**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


WASHINGTON,
      D.C. 20549





**FORM
      10-QSB**





(MARK
      ONE)





x QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE


SECURITIES
      EXCHANGE ACT OF 1934





For
      the
      quarterly period ended September 30, 2007





o TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF


THE
      EXCHANGE ACT





For
      the
      transition period from ___ to ___





Commission
      file number: 333-5278-NY





MIGO
      SOFTWARE, INC.


(Exact
      Name of small business issuer as Specified in Its Charter)





**Delaware**
            **94-3334052**(State
                or other jurisdiction of
            (I.R.S.
                Employerincorporation
                or organization)
            Identification
                No.)





**555
                Twin Dolphin Drive, Suite 650****Redwood
                City, California 94065**(Address
                of principal executive offices)





Issuer's
      telephone number: (650) 232-2600





(Former
      name, former address and former fiscal year if changed since last
      report)





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Securities Exchange Act during the past 12 months (or for such
      shorter period that the registrant was required to file such reports), and
      (2)
      has been subject to such filing requirements for the past 90 days.





Yes x No o





Indicate
      by checkmark whether the registrant is a shell company (as defined in Rule
      12b-2
      of the Exchange Act). Yes o No x





As
      of
      November 1, 2007, there were 119,037,604 shares of the issuer's common
      stock, $0.0001 par value per share ("Common Stock"), outstanding.





Transitional
      Small Business Disclosure Format (check one): Yes o No x







1





QUARTERLY
      REPORT





TABLE
      OF
      CONTENTS





PART
                I. FINANCIAL INFORMATION
            3Item
                1. Financial Statements
            3Consolidated
                Balance Sheet - September 30, 2007 - (Unaudited)
            3Consolidated
                Statements of Operations -Three and nine months endedSeptember
                30, 2007 and 2006 - (Unaudited)
            4Consolidated
                Statements of Cash Flows -Nine months endedSeptember
                30, 2007 and 2006 - (Unaudited)
            5Notes
                to Consolidated Financial Statements - (Unaudited)
            6Item
                2. Management's Discussion and Analysis or Plan of
                Operation
            12Item
                3. Controls and Procedures
            18PART
                II. OTHER INFORMATION
            18Item
                1. Legal Proceedings
            18Item
                2. Unregistered Sales of Equity Securities and Use of
                Proceeds
            18Item
                3. Defaults Upon Senior Securities
            19Item
                4. Submission of Matters to a Vote of Security Holders
            19Item
                5. Other Information
            19Item
                6. Exhibits
            19SIGNATURES
            20




2


PART
      I.
      FINANCIAL INFORMATION





Item
      1.
      Financial Statements


**MIGO
      SOFTWARE, INC.**


**CONSOLIDATED
      BALANCE SHEET****S**


**September
                    30,****2007****ASSETS**
                
                (Unaudited)***Current
                    Assets:***Cash
                    and cash equivalents
                
                $
                148,645Short-term
                    investments
                
                
                244,158Accounts
                    receivable, net
                
                
                1,596,400Inventory
                
                
                179,934Other
                    current assets
                
                
                80,938Total
                    current assets
                
                
                2,250,075Property
                    and equipment, net
                
                
                24,862OTHER
                    ASSETS:Goodwill
                
                
                3,180,967Intangible
                    assets, net
                
                
                5,665,061Other
                    assets
                
                
                65,540**TOTAL
                    ASSETS**
                
                $
                11,186,505**LIABILITIES
                    AND STOCKHOLDERS’ EQUITY*****Current
                    Liabilities:***Accounts
                    payable
                
                $
                720,897Accrued
                    compensation
                
                
                104,521Accrued
                    liabilities
                
                
                598,764Short
                    Term Debt and Capitalized leases
                
                
                507,583Deferred
                    revenue
                
                
                697,779Total
                    current liabilities
                
                
                2,629,544***Non-current
                    liabilities:***Long
                    Term Debt, net of current portion
                
                
                1,277,581**TOTAL
                    LIABILITIES**
                
                
                3,907,125Commitments
                    and contingencies (Note 9)**Stockholders’
                    Equity:**Senior
                    B Convertible Preferred Stock, $.0001 par value; 2,500,000 shares
                    authorized, 2,000,000 shares issued and outstanding; preference
                    upon
                    liquidation of $2,000,000
                
                
                200Junior
                    A Preferred stock, $.0001 par value; 5,000,000 shares
                     authorized, 687,575 issued and outstanding; preference upon
                    liquidation of $2,600,000
                
                
                69Common
                    stock, $.0001 par value; 200,000,000 shares authorized; and
                    106,089,036 shares issued and outstanding
                
                
                10,609Additional
                    paid in capital in excess of par value
                
                
                57,624,694Treasury
                    Stock
                
                
                (386,400
                )Accumulated
                    Deficit
                
                
                (49,969,792
                )**Total
                    stockholders’ equity**
                
                
                7,279,380**TOTAL
                    LIABILITIES AND STOCKHOLDERS’ EQUITY**
                
                $
                11,186,505





The
      accompanying notes are an integral part of these consolidated financial
      statements.


3


**MIGO
      SOFTWARE, INC.**


**CONSOLIDATED
      STATEMENTS OF OPERATIONS (UNAUDITED)**




Three
                  Months ended September 30, 2007
              
              Three
                  Months ended September 30, 2006
              
              Nine
                  Months ended September 30, 2007
              
              Nine
                  Months ended September 30, 2006(Unaudited)
              
              (Unaudited)
              
              (Unaudited)
              
              (Unaudited)**Revenues**
              
              $
              2,203,441
              
              $
              68,609
              
              $
              4,229,458
              
              $
              136,225Cost
                  of Sales
              
              
              1,411,882
              
              
              151,117
              
              
              2,159,887
              
              
              455,918Gross
                  Profit
              
              
              791,559
              
              
              (82,508
              )
              
              2,069,571
              
              
              (319,693
              )**Operating
                  Expenses**Research
                  and development
              
              
              659,216
              
              
              505,703
              
              
              2,198,934
              
              
              1,291,244Sales
                  and marketing
              
              
              1,097,919
              
              
              278,026
              
              
              2,443,288
              
              
              819,447General
                  and administrative
              
              
              897,023
              
              
              1,271,824
              
              
              2,717,704
              
              
              3,829,692Total
                  operating expenses
              
              
              2,654,158
              
              
              2,055,553
              
              
              7,359,926
              
              
              5,940,383**Loss
                  from operations**
              
              
              (1,862,599
              )
              
              (2,138,061
              )
              
              (5,290,355
              )
              
              (6,260,076
              )**Other
                  Expense (income)**Interest
                  (net)
              
              
              21,740
              
              
              (62,487
              )
              
              (28,167
              )
              
              (181,667
              )Decrease
                  in warrant liability
              
              
              -
              
              
              -
              
              
              -
              
              
              (166,538
              )Other
              
              
              -
              
              
              1,018,025
              
              
              20,537
              
              
              1,190,829Total
                  other expense (income)
              
              
              21,740
              
              
              955,538
              
              
              (7,630
              )
              
              842,624Loss
                  before income taxes
              
              
              (1,884,339
              )
              
              (3,093,599
              )
              
              (5,282,725
              )
              
              (7,102,700
              )Provision
                  for income taxes
              
              
              -
              
              
              -
              
              
              -
              
              
              -**Net
                  Loss**
              
              
              (1,884,339
              )
              
              (3,093,599
              )
              
              (5,282,725
              )
              
              (7,102,700
              )Net
                  Loss Attributable to Holders of common shares
              
              
              ($1,884,339
              )
              
              ($
                  3,093,599
              )
              
              ($5,282,725
              )
              
              ($
                  7,102,700
              )Basic
                  and Diluted net loss per share
              
              
              ($
                    0.02
              )
              
              ($
                  0.05
              )
              
              ($
                    0.05
              )
              
              ($
                  0.11
              )Weighted
                  Average Shares Outstanding Basic and Diluted
              
              
              103,546,942
              
              
              67,189,128
              
              
              97,756,615
              
              
              63,199,504





The
      accompanying notes are an integral part of these consolidated financial
      statements .


4


**MIGO
      SOFTWARE, INC.**


**CONSOLIDATED
      STATEMENTS OF CASH FLOWS (UNAUDITED)**


Nine
                  Months
              
              Nine
                  MonthsEnded
                  September
              
              Ended
                  September30,
                  2007
              
              30,
                  2006(Unaudited)
              
              (Unaudited)Cash
                  Flows from Operating Activities:Net
                  loss
              
              $
              (5,282,725
              )
              $
              (7,102,700
              )Adjustments
                  to reconcile net loss to net cashused
                  in operating activities:Inventory
                  write-downs
              
              
              2,572
              
              
              15,442Accounts
                  payable settlement
              
              
              -
              
              
              (683,971
              )Depreciation
                  and amortization
              
              
              845,808
              
              
              427,802Amortization
                  of deferred compensation
              
              
              -
              
              
              364,192Interest
                  expense relating to amortization of debt discount
              
              
              5,739
              
              
              -and
                  beneficial conversionRemeasurement
                  of warrants to fair value
              
              
              -
              
              
              (166,538
              )Allowance
                  for doubtful accounts
              
              
              40,000
              
              
              -Stock
                  based compensation
              
              
              564,831
              
              
              1,620,315Changes
                  in operating assets and liabilities:Accounts
                  receivable
              
              
              (1,545,483
              )
              
              (32,164
              )Inventory
              
              
              (113,494
              )
              
              313Other
                  current assets
              
              
              (40,570
              )
              
              25,456Other
                  assets
              
              
              69,460
              
              
              1,475Accounts
                  payable
              
              
              229,247
              
              
              (294,765
              )Accrued
                  compensation
              
              
              (130,562
              )
              
              7,906Settlement
                  payable
              
              
              -
              
              
              274,000Deferred
                  revenue
              
              
              17,779
              
              
              850,000Accrued
                  liabilities
              
              
              164,024
              
              
              833,127Net
                  cash used in operating activities
              
              
              (5,173,374
              )
              
              (3,860,110
              )Cash
                  Flows from Investing Activities:Purchase
                  of available for sale investments
              
              
              -
              
              
              (2,495,650
              )Acquisition
                  of MacroPort , Inc. net of cash
                  acquired
              
              
              (25,160
              )
              
              -Proceeds
                  from investments
              
              
              2,910,636
              
              
              788,316Acquisition
                  of intangible assets
              
              
              (311,960
              )
              
              (5,513
              )Net
                  cash used in investing activities
              
              
              2,573,516
              
              
              (1,712,847
              )Cash
                  Flows from Financing Activities:Payment
                  on capitalized leases and Line of Credit
              
              
              (51,305
              )
              
              -Proceeds
                  from Warrant Exercise
              
              
              310,803
              
              
              -Proceeds
                  from Notes Payable
              
              
              2,003,000
              
              
              -Repayment
                  of Notes Payable
              
              
              (68,480
              )
              
              -Payment
                  of equity financing costs
              
              
              (150
              )
              
              (415,568
              )Proceeds
                  from sale of common stock
              
              
              250,000
              
              
              4,125,000Net
                  cash provided by financing activities
              
              
              2,443,868
              
              
              3,709,432NET
                  DECREASE IN CASH AND CASH EQUIVALENTS
              
              
              (155,990
              )
              
              (1,863,525
              )CASH
                  AND CASH EQUIVALANTS, Beginning of period
              
              
              304,635
              
              
              2,510,704CASH
                  AND CASH EQUIVALENTS, End of period
              
              $
              148,645
              
              $
              647,179**Non-cash
                  investing and financing activity:**Issuance
                  of shares for penalties
              
              $
              -
              
              $
              1,136,300Restricted
                  stock issued
              
              
              -
              
              
              65,000Common
                  Stock Purchase Warrant Issued to Placement Agent
              
              
              -
              
              
              246,971Reclassification
                  from temporary to permanent equity
              
              
              -
              
              
              8,715,214Reclassification
                  from warrant liability to permanent equity
              
              
              -
              
              
              5,130,926MacroPort
                acquisition
              
              
              3,500,000
              
              
              -**Cash
                  paid for:**Income
                taxes
              
              $
              800
              
              $
              800Interest
              
              
              25,431
              
              
              -





The
      accompanying notes are an integral part of these consolidated financial
      statements.




5


Migo
      Software, Inc. and Subsidiaries


Notes
      to
      Consolidated Financial Statements (Unaudited)


Quarter
      and Nine Months Ended September 30, 2007





1.
      INTERIM FINANCIAL DATA AND BASIS OF PRESENTATION




The
      accompanying unaudited financial statements have been prepared by Migo Software,
      Inc. ("the Company") in accordance with accounting principles generally accepted
      in the United States of America ("US GAAP"). In the opinion of management,
      the
      accompanying unaudited financial statements contain all adjustments, consisting
      only of those of a normal recurring nature, necessary for a fair presentation
      of
      the Company's financial position, results of operations and cash flows at the
      dates and for the periods indicated. These financial statements should be read
      in conjunction with the financial statements and notes related thereto, included
      in the Annual Report on Form 10-KSB for the year ended December 31, 2006.





These
      results for the three and nine month periods ended September 30, 2007 are not
      necessarily indicative of the results to be expected for other interim periods
      or the full fiscal year. The preparation of financial statements in conformity
      with US GAAP requires management to make estimates and assumptions that affect
      the reported amounts of assets and liabilities and disclosure of contingent
      assets and liabilities at the date of the financial statements and the reported
      amounts of revenues and expenses during the reporting period. Actual results
      could differ from those estimates.





Forward-Looking
      Statements





This
      Quarterly Report on Form 10-QSB contains forward-looking statements including,
      without limitation, statements concerning the future of the industry in which
      the Company operates, its product development plans, business strategy,
      financial estimates, continued acceptance of its products and dependence on
      significant distributors and customers. In some cases, you can identify
      forward-looking statements by terminology such as “may", "will", "should",
      "expects", "plans", "anticipates", "believes", "estimates", "predicts",
      "potential", "continue" or the negative of such terms or other comparable
      terminology. You should not place undue reliance on the forward-looking
      statements contained in this document. When considering forward-looking
      statements, you should keep in mind the risk factors and other cautionary
      statements made in this Quarterly Report on Form 10-QSB and in the Company's
      other SEC filings. Forward-looking statements, particularly those concerning
      anticipated events relating to the development, marketing and customer
      acceptance of the Company's products and the timing or magnitude of those
      events, are inherently uncertain. The risk factors and other considerations
      noted in the Company's SEC filings could cause the Company's actual results
      to
      differ significantly from those stated or implied in any forward-looking
      statements.




2. *SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES*




Basis
      of Presentation - The
      accompanying financial statements have been prepared in conformity with
      accounting principles generally accepted in the United States (''US GAAP"),
      which contemplate continuation of the Company as a going concern. From
      inception, the Company has never been profitable and has sustained substantial
      net losses from operations. There can be no assurance that it will ever generate
      sufficient revenues from its operating activities, or that it will achieve
      and
      sustain a profit during any future period, particularly if revenues remain
      at
      current levels. Management estimates that the current funds available and
      on-hand along with expected revenues will be adequate to fund operations
      through, at least,  2008.





Principles
      of Consolidation - The
      consolidated financial statements include the accounts of the Company and its
      wholly-owned subsidiaries, MacroPort, Inc., PowerHouse Acquisition LLC and
      PowerHouse Studios, Inc. All significant inter-company accounts and transactions
      have been eliminated in consolidation.




Use
      of
      Estimates - The
      preparation of financial statements in conformity with US GAAP requires
      management to make estimates and assumptions that affect the reported amounts
      of
      assets and liabilities and disclosure of contingent assets and liabilities
      at
      the date of the financial statements, and the reported amounts of revenues
      and
      expenses during the reported periods. Management bases its estimates and
      assumptions on historical experience and on various other assumptions that
      it
      believes are reasonable under the circumstances. Actual results could differ
      from those estimates. Significant estimates include the valuation of acquired
      goodwill and intangible assets, and revenue recognition.




6


Cash
      and Cash Equivalents - The
      Company considers temporary liquid investments with an original maturity of
      three months or less to be cash equivalents.





Inventory - Inventory is valued at the lower of cost or market with cost determined under
      the first-in, first-out method. At September 30, 2007, inventory consisted
      primarily of packaging material and assembled boxes of retail software. The
      Company regularly evaluates its ability to realize the value of its software
      and
      hardware inventory based on a combination of factors, including historical
      usage
      rates, forecasted sales, product life cycles, and market acceptance of new
      products. When inventory that is obsolete or in excess of anticipated usage
      is
      identified, it is written down to realizable salvage value or an inventory
      valuation reserve is established.




Property
      and Equipment -
      Property and equipment are stated at cost. Depreciation is computed using the
      straight-line method over estimated useful lives of three to five years.
      Leasehold improvements are amortized over the shorter of the lease term or
      the
      estimated useful life. The Company capitalizes costs associated with acquiring
      and installing software to be used for internal purposes.




Goodwill -
      Goodwill represents the excess of acquisition costs over the fair value of
      tangible net assets and identifiable intangible assets of businesses acquired.
      Goodwill and certain other intangible assets deemed to have indefinite lives
      are
      not amortized. Intangible assets determined to have definite lives are amortized
      over their useful lives. Goodwill and indefinite lived intangible assets are
      subject to impairment testing annually as of December 31, or whenever events
      or
      changes in circumstances indicate that the carrying amount may not be fully
      recoverable, using the guidance and criteria described in Statement of Financial
      Accounting Standards No. 142, Goodwill and Other Intangible Assets. This
      testing compares carrying values to fair values and, when appropriate, the
      carrying value of these assets is reduced to fair value.




Other
      Intangible Assets - Other
      intangible assets include software technology assets (acquired as part of the
      First Person Software acquisition in 2004) and intangible assets acquired from
      StompSoft and MacroPort. Intangible assets are stated at cost. Amortization
      of
      software technology assets is computed using the revenue or straight-line
      method, whichever is greater, over an estimated useful life of five years.
      Intangible assets acquired from StompSoft and MacroPort have weighted average
      useful lives of approximately 6.5 years and 9.3 years, respectively.
      Amortization of StompSoft and MacroPort intangible assets is computed using
      the
      straight-line method over the following estimated useful lives:





Existing
                Product/Unpatented Technology
            
            
            4
                -
                10 yearsTrademarks/Trade
                Names
            
            
            10
                yearsCustomer
                Relationships
            
            
            7
                -
                10 yearsNon-Compete
                Agreements
            
            
            2
                years




Impairment
      of Long-Lived Assets -
      Property, equipment, intangible and certain other long-lived assets are
      depreciated or amortized over their useful lives. Useful lives are based on
      management's estimates of the period that the assets will generate revenues.
      Long-lived assets are written down to fair value whenever events or changes
      indicate that the carrying amount of an asset may not be recoverable. The
      Company's policy is to review the recoverability of all long-lived assets at
      a
      minimum of once per year and record an impairment loss when the fair value
      of an
      asset does not exceed the carrying amount of the asset.




Revenue
      Recognition - The
      Company recognizes revenue in accordance with Statement of Accounting Position
      ("SOP") 97-2, Software Revenue Recognition, as amended, and Staff Accounting
      Bulletin ("SAB") No. 104, Revenue Recognition.




The
      Company recognizes revenue from sales through the Company's website after the
      30
      day return period has lapsed. The Company's software products are licensed
      on a
      perpetual basis. Revenue from the sale of software licenses is recognized only
      when persuasive evidence of an arrangement exists, the product has been
      delivered, the fee is fixed or determinable and collection of the resulting
      receivable is reasonably assured.


Revenue
      from direct sale contracts of the Company's products to commercial users is
      recognized based on the terms of the agreement, after the product has been
      delivered, and collection of the resulting receivable is reasonably assured.
      Revenue from distributors is recognized when the product has been sold to third
      party customers.





7


Product
      Revenue :
      Product
      revenue, including sales to retailers, resellers and distributors ("channel
      partners"), is recognized when the above criteria are met.





Shipping
      and Handling :
      In accordance with Emerging Issues Task Force ("EITF") Issue No. 00-10,
      Accounting for Shipping and Handling Fees and Costs, the Company recognizes
      amounts billed to customers for shipping and handling as revenue. Additionally,
      shipping and handling costs incurred by the Company are included in cost of
      sales.





OEM
      Software Licenses :
      The
      Company licenses software rights to manufacturers of products in related
      industries (for example, flash drives or other computer accessories) to include
      certain of its products with the manufacturer's product. The Company calls
      these combined products "OEM bundles". These OEM bundles generally require
      either the customer to pay an upfront nonrefundable fee, as in the case of
      Kingston Technology Company, or the Company receives a fee once the consumer
      uses the product and elects to purchase it over the Internet, such
      as the Company's agreement with Sandisk.





Bad
      Debt Reserves - The
      Company analyzes customer concentrations, customer credit-worthiness, current
      economic trends, and historical experience when evaluating the adequacy of
      the
      allowance for doubtful accounts. At September 30, 2007, management believed
      that
      all accounts receivable were collectible.





Advertising
      Costs - The
      Company generally expenses advertising costs as incurred. Cooperative
      advertising with the Company's channel partners is accrued when revenue is
      recognized and such amounts are included in marketing and sales expense if
      there
      is a separate identifiable benefit for which the Company can reasonably estimate
      the fair value of the benefit identified. Otherwise, they are recognized as
      a
      reduction of net revenue. The Company then reimburses the channel partner when
      qualifying claims are submitted.





Software
      Development Costs -
      Research and development costs, which consist primarily of software development
      costs, are expensed as incurred, and totaled $2,198,934 and $1,291,244 for
      the
      nine months ending September 30, 2007 and 2006, respectively.
      SFAS No. 86, Accounting for the Cost of Computer Software to be Sold,
      Leased, or Otherwise Marketed, provides for the capitalization of certain
      software development costs incurred after technological feasibility of the
      software is established or for development costs that have alternative future
      uses. Under the Company's current practice of developing new products, the
      technological feasibility of the underlying software is not established until
      substantially all product development is complete, which generally includes
      the
      development of a working model. During the three months ended September 30,
      2007, the Company had capitalized $311,960 based upon the
      foregoing.




Basic
      and Diluted Loss Per Share - In
      accordance with Financial Accounting Standards Board ("FASB") SFAS No. 128,
      Earnings Per Share, the basic loss per common share, which excludes dilution,
      is
      computed by dividing the net loss available to common shareholders by the
      weighted average number of common shares outstanding. Diluted loss per common
      share reflects the potential dilution that could occur if all potential common
      shares had been issued and if the additional common shares were dilutive. As
      a
      result of net losses for all periods presented, there is no difference between
      basic and diluted loss per share of common stock. As
      of
      November 1, 2007, the Company's outstanding stock options and warrants totaled
      63,402,963. Some of the outstanding warrants contain anti-dilution provisions
      the interpretation of which is unclear.  Although management of the Company
      believes that the most likely interpretation of these provisions would result
      in
      there being 63,402,963  potential shares of common stock that may be issued
      upon the exercise of all stock options and warrants, other interpretations
      could
      result in up to a total of 99,291,926  potential shares. The Company
      intends to pursue resolution of these uncertainties in due
      course.




Comprehensive
      Loss -
      Comprehensive loss is comprised of net loss and other comprehensive income
      (loss). Other comprehensive income (loss) includes certain changes in
      stockholders' equity that are excluded from net loss, such as unrealized gains
      and losses on marketable securities and currency translation adjustments.
      Comprehensive income (loss) for each of the periods presented equals net
      loss.




Stock-Based
      Compensation - In
      December 2004, the FASB issued SFAS No. 123R, Share Based Payment. SFAS No.
      123R
      establishes the accounting for grants of stock options and other transactions
      in
      which an entity exchanges its equity instruments for goods or services. It
      also
      addresses transactions in which an entity incurs liabilities in exchange for
      goods or services that are based on the fair value of the entity's equity
      instruments or that may be settled by the issuance of those equity instruments.
      SFAS No. 123R (1) revises SFAS No. 123, Accounting for Stock-Based Compensation,
      (2) supersedes Accounting Principles Board ("APB") Opinion No. 25, Accounting
      for Stock Issued to Employees, and (3) establishes fair value as the measurement
      objective for share-based payment transactions. The Company adopted SFAS 123R
      effective January 1, 2005 in accordance with the standard's early adoption
      provisions. Prior to January 1, 2005, the Company's Board of Directors had
      not
      approved the granting of any stock options. As such, the Company decided to
      follow the provisions of SFAS No. 123R on a prospective basis, and for the
      three
      months ended September 30, 2007 and 2006, the Company recorded $257,219 and
      $579,448 respectively, of compensation expense related to the granting of stock
      options to employees. For the nine months ended September 30, 2007 and 2006,
      the
      Company recorded $564,831 and $1,620,315 respectively, of compensation expense
      related to the granting of stock options to employees.


8


Fair
      Value of Financial Instruments - The
      estimated fair values for financial instruments under SFAS No. 107, Disclosures
      about Fair Value of Financial Instruments, are determined at discrete points
      in
      time based on relevant market information. These estimates involve uncertainties
      and cannot be determined with precision. For certain of the Company's financial
      instruments, including certain assets, accounts payable, and accrued
      liabilities, the carrying amounts approximate fair value due to their
      maturities.





Concentrations
      of Credit Risk - Credit
      risk represents the accounting loss that would be recognized at the reporting
      date if counter parties failed completely to perform as contracted. The
      Company's product revenues are concentrated in the software industry, which
      is
      highly competitive and rapidly changing. Significant technological changes
      in
      the industry or customer requirements, or the emergence of competitive products
      with new capabilities or technologies, could adversely affect operating results.
      Concentrations of credit risk (whether on or off balance sheet) that arise
      from
      financial instruments exist for groups of customers or counter parties when
      they
      have similar economic characteristics that would cause their ability to meet
      contractual obligations to be similarly affected by changes in economic or
      other
      conditions.





Financial
      instruments that subject the Company to credit risk consist of cash balances
      maintained in excess of federal depository insurance limits and accounts
      receivable, which have no collateral or security. The Company maintains its
      cash
      balances with high credit quality financial institutions. At times, cash
      deposits may be in excess of Federal Deposit Insurance Corporation's limits.
      To
      date, the Company has not experienced any such losses and believes it is not
      exposed to any significant credit risk with respect to its cash
      balances.





Financial
      Instruments - The
      Company's financial instruments consist primarily of cash and cash equivalents
      and auction rate securities. These balances, as presented in the consolidated
      financial statements at September 30, 2007, approximate their fair
      value.





Short-term
      Investments - The
      Company's short-term investments consist primarily of Auction Rate Securities,
      or ARS, which represent funds available for current operations. In accordance
      with SFAS No. 115, Accounting for Certain Investments in Debt and Equity
      Securities, these short-term investments are classified as available-for-sale
      and are carried at cost or par value, which approximates the fair market value.
      These securities have stated maturities beyond three months but are priced
      and
      traded as short-term instruments.





Income
      Taxes - The
      Company accounts for income taxes using the asset and liability method, as
      set
      forth in SFAS No. 109, Accounting for Income Taxes, wherein deferred tax assets
      and liabilities are recognized for the future tax consequences attributable
      to
      differences between financial statement carrying amounts of existing assets
      and
      liabilities and their respective tax bases. Deferred tax assets and liabilities
      are measured using enacted tax rates expected to apply to taxable income in
      the
      years in which the temporary differences are expected to be recovered or
      settled. Reserves against deferred tax assets are provided when management
      cannot conclude that realization of such assets is probable.




Recently
      Issued Accounting Pronouncements In
      February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid
      Financial Instruments, which amends SFAS No. 133, Accounting for Derivative
      Instruments and Hedging Activities, and SFAS No. 140, Accounting for the
      Impairment or Disposal of Long-Lived Assets. Specifically, SFAS No. 155 amends
      SFAS No. 133 to permit fair value remeasurement for any hybrid financial
      instrument with an embedded derivative that otherwise would require bifurcation,
      provided the whole instrument is accounted for on a fair value basis.
      Additionally, SFAS No. 155 amends SFAS No. 140 to allow a qualifying special
      purpose entity to hold a derivative financial instrument that pertains to a
      beneficial interest other than another derivative financial instrument. SFAS
      No.
      155 applies to all financial instruments acquired or issued after the beginning
      of an entity's first fiscal year that begins after September 15, 2006, with
      early application allowed. The adoption of SFAS No. 155 has not had a material
      impact on the Company's results of operations or financial
      position.




In
      July
      2006, the FASB issued FASB Interpretation ("FIN") No. 48, Accounting for
      Uncertainty in Income Taxes - an Interpretation of FASB Statement 109. FIN
      48
      clarifies the accounting for uncertainty in income taxes recognized in an
      enterprise's financial statements in accordance with FASB Statement No. 109,
      Accounting for Income Taxes. FIN 48 prescribes a comprehensive model for
      recognizing, measuring, presenting and disclosing in the financial statements
      tax positions taken or expected to be taken on a tax return.


9


The
      Company adopted the provisions of FIN 48 as of January 1, 2007. As of
      the date of adoption, the Company had no unrecognized income tax benefits.
      Accordingly, the annual effective tax rate will not be affected by the adoption
      of FIN 48. Unrecognized tax benefits are not expected to increase or decrease
      within the next 12 months as a result of the anticipated lapse of any applicable
      statute of limitations. Interest and penalties related to unrecognized income
      tax benefits will be accrued as interest expense and operating expense,
      respectively. The Company has not accrued interest or penalties as of the date
      of adoption because they are not applicable.





Due
      to
      the Company's history of losses, the effective tax rate for each of the three
      month and nine month periods ended September 30, 2007 and 2006 was 0.0%.
      The provision for income taxes for all periods presented is primarily
      attributable to the cumulative tax net operating losses that the Company has
      generated in the current and prior years for which a valuation allowance has
      been established under the rules of FASB 109.





The
      Company may be audited for the years indicated by applicable federal and state
      taxing authorities in the following income tax jurisdictions in which the
      Company previously filed or expects to file income tax returns:




Jurisdiction
            
            Tax
                YearsFederal
            
            
            2003
                - 2006California
            
            
            2002
                - 2006




However,
      although the Company had net operating losses and credits carried forward for
      federal and California taxes, certain items attributable to closed tax years
      are
      still subject to adjustment by applicable taxing authorities through an
      adjustment to tax attributes carried forward to open years.




In
      September 2006, the FASB issued SFAS No. 157, Fair Value Measurements ( SFAS
      157). SFAS 157 defines fair value, establishes a framework for measuring fair
      value in generally accepted accounting principles (GAAP), and expands
      disclosures about fair value measurements. This statement does not require
      any
      new fair value measurements; however, the standard will impact how other fair
      value based GAAP is applied. SFAS 157 is effective for financial statements
      issued for fiscal years beginning after November 15, 2007, and interim periods
      within those fiscal years with early adoption encouraged. The Company is
      currently assessing the impact this statement will have on its financial
      statements and results of operations.


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
        No. 159 permits entities to choose to measure many financial instruments
        and certain other items at fair value that are not currently required to
        be
        measured at fair value. It also establishes presentation and disclosure
        requirements designed to facilitate comparisons between entities that choose
        different measurement attributes for similar types of assets and liabilities.
        The provisions of SFAS No. 159 are effective for financial statements
        issued for fiscal years beginning after November 15, 2007. This Statement
        should not be applied retrospectively to fiscal years beginning prior to
        the
        effective date, except as permitted with early adoption. The Company
        is evaluating if it will adopt SFAS No. 159 and what impact the
        adoption will have on its Financial Statements if adopted. If the
        Company adopts SFAS No. 159, it could have a material impact on the
        Company's Financial Statements.
 
 In
        June 2007, the FASB ratified the Emerging Issues Task Force’s (“EITF”)
        consensus conclusion on EITF 07-03, “ *Accounting
        for Advance Payments for Goods or Services to Be Used in Future Research
        and
        Development* ”.
        EITF
        07-03 addresses the diversity which exists with respect to the accounting
        for
        the non-refundable portion of a payment made by a research and development
        entity for future research and development activities. Under this conclusion,
        an
        entity is required to defer and capitalize non-refundable advance payments
        made
        for research and development activities until the related goods are delivered
        or
        the related services are performed. EITF 07-03 is effective for interim or
        annual reporting periods in fiscal years beginning after December 15, 2007
        and requires prospective application for new contracts entered into after
        the
        effective date. The Company does not expect the adoption of EITF 07-03 to
        have a material impact on its Financial Statements.




3.
            MACROPORT
                ACQUISITION


On
          June
          6, 2007, MacroPort, Inc. merged into a newly formed, wholly owned
          acquisition subsidiary of Migo. Prior to the acquisition, MacroPort was
          a
          privately owned provider of mobile content management software.
 
 In
          consideration for the acquisition, the Company issued 7,500,000 shares of
          its common stock and 2,000,000 shares of a newly authorized Series B Senior
          Convertible Preferred Stock. The preferred stock would be automatically
          converted into 10,000,000 shares of common stock if the closing price for
          Migo’s
          stock is more than $0.45 per share for ten consecutive trading days more
          than 90
          days after the closing date. The Company’s common
          stock (and the preferred stock on an if-converted basis) was valued using
          the
          average closing price of the Company’s common
          stock for
          the four days prior to the acquisition.
 
 Up
          to an
          additional $3,000,000 of consideration may be paid depending on the revenues
          generated from the MacroPort products during the 12-month period following
          the
          closing. The additional consideration would be paid in cash or common stock
          at the Company’s option,
          except that no more than $1,000,000 may be paid in cash. If MacroPort revenues
          during the 12-month period do not meet a certain minimum amount, $1,000,000
          of
          consideration is to be returned to the Company, and a portion of the stock
          issued in the acquisition is subject to a Stock Pledge Agreement to secure
          the
          possible return of this consideration. In accordance with Statement of
          Financial
          Accounting Standards No. 141, *Business
          Combinations* ,
          both
          the potential additional consideration and the potential return of consideration
          are considered to be contingent elements of the acquisition that are not
          recognized until the contingencies are resolved. Accordingly, $1,000,000 of
          common and preferred stock that was issued at the acquisition date has
          not been
          recognized in the allocation of the purchase price detailed below.
 
 The
          acquisition was accounted for under the purchase method of accounting in
          accordance with US GAAP. Under this method, tangible and identifiable intangible
          assets acquired and liabilities assumed are recorded at their estimated
          fair
          values. The excess of the purchase price, plus estimated fees and expenses
          related to the acquisition, over the fair value of net assets acquired
          is
          recorded as goodwill.
 
 10
 The
          following tables summarize the total consideration and the purchase price
          allocation as of June 6, 2007:
  **Total
                      Consideration:**Common
                      stock
                  
                  $
                  2,000,000Preferred
                      stock
                  
                  
                  2,500,0004,500,000Less
                      contingent consideration
                  
                  
                  (1,000,000
                  )Transaction
                      costs
                  
                  
                  28,000Total
                      purchase price
                  
                  $
                  3,528,000
 
 **Preliminary
                      Purchase Price Allocation:**Net
                      Assets (Liabilities)
                  
                  $
                  (186,000
                  )Existing
                      Product/Unpatented Technology
                  
                  
                  1,600,000In-Process
                      Technology
                  
                  
                  60,000Customer
                      relationships
                  
                  
                  230,000Non-Compete
                      agreement
                  
                  
                  40,000Goodwill,
                      including assembled workforce
                  
                  
                  1,784,000$
                  3,528,000
  The
              allocation of the purchase price is based upon estimates of the fair
              value of
              the assets acquired and liabilities assumed in the acquisition. The
              total
              purchase price has been allocated to the assets acquired and liabilities
              assumed
              based on management's best estimate of fair value, with the excess
              cost over net
              tangible and identifiable intangible assets acquired being allocated
              to
              goodwill. The estimated fair values of certain intangible assets have
              been
              determined by the Company management with the assistance of a
              third-party valuation firm.
 The
            pro
            forma unaudited results of operations, assuming that the MacroPort acquisition
            occurred as of January 1, 2006, are as follows for the three and nine
            months ended September 30, 2007 and 2006:
  Three
                      Monthsended09/30/2007
                  
                  Three
                      Monthsended09/30/2006Revenues
                  
                  $
                  2,203,441
                  
                  $
                  230,411Net
                      Loss
                  
                  $
                  (1,884,339
                  )
                  $
                  (3,294,489
                  )Net
                      Loss Attributable to Holders of Common Shares
                  
                  $
                  (1,884,339
                  )
                  $
                  (3,294,489
                  )Basic
                      and Diluted Net Loss Attributable to Common Stockholders per
                      Share
                  
                  $
                  (0.02
                  )
                  $
                  (0.05
                  )Weighted
                      Average Shares Outstanding, Basic and Diluted
                  
                  
                  103,546,942
                  
                  
                  67,189,128
  Nine
                      Monthsended
                    09/30/2007
                  
                  Nine
                      Monthsended
                    09/30/2006Revenues
                  
                  $
                  4,497,915
                  
                  $
                  546,766Net
                      Loss
                  
                  $
                  (5,581,746
                  )
                  $
                  (7,824,264
                  )Net
                      Loss Attributable to Holders of Common Shares
                  
                  $
                  (5,581,746
                  )
                  $
                  (7,824,264
                  )Basic
                      and Diluted Net Loss Attributable to Common Stockholders per
                      Share
                  
                  $
                  (0.05
                  )
                  $
                  (0.12
                  )Weighted
                      Average Shares Outstanding, Basic and Diluted
                  
                  
                  97,756,615
                  
                  
                  63,199,504
  The
            unaudited pro forma results of operations above are not intended to represent
            or
            be indicative of operations of the Company that would have been reported
            had the
            MacroPort acquisition been completed as of the beginning of the periods
            presented, and should not be taken as representative of any future consolidated
            results of operations of the Company. The unaudited pro forma results
            of
            operations do not reflect any operating efficiencies or cost savings
            that may be
            achieved with respect to the combined operations.
 4.
              Debt


On
      August
      10, 2007, the Company entered into a loan agreement with VenCore Solutions
      LLC
      under which VenCore loaned the Company $2,000,000. The loan bears interest
      at
      15% per annum, is repayable in monthly installments over three years and is
      secured by all of the Company's assets. In connection with the loan, the
      Company has granted to VenCore five-year warrants to purchase up to 812,500
      shares of the Company's common stock at an exercise price of $.21 per share,
      and
      warrants for up to an additional 406,000 shares at an exercise price of $.15
      per
      share


In
        accordance with Accounting Principles Board Opinion No. 14, proceeds from
        the
        VenCore transaction were allocated between debt and warrants, based on the
        relative fair values of the two instruments. The value attributed to the
        warrants, $158,702, has been recorded as a debt discount, and is being amortized
        over the term of the note. Debt discount amortization, classified as interest
        expense in the accompanying Statement of Operations, amounted to $5,739 for
        the
        three and nine months ended September 30, 2007.
 Due
                    as of September 30:**Debt**
                
                **Debt
                    Discount**
                
                **Net
                    Amount**2008
                
                $
                544,662
                
                $
                43,686
                
                $
                500,9762009
                
                
                657,666
                
                
                54,037
                
                
                603,6292010
                
                
                729,192
                
                
                60,980
                
                
                668,212Accum.
                    amort. of debt discount
                
                
                
                
                
                
                
                
                5,739Totals
                
                $
                1,931,520
                
                $
                158,702
                
                $
                1,778,557
 11


5.
            Accrued
                Liabilities





The
      primary component of accrued liabilities of $598,764 at September 30, 2007
      was
      $443,892 of accrued rebates and bonuses.


6.
              Intangible
                  assets


Intangible
      assets consist of the following at September 30, 2007:


AccumulatedCost
              
              Amortization
              
              NetSoftware
                  Technology Assets
              
              $
              5,694,297
              
              $
              2,070,367
              
              $
              3,623,930Trademarks/
                  tradenames
              
              $
              700,000
              
              $
              52,500
              
              $
              647,500Customer
                  Relationships
              
              $
              1,430,000
              
              $
              100,952
              
              $
              1,329,048Non-Compete
                  Agreements
              
              $
              90,000
              
              $
              25,417
              
              $
              64,583$
              7,914,297
              
              $
              2,249,236
              
              $
              5,665,061





The
      Company is currently amortizing its acquired intangible assets over periods
      up to ten years. Amortization expense related to intangible assets
      amounted to $308,527 and $142,312 for the three months ended September 30,
      2007
      and 2006, respectively, and $827,320 and $422,368 for the nine months ended
      September 30, 2007 and 2006, respectively.





7.
            Related
                Party Transactions





None.





8.
            Equity
                transactions




During
        September 2007, the Company extended an offer to holders of its warrants
        that
        had been acquired under various private equity transactions, giving investors
        the opportunity to exercise their warrants at a discount until October 26,
        2007.
        As of September 30, 2007, holders had exercised warrants for a total of
        2,701,746 shares, resulting in proceeds of $310,803. As of the closing of
        the
        exchange offer on October 26, 2007, investors had exercised warrants for
        a total
        of 15,216,977 shares, resulting in total proceeds to Migo of $1,799,786.
        The
        proceeds of the sale of securities will be used for working capital and general
        corporate purposes.




On
        September 5, 2006, the Company entered into a Common Stock and Warrant
        Purchase Agreement with Kingston Technology Group. Kingston paid $150,000
        for
        the purchase of 468,750 shares of common stock and warrants to purchase up
        to 950,000 shares of common stock. On
        May
        31, 2007, the Company signed an Amendment to the License Agreement and
        a second Common Stock and Warrant Purchase Agreement with Kingston. Under
        the
        Common Stock and Warrant Purchase Agreement, Kingston paid $250,000 for the
        purchase of 1,250,000 shares of common stock and warrants to purchase up
        to
        250,000 shares of our common stock. Kingston exercised 766,667 warrants in
        September 2007, and still holds 433,333 warrants, exercisable at $0.23 per
        share.


9.
            Commitments
                and Contingencies - Litigation




On
        December 20, 2005, two former employees made a demand for arbitration with
        JAMS, San Francisco alleging that each claimant is entitled to severance
        pay
        following their resignations in February 2005. The claimants were
        employed by the Company as part of the 2004 acquisition of First
        Person Software, Inc.  In October 2006, the arbitrator ruled in favor of
        the plaintiffs. The Company accrued a $424,000 liability as a result
        of this matter for the year ended December 31, 2006, and has as of August
        2,
        2007, fully satisfied this liability.




The
      Company is not aware of any pending litigation as of November 10,
      2007.





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





The
      following discussion should be read in conjunction with the selected
      consolidated financial information and the consolidated financial statements
      and
      notes appearing elsewhere in this Form 10-QSB. The following discussion
      contains forward-looking statements, such as statements of expected revenues
      and
      expenses that involve many risks and uncertainties. We assume no obligation
      to
      update any such forward-looking statements. Our actual results could differ
      materially from those anticipated in these forward-looking statements. Factors
      that could cause or contribute to such differences include, but are not limited
      to, those detailed from time to time in our filings with the Securities and
      Exchange Commission and those discussed in this Form 10-QSB, particularly
      in this Management’s Discussion and Analysis.





Unless
      expressly stated or the context otherwise requires, the terms “we”, “our”, “us”,
“the Company”, and “Migo” refer to Migo Software, Inc., formerly known as
      Powerhouse Technologies Group, Inc. and its subsidiaries as a whole.  Our
      name change became official on August 10, 2006.


12


**General**





Migo
      Software, Inc. develops a wide range of mobile data and communications software.
      Our goal is to provide Migo users with access to all their data, from any
      device, from anywhere, anytime. To accomplish this, we have developed and\or
      acquired a suite of software products that are easy to use, secure and are
      designed to improve the way information is personalized, secured, carried and
      accessed. We continually seek to improve our software, and we are spending
      substantial resources to develop enhanced versions that address our customers’
needs.




In
      September 2006, we entered into a new OEM partnership relationship with Kingston
      Technology Corporation, granting Kingston a global license to install our
      software on their line of flash memory products through December 2007. In
      December 2006, we acquired all the software titles of StompSoft, Inc., adding
      a
      wide assortment of related consumer oriented software to our product line.
      In
      June 2007, we acquired MacroPort, Inc. a company that had developed several
      software products addressing the needs of mobile phone manufacturers and other
      users of Secure Digital® (SD) memory cards. As a direct result of the MacroPort
      acquisition, in June 2007, Kingston signed an Amendment to the global license,
      allowing Kingston to incorporate the MacroPort technology on their flash memory
      and Secure Digital® (SD) Cards through December 2008. Going forward, we are
      seeking additional acquisition and partnership opportunities to expand our
      product line and user base, worldwide.




**Our
      Current Software Product Line**




Migo
      Software products solve a number of common, significant problems for computer
      users, and offer a variety of management tools that give users control over
      the
      way their data is stored, accessed and managed. Our current categories of
      software include:




**Software
      for Mobile Phones and Removable Memory**




·
            ***Video
                Auto Scalar-***Today
                there are over 150 different mobile phone screen sizes capable of
                playing
                video. Additionally, because there are also different operating systems,
                video codecs, screen sizes and processor capabilities running on
                cell
                phones, it is extremely difficult to distribute video content, such
                as
                movies and instructional videos, to a wide range of phones. Migo’s Video
                Auto Scalar software solves this problem for handset manufacturers,
                network operators and content producers. It allows content to be
                created
                in one format and playable on any mobile phone. Video files are
                manipulated in real-time to meet the specific playback device
                requirements, resulting in a simple to use video playback
                experience.





·
            ***Universal
                Loader -***Once
                content has been created, consumers often face multiple challenges
                making
                it easily play on their mobile phones. For example, consumers using
                a
                newly purchased phone must navigate through a long list of menus
                before
                launching a video, which can be very challenging. Migo’s patent pending
                Universal Loader solves these issues and creates a compelling user
                experience by auto launching and installing software in a truly “plug and
                play” manner.





·
            ***PhotoPlay-***Migo’s
                patent pending PhotoPlay technology solves the problem of copying
                images
                and video from your mobile phone, digital camera of flash memory,
                to your
                PC and uploading those files to a remote server (such as a retail
                photo
                finisher). PhotoPlay can be distributed on removable memory, downloaded
                from the Internet or bundled with PCs and other peripherals such
                as card
                readers. To date, Migo has signed a revenue sharing agreement with
                Shutterfly to deploy the PhotoPlay
                software.




13


**Software
      for Sync & Mobility**





·
            ***MigoSync***- Provides a very easy means for users to take their unique, personal
                data
                with them, without the need to bring along their laptop or link back
                to
                their office machine. MigoSync allows users to easily synchronize
                their
                emails (Microsoft® Outlook®, Outlook Express, Mozilla Thunderbird, and IBM
                Lotus Notes), web browser bookmarks and favorites (Microsoft Internet
                Explorer, Mozilla Firefox), Multimedia (photos, videos, music), Office
                documents (Microsoft PowerPoint, Excel, Word, etc) and/or various
                other
                files to a portable storage device, and then access their personal
                data on
                any other Windows-based, "guest" computer. MigoSync® is designed so that
                once it has been disconnected from a "guest" computer, no trace of
                the
                user's synced data will be left behind on the "guest"
                computer.





**·**
            ***Media
                Anywhere***- Multimedia management solution that allows users to easily and
                seamlessly transfer and sync photo albums, music, videos and games
                across
                multiple handheld devices - including MP3 players, digital cameras,
                and
                mobile phones.




**Software
      for Back-up & Recovery**





·
            ***Digital
                Backup***- Hassle-free and automated backup and recovery solution that allows
                users
                to archive their multimedia and office files to local or networked
                storage
                devices as well as online.





·
            ***Digital
                Rescue***- A powerful utility for quickly and easily recovering multimedia,
                office
                or email files that have been accidentally deleted from the computer,
                USB
                flash drive, or SecureDitgital® (SD) memory
                card.




**Software
      for Security and Privacy**





·
            ***Digital
                Shedder***- Easily and securely wipes away confidential files, system history,
                deleted emails and the like to maintain a user's digital
                privacy.





·
            ***DriveWasher***- Wipes an entire hard drive clean of sensitive data to help prevent
                identity theft and protect privacy.





·
            ***Easy
                PC Transfer***-
                Simply and safely transfers contents of one PC to
                another.




**Software
      for PC Optimization**





· ****
            ***Registry
                Repair***-
                Fixes some of the most vexing computer problems experienced by users,
                including system lock-ups and freezes. Includes a startup optimizer
                feature that allows the user to disable unnecessary programs that
                run each
                time they boot up their Windows PC, making the startup process much
                faster.




14


**Market
      Channels**





To
      market
      our software, we currently have four major distribution channels; OEM
      partnerships, Smart Phone & SD Card Users, Major Retailers, and various
      e-commerce enabled websites. Below is a partial list of our customers in each
      marketing channel:





**OEM
                Agreements**
            **Smart
                Phone\SD Cards**
            **Major
                Retailers**
            **E
                Commerce\Web Sites**Kingston
                Technologies
            Motorola
            Fry's
                Electronics
            www.migosoftware.comHewlett
                Packard
            Nokia
            CompUSA
            www.hp.com
              www.stompsoft.comMemorex
            Palm
            Sam's
                Club
            www.download.comEdge
                Tech
            Microsoft
            Office
                Depot
            www.U3.comSanDisk
                Corporation
            
            Micro
                Center
            www.migosoftware.jpTargetCircuit
                City




We
      have
      also entered into distribution and reseller agreements to sell our products
      in
      Japan and are seeking other resellers outside the United States.




**Future
      R&D Efforts**





Migo
      Software products are designed to make the computing experience easy, safe,
      and
      more adaptable to a user's needs. Our ongoing research and development continue
      to focus on increasing the scope of our product set, and the range of
      applications to which they can be applied.




15


**Financial
      Results, Liquidity and Management's Discussion and Analysis**





*Three
      months ended September 30, 2007 and 2006*





We
      reported revenues of $2,203,441 for the three months ended September 30, 2007
      compared to revenues of only $68,609 for the corresponding period ended
      September 30, 2006. The growth in revenues reflected several factors, including
      the
      inclusion of revenues from our acquisitions of MacroPort in June 2007 and
      StompSoft in December 2006, increased licensing revenues from Motorola in
      our Mobile channel, OEM partners Kingston Technology and Memorex in our Flash
      Memory channel, sales of our software titles via major retailers, such as Fry’s
      Electronics, CompUSA and Office Depot, as well as software sales via our on-line
      webstore. During the three months ended September 30, 2006, we sold only
      software loaded on M-Systems (now SanDisk) flash drives or via online
      download.





Our
      costs
      associated with the sale of products for the three month period ended September
      30, 2007 were $1,411,882 and consisted of the direct costs to fill orders from
      our Mobile channel, the amortization of software technology, as well as expenses
      related to fees for customer downloads of our software and packaging and
      shipping costs. For the three month period ended September 30, 2006, we incurred
      costs associated with the sale of our products of $151,117, most all of which
      consisted of amortization of software technology.





Research
      and development expenses totaled $659,216 for the three months ended September
      30, 2007, up from $505,703 in the corresponding period in 2006, due primarily
      to
      the increase of both internal and external staff dedicated to the development
      of
      new products. Sales and marketing expenses were $1,097,919 for the three months
      ended September 30, 2007 compared to $278,026 in the period ended September
      30,
      2006. The
      major
      increases consisted of increased personnel costs as well as significantly
      greater expenditure for marketing support of our retail sales efforts. However,
      general and administrative costs decreased to $897,023 for the period ended
      September 30, 2007 from $1,271,824 in the year earlier quarter, due primarily
      to lower expenses related to the cost of stock options which
      totaled $109,551 for the three months ended September 30, 2007 compared with
      $459,613 for the year earlier, three month period ended September 30,
      2006.





Non-operating
      expense totaled $21,740 for the three months ended September 30, 2007, compared
      with non-operating expense of $955,538 for the three months ended September
      30,
      2006, which included a one time charge of $614,025 related to the issuance
      of
      penalty shares that we recorded due to provisions in our registration rights
      agreements which resulted in the issuance of additional common shares to
      investors in our September 2006, December 2005 and March 2006 equity placements
      caused by delays in having a registration statement covering those shares
      declared effective by the SEC. Interest (net) decreased to a net interest
      expense of $21,740 for the three months ended September 30, 2007 compared
      to net interest income of $62,487 in the three month period ended September
      30,
      2006 as a result of decreased amounts of investable cash.





*Nine
      months ended September 30, 2007 and 2006*





We
      reported revenues of $4,229,458 for the nine months ended September 30, 2007
      and
      revenues of only $136,225 for the corresponding period ended September 30,
      2006.
      The growth in revenues reflected several factors, the
      inclusion of revenues from our acquisitions of MacroPort in June 2007 and
      StompSoft in December 2006, increased including licensing revenues from
      Motorola in our Mobile channel, OEM partners Kingston Technology and Memorex
      in
      our Flash Memory channel, sales of our software titles via major retailers,
      such
      as Fry’s Electronics, CompUSA and Office Depot, as well as software sales via
      our on-line webstore. During the nine months ended September 30, 2006, we sold
      only software loaded on M-Systems (now SanDisk) flash drives or via online
      download.





For
      the
      nine month period ended September 30, 2007, we incurred costs associated with
      the sale of our products of $2,159,887, which consisted of the direct costs
      to
      fill orders for our Mobile channel, the amortization of software technology,
      as
      well as expenses related to fees for customer downloads of our software and
      packaging and shipping costs. Our costs associated with the sale of products
      for
      the nine month period ended September 30, 2006 were $455,918 and consisted
      almost entirely of the amortization of software technology of $422,368, as
      well
      as expenses related to fees for customer downloads of our software, and
      packaging and shipping costs.




Research
      and development expenses totaled $2,198,934 for the nine months ended September
      30, 2007, up from $1,291,244 in the corresponding period in 2006, due primarily
      to the increase of both internal and external staff dedicated to the development
      of new products. Sales and marketing expenses increased to $2,443,288 for the
      nine months ended September 30, 2007 compared with $819,447 for the period
      ended
      September 30, 2006. The major increases in Sales and Marketing consisted of
      increased personnel costs as well as significantly greater expenditures for
      the
      marketing support of our retail sales efforts. For the nine months ended
      September 30, 2007, general and administrative expenses decreased to $2,717,704
      compared with $3,829,692 for the nine months ended September 30, 2006 due
      primarily to reduced expenses related to stock options which totaled $151,617
      for the nine months ended September 30, 2007, compared with $1,307,110 for
      the
      comparable nine month period ended September 30, 2006.


16




Non-operating
      expenses totaled $(7,630) for the nine months ended September 30, 2007 compared
      with $842,624 for the nine months ended September 30, 2006, which period
      included an expense of $1,374,800 due to provisions in our registration rights
      agreements which resulted in the issuance of additional shares to investors
      caused by delays in having a registration statement covering these shares
      declared effective. Interest (net) decreased for the nine months ended
      September 30, 2007 to $28,167 from $181,667 due to decreased investment income
      earned from lower cash balances, as well as interest expense related to our
      long
      term debt.





*Liquidity
      and Capital Resources*




On
      August
      10, 2007, we entered into a loan agreement with VenCore Solutions, LLC under
      which VenCore loaned us $2,000,000. The loan bears interest at 15% per annum,
      is
      repayable in monthly installments over three years and is secured by all of
      our
      assets. In connection with the loan, we have granted to VenCore five-year
      warrants to purchase up to 812,500 shares of our common stock at an exercise
      price of $.21 per share and 406,000 warrants at an exercise price of $.15 per
      share.




During
        September 2007, we extended an offer to holders of our warrants that
        had been acquired under various private equity transactions, giving investors
        the opportunity to exercise their warrants at a discount until October 26,
        2007.
        As of September 30, 2007, holders had exercised warrants for a total of
        2,701,746 shares, resulting in proceeds of $310,803. As of the closing of
        the
        exchange offer on October 26, 2007, investors had exercised warrants for
        a total
        of 15,216,977 shares, resulting in total proceeds to Migo of $1,799,786.
        The
        proceeds of the sale of securities will be used for working capital and general
        corporate purposes.
  For
        the
        nine months ended September 30, 2007, net cash used in operating activities
        was
        ($5,173,374). We believe we will require approximately $6.0 million to fund
        our
        operations for the next 12 months based on our current rate of spending.
        We
        expect this to be funded from revenues generated by the business, proceeds
        from
        warrant exercises, and our current cash resources. Thereafter, we will depend
        on
        cash from operations, and additional financing, if available.





*Recent
      and Expected Losses*




From
      inception, we have never been profitable and have sustained substantial net
      losses from operations. There can be no assurance that we will ever generate
      positive revenues from our operating activities, or that we will achieve and
      sustain a profit during any future period, particularly if operations remain
      at
      current levels. Failure to achieve significant revenues or profitability would
      materially and adversely affect our business, financial condition, and results
      of operations. For the nine months ended September 30, 2007 and 2006, we
      incurred net pre-tax losses of $5,282,725 and $7,102,700, respectively.





*Satisfaction
      of Current and Future Capital Requirements*





No
      assurance can be given that we will be able to obtain the additional financing
      we require to continue normal operations. We cannot provide assurances that
      we
      will be able to develop our business to the point of generating net operating
      profits and positive cash flows from operations. If funds from these sources
      are
      not sufficient to offset operating expenses, we would seek to institute
      cost-saving measures that would not only reduce overhead, but also curtail
      operations. We cannot assure that such measures, if implemented, would be
      sufficient to offset all of our operating expenses. If any capital subsequently
      raised from the sale of securities is not sufficient to fund the balance of
      our
      operating expenses after implementing cost-cutting measures, we could be forced
      to discontinue certain operations or may be unable to continue as a going
      concern.





Any
      further issuances of any additional equity securities to raise capital may
      be on
      terms that are detrimental to existing stockholders. In order to meet our
      capital requirements, we may continue to offer equity securities for sale,
      and
      existing stockholders would experience additional dilution. Any new equity
      securities issued may have rights, preferences or privileges senior to those
      of
      holders of existing equity securities.





*Off-Balance
      Sheet Arrangements*





At
      September 30, 2007, we did not have any relationship with unconsolidated
      entities or financial partnerships, which other companies have been established
      for the purpose of facilitating off-balance sheet arrangements or other
      contractually narrow or limited purposes as defined in Item 303(c) of SEC
      Regulation S-B. Therefore, we are not materially exposed to any financing,
      liquidity, market or credit risk that could arise if we had engaged in such
      relationships.




17


*Trends*





As
      of
      September 30, 2007, to the best of our knowledge, no known trends or demands,
      commitments, events or uncertainties, except as described in this Management's
      Discussion and Analysis and in “Notes to Financial Statements Note 8 -
      Commitments and Contingencies” existed, which are likely to have a material
      effect on our liquidity.





**Item
      3. Controls and Procedures**





Evaluation
      of Disclosure Controls and Procedures





As
      of the
      end of the period covered by this report, under the supervision and with the
      participation of our management, including our chief executive officer ("CEO")
      and chief financial officer ("CFO"), we evaluated the design and operation
      of
      our disclosure controls and procedures (as defined in Rules 13a-15(e) and
      15d-15(e) of the Securities Exchange Act of 1934, as amended, or the "Exchange
      Act").  Based on this evaluation, our management, including our CEO
      and CFO, has concluded that our disclosure controls and procedures are
      designed, and are effective to give reasonable assurance that the
      information we are required to disclose is recorded, processed, summarized
      and
      reported within the time periods specified in the SEC’s rules and
      forms. Based upon this evaluation, the CEO and CFO concluded that our
      disclosure controls and procedures are effective in providing reasonable
      assurance that information required to be disclosed in our reports filed with
      or
      submitted to the SEC under the Exchange Act is accumulated and communicated
      to
      management, including the CEO and CFO, as appropriate to allow timely decisions
      regarding required disclosure. Our management does not expect that our
      disclosure controls or our internal controls over financial reporting will
      prevent all error and fraud. A control system, no matter how well conceived
      and
      operated, can provide only reasonable, but not absolute, assurance that the
      objectives of a control system are met. Further, any control system reflects
      limitations on resources, and the benefits of a control system must be
      considered relative to its costs. These limitations also include the realities
      that judgments in decision-making can be faulty and that breakdowns can occur
      because of simple error or mistake.  In addition, controls can be
      circumvented by the individual acts of some persons, by collusion of two or
      more
      people or by management override of a control. A design of a control system
      is
      also based upon certain assumptions about potential future conditions; over
      time, controls may become inadequate because of changes in conditions, or the
      degree of compliance with the policies or procedures may deteriorate. Because
      of
      the inherent limitations in a cost-effective control system, misstatements
      due
      to error or fraud may occur and may not be detected.




Changes
      in Internal Control Over Financial Reporting




There
      were no changes in our internal control over financial reporting that occurred
      during our quarter ended September 30, 2007, that have materially affected,
      or
      are reasonably likely to materially affect, our internal control over financial
      reporting.




PART
      II.
      OTHER INFORMATION





Item
      1.
      Legal Proceedings




On
      December 20, 2005, two former employees made a demand for arbitration with
      JAMS, San Francisco alleging that each claimant is entitled to severance pay
      following their resignations in February 2005. The claimants were
      employed by the Company as part of the 2004 acquisition of First
      Person Software, Inc.  In October 2006, the arbitrator ruled in favor of
      the plaintiffs. The Company accrued a $424,000 liability as a result
      of this matter for the year ended December 31, 2006, and has as of August 2,
      2007, fully satisfied this liability.




We
      are
      not aware of any pending litigation as of November 10, 2007.





Item
      2.
      Unregistered Sales of Equity Securities and Use of Proceeds




During
      September 2007, the Company extended an offer
      to holders of its warrants that had been acquired under various private equity
      transactions, giving investors the opportunity to exercise their warrants at
      $.115 per share until October 26, 2007. As of September 30, 2007, holders,
      including Kingston Technology Corporation, had exercised warrants for
      2,701,746 shares, generating $310,803 in proceeds to the Company. As of the
      closing of the exchange offer on October 26, 2007, investors had exercised
      warrants for a total of 15,216,977 shares of common stock resulting in
      total proceeds to the Company of $1,799,786. The Company relied on Section
      4(2)
      of the Securities Act and Regulation D thereunder as the basis for an exemption
      from registering the sale of these shares of common stock under the Securities
      Act.


18


In
      August
      and September, 2007, the Company issued warrants to purchase a total
      of 1,218,500 shares to VenCore Solutions LLC in connection with a loan to the
      Company. The Company relied on Section 4(2) of the Securities Act as the basis
      for an exemption from registering the issuance of these warrants under the
      Securities Act.




Item
      3.
      Defaults Upon Senior Securities





None.





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




None





Item
      5.
      Other Information





None.




Item
      6.
      Exhibits




EXHIBIT
      INDEX:





Exhibit
            
            Description
                Number3
                .1
            
            Amended
                and Restated Certificate of Incorporation, hereby incorporated by
                reference to Exhibit 3.1 of the Company's Quarterly Report of Form
                10-QSB
                for the quarter ended June 30, 2006, filed with the Commission on
                August
                10, 2006.3.2
            
            Bylaws,
                hereby incorporated by reference to Exhibit 3.2 of the Annual Report
                on
                Form 10-KSB filed with the Commission on July 14, 2004.3.3
            
            Text
                of amended provision of the Company's Bylaws, hereby incorporated
                by
                reference from the Company's Current Report on Form 8-K filed with
                the
                Commission on September 27, 2005.3.4
            
            Certificate
                of Designations, Preferences and Rights of the Series B Senior
                Convertible Preferred Stock, hereby  incorporated by reference to the
                Company's Current Report on Form 8-K filed with the Commission on
                June 12,
                2007.10.1
            
            Loan
                and Security Agreement between the Company and VenCore Solutions,
                LLC
                dated as of August 10, 2007.31.1
            
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.31.2
            
            Certification
                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.32.1
            
            Certification
                of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002, 18 U.S.C. 1350.32.2
            
            Certification
                of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002, 18 U.S.C. 1350.




19


**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly authorized.




**MIGO
                SOFTWARE, INC.**Date:
                November 14, 2007
            By:
            /s/
                Kent HeymanKent
                HeymanChief
                Executive Officer (Principal Executive Officer)





Date:
                November 14, 2007
            By:
            /s/
                Richard LiebmanRichard
                LiebmanChief
                Financial Officer
              (Principal
                Financial and Accounting Officer)


20