31, 2007, Anchor Funding Services, LLC and its members                  entered                  into a Securities Exchange Agreement with BTHC XI, Inc.  The                  members namely, George Rubin, Morry Rubin (“M. Rubin”) and Ilissa                  Bernstein exchanged their units in Anchor Funding Services, LLC                  for an                  aggregate of 8,000,000 common shares of BTHC XI, Inc. issued to                  George                  Rubin (2,400,000 shares), M. Rubin (3,600,000 shares) and Ilissa                  Bernstein                  (2,000,000 shares).  Upon the closing of this transaction Anchor                  Funding Services, LLC became a wholly-owned subsidiary of BTHC                  XI,                  Inc. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | At                  the time of this transaction, BTHC XI, Inc. had no operations and                  no                  assets or liabilities. After this transaction the former members                  of Anchor                  Funding Services, LLC owned approximately 67.7% of the outstanding                  common                  stock of BTHC XI, Inc. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**9.        EMPLOYMENT AND STOCK OPTION AGREEMENTS:**

|   | At                  closing of the exchange transaction described above, M. Rubin and                  Brad                  Bernstein (“B. Bernstein”), the husband of Ilissa Bernstein and President                  of the Company, entered into employment contracts and stock option                  agreements with the BTHC XI, Inc.  Additionally, at closing two                  non-employee directors entered into stock option agreements with                  BTHC XI,                  Inc.  |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  following summarizes M. Rubin’s employment agreement and stock                  options: |
|--------|---------------------------------------------------------------------------------------------------------------------|

| ·   | The                  employment agreement with M. Rubin retains his services as Co-chairman                  and                  Chief Executive Officer for a three-year                  period. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | An                  annual salary of $1 until, the first day of the first month following                  such                  time as BTHC XI, Inc. shall have, within any period beginning on                  January 1                  and ending not more than 12 months thereafter, earned pre-tax net                  income                  exceeding $1,000,000, M. Rubin’s base salary shall be adjusted to an                  amount, to be mutually agreed upon between M. Rubin and BTHC XI,                  Inc.,                  reflecting the fair value of the services provided, and to be provided,                  by                  M. Rubin taking into account (i) his position, responsibilities                  and                  performance, (ii) BTHC XI, Inc.’s  industry, size and                  performance, and (iii) other relevant factors. M. Rubin is eligible                  to                  receive annual bonuses as determined by BTHC XI, Inc.’s compensation                  committee.  M. Rubin shall be entitled to a monthly automobile                  allowance of $1,500. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | 10-year                  options to purchase 650,000 shares exercisable at $1.25 per share,                  pursuant to BTHC XI, Inc.’s 2007 Omnibus Equity Compensation Plan. Vesting                  of the options is one-third immediately, one-third on February                  29, 2008                  and one-third on February 28, 2009, provided that in the event                  of a change                  in control or M. Rubin is terminated without cause or M. Rubin                  terminates                  for good reason, all unvested options shall accelerate and immediately                  vest and become exercisable in full on the earliest of the date                  of change                  in control or date of M. Rubin’s voluntary termination or by BTHC XI, Inc.                  without cause. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  following summarizes B. Bernstein’s employment agreement and stock                  options: |
|--------|-------------------------------------------------------------------------------------------------------------------------|

| ·   | The                  employment agreement with B. Bernstein retains his services as                  President                  for a three-year period. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | An                  annual salary of $205,000 during the first year, $220,000 during                  the                  second year and $240,000 during the third year and any additional                  year of                  employment.  The Board may periodically review B. Bernstein’s                  base salary and may determine to increase (but not decrease) the                  base                  salary in accordance with such policies as BTHC XI, Inc. may hereafter                  adopt from time to time.  B. Bernstein is eligible to receive                  annual bonuses as determined by BTHC XI, Inc.’s compensation                  committee.  B. Bernstein shall be entitled to a monthly                  automobile allowance of $1,000. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | 10-year                  options to purchase 950,000 shares exercisable at $1.25 per share,                  pursuant to BTHC XI, Inc.’s 2007 Omnibus Equity Compensation Plan. Vesting                  of the options is one-third immediately, one-third on February                  29, 2008                  and one-third on February 28, 2009, provided that in the event                  of a change                  in control or B. Bernstein is terminated without cause or B. Bernstein                  terminates for good reason, all unvested options shall accelerate                  and                  immediately vest and become exercisable in full on the earliest                  of the                  date of change in control or date of B. Bernstein’s voluntary termination                  or by BTHC XI, Inc. without cause. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | 10-year                  options to purchase 360,000 shares exercisable at $1.25 per share,                  pursuant to BTHC XI, Inc.’s 2007 Omnibus Equity Compensation Plan. Vesting                  of the options is one-third immediately, one-third on February                  29, 2008                  and one-third on February 28, 2009.  If either director ceases                  serving BTHC XI, Inc. for any reason, all unvested options shall                  terminate                  immediately and all vested options must be exercised within 90                  days after                  the director ceases serving as a                  director. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  following table summarizes information about stock options as of                  June 30,                  2007: |
|--------|----------------------------------------------------------------------------------------------------------------------------------------|

|     |   |        |   |                                |   |        |
|----------|--------|-------------|--------|-------------------------------------|--------|-------------|
|     |   |        |   | Weighted                    Average |   |        |
| Exercise |   | Number      |   | Remaining                           |   | Number      |
| Price    |   | Outstanding |   | Contractual                    Life |   | Exercisable |
|     |   |        |   |                                |   |        |
| $1.25    |   | 1,960,000   |   | 10                    years         |   | 653,000     |
|     |   |        |   |                                |   |        |

|                              |   |   |   |                        |
|-----------------------------------|--------|--------|--------|-----------------------------|
| Exercise                    price |   |   |   | $1.25                       |
| Term                              |   |   |   | 10                    years |
| Volatility                        |   |   |   | 2.5                         |
| Dividends                         |   |   |   | 0%                          |
| Discount                    rate  |   |   |   | 4.75%                       |
|                              |   |   |   |                        |

----

|   | The                  financial effect of these options to record over their life is                  as                  follows: |
|--------|-----------------------------------------------------------------------------------------------------------------------------------|

|                                               |   |   |      |
|----------------------------------------------------|--------|--------|-----------|
| Options                    to value                |   |   | 1,960,000 |   |
| Option                    price                    |   | $      | 0.0468    |   |
| Total                    expense to recognize over |   |   |      |   |
|   life                    of options     |   | $      | 91,728    |   |
|                                               |   |   |      |   |

|   | The                  amounts recorded for these options in the statement of operations                  for the                  six months and quarter ended June 30, 2007 and 2006 were as                  follows: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                 |   |                             |    |   |                               |   |
|--------------------------------------|--------|----------------------------------|---------|--------|------------------------------------|--------|
|                                 |   | For                    the six   |    |   | For                    the quarter |   |
|                                 |   | months                    ended  |    |   | ended                              |   |
|                                 |   | June                    30, 2007 |    |   | June                    30, 2007   |   |
|                                 |   |                             |    |   |                               |   |
|                                 |   |                             |    |   |                               |   |
| Pre-tax                    effect    |   | $                                | 49,686  |   |                               | $      | 11,466 |   |
| Tax                    benefit (34%) |   |                             | (17,000 | )      |                               |   | (4,000 | ) |
|                                 |   |                             |    |   |                               |   |   |   |
| After-tax                    effect  |   | $                                | 32,686  |   |                               | $      | 7,466 |   |
|                                 |   |                             |    |   |                               |   |   |   |

|   | The                  pre-tax effect recorded in the financial statements for the six                  months                  ending June 30, 2007 consists of $30,576 in fully vested stock                  options and                  a provision of $19,110 to record five months of the unvested portions                  of                  stock options that will eventually vest on February 28, 2008 and                  2009. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**10.        SALE OF CONVERTIBLE PREFERRED STOCK:**

|                                                |   |   |      |
|-----------------------------------------------------|--------|--------|-----------|
| Gross                    proceeds                   |   | $      | 6,712,500 |   |
|                                                |   |   |      |   |
| Cash                    fees:                       |   |   |      |   |
| Placement                    agent                  |   |   | (949,050  | ) |
| Legal                    and accounting             |   |   | (218,552  | ) |
| Blue                    sky                         |   |   | (39,348   | ) |
| Net                    cash proceeds                |   |   | 5,505,550 |   |
|                                                |   |   |      |   |
| Non-cash                    fees:                   |   |   |      |   |
| Placement                    agents fees - warrants |   |   | (62,695   | ) |
|                                                |   |   |      |   |
| Net                    proceeds                     |   | $      | 5,442,855 |   |
|                                                |   |   |      |   |

----

|   | The                  placement agent was issued warrants to purchase 1,342,500 shares                  of the                  Company’s common stock.  The following information was input                  into a Black Scholes option pricing model to compute a per option                  price of                  $.0462: |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                              |   |                       |
|-----------------------------------|--------|----------------------------|
| Exercise                    price |   | $1.10                      |
| Term                              |   | 5                    years |
| Volatility                        |   | 2.5                        |
| Dividends                         |   | 0%                         |
| Discount                    rate  |   | 4.70%                      |
|                              |   |                       |

|     |   |        |   |                                |   |        |
|----------|--------|-------------|--------|-------------------------------------|--------|-------------|
|     |   |        |   | Weighted                    Average |   |        |
| Exercise |   | Number      |   | Remaining                           |   | Number      |
| Price    |   | Outstanding |   | Contractual                    Life |   | Exercisable |
|     |   |        |   |                                |   |        |
| $1.10    |   | 1,342,500   |   | 5                    years          |   | 1,342,500   |
|     |   |        |   |                                |   |        |

----

**11.**
**CONCENTRATIONS:**

|   | **Revenues                  –** The Company recorded revenues from United States companies                  in                  the following industries as                  follows: |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|           |   |                                                              |    |   |   |   |
|----------------|--------|-------------------------------------------------------------------|---------|--------|--------|--------|
| Industry       |   |   For                    the six months ending June 30, |    |
|           |   |                                                              |    |   |   |   |
|           |   | 2007                                                              |    |   | 2006   |   |
|           |   |                                                              |    |   |   |   |
| Staffing       |   | $                                                                 | 118,295 |   |   | $      | 82,685 |   |
| Transportation |   |                                                              | 5,495   |   |   |   | 69,730 |   |
| Publishing     |   |                                                              | 1,788   |   |   |   | 13,119 |   |
| Construction   |   |                                                              | 4,196   |   |   |   | 228,081 |   |
| Service        |   |                                                              | 17,560  |   |   |   | 7,311 |   |
| Other          |   |                                                              | 5,316   |   |   |   | 2,115 |   |
|           |   |                                                              |    |   |   |   |   |   |
|           |   |                                                              |    |   |   |   |   |   |
|           |   | $                                                                 | 152,650 |   |   | $      | 403,041 |   |
|           |   |                                                              |    |   |   |   |   |   |
|           |   |                                                              |    |   |   |   |   |   |

| Industry       |   |   |   For                    the quarter ending June 30, |   |
|----------------|--------|--------|----------------------------------------------------------------|--------|
|           |   |   |                                                           |   |   |   |   |   |
|           |   | 2007   |                                                           |   | 2006 |   |
|           |   |   |                                                           |   |   |   |   |   |
| Staffing       |   | $      | 61,308                                                         |   |   | $ | 55,426 |   |
| Transportation |   |   | 110                                                            |   |   |   | 33,986 |   |
| Publishing     |   |   | 589                                                            |   |   |   | 6,826 |   |
| Construction   |   |   | 2,323                                                          |   |   |   | 79,969 |   |
| Service        |   |   | 14,856                                                         |   |   |   | 3,003 |   |
| Other          |   |   | 2,328                                                          |   |   |   | 1,057 |   |
|           |   |   |                                                           |   |   |   |   |   |
|           |   |   |                                                           |   |   |   |   |   |
|           |   | $      | 81,514                                                         |   |   | $ | 180,267 |   |
|           |   |   |                                                           |   |   |   |   |   |

|   | **Major                  Customers –** The Company had the following transactions and                  balances with unrelated customers (4 for the six months ending                  June 30,                  2007 and 3 for the six months ending June 30, 2006) which represent                  10                  percent or more of its revenues for the six months June 30, 2007                  and 2006                  as follows: |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |
|-------------------------------------------|--------|-----------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------|--------|--------|--------|---------|--------|--------|--------|---------|--------|
|                                      |   |      For                    the six months ended June 30, 2007 |
|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |
| Revenues                                  |   | $                                                                                       | 25,300                                                                                        |   |   | $      | 24,200  |   |   | $      | 28,900  |   |   | $ | 15,900 |   |
|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |
|                                      |   |                                                                                    |       As                    of June 30,2007      |   |
| Purchased                    accounts     |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |
| receivable                    outstanding |   | $                                                                                       | 159,300                                                                                       |   |   | $      | 204,500 |   |   | $      | 155,400 |   |   | $ | 86,200 |   |
|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |
|                                      |   |                                                                                    |       For                    the six months ended June 30, 2006 |
|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Revenues                                  |   | $                                                                                       | 6,200                                                                                         |   |   | $      | 41,300  |   |   | $      | 239,200 |   |   |   |   |   |
|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |
|                                      |   |                                                                                    |       As                    of June 30,2006      |   |
| Purchased                    accounts     |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |
| receivable                    outstanding |   | $                                                                                       | 285,500                                                                                       |   |   | $      | 270,000 |   |   | $      | -       |   |   |   |   |   |
|                                      |   |                                                                                    |                                                                                          |   |   |   |    |   |   |   |    |   |   |   |   |   |

|   | **Cash                  –** The Company maintains cash deposits with a bank.  At                  various times throughout the year, these balances exceeded the                  federally                  insured limit of $100,000. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**12.        **
**SUPPLEMENTAL DISCLOSURES OF CASH FLOW:**

|   | Cash                  paid for interest for the six months ended June 30, 2007 and 2006                  was                  $21,000 and $154,000 respectively. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Non-cash                  financing and investing activities consisted of the                  following: |
|--------|-----------------------------------------------------------------------------------------------------------|

|   | 8,000,000                  shares of common stock were issued in exchange for 100,000 membership                  units of Anchor Funding Services, LLC (see Note                  8). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1,960,000                  stock options were issued to the Company’s President, CEO and two                  non-employee directors (see Note                  9). |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**13.        **
**INCOME TAXES:**

|   | The                  income tax benefit for the six months ending June 30, 2007 consists                  of the                  change in deferred income taxes related to the issuance of stock                  options                  (See Note 9).  There is no current income tax liability for the                  period. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The** **net                  operating loss carryforward generated in the six months ending                  June 30,                  2007 was approximately $281,000.  The deferred tax asset related                  to this net operating loss carryforward is approximately                  $95,000.  This deferred tax asset has been reduced by a $95,000                  valuation allowance.  Management is uncertain if this net                  operating loss will ever be utilized, therefore it has been fully                  reserved. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**14.        FACILITIY LEASES:**

|   | In                  May 2007, the Company executed lease agreements for office space                  in                  Charlotte, NC and Boca Raton, FL.  Both lease agreements are                  with unrelated parties. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  Charlotte lease is effective on August 15, 2007, is for a twenty-four                  month term and includes an option to renew for an additional three                  year                  term at substantially the same terms.  The monthly rental is                  approximately $1,500. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                  Boca Raton lease is expected to be effective on August 20, 2007                  and is for                  a sixty-one month term.  The monthly rental is approximately                  $8,300. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**Item          2. **
**Management’s          Discussion and Analysis or Plan of Operation. **

----

|   | **Estimates                    –** The preparation of financial statements in conformity                    with                    generally accepted accounting principles requires management                    to make                    estimates that affect the reported amounts of assets and liabilities                    and                    disclosure of contingent assets and liabilities at the date of                    the                    financial statements and the reported amounts of revenues and                    expenses                    during the reporting period.  Actual results could differ from                    those estimates. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Revenue                    Recognition –**Revenue is recognized when the fee is earned and                    consists primarily of non-refundable transaction (factor commission)                    and                    time-based fees. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Non-refundable                    factor commissions are collected when the Company funds a purchased                    accounts receivable and when the accounts receivable is collected.                    The                    Company uses the cost-recovery method of accounting for these                    commissions.                    Under this method, commissions are recognized as revenue when                    all amounts                    funded have been collected from the account                    debtor. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    amount charged as a factor commission and time-based fees is                    specified in                    each customer’s factoring and security agreement and these amounts can                    vary between customers. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    term of the factoring and security agreement is typically one                    year, unless                    terminated in writing by the customer ninety days prior to the                    agreement’s                    anniversary date. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Retained                    Interest in Purchased Accounts Receivable –**Retained interest in                    purchased accounts receivable represents the gross amount of                    invoices                    purchased from factoring customers less amounts maintained in                    a reserve                    account, less unearned factor commissions and time based fees,                    plus earned                    but uncollected time based fees.  The Company purchases a                    customer’s accounts receivable and advances them a percentage of the                    invoice total.  The difference between the purchase price, less                    unearned factor commission, and amount advanced is maintained                    in a reserve                    account.  The reserve account is used to offset any potential                    losses the Company may have related to the purchased accounts                    receivable. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    Company’s factoring and security agreements with their customers include                    various recourse provisions requiring the customers to repurchase                    accounts                    receivable if certain conditions, as defined in the factoring                    and security                    agreement, are met. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Senior                    management reviews the status of uncollected purchased accounts                    receivable                    monthly to determine if any are uncollectible.  The Company has                    a security interest in the accounts receivable purchased and                    on a                    case-by-case basis, may have additional collateral.  The Company                    files security interests in the property securing their                    advances.  Access to this collateral is dependent upon the laws                    and regulations in each state where the security interest is                    filed.  Additionally, the Company has varying types of personal                    guarantees from their factoring customers relating to the purchased                    accounts receivable. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Management                    did not consider any of the June 30, 2007 and December 31, 2006                    retained                    interest in purchased accounts receivable uncollectible based                    on their                    analysis of the portfolio. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Management                    believes the fair value of the retained interest in purchased                    accounts                    receivable approximates its recorded value because the majority                    of these                    invoices have been subsequently                    collected. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | **Property                    and Equipment –** Property and equipment, consisting primarily of                    computers and software, are stated at cost.  Depreciation is                    provided over the estimated useful lives of the depreciable assets                    using                    the straight-line method.  Estimated useful lives range from 2                    to 5 years. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Advertising                    Costs –** The Company charges advertising costs to expense as                    incurred.  Total advertising costs were as                    follows: |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

|   |                                                                    |                                                                  |   |   |   |
|--------|-------------------------------------------------------------------------|-----------------------------------------------------------------------|--------|--------|--------|
|   |    For                    the six months ending June 30, |                                                                  |
|   |                                                                    |                                                                  |   |   |   |
|   | 2007                                                                    |                                                                  |   | 2006   |   |
|   |                                                                    |                                                                  |   |   |   |
|   | $                                                                       | 87,000                                                                |   |   | $      | 31,500 |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   |                                                                    |    For                    the quarters ending June 30, |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   | 2007                                                                    |                                                                  |   | 2006   |   |
|   |                                                                    |                                                                  |   |   |   |   |   |
|   | $                                                                       | 55,200                                                                |   |   | $      | 15,800 |   |
|   |                                                                    |                                                                  |   |   |   |   |   |

|   | **Earnings                    per Share –** The Company computes net income per share in                    accordance with SFAS No. 128 “Earnings Per Share.”  Basic net                    income per share is computed by dividing the net income for the                    period by                    the weighted average number of common shares outstanding during                    the                    period.  Dilutive net income per share includes the potential                    impact of dilutive securities, such as convertible preferred                    stock, stock                    options and stock warrants.  The dilutive effect of stock                    options and warrants is computed using the treasury stock method,                    which                    assumes the repurchase of common shares at the average market                    price. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Stock                    Based Compensation until December 31, 2005 -** In December 2004,                    the Financial Accounting Standards Board (“FASB”) issued Statement of                    Financial Accounting Standard (“SFAS”) No. 123(R), “Accounting for                    Stock-Based Compensation.” SFAS No. 123(R) establishes standards for the                    accounting for transactions in which an entity exchanges its                    equity                    instruments for goods or services. This statement focuses primarily                    on                    accounting for transactions in which an entity obtains employee                    services                    in share-based payment transactions. SFAS No. 123(R) requires                    that the                    fair value of such equity instruments be recognized as an expense                    in the                    historical financial statements as services are performed. Prior                    to SFAS                    No. 123(R), only certain pro forma disclosures of fair value                    were                    required. The provisions of this statement were effective for                    the first                    interim reporting period that began after December 15, 2005.                    The Company                    adopted the provisions of SFAS No.123(R) in the first quarter                    of fiscal                    2006. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | See                    Note 9 for the SFAS No. 123(R) impact on the operating results                    for the                    quarter and six months ended June 30, 2007.  The adoption of                    SFAS No. 123(R) had no impact on the Company’s operating results for the                    quarter and six months ended June 30,                    2006. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Recent                    Accounting Pronouncements–** |
|--------|----------------------------------------------------------------|

|   | In                    September 2006, the Financial Accounting Standards Board (“FASB”) issued                    Statement of Financial Accounting Standards (“SFAS”) No. 157, “*Fair                    Value Measurements*.” SFAS 157 provides enhanced guidance for using                    fair value to measure assets and liabilities.  It clarifies the                    principle that fair value should be based on the assumptions                    market                    participants would use when pricing the asset or liability and                    establishes                    a fair value hierarchy that prioritizes the information used                    to develop                    those assumptions.  SFAS 157 is effective for fiscal years                    beginning after November 15, 2007.  The Company is currently                    evaluating the impact of SFAS 157 on its results of operations                    and                    financial condition. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | In                    September 2006, the Securities and Exchange Commission (SEC)                    issued Staff                    Accounting Bulletin No. 108 (“SAB 108”), *Considering the Effects of                    Prior Year Misstatements when Quantifying Misstatements in Current                    Year                    Financial Statements*.  SAB 108 provides additional guidance                    for the quantitative assessment of the materiality of uncorrected                    misstatements in current and prior years.  The assessment for                    materiality should be based on the amount of the error relative                    to both                    the current year income statement and balance sheet.  For                    misstatements originating in prior years that are deemed material                    to the                    current year financial statements, SAB 108 permits recording                    the effect of                    adopting this guidance as a cumulative effect adjustment to retained                    earnings.  During the fourth quarter of 2006, the Company                    adopted SAB 108 and it did not have a significant impact on the                    Company’s                    financial statements. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In                    February 2007, the FASB issued SFAS No. 159, “*The Fair Value Option                    for Financial Assets and Financial Liabilities – Including an amendment of                    FASB Statement No. 115.*  SFAS 159 provides companies with                    an option to report selected financial assets and liabilities                    at estimated                    fair value.  Most of the provisions of SFAS No. 159 are                    elective; however, the amendment to SFAS No. 115, *Accounting for                    Certain Investments in Debt and Equity Securities*, applies to all                    entities that own trading and available-for-sale                    securities.  The fair value option created by SFAS No. 159                    permits an entity to measure eligible items at fair value as                    of specified                    election dates.  The fair value option (a) may generally be                    applied instrument by instrument, (b) is irrevocable unless a                    new election                    date occurs, and must be applied to the entire instrument and                    not to only                    a portion of the instrument. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | SFAS                    No. 159 is effective as of the beginning of an entity’s first fiscal year                    beginning after November 15, 2007.  Early adoption is permitted                    as of the beginning of the previous fiscal year provided that                    the entity                    makes that choice in the first 120 days of the fiscal year, has                    not yet                    issued financial statements for any interim period of such year,                    and also                    elects to apply the provisions of SFAS No. 157.  The Company is                    currently evaluating the impact of SFAS 157 on its results of                    operations                    and financial condition. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Fair                    Value of Financial Instruments –** The carrying value of cash                    equivalents, retained interest in purchased accounts receivable,                    due                    from/to financial institution, accounts payable and accrued liabilities                    approximates their fair value. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Cash                    and cash equivalents –** Cash and cash equivalents consist                    primarily of highly liquid cash investment funds with original                    maturities                    of three months or less when                    acquired. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Income                    Taxes –** Effective January 31, 2007, the Company became a “C”                    corporation for income tax purposes.  In a “C” corporation                    income taxes are provided for the tax effects of transactions                    reported in                    the financial statements plus deferred income taxes related to                    the                    differences between financial statement and taxable                    income. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    primary difference between financial statement and taxable income                    for the                    Company are compensation costs related to the issuance of stock                    options                    and net operating loss carryforwards.  The deferred tax asset                    represents the future tax return consequences of utilizing this                    net                    operating loss.   Deferred tax assets are reduced by a                    valuation reserve, when management is uncertain if the net operating                    loss                    carryforwards will ever be                    utilized. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Prior                    to January 31, 2007,** **Anchor Funding Services, LLC                    was treated as a partnership for Federal and state income tax                    purposes.  Its earnings and losses were included in the personal                    tax returns of its members; therefore, no provision or benefit                    from income                    taxes has been included in those financial                    statements. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                           |   | Three                    Months Ended June 30, |     |   |   |   |
|--------------------------------------------------------------------------------|--------|------------------------------------------------|----------|--------|--------|--------|
|                                                                           |   | 2007                                           |     |   | 2006   |   |   | $                    Change |   |   | %                    Change |   |
| Finance                    revenues                                            |   | $                                              | 81,514   |   |   | $      | 180,267 |   |   | $ | (98,753 | ) |   |   | (54.8 | ) |
| Interest                    income (expense), net                              |   |                                           | 51,389   |   |   |   | (55,828 | ) |   |   | 107,217 |   |   |   | - |   |
| Net                    finance revenues                                        |   |                                           | 132,903  |   |   |   | 124,439 |   |   |   | 8,464 |   |   |   | 6.8 |   |
| Provision                    for credit losses                                 |   |                                           | -        |   |   |   | - |   |   |   |   |   |   |   |   |   |
| Finance                    revenues, net of interest expense and credit losses |   |                                           | 132,903  |   |   |   | 124,439 |   |   |   | 8,464 |   |   |   | 6.8 |   |
| Operating                    expenses                                          |   |                                           | 297,432  |   |   |   | 45,191 |   |   |   | 252,241 |   |   |   | 558.2 |   |
| Net                    income (loss) before income taxes                       |   |                                           | (164,529 | )      |   |   | 79,248 |   |   |   | (243,777 | ) |   |   |   |   |
| Income                    tax (provision) benefit:                             |   |                                           | 4,000    |   |   |   |   |   |   |   | 4,000 |   |   |   |   |   |
| Net                    income (loss)                                           |   | $                                              | (160,529 | )      |   | $      | 79,248 |   |   | $ | (239,777 | ) |   |   |   |   |

**Finance          revenue**

**Interest          income (expense).**

**Provision          for credit losses. **

----

**Operating          expenses.**

----

|                                                                           |   | Six                    Months Ended June 30, |     |   |   |   |     |                        |   |
|--------------------------------------------------------------------------------|--------|----------------------------------------------|----------|--------|--------|--------|----------|-----------------------------|--------|
|                                                                           |   | 2007                                         |     |   | 2006   |   |     | $                    Change |   |   | %                    Change |   |
| Finance                    revenues                                            |   | $                                            | 152,650  |   |   | $      | 403,041  |                        |   | $ | (250,391 | ) |   |   | (62.1 | ) |
| Interest                    income (expense), net                              |   |                                         | 76,164   |   |   |   | (138,275 | )                           |   |   | 214,439 |   |   |   | - |   |
| Net                    finance revenues                                        |   |                                         | 228,814  |   |   |   | 264,766  |                        |   |   | (35,952 | ) |   |   | (13.6 | ) |
| Provision                    for credit losses                                 |   |                                         | -        |   |   |   | -        |                        |   |   |   |   |   |   |   |   |
| Finance                    revenues, net of interest expense and credit losses |   |                                         | 228,814  |   |   |   | 264,766  |                        |   |   | (35,952 | ) |   |   | (13.6 | ) |
| Operating                    expenses                                          |   |                                         | 559,456  |   |   |   | 104,876  |                        |   |   | 454,580 |   |   |   | 433.4 |   |
| Net                    income (loss) before income taxes                       |   |                                         | (330,642 | )      |   |   | 159,890  |                        |   |   | (490,532 | ) |   |   |   |   |
| Income                    tax (provision) benefit:                             |   |                                         | 17,000   |   |   |   |     |                        |   |   | 17,000 |   |   |   |   |   |
| Net                    income (loss)                                           |   | $                                            | (313,642 | )      |   | $      | 159,890  |                        |   | $ | (473,532 | ) |   |   |   |   |

**Finance          revenue**

**Interest          income (expense).**

**Provision          for credit losses. **

**Operating          expenses.**

----

| Key                    changes in certain selling, general and administrative                    expenses:  |   |                                |
|------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|
|                                                                                                             |   | Six                    Months Ended |   |   |   |   |   |
|                                                                                                             |   | June                    30,         |   |   |   |   |   |
|                                                                                                             |   | 2007                                |   |   | 2006 |   |   | $                    Change |   | Explanation |
| Professional                    fees                                                                        |   | $                              | 100,870  |   |   | $  | 8,376  |   |   | $  | 92,494  |   | Increased                    cost for 2006 and 2005 audits. Additional legal fees for corporate                    matters                    and SEC filings |
|                                                                                                             |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| Payroll,                    payroll taxes and benefits                                                 |   |                                | 174,292   |   |   |   | 35,865   |   |   |   | 138,427   |   | Increased                    payroll and health benefits for President and other corporate                    staff.                    Increased health benefits for CEO and a Director. |
|                                                                                                             |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| Advertising                                                                                                      |   |                                | 86,907 |   |   |   | 31,543 |   |   |   | 55,364 |   | Increased                    marketing |
|                                                                                                             |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| Consulting                    expense                                                                       |   |                                | 25,000  |   |   |   |   |   |   |   | 25,000  |   | Monthly                    advisory fee to investment banking firm for acquiring other                    companies |
|                                                                                                             |   |                                |   |   |   |   |   |   |   |   |   |   |   |
| Insurance                                                                                                   |   |                                | 33,764  |   |   |   |   |   |   |   | 33,764  |   | Premiums                    for insurance policies including Directors and Officers and fidelity                    policies |
|                                                                                                             |   |                                |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                             |   | $                                   | 422,840 |   |   | $ | 77,790 |   |   | $ | 345,049 |   |   |

**Cash          Flow Summary**

**Cash          Flows from Operating Activities**

**Cash          Flows from Investing Activities**

**Cash          Flows from Financing Activities**

----

**Capital          Resources**

----

**ITEM        3.  CONTROLS AND PROCEDURES**

**PART        II. OTHER INFORMATION**

**ITEM        1.  LEGAL PROCEEDINGS:**

**ITEM        2.  CHANGES IN SECURITIES.**

| (a)   | For                  the six months ended June 30, 2007, there were no sales of unregistered                  securities, except as reported in our Form 10-SB, as                  amended. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Rule                  463 of the Securities Act is not applicable to the                  Company. |
|-----------------|----------------------------------------------------------------------------------------------------|

| (c)   | In                  the six months ended June 30, 2007, there were no repurchases by                  the                  Company of its Common Stock. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

**ITEM        3.  DEFAULTS UPON SENIOR SECURITIES**

**ITEM        4.  SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY        HOLDERS:**

**ITEM        5.  OTHER INFORMATION:**

|                T.R.                  Winston & Company, Inc. has filed a Form 211 with the NASD for trading                  to commence in our common shares. At such time as the Securities                  and                  Exchange Commission has reached a “no comment stage” for the our Form                  10-SB Registration Statement, as amended, it is expected that an                  OTC                  Bulletin Board symbol will be assigned to our common shares and                  that                  quotations for our common shares will be available a short time                  thereafter. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**ITEM        6.  EXHIBITS:**

| ExhibitNumber   |  Description                   |
|---------------------------|-------------------------------------|
|                      |                                |
| 2.1                       | Exchange                  Agreement |

| 3.1 | Certificate of                  Incorporation-BTHC,INC. |
|-----|--------------------------------------------------------------|

| 3.2 | Certificate                  of Merger of BTHC XI, LLC into BTHC XI,                  Inc. |
|-----|--------------------------------------------------------------------------------------------|

| 3.3 | Certificate                  of Amendment |
|-----|-------------------------------------------|

| 3.4 | Designation                  of Rights and Preferences-Series 1 Convertible Preferred                  Stock |
|-----|--------------------------------------------------------------------------------------------------------------|

| 3.5 | Amended                  and Restated By-laws |
|-----|-----------------------------------------------|

| 4.1 | Form                  of Placement Agent Warrant issued to Fordham Financial                  Management |
|-----|----------------------------------------------------------------------------------------------------------|

| 10.1 | Directors’                  Compensation Agreement-George Rubin |
|------|-----------------------------------------------------------------------|

| 10.2 | Employment                  Contract-Morry F. Rubin |
|------|-----------------------------------------------------|

| 10.3 | Employment                  Contract-Brad Bernstein |
|------|-----------------------------------------------------|

| 10.4 | Agreement-Line                  of Credit |
|------|-------------------------------------------|

| 10.5 | Fordham                  Financial Management-Consulting                  Agreement |
|------|-------------------------------------------------------------------------------------|

| 10.6             | Facilities                  Lease – Florida                                  |
|------------------|------------------------------------------------------------------------------------|
|             |                                                                               |
| 10.7             | Facilities                  Lease – North Carolina                           |
|             |                                                                               |
| 31.1        | Chief                Executive Officer Rule 13a-14(a)/15d-14(a) Certification *    |
|             |                                                                               |
| 31.2   | Chief                Financial Officer Rule 13a-14(a)/15d-14(a) Certification *    |
|             |                                                                               |
| 32.1             | Chief                Executive Officer Section 1350 Certification *                |
|             |                                                                               |
| 32.2             | Chief                Financial Officer Section 1350 Certification                * |

| 99.1 | 2007                  Omnibus Equity Compensation Plan |
|------|--------------------------------------------------------|

| 99.2 | Form                  of Non-Qualified Option under 2007 Omnibus Equity Compensation                  Plan |
|------|------------------------------------------------------------------------------------------------------------|

----

**SIGNATURES**

**ANCHOR        FUNDING SERVICES,        INC.**

|                                                                 |        |                                                   |
|----------------------------------------------------------------------|--------|--------------------------------------------------------|
|                                                                 |   |                                                   |   |
| Date:                  August 20, 2007      | By:    | /s/ Morry                F. Rubin                 |   |
|                                                                 |   | Morry                F. Rubin, Chief Executive Officer |   |
|                                                                 |   |                                                   |   |
|                                                                 |   |                                                   |   |
|                                                                             |        |                                         |
|----------------------------------------------------------------------------------|--------|----------------------------------------------|
|                                                                             |   |                                         |   |
| Date:                  August 20, 2007        | By:    | /s/ Brad                Bernstein       |   |
|                                                                             |   | Brad                Bernstein, President and |   |
|                                                                             |   | Chief                Financial Officer       |   |
|                                                                             |   |                                         |   |