UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 2054

                                 _______________


                                    FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2000

                                       OR


TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from _____________________ to _____________________

                        Commission file number 000-22327


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


  Delaware                                        74-2796054
(State or other jurisdiction of
 incorporation or organization)     (I.R.S. Employer Identification No.)




6300 Bridgepoint Parkway, Building 3, Suite 200, Austin Texas        78730
       (Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code (512) 343-6666


Former name,former address and former fiscal year, if changed since last report.
                             PSW Technologies, Inc.

         Indicate by check x whether the  registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange Act of
1934 during the  preceding 12 months (or for such shorter  period that the
registrant was required to file such reports), and (2)has been subject to such
filing requirements for the past 90 days.   Yes   ____x__     No ________


         Indicate the number of shares  outstanding of each of the issuer's
classes of common stock, as of the latest practicable date: 10,062,702 shares of
the Company's Common Stock, $.01 par value, were outstanding as of July 31,
2000.
<PAGE>

                                  CONCERO, INC.

                                Table of Contents

<TABLE>
<CAPTION>

                                                                                                               Page
                                            Part I - Financial Information
<S>         <C>                                                                                                <C>

Item 1.     Financial Statements (Unaudited)......................................................................3

            Condensed Balance Sheets - December 31, 1999 and June 30, 2000........................................3

            Condensed Statements of Operations - Three Months and Six Months Ended
            June 30, 1999 and 2000................................................................................4

            Condensed Statements of Cash Flows - Six Months Ended June 30,
            1999 and 2000.........................................................................................5

            Notes to Condensed Financial Statements...............................................................6

Item 2.     Management's Discussion and Analysis of
            Financial Condition and Results of Operations.........................................................8

Item 3.     Quantitative and Qualitative Disclosures about Market Risks..........................................18


                                            Part II - Other Information

Item 4.     Submission of Matters to a Vote of Security Holders..................................................19

Item 5.     Other Information....................................................................................20

Item 6.     Exhibits and Reports on Form 8-K.....................................................................20

            Signatures...........................................................................................21

</TABLE>
<PAGE>
                         PART 1 - FINANCIAL INFORMATION

Item 1. Financial Statements
<TABLE>
<CAPTION>

                                                                         Concero, Inc.
                                                                   Condensed Balance Sheets
                                                        (in thousands, except share and per share data)

                                                                                         June 30,
                                                                   December 31,            2000
                                                                       1999            (Unaudited)
<S>                                                                <C>                 <C>
Assets
Current assets:
   Cash                                                                 $ 2,108            $ 781
   Short-term investments                                                18,149           14,612
   Accounts receivable, net of allowance for doubtful
      accounts of  $505 at June 30, 2000 and $380
at
      December 31, 1999                                                  10,840           14,874
   Unbilled revenue under customer contracts                              1,150            2,592
   Income tax receivable                                                      -              825
   Net deferred taxes                                                       447            1,010
   Prepaid expenses and other current assets                                445            1,544
Total current assets                                                     33,139           36,238
Property and equipment, net                                               4,677            6,057
Other assets                                                                  -              925

Total assets                                                           $ 37,816         $ 43,220


Liabilities and stockholders' equity
Current liabilities:
   Trade payables                                                        $  925           $  753
   Accrued expenses and other current liabilities                         2,954            3,816
Total current liabilities                                                 3,879            4,569

Net deferred taxes                                                          515              515

Stockholders' equity:
  Preferred stock, par value $.01 per share, 1,000,000
     shares authorized and none issued and                                    -                -
outstanding
  Common stock, par value $.01 per share, 34,000,000
     shares authorized, 10,049,826 and 9,666,535 shares
     issued and outstanding at June 30, 2000 and
     December 31, 1999, respectively                                         97               99
  Additional paid-in capital                                             30,491           33,495
  Accumulated other comprehensive income                                    (39)             (8)
  Retained earnings                                                       2,873            4,550
Total stockholders' equity                                               33,422           38,136

Total liabilities and stockholders' equity                             $ 37,816         $ 43,220
</TABLE>

                             See accompanying notes.


<PAGE>
<TABLE>
<CAPTION>
                                                                         Concero, Inc.
                                                            Condensed Statements of Operations
                                                             (in thousands, except per share data)
                                                                          (unaudited)

                                                          Three Months Ended           Six Months Ended
                                                               June 30,                    June 30,
                                                      --------------------------- ---------------------------
                                                           1999          2000          1999         2000
<S>                                                       <C>            <C>          <C>          <C>

Revenue                                                   $11,006        $17,068      $ 21,401     $ 31,293
Operating expenses:
   Technical staff                                          6,035          8,686        12,105       16,082
   Selling and administrative staff                         2,304          3,142         4,533        5,747
   Other expenses                                           2,440          3,820         4,535        7,349
Total operating expenses                                   10,779         15,648        21,173       29,178

Income from operations                                        227          1,420           228        2,115

Interest income (expense), net                                237            238           488          472
Income before provision for income taxes                      464          1,658           716        2,587

Provision for income taxes                                    180            565           280          910

Net income                                                 $  284        $ 1,093        $  436      $ 1,677

Basic earnings per share                                   $ 0.03         $ 0.11       $  0.05      $  0.17

Diluted earnings per share                                 $ 0.03         $ 0.10       $  0.04      $  0.15

Shares used in basic earnings per share
   calculation                                              9,414         10,000         9,369        9,901

Shares used in diluted earnings per share
   calculation                                             10,202         11,364        10,216       11,413


</TABLE>

                             See accompanying notes.


<PAGE>
<TABLE>
<CAPTION>
                                                                         Concero, Inc.
                                                              Condensed Statements of Cash Flows
                                                                        (in thousands)
                                                                          (unaudited)


                                                                                    Six Months
                                                                                  Ended June 30,
                                                                       -------------------------------------
                                                                             1999              2000
<S>                                                                          <C>               <C>
Operating activities
Net income                                                                     $436             $1,677
Adjustments to reconcile net income to net cash
   provided by (used in) operating activities:
     Depreciation and amortization                                              667              1,031
     Bad debt expense, net of recoveries                                         15                 31
     Changes in operating assets and liabilities:
        Accounts receivable                                                  (1,474)            (4,065)
        Unbilled revenue under customer contracts                              (955)            (1,442)
        Prepaid expenses and other current assets                               (30)            (1,099)
        Other assets                                                               -              (498)
        Trade payables                                                          162               (175)
        Accrued expenses and other current liabilities                        1,192                547
        Income taxes                                                            520                844
Net cash provided by (used in) operating activities                             533              (3,149)

Investing activities
Purchase securities, net                                                       (176)                 -
Proceeds from the sale of short-term investments, net                             -              3,568
Acquisition of property and equipment                                           (886)            (2,424)
Net cash provided by (used in) investing activities                           (1,062)            1,144

Financing activities
Proceeds from issuance of common stock, net of issuance cost                    142                678
Net cash provided by financing activities                                       142                678

Net decrease in cash                                                           (387)            (1,327)
Cash, beginning of period                                                     1,167              2,108

Cash, end of period                                                           $ 780              $ 781

Non-cash activities:
Unrealized gain on investments                                                $  39              $  31
Reduction of income taxes payable associated with the
     exercise of stock options                                                $   1            $ 2,328
Deferred offering costs in accrued expenses                                   $   -             $  427

</TABLE>


                             See accompanying notes.

<PAGE>

                                  Concero, Inc.
                     Notes to Condensed Financial Statements
                                  June 30, 2000
                                   (unaudited)

1.       Basis of Presentation

The  accompanying  unaudited  financial  statements  have  been  prepared  by us
pursuant to the rules and regulations of the Securities and Exchange  Commission
(the "SEC") regarding  interim  financial  reporting.  Accordingly,  they do not
include  all  the  information  and  notes  required  by  accounting  principles
generally  accepted in the United States for complete  financial  statements and
should be read in  conjunction  with the financial  statements and notes thereto
for the year ended December 31, 1999 included in our annual report on Form 10-K.
The accompanying financial statements reflect adjustments, all of which are of a
normal recurring nature, which are, in the opinion of management,  necessary for
a fair  presentation.  The  results  for  interim  periods  are not  necessarily
indicative of full year results.

2.       Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and  assumptions,  including  estimates to complete  contracts,  that affect the
reported  amounts in the financial  statements and  accompanying  notes.  Actual
results could differ from those estimates.

3.       Comprehensive Income

As of January 1, 1998, we adopted SFAS No. 130, Reporting  Comprehensive Income.
SFAS  No.  130   establishes   new  rules  for  the  reporting  and  display  of
comprehensive income and its components; however, the adoption of this Statement
had no impact on our net income or stockholders'  equity.  SFAS No. 130 requires
unrealized gains or losses on our available-for-sale  securities, which prior to
adoption were reported  separately in  stockholders'  equity,  to be included in
other comprehensive income.

The components of comprehensive income for the three and six months ended
June 30, 1999 and 2000 are as follows (amounts in thousands):
<TABLE>
<CAPTION>

                                                          Three months ended              Six months ended
                                                               June 30,                       June 30,
                                                         1999            2000             1999         2000
                                                      -----------     -----------       ---------    ---------
<S>                                                      <C>             <C>              <C>        <C>
Net income                                                 $ 284          $1,093           $ 436     $1,677

Unrealized gain (loss) on short-term
  Investments                                                (85)             18              66           49
Income tax expense (benefit) related to items
  of other comprehensive income                              (33)              6              27           18

                                                      -----------
                                                                      -----------       ---------    ---------
Comprehensive income                                       $ 232         $ 1,105           $ 475       $1,708
                                                      ===========     ===========       =========    =========

</TABLE>
<PAGE>




                                  Concero, Inc.
               Notes to Condensed Financial Statements (Continued)
                                   (unaudited)

4.       Earnings per Share

The following table sets forth the computation of basic and diluted earnings per
share (in thousands,  except per share data) for the three months and six months
ended June 30, 1999 and 2000:
<TABLE>
<CAPTION>

                                                          Three Months Ended                      Six Months Ended
                                                               June 30,                               June 30,
                                                       1999                2000               1999              2000
                                                   --------------      --------------    ---------------    --------------
<S>                                                    <C>                 <C>                <C>               <C>
Numerator:
  Net income                                              $  284            $  1,093             $  436          $  1,677
                                                   ==============      ==============    ===============    ==============

Denominator:
  Shares used in basic earnings per
    share calculation                                      9,414              10,000              9,369             9,901

  Effect of dilutive securities:
    Employee stock options                                   328               1,247                376             1,376
    Warrants                                                 460                 117                471               136
                                                   --------------      --------------    ---------------    --------------
  Shares used in diluted earnings per
    share calculation                                     10,202              11,364             10,216            11,413
                                                   ==============      ==============    ===============    ==============

Basic earnings per share                                $   0.03            $   0.11           $   0.05          $   0.17
                                                   ==============      ==============    ===============    ==============

Diluted earnings per share                              $   0.03            $   0.10           $   0.04          $   0.15
                                                   ==============      ==============    ===============    ==============

</TABLE>

<PAGE>
Item 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

     The  discussion and analysis  below  contains  forward-looking  statements,
within the meaning of Section 27A of the  Securities Act of 1933 and Section 21E
of the Securities  Exchange Act of 1934,  that involve risks and  uncertainties,
such as statements for our plans, objectives,  expectations and intentions. Such
forward  looking  statements are generally  accompanied by words such as "plan,"
"estimate," "expect," "believe," "could," "would," "anticipate," "may," or other
words  that   convey   uncertainty   of  future   events  or   outcomes.   These
forward-looking  statements and other  statements  made elsewhere in this report
are made in reliance on the Private  Securities  Litigation  Reform Act of 1995.
The section below entitled  "Factors That May Affect Future  Results,  Financial
Condition and Market Price of Securities"  sets forth certain factors that could
cause our actual future results to differ materially from these statements.

Overview

     We are an e-business services firm that offers strategic  consulting skills
with deep technology and integration  expertise.  This combination enables us to
utilize existing and new technologies to provide reliable, flexible and scalable
e-business  solutions.  Our  alliances  with leading  Internet  and  interactive
television  technology  providers allow us to gain a thorough  understanding  of
their  products and  perspective  on other  products as well as  next-generation
technologies.  Using our technology insight and skills, we assist our clients to
define,  design,  develop and deploy  e-business  solutions  that enhance  their
competitive positions.

     We  formally  began  doing  business  as Concero on April 17,  2000 and our
NASDAQ  ticker  symbol  was  changed  from PSWT to CERO on April 28,  2000.  Our
corporate name officially became Concero,  Inc., after  stockholder  approval at
the annual  stockholders'  meeting  on May 17,  2000.  We believe  that our name
change and related  advertising  and  promotional  activities  will enable us to
communicate our capabilities as an e-business  solutions provider to prospective
clients and employees.  Moreover,  we intend to pursue acquisitions that provide
access to complementary  skills or provide  additional  talented  professionals,
allow us to expand our geographic presence or increase our client base.

     We derive our  revenues  from fees for  services  that are  generated on an
engagement-by-engagement  basis. During the first six months of 2000, we derived
approximately  88% of revenues from time and materials  contracts.  We recognize
revenues  generated  under time and  materials  contracts  as the  services  are
provided.  For fixed price  contracts,  which  accounted  for the balance of our
first  six  months  of  2000   revenues,   we  recognize   revenues   using  the
percentage-of-completion   method.  Using  this  method,  we  recognize  revenue
proportionate  to the  percentage  of  units of  labor  incurred  to the date of
measurement  relative  to the  estimated  total  units of labor for  completion.
Revenues exclude expenses reimbursed by clients.  Software licensing fees do not
constitute a material portion of our revenue base.

<PAGE>
Results of Operations

The following table sets forth the percentage of revenue of certain items
included in our condensed statement of operations for the period indicated:
<TABLE>
<CAPTION>

                                                      Three Months                       Six Months
                                                     ended June 30,                     ended June 30,
                                                     1999       2000                    1999       2000
<S>                                                  <C>        <C>                     <C>        <C>

Revenue...................................           100%       100%                    100%       100%
Operating expenses:
   Technical staff........................            55         51                      57         51
   Selling and administrative staff                   21         19                      21         19
   Other expenses.........................            22         22                      21         23
                                                      ___        ___                     ___        ___
Total operating expense...................            98         92                      99         93
                                                      ___        ___                     ___        ___
Income from operations....................             2          8                       1          7
Interest income (expense), net............             2          1                       2          1
Provision for income taxes................             1          3                       1          3
                                                      ___       ___                      __         ___
Net income...............................              3%        6%                      2%          5%
                                                      ===       ===                      ===        ===

</TABLE>

Revenue

Our revenue consists primarily of fees for software services provided.  Revenues
increased  55% to $17.1  million in the  quarter  ended June 30, 2000 from $11.0
million in the  quarter  ended June 30,  1999.  In the first six months of 2000,
revenues  increased  46% to $31.3  million  from $21.4  million in the first six
months of 1999.  This  increase is  principally  due to the  improvement  in our
average  hourly bill rate.  This  improvement  in our  average  hourly bill rate
resulted from our shift from performing  primarily software  development support
services to developing strategic e-business and eTV solutions. This increase was
partially offset by a decrease in our average  technical  personnel  utilization
rate.

IBM accounted for 12% and 33% of revenue in each of the first six months of 2000
and  1999,  respectively.  The IBM  revenue  consists  of  revenues  from  three
different IBM organizations: IBM, Tivoli and Lotus. Another client accounted for
12% of revenue for the first six months of 1999 and another client accounted for
18% of revenue for the first six months of 2000.  No other client  accounted for
more than 10% of revenue for either period.

Technical Staff

Technical staff expenses consist of the cost of salaries,  payroll taxes, health
insurance and workers'  compensation  for technical staff personnel  assigned to
client  engagements and unassigned  technical staff personnel,  and fees paid to
any  subcontractors  for work performed in connection with a client  engagement.
Technical staff expenses increased 44% to $8.7 million in the quarter ended June
30, 2000 from $6.0 million in the quarter ended June 30, 1999.  Technical  staff
expenses  were $16.1 million in the first six months of 2000, an increase of 33%
over $12.1  million for the first six months of 1999.  The increase in technical
staff  expenses is  primarily  due to the  addition of  personnel to service the
increase in scope and number of client engagements. As a percentage of revenues,
technical  staff  expenses  decreased  to 51% in the  quarter  ended and the six
months  ended June 30, 2000 from 55% in the quarter  ended June 30, 1999 and 57%
in the six months ended June 30, 1999,  primarily as a result of higher revenues
resulting from the improvement in our average hourly bill rate.


<PAGE>

Selling and Administrative Staff

Selling  and  administrative  staff  expenses  consist of the cost of  salaries,
payroll taxes, health insurance and workers' compensation for selling, marketing
and  administrative  personnel,  and all commissions and bonuses whether paid to
technical or administrative  staff.  Selling and  administrative  staff expenses
increased  36% to $3.1  million in the  quarter  ended  June 30,  2000 from $2.3
million in the quarter  ended June 30, 1999.  Selling and  administrative  staff
expenses  were $5.7 million in the first six months of 2000,  an increase of 27%
from $4.5 million in the first six months of 1999.  As a percentage of revenues,
selling and administrative  staff expenses decreased to 19% in the quarter ended
and the six months  ended June 30,  2000 from 21% in the  quarter  ended and six
months ended June 30, 1999, primarily as a result of higher revenues.

Other Expenses

Other expenses consist of all non-staff  related costs, such as occupancy costs,
travel,  business  insurance,  business  development,  recruiting,  training and
depreciation.  Other expenses increased 57% to $3.8 million in the quarter ended
June 30,  2000 from $2.4  million  in the  quarter  ended June 30,  1999.  Other
expenses  were $7.3 million in the first six months of 2000,  an increase of 62%
over  other  expenses  of $4.5  million  in the  first six  months of 1999.  The
increase  in  other  expenses  is  primarily  due to the  one-time  costs of our
branding and public relations  launch  associated with the change of our name to
Concero as well as  facility  additions,  and higher  recruiting,  training  and
travel costs.  As a percentage of revenues,  other expenses  remained at 22% for
the quarter ended June 30, 2000 and 1999.  Other expenses were 23% of revenue in
the first six months of 2000 compared to 21% in the first six months of 1999.

We  currently  have  $800,000 of deferred  offering  costs on the balance  sheet
classified as other assets.  These  deferred  offering  costs are related to the
preparation  for a public  offering of our  securities,  which was  withdrawn on
April 27, 2000. In the event this offering is completed,  the deferred  offering
costs will be netted  against the proceeds of the offering.  If this offering is
not  completed,  these  costs will be  expensed  when  appropriate,  which would
negatively impact our operating results for such quarter.

Income from Operations

We recorded  income from  operations  of $1.4 million for the quarter ended June
30, 2000,  an increase of 526%,  from  $227,000  for the quarter  ended June 30,
1999.  Income from  operations was $2.1 million in the first six months of 2000,
up from $228,000 of income from operations in the first six months of 1999. As a
percentage of revenues,  income from operations  increased to 8% for the quarter
ended June 30, 2000 from 2% for the  quarter  ended June 30,  1999.  Income from
operations  was 7% of  revenue  in the first six  months of 2000,  up from 1% of
revenue in the first six months of 1999.

Income Taxes

During the second quarter of 2000, we revised our estimated annual effective tax
rate for 2000 from 37%,  which was used during the first quarter of 2000, to 35%
due to the  elimination of Texas  franchise taxes from our estimated tax expense
as a result of an organizational restructuring made in conjunction with our name
change during the second quarter of 2000.  Using a 35% annual effective tax rate
during the first and second quarter, net income would have been $604,000 for the
three months ended March 31, 2000 and $1,073,000 for the three months ended June
30, 2000.  The diluted  earnings per share would have  remained at $0.05 for the
three months ended March 31, 2000 and decreased $0.01 to a diluted  earnings per
share of $0.09 for the three months ended June 30, 2000.

The  provision  for income  taxes of $910,000  for the six months ended June 30,
2000 is computed  using an estimated  annual  effective  tax rate of 35%,  which
differs  from the  federal  statutory  rate of 34% as a result  of state  taxes,
tax-exempt  interest  and  permanent  differences  for meals  and  entertainment
expenses.

The  provision  for income  taxes of $280,000  for the six months ended June 30,
1999 is computed  using an estimated  annual  effective  tax rate of 39%,  which
differs  from the federal  statutory  rate of 34% as a result of state taxes and
permanent differences for meals and entertainment expenses.


Liquidity and Capital Resources
<PAGE>
Our operating  activities  used cash of $3.1 million for the first six months of
2000.  Our  operating  activities  provided  cash of $533,000  for the first six
months  of 1999.  We  purchased  approximately  $2.4  million  and  $886,000  of
computers,  office and system  equipment and software in the first six months of
2000 and 1999, respectively. At June 30, 2000, we had cash, cash equivalents and
short-term investments totaling $15.4 million.

At  June  30,  2000,  we did not  have  any  material  commitments  for  capital
expenditures. We have budgeted approximately $4 million for capital expenditures
for  fiscal  2000.  Our  capital  expenditures  normally  consist  primarily  of
purchases of laptop  computers,  computer  servers and furniture,  the amount of
which  fluctuates  based on the number of  additional  employees we hire and the
number of new offices that we open in any period.

The number of days of revenue in our accounts receivable balance fluctuated from
84 days to 93 days during the first six months of 2000. We may experience longer
collection  periods if the work we perform for smaller companies  increases as a
percentage of our total services.

We anticipate that our existing cash, cash equivalents and short-term investment
balances and potential cash flows from  operations  will be adequate to fund our
working capital and capital  expenditure  requirements  for at least the next 12
months.  However,  changes  may  occur  that  could  consume  available  capital
resources before such time. Our capital requirements depend on numerous factors,
including  potential  acquisitions,  the  timing  of  the  receipt  of  accounts
receivable,  employee  growth and the  percentage  of projects  performed at our
facilities.

We currently do not maintain any committed credit  facilities.  We cannot assure
you that commercial  credit, if necessary,  will be available to us on favorable
terms, or at all.

<PAGE>

Factors That May Affect Future Results, Financial Condition
  and Market Price of Securities

Risks that Relate to Our Business Strategy

     We are subject to a number of risks  related to our business  strategy.  We
describe  some of these risks  below.  If any of these risks  materializes,  our
business, financial condition and results of operations could be harmed, and our
stock price could fall.

   We have refocused our business strategy. This may not be successful.

     In August 1998, we began building a new management team. The new management
team has  refocused  our business  strategy.  This  strategy is described in the
Business section in our Annual Report on Form 10-K filed March 14, 2000. Some
of the changes to our business strategy include:

o        expansion into new and largely untested business areas such as eTV and
         broadband services;

o        realignment of our internal corporate structure on a geographic basis;
         and

o        a shift in focus of our  client  base from  technology  vendors  to
         technology  users, and a shift from longer-term development and
         maintenance arrangements to specific, shorter-term e-business project
         engagements.

     Our shift from ongoing development and maintenance engagements to strategic
engagements  has favorably  affected our average  billing  rates but  negatively
affected  our  technical  staff  utilization  rates.  If we are unable to offset
decreases in our utilization  rates through  increases in our billing rates, our
profitability will be harmed.  Adverse economic  conditions,  a lack of consumer
acceptance  of  eTV,  broadband  and  other  advanced  technologies,   increased
competition  and other  factors  could hurt both our  utilization  rates and our
billing  rates.  As a result,  it is too early to know whether the refocusing of
our business  strategy will help us achieve  long-term  success.  Companies that
implement  major changes in their  business  strategy can face more  challenging
risks  and  unexpected   difficulties.   These  risks  and  difficulties   apply
particularly to us because the market for our Internet and e-business consulting
services is new and rapidly evolving.

The success of our business strategy depends on our ability to identify
emerging technologies that will gain wide acceptance in future markets.

     Our business strategy requires us to:

o        identify promising technologies at an early stage in their development;

o        accurately assess their long-term viability; and

o        rapidly gain expertise in these technologies.

     Our  business may suffer if we invest time and  resources  in  technologies
that ultimately do not reach  widespread use or commercial  success.  Even if we
identify the best  technologies,  their  widespread  use and  deployment may not
occur within a time span that is compatible  with our business plans and revenue
expectations.

     In particular,  some of the  technologies  that we are focusing on heavily,
such as eTV and broadband,  may not achieve  business or consumer  acceptance in
the near term,  or at all. For example,  companies  promoting  eTV and broadband
services may find that  consumers are reluctant to use them, for reasons of cost
or  complexity.  As a  result,  we  may  use  substantial  resources  developing
expertise in areas that will not yield substantial revenues or profits for us in
the next few years.
<PAGE>

Our business strategy depends on our ability to create and maintain strategic
alliances with other e-business and technology companies. These alliances
may shift or terminate suddenly.

     We currently maintain strategic alliances with other companies that help us
to gain access to new technology and business opportunities.  This is one of the
principles  of our exponet  strategy.  Like many in our  industry,  we sometimes
refer to these companies as our "partners", but they are not partners in a legal
sense. In particular,  these companies are under no binding obligation to remain
in  relationships  with us or to  continue  to  cooperate  with  us,  and  these
relationships are generally not exclusive.

     Any of our  alliance  partners  may choose to end the  alliance,  alter the
terms of the  alliance in a way that harms our business or increase the level of
business they conduct with our  competitors.  Similarly,  if one of our alliance
partners  undergoes a management  or ownership  change,  we could lose access to
critical  technology  and business  opportunities.  In addition to a decrease in
revenue,  the publicity that could accompany these kinds of changes could have a
damaging effect on our stock price.

     Moreover,  our brand may be closely associated with the business success or
failure of some of our high-profile alliance partners, many of whom are pursuing
unproven  business models in competitive  markets.  As a result,  the failure or
other difficulties of these companies may damage our brand and hurt our business
opportunities.


Some of our clients are emerging companies that have little or no operating
history and may lack the resources to pay our fees.

     Because we focus on emerging  technologies,  we derive some of our revenues
from  small  companies,   particularly  start-up  companies  that  have  limited
operating   histories  and  resources  to  pay  our  fees.  Our  business  model
contemplates increasing the amount of business we do with these companies. These
companies  often  have  little or no  earnings  or cash  flow and are  generally
considered to have a greater risk of failing than more  established  businesses.
As a result,  these  clients may not be able to pay for our services in a timely
manner,  or at all.  These effects would lead to an extension of our  collection
period, which would harm our liquidity, and an increase in our bad debt expense,
which would harm our profitability.

We may make investments in clients or potential clients that are emerging
companies. These investments are risky, we have limited experience in making
these investments and we could lose all of our investment.

     Although not a key part of our strategy,  we may make strategic investments
in small,  emerging clients or potential clients,  either in cash or in kind. We
may also agree to take some or all of our fees in the form of equity  securities
issued by these clients as part of our engagement.  Investments in such emerging
companies are extremely  risky and some or all of our investment  could be lost.
We  have  limited   experience  in  these   investments  or  in  managing  these
arrangements.

Potential acquisitions could be difficult to integrate, disrupt our business,
dilute stockholder value and hurt our operating results.

     As part of our  growth  strategy,  we  intend  to  pursue  acquisitions  of
businesses and technologies that are  complementary to our core businesses.  Our
ability  to  grow  through  acquisitions  will  depend  on the  availability  of
attractive acquisition candidates, our ability to successfully compete for these
acquisition  candidates  and  the  availability  of  capital  to  finance  these
acquisitions.

     The benefits of an acquisition often may take considerable time to develop,
and the acquisition may never produce the intended benefits.  Factors that could
cause an acquisition to be unsuccessful include:

<PAGE>
o        the loss of employees or clients of the acquired business, and thus a
         loss of one of the key rationales for making the acquisition;

o        our failure to appreciate the dynamics of markets in which we have
         limited or no prior experience;

o        the diversion of management's attention from our core businesses;

o        any  difficulties  we experience in  assimilating  the operations of an
         acquired business or in realizing projected efficiencies, cost savings
         and revenue synergies;

o        our failure to assess or discover liabilities;

o        the dilution of our stockholders' equity and earnings per share,
         particularly if we finance the acquisitions with equity; and

o        an increase in our debt and contingent  liabilities,  which in turn
         could restrict our ability to access additional capital when needed or
         to pursue other important elements of our business plan.


If we fail to manage our growth, our resources may be strained and our
ability to implement our business strategy will be harmed.

     Our growth  could place  significant  demands on our  management  and other
resources.  In order to manage  our  growth  effectively,  we must  continue  to
develop and improve our operational,  financial and other internal  systems,  as
well as our business development capabilities,  and we must continue to attract,
train,  retain,  motivate and manage our employees.  We may not succeed in these
efforts.


Risks that Relate to Our Business

     We are subject to a number of risks that are particular to our business and
that may or may not affect our competitors.  We describe some of these below. If
any of these risks materializes,  our business,  financial condition and results
of operations could be harmed, and our stock price could fall.

Our key employees are critical to our continued success. The loss of any of
these employees could impair our ability to execute our strategy or grow our
business.

     Our future  success  will depend in part upon the  continued  services of a
number of key  management  and technical  employees.  The loss of any of our key
personnel  could hurt our ability to execute our strategy and grow our business.
We do not  maintain  key-person  life  insurance  on any  of our  employees.  In
addition, if one or more of our key employees resigns to join a competitor or to
form a competing  business,  we could lose existing or potential clients. In the
event  we lose  any of  these  employees,  we may not be  able  to  prevent  the
disclosure  or  use  of  our  proprietary  technical  knowledge,  practices  and
procedures.


We need to recruit, train and retain qualified employees to successfully
grow our business.

     Our success depends on our ability to recruit,  train, retain, motivate and
manage highly skilled employees. Qualified project managers, software architects
and senior technical and professional staff with the skills we need are in great
demand worldwide and are likely to remain a limited resource for the foreseeable
future.  We may not be  able  to hire a  sufficient  number  of  highly  skilled
employees.  In addition,  the highly  competitive labor market may require us to
raise  salaries  faster  than we have in the past,  and faster than we raise our
billing rates.
<PAGE>

     We have  experienced  a high rate of  attrition  in the past,  particularly
around the time of our  management  change.  If we continue to  experience  high
rates of  attrition,  it will be even  more  difficult  to  execute  our  growth
strategy.

     We may also be  unsuccessful  in training,  retaining  and  motivating  our
employees.  If our employees do not achieve the required  levels of performance,
our ability to manage and staff  existing  projects  and to obtain new  projects
might suffer.

We changed our name.

     We changed  our name to  Concero,  Inc.  Although we have filed a trademark
application  for this  name,  we may be unable to  protect  our name or  prevent
others  from  using our name.  Other  parties  may claim that our use of Concero
violates their intellectual  property rights. If we are prevented from using the
Concero  name,  it may become more  difficult  for us to carry out our  business
plans. In addition, our planned advertisement of the change and promotion of our
new brand may fail to reach important  segments of our potential  customer base,
and our marketing campaign may yield little results.

We may not be able to protect our intellectual property and proprietary
rights.

     Our proprietary  intellectual  property consists of the business  processes
and  software  that we develop to assist  clients.  Our  efforts to protect  our
proprietary  rights  may  not be  adequate  to  deter  theft  or  misuse  of our
intellectual  property.  We may not be able to  detect  unauthorized  use of our
intellectual property and take appropriate steps to enforce our rights. If third
parties  infringe,   misappropriate  or  copy  our  trade  secrets,  proprietary
processes,  copyrights,  trademarks or other proprietary  information,  we could
lose important competitive advantages.

We could be subject to claims that we infringe the intellectual property
rights of others.

     There  has been a marked  increase  in  patent  and  intellectual  property
litigation  in  recent  months,   particularly   involving  competitors  in  the
technology sector. Although we are not aware that any of our activities infringe
the patent or other  intellectual  property rights of others, we have not sought
any  formal  assurances  that  this  is  the  case.  Other  parties  may  assert
infringement claims against us or claim that we have violated their intellectual
property  rights.  These claims,  even if not true,  could result in significant
legal and other costs and may  distract  our  management.  If we are required to
stop using a particular  methodology  or technology  because of an  infringement
lawsuit, it could become extremely difficult to carry out our business plans.

We depend on a small number of clients for a significant portion of our
revenues.

     During the first six months of 2000, we derived 46% of our revenue from our
five largest clients. Our largest client accounted for 18% of our revenue in the
first six months of 2000. The volume of work  performed for specific  clients is
likely to vary from year to year, and a major client in one year may not use our
services in another year.  The loss or reduction of our revenue due to a decline
in services performed for any large client could harm our business.

<PAGE>

Our lack of long-term contracts with clients makes our revenues difficult to
predict.

     Our clients  retain us on an  engagement-by-engagement  basis,  rather than
under  long-term  contracts.  As  a  result,  the  size  and  number  of  client
engagements are difficult to predict, and vary markedly from quarter to quarter.
At the same time,  our  operating  expenses are  relatively  fixed and cannot be
reduced on short notice for  unanticipated  shortfalls  in our revenue.  This is
because our most significant operating expense is employee salaries.

     Moreover,  our clients can  generally  reduce the scope of our  services or
cancel our engagements without penalty and with little or no notice. If a client
postpones,  modifies  or cancels an  engagement  or chooses not to retain us for
additional  phases of a project,  we might not be able to redeploy our employees
quickly to other engagements.


Some of our client contracts are on a fixed-price basis. If we fail to
accurately estimate the resources required for a fixed-price project, our
profitability could be harmed.

     During the first six months of 1999 and 2000,  we  generated  approximately
20%   and   12%,    respectively,    of   our   revenue   on   a    fixed-price,
fixed-delivery-schedule  basis, rather than on a time-and-materials basis. If we
fail to accurately  estimate the resources required for a fixed-price project or
fail to complete our  obligations  on time, our revenues could be harmed and our
expenses could increase.  We sometimes must revise project plans after beginning
a project because we failed to accurately estimate the resources required.


Risks that Relate to Our Industry

     We are  subject to a number of risks that are  inherent  in the  technology
industry.  We describe some of these below. If any of these risks  materializes,
our business, financial condition and results of operations could be harmed, and
our stock price could fall.


Our industry is intensely competitive.

     We expect  competition to persist and intensify in the future. We cannot be
certain  that  we will be able to  compete  successfully  with  existing  or new
competitors. If we fail to compete successfully, our business would be seriously
harmed. Competition can make it more difficult for us to:

o        attract and retain customers;

o        expand our sales and marketing activities;

o        create and maintain the strategic  relationships  that are vital to
         success in the Internet and e-business marketplace, and thus develop
         and acquire knowledge of leading-edge technologies; and

o        recruit and maintain the highly skilled technical staff that our
         business model demands.

     We  compete  against  numerous  companies  that  offer  Internet  services,
software engineering,  systems integration, or management consulting, as well as
the  consulting  divisions of large  accounting  firms.  Because  relatively low
barriers to entry  characterize  the market,  we expect other companies to enter
our market.  Some large  information  technology  firms have announced that they
will focus more resources on e-business opportunities.

     Many of our current  competitors  have longer operating  histories,  larger
client bases, larger professional staffs,  greater brand recognition and greater
financial,  technical,  marketing and other resources than we do.
<PAGE>

This may place us at a disadvantage  in responding to our  competitors'  pricing
strategies,    technological   advances,    advertising   campaigns,   strategic
partnerships and other  initiatives.  In addition,  many of our competitors have
well established  relationships  with our current and potential clients and have
extensive knowledge of our industry. As a result, our competitors may be able to
respond  more  quickly to new or emerging  technologies  and changes in customer
requirements,  and  they  may  also be  able to  devote  more  resources  to the
development,  promotion and sale of their services than we can. Competitors that
offer  more  standardized  or less  customized  services  than we do may  have a
substantial cost advantage,  which could force us to lower our prices, adversely
affecting our operating margins.

     Current and potential  competitors  also have  established or may establish
cooperative  relationships  among  themselves  or with third parties to increase
their ability to address  customer needs.  Accordingly,  it is possible that new
competitors  or  alliances  among  competitors  may emerge and  rapidly  acquire
significant  market  share.  In addition,  some of our  competitors  may develop
services  that are superior  to, or have greater  market  acceptance  than,  the
services that we offer.


Our success depends on the continued growth and acceptance of advanced
technologies.

     Our future  success  depends  heavily on the further  widespread use of the
Internet as a means for commerce,  and consumer and commercial acceptance of eTV
and broadband.  Despite the large amount of investor and media  attention  these
technologies  have received,  they are in early stages of development  and it is
difficult to predict  whether or how they will continue to develop.  Development
of  these  technologies  could  be  hindered  by a number  of  factors,  such as
government  regulation,  taxation,  general  economic  conditions  and  lack  of
consumer  acceptance.   If  these  new  technologies  fail  to  gain  widespread
acceptance or grow more slowly than expected,  our business  opportunities  will
diminish.


Risks that Relate to Our Stock

     Our stock price is subject to a number of risks. We describe some of these
below. If any of these risks materializes, our stock price could fall.


Our quarterly operating results will vary, which may affect the market price
of our common stock in a manner unrelated to our long-term performance.

     Our quarterly  operating results have varied in the past and we expect that
they will continue to vary in the future depending on a number of factors,  many
of which are  outside  of our  control.  Factors  that may  cause our  quarterly
operating results to vary include:

o        the number, size and scope of projects in which we are engaged;

o        the contractual terms and degree of completion of these projects;

o        any delays incurred in connection with a project;

o        our success in earning bonuses or other contingent payments;

o        our employee hiring and utilization rates;

o        the adequacy of provisions for losses;

o        the accuracy of our estimates of resources required to complete ongoing
         projects;
<PAGE>
o        customer budget cycles and spending priorities; and

o        general economic conditions.

     A high  percentage of our operating  expenses,  particularly  personnel and
rent, are fixed in advance of any particular quarter. As a result, unanticipated
variations in the number of our projects,  in our progress on projects or in our
employee utilization rates may cause significant variations in operating results
in  any  particular   quarter.   Given  the   possibility  of  these   quarterly
fluctuations,  we believe  that  comparisons  of our  quarterly  results are not
necessarily  meaningful  and that  results for one quarter  should not be relied
upon to predict our future performance.

     We currently have $800,000 of deferred  offering costs on the balance sheet
classified as other assets.  These  deferred  offering  costs are related to the
preparation  for a public  offering of our  securities,  which was  withdrawn on
April 27, 2000. In the event this offering is completed,  the deferred  offering
costs will be netted  against the proceeds of the offering.  If this offering is
not  completed,  these  costs will be  expensed  when  appropriate,  which would
negatively impact our operating results for such quarter.


     Any quarterly  shortfall in revenue or earnings from  expected  levels,  or
other short-term failures to meet the expectations of securities analysts or the
market in general, can have an immediate and damaging effect on the market price
of our common stock.

Our common stock may experience extreme price and volume fluctuations.

     The stock  market,  from time to time,  has  experienced  extreme price and
volume  fluctuations.  The  market  prices of the  securities  of  Internet  and
technology companies have been especially volatile,  including fluctuations that
often are  unrelated to the  operating  performance  of the affected  companies.
Broad market  fluctuations of this type may adversely affect the market price of
our common stock.

     The  market  price of our  common  stock has  fluctuated  since we became a
public company. Our stock price could continue to fluctuate significantly due to
a variety of factors, including:

o        public announcements concerning us, our ompetitors or the technology
         industry;

o        fluctuations in our operating results;

o        introductions of new products or services by us or our competitors;

o        changes in analysts' revenue or earnings estimates; and

o        announcements of technological innovations.

     In the past, companies that have experienced volatility in the market price
of their stock have been the target of securities class action litigation. If we
were sued in a securities  class action,  we could incur  substantial  costs and
suffer from a diversion of our management's attention and resources.

Item 3.

Quantitative and Qualitative Disclosures about Market Risks

     Information concerning market risk is contained on page 24 of our 1999
     Annual Report on Form 10-K and is incorporated by reference to such annual
     report.



                           PART II - OTHER INFORMATION

Item 4.  Submission of Matters to a Vote of Security Holders
<PAGE>
         At our Annual Meeting of Stockholders held on May 17, 2000 in Austin,
Texas, our stockholders voted on the following matters.

1.       The election of seven directors to serve until the annual stockholders'
         meeting in 2001, or until their successors have been elected and
         qualified. The nominees of the Board of Directors were elected.
<TABLE>
<CAPTION>
                                                                          AGAINST OR
                                                           FOR             WITHHELD            ABSTAIN
                                                       ------------    ------------------    -------------
           <S>                                           <C>                     <C>                    <C>

           Edward C. Ateyeh, Jr.                         8,645,507               459,393                -
           Thomas A. Herring                             8,675,607               429,293                -
           W. Frank King, Ph.D.                          8,675,607               429,293                -
           Kevin B. Kurtzman                             8,674,507               430,393                -
           Michael J. Maples                             8,674,301               430,599                -
           Wade E. Saadi                                 8,645,410               459,490                -
           Timothy D. Webb                               8,210,717               894,183                -
</TABLE>


2.       Approval of an amendment to our Amended and Restated 1996 Stock Option/
         Stock Issuance Plan (the "Plan") to effect the following:

o        increase the number of shares of our common stock reserved for issuance
         under the Plan by an additional 1,000,000 shares;

o        implement  an  automatic  share  increase  provision  to such plan so
         that the number of shares of common stock  available  for  issuance
         under such plan will automatically  increase on the first trading day
         in January each year, beginning with the 2001  calendar  year,  by an
         amount equal to eight  percent (8%) of the shares of common  stock
         outstanding  on the last trading day of December of the immediately
         preceding  calendar  year,  but in no event  will  any such  annual
         increase exceed 2,000,000 shares of common stock; and

o        provide greater flexibility concerning the limited transferability of
         non-statutory options in connection with estate planning transfers and
         transfers incident to domestic orders.

         The amendment was approved.

<TABLE>
<CAPTION>
                                                                          AGAINST OR
                                                           FOR             WITHHELD            ABSTAIN
                                                       ------------    ------------------    -------------
          <S>                                            <C>                   <C>                  <C>
          Approval of an amendment to 1996               5,855,182             2,075,034            4,995
          Stock Option/Stock Issuance Plan
</TABLE>

3.       To approve an amendment to our Employee Stock Purchase Plan (the
         "Purchase Plan" to increase the number of shares of common stock
         authorized to be issued by 500,000 shares resulting in 900,000 shares
         available for issuance under the Purchase Plan;

         The amendment was approved.

<TABLE>
<CAPTION>                                                                 AGAINST OR
                                                           FOR             WITHHELD            ABSTAIN
                                                       ------------    ------------------    -------------
          <S>                                            <C>                     <C>                <C>
          Approval of an amendment to our                7,602,584               328,457            4,170
          Employee Stock Purchase Plan
</TABLE>

4.       To approve an amendment to our Certification of Incorporation to change
         the name of the corporation to Concero, Inc.

         The amendment was approved.
<PAGE>
<TABLE>
<CAPTION>
                                                                          AGAINST OR
                                                           FOR             WITHHELD            ABSTAIN
                                                       ------------    ------------------    -------------
          <S>                                            <C>                     <C>                <C>
          Approval of an Amendment to the                8,838,001               264,668            2,231
          Certification of Incorporation
</TABLE>

5.       To ratify the appointment of Ernst & Young LLP as the Company's
         independent auditors for the fiscal year ending December 31, 2000.

         The appointment of Ernst & Young LLP was ratified.

<TABLE>
<CAPTION>
                                                                          AGAINST OR
                                                           FOR             WITHHELD            ABSTAIN
                                                       ------------    ------------------    -------------
          <S>                                            <C>              <C>                  <C>    <
          Ratification of Ernst & Young LLP              9,078,360        24,100               2,440
          as independent auditors
</TABLE>

Item 5.   Other Information

     On July 28, 2000, we filed a registration statement on Form S-8 to register
2,250,000  shares of common stock and related stock  options for issuance  under
the Company's 1996 Stock  Option/Stock  Issuance Plan,  2000  Non-Officer  Stock
Option/Stock Issuance Plan and Employee Stock Purchase Plan.

Item 6.   Exhibits and Reports on Form 8-K

          (a)Exhibits

Number            Description

27.1              Financial Data Schedule

         (b) Reports on Form 8-K

During the quarter ended June 30, 2000, we filed the following Current Reports
on Form 8-K;

         On April 18, 2000, we filed a Form 8-K (Item 5) reporting our results
for the first quarter ended March 31, 2000.

         On April 20, 2000, we filed a Form 8-K (Item 5) discussing previously
released statements related to the strength of our revenue pipeline.


<PAGE>

                                   SIGNATURES

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


                                         CONCERO, INC.
                                         (Registrant)



Date:  August 14, 2000                    /s/ Timothy D. Webb
                                          Timothy D. Webb
                                          President and Chief Executive Officer
                                          (Principal Executive Officer)





Date: August 14, 2000                     /s/ Keith D. Thatcher
                                          Keith D. Thatcher
                                          Vice President of Finance, Treasurer
                                          and Chief Financial Officer
                                          (Principal Financial Officer)



Date: August 14, 2000                     /s/ Kasaundra L. Smith
                                          Kasaundra L. Smith
                                          Controller
                                          (Principal Accounting Officer)