<PAGE>
 
                                   FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

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

     For the quarterly period ended September 30, 1997
                                       OR
[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

Commission File Number 000-21593

            WESTERN PENNSYLVANIA ADVENTURE CAPITAL FUND
              (Exact Name of Registrant as Specified in its Charter)

          Pennsylvania                                 25-1792727
(State of Other Jurisdiction of                    (I.R.S. Employer
Incorporation or Organization)                    Identification No.)

                        2000 Technology Drive, Suite 150
                           Pittsburgh, PA 15219-3109
              (Address of Principal Executive Offices and Zip Code)

                                  412-687-0977
               (Registrant's Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirement for the past 90 days.

    X    Yes                     No
 -------                 -------

Number of shares outstanding of the issuer's Common Stock, par value $.01 per
share, as of October 24, 1997:  2,354,333 shares

                                       1
<PAGE>
 
                        Part I -- Financial Information
                                        
                                        
Item 1.  Financial Statements

                                                  Page No.
                                                  --------


     Report on Review by Independent Certified        3
     Public Accountants


     Statement of Assets and Liabilities, as          4
     of September 30, 1997 (unaudited) and 
     December 31, 1996


     Statement of Operations, for the Periods
     July 1, 1997 through September 30, 1997 and      5
     January 1, 1997 through September 30, 1997
     (unaudited)


     Statement of Changes in Net Assets (Deficit),
     for the Periods July 1, 1997 through 
     September 30, 1997 and January 1, 1997 through   6
     September 30, 1997 (unaudited)


     Statement of Cash Flows, for the Periods         7
     July 1, 1997 through September 30, 1997 and
     January 1, 1997 through September 30, 1997
     (unaudited)


     Notes to Financial Statements                    8


Item 2.    Management's Discussion and Analysis of   13
           Financial Condition and Results of 
           Operations 
         


Statement by Management Concerning Review of         14
Interim Information by Independent Certified 
Public Accountants


Statement by Management Concerning the Fair          15
Presentation of Interim Financial Information

                                       2
<PAGE>
 
                   REPORT ON REVIEW BY INDEPENDENT CERTIFIED
                              PUBLIC ACCOUNTANTS

To the Board of Directors
Western Pennsylvania Adventure Capital Fund

We have reviewed the accompanying statement of assets and liabilities of Western
Pennsylvania Adventure Capital Fund as of September 30, 1997, and the related
statements of operations, changes in net assets (deficit), and cash flows for
the three and nine month periods ended September 30, 1997.  These financial
statements are the responsibility of the company's management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants.  A review of interim financial
information consists primarily of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters.  It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole.  Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with generally accepted accounting principles.

We have previously audited, in accordance with generally accepted auditing
standards, the statement of assets and liabilities as of December 31, 1996 and
the related statements of operations, changes in net assets (deficit), and cash
flows for the period from inception (May 23, 1996) to December 31, 1996 (not
presented herein), and in our report dated March 25, 1997, we expressed an
unqualified opinion on those financial statements.


s/ Goff, Ellenbogen, Backa & Alfera, LLC

Goff, Ellenbogen, Backa & Alfera, LLC
Pittsburgh, October 29, 1997

                                       3
<PAGE>
 
                  Western Pennsylvania Adventure Capital Fund
                      Statement of Assets and Liabilities
                                     As of


<TABLE>
<CAPTION>
 
                                  September 30, 1997   December 31, 1996
                                  ------------------   -----------------
                                      (unaudited)
                  Assets
                  ------
 
<S>                                       <C>          <C>
Cash and Cash Equivalents                 $  901,994            $    418
 
Short Term Investments, Net                1,087,421                   0
 
Accrued Interest Receivable                    1,032                   0
 
Organization Costs                            15,200              15,000
                                          ----------            --------
 
     Total Assets                         $2,005,647            $ 15,418
                                          ==========            ========
 
                  Liabilities
                  -----------
 
 
Accounts Payable                          $    8,543            $ 53,167
 
Accrued Liabilities                            2,558                   0
 
Demand Note Payable                                0               1,000
 
Accrued Interest Payable                           0                  24
                                          ----------            --------
 
     Total Liabilities                    $   11,101            $ 54,191
                                          ==========            ========
 
                  Net Assets
                  ----------
 
 
Common Stock, Par Value $.01              $   23,193            $  2,500
Per Share, Authorized 10,000,000
Shares, Issued and Outstanding
2,319,333 Shares (250,000 shares as of
December 31, 1996)
 
Additional Paid in Capital                 2,048,640                   0
 
Syndication Costs                            (85,507)            (41,167)
 
Retained Earnings (Deficit)                    8,220                (106)
                                          ----------            --------
 
 Net Assets (Deficit) Applicable to
 Shares Outstanding                       $1,994,546            $(38,773)
                                          ==========            ========
 
 Net Assets (Deficit) Value Per Share          $0.86              $(0.16)
                                          ==========            ========
</TABLE>


See Accountant's Report and accompanying notes to financial statements.

                                       4
<PAGE>
 
                  Western Pennsylvania Adventure Capital Fund
                            Statement of Operations
                                For the Periods


<TABLE>
<CAPTION>
                                July 1, 1997            January 1, 1997
                                   through                  through
                              September 30, 1997       September 30, 1997
                              ------------------       ------------------
                                 (unaudited)              (unaudited)


<S>                           <C>                      <C>
Revenues -- Interest Income        $  47,712              $  47,712

Expenses:
 
 General and Administrative            2,161                 15,759
 Interest                             20,327                 20,367
 Operating Expenses                      168                    219
 Taxes                                   483                    483
                                     -------                -------
 
          Total Expenses              23,139                 36,828
                                     -------                -------
 
 
Profit Before Income Taxes            24,573                 10,884
 
Income Taxes                           2,558                  2,558
                                     -------                -------
 
Net Income                           $22,015                $ 8,326
                                     =======                =======
 
Earnings Per Share                   $  0.01                $  0.01
                                     =======                =======
</TABLE>


See Accountant's Report and accompanying notes to financial statements.

                                       5
<PAGE>
 
                  Western Pennsylvania Adventure Capital Fund
                  Statement of Changes in Net Assets (Deficit)
                                For the Periods

<TABLE>
<CAPTION>

                                      July 1, 1997         January 1, 1997
                                        through               through
                                   September 30, 1997     September 30, 1997
                                   ------------------     ------------------
                                      (unaudited)            (unaudited)


<S>                                     <C>           <C>
From Operations
 Net Income                              $   22,015         $     8,326
 
 
From Share Transactions:
 Proceeds from Sale of Common Stock       2,069,333           2,069,333
 Syndication Costs                           (5,919)            (44,340)
                                         ----------          ----------
 Net Increase in Net Assets
     Derived from Share Transactions      2,063,414           2,024,993
                                         ----------          ----------
 
     Net Increase in Net Assets           2,085,429           2,033,319
 
Net Assets (Deficit):
 Beginning of Period                        (90,883)            (38,773)
                                         ----------          ----------
 
 End of Period                           $1,994,546          $1,994,546
                                         ==========          ==========
 
</TABLE>


See Accountant's Report and accompanying notes to financial statements.

                                       6
<PAGE>
 
                  Western Pennsylvania Adventure Capital Fund
                            Statement of Cash Flows
                                For the Periods



<TABLE>
<CAPTION>
                                                                  July 1, 1997              January 1, 1997
                                                                    through                     through
                                                               September 30, 1997         September 30, 1997
                                                           --------------------------  -------------------------
                                                                  (unaudited)                 (unaudited)
 
<S>                                                        <C>                         <C>
Cash Flow from Operating Activities:
     Interest Income                                                     $    35,207                $    35,207
     Interest Expense                                                        (20,327)                   (20,367)
     Operating Expenses Paid                                                 (13,299)                   (14,044)
                                                                         -----------                -----------
 
          Net Cash Provided by Operating Activities                            1,581                        796
                                                                         -----------                -----------
 
Cash Flow from Financing Activities:
   Proceeds from Sale of Common Stock                                      2,069,333                  2,069,333
   Payments of Syndication Costs                                             (76,588)                   (76,588)
   Payment of Demand Note Payable                                             (1,000)                    (1,000)
   Repayment of Advance from The Enterprise Corp.                               (500)                        (0)
   Payments of Organization Costs                                            (15,000)                   (15,000)
                                                                         -----------                -----------
 
        Net Cash Provided by Financing Activities                          1,976,245                  1,976,745
                                                                         -----------                -----------
 
Cash Flow from Investing Activities:
   Purchase of Short Term Investments                                     (1,196,965)                (1,196,965)
   Proceeds from Redemption of Short Term Investments                        121,000                    121,000
                                                                         -----------                -----------
 
        Net Cash Used by Investing Activities                             (1,075,965)                (1,075,965)
                                                                         -----------                -----------
 
Net Increase in Cash:                                                        901,861                    901,576
   Cash at Beginning of Period                                                   133                        418
                                                                         -----------                -----------
   Cash at End of Period                                                 $   901,994                $   901,994
                                                                         ===========                ===========
</TABLE>
                                                                                

See Accountant's Report and accompanying notes to financial statements.

                                       7
<PAGE>
 
                  Western Pennsylvania Adventure Capital Fund
                         Notes to Financial Statements
                              September 30, 1997


Note 1 -- Summary of Significant Accounting Policies:
-----------------------------------------------------

This summary of significant accounting policies of Western Pennsylvania
Adventure Capital Fund ("the Fund") is presented to assist in understanding the
Fund's financial statements.  These accounting policies conform with generally
accepted accounting principles and have been consistently applied in the
preparation of the financial statements.


Nature of Operations

The Fund is a newly-formed Pennsylvania corporation, incorporated on May 23,
1996, which has conducted no significant business operations.  The Fund has been
formed to become a Business Development Company ("BDC") and to be subject to the
applicable provisions of the Investment Company Act of 1940, as amended (the
"1940 Act").  The Fund intends to invest primarily in the equity and/or debt
securities of development stage companies located in western Pennsylvania.  The
Fund will seek to make its investments in conjunction with a consortium of
investment partners such as individual investors, private non-profit or for-
profit companies or foundations, and federal, state or local public, quasi-
public or publicly-supported economic development organizations, agencies or
authorities which provide investment capital or low interest or other financing
for economic development.

The Fund's Board of Directors, which will be elected by the shareholders
annually, will have responsibility for management of the Fund, including
authority to select portfolio securities for investment by the Fund.  The Board
will be advised by the officers of the Fund and by The Enterprise Corporation of
Pittsburgh ("Enterprise"), the Fund's investment advisor.  Enterprise will
screen potential Portfolio Companies and present them to the Fund's Board for
investment consideration, conduct due diligence reviews of investment candidates
and manage the day-to-day operations of the Fund including, portfolio
management, preparing reports to shareholders and performing administrative
services.  The recommendations of Enterprise as to investments are advisory only
and will not be binding on the Fund or its Board of Directors.  Enterprise is a
private, non-profit consulting firm founded in 1983 for the purpose of assisting
entrepreneurs in developing new businesses in western Pennsylvania.

Enterprise will receive a fee equal to 5% of the aggregate amount of assets
invested by the Fund in portfolio securities for providing investment advisory
and administrative services to the Fund. Enterprise may also receive
compensation from investment partners or members of any investment consortium
that invests with the Fund in portfolio securities, all on such basis as such
other parties and Enterprise shall agree.

                                       8
<PAGE>
 
Basis of Presentation -- Interim Financial Statements

The financial information included herein has been prepared from the books and
records without audit.  The accompanying financial statements have been prepared
in accordance with the instructions to Form 10-Q and do not include all of the
information and the footnotes required by generally accepted accounting
principles for complete statements.  In the opinion of management, all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair presentation of the financial condition, results of operations, changes in
net assets (deficit), and cash flows, have been included.

The preparation of financial statements in conformity with generally accepted
accounting principles 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.

These financial statements should be read in conjunction with the financial
statements and notes thereto for the period from the date of inception (May 23,
1996) to December 31, 1996, contained in the Fund's 1996 Annual Report on Form
10-K.

As the Fund was incorporated on May 23, 1996, and was inactive through
September 30, 1996, there are no corresponding financial statements for the
comparable interim periods of calendar year 1996.


Basis of Presentation -- Net Assets

The Fund is currently offering a total of 5,000,000 shares of its common stock,
par value $.01, at a price of $1.00 per share under Regulation E of the
Securities Act of 1933 (the "Offering").  In connection with its services in
organizing the formation and development of the Fund, Enterprise purchased
250,000 shares of common stock for $.01 per Share.  If all 5,000,000 Shares are
sold in the Offering, the Shares held by Enterprise will represent 4.8% of the
issued and outstanding shares of the Fund.  If less than 5,000,000 Shares are
sold in the Offering, the Fund shall have the right to repurchase from
Enterprise for $.01 per share such number of Shares as will result in
Enterprise's ownership percentage in the Fund immediately following the Offering
being 4.8%.  The Shares purchased by Enterprise represent founder's shares.


Syndication Costs

For the three and nine month periods ending September 30, 1997, legal and other
costs of $5,919 and $44,340, respectively, incurred in connection with the
Offering have been capitalized and reported as a permanent reduction of net
assets.

                                       9
<PAGE>
 
Cash and Cash Equivalents

Cash and Cash Equivalents consist of cash in checking and escrow accounts, and
high quality money market instruments having or deemed to have remaining
maturities of thirteen months or less.


Short Term Investments

The Fund's short term investments consist of high quality commercial paper and
U.S. Government securities.  These investments generally are purchased at a
discount from face value and are redeemed at maturity at face value.  The
difference represents interest income which will accrete over the period from
date of acquisition to date of maturity.  The Fund uses the effective yield to
maturity method to recognize the accretion of interest income over the life of
each individual short term investment.  This method produces a rate of return
which is constant over the period from acquisition to maturity.  Using this
method, the interest income recognized on each individual investment will
increase over time as the carrying value of that investment increases.

The Fund records these investments net of remaining unearned interest income as
of September 30, 1997.


Start-Up and Organization Costs

A total of $15,000 was incurred in 1996, plus an additional $200 in the third
quarter of 1997, in connection with the start-up and organization of the Fund.
These costs have been deferred and will be amortized ratably over a period of 60
months from the date the Fund commences investment operations.


Earnings Per Share

Earnings per share is computed using the weighted average number of shares
outstanding during the respective periods.  There are no outstanding stock
options, warrants, or other contingently issuable shares.


Income Taxes

The Fund has adopted the Statement of Financial Accounting Standard No. 109 (FAS
109), Accounting for Income Taxes, from its inception.  FAS 109 requires an
asset and liability approach that recognizes deferred tax assets and liabilities
for the expected future tax consequences of events that have been recognized in
the Company's financial statements or tax returns.  In estimating future tax
consequences, FAS 109 generally considers all expected future events other than
enactments of changes in the tax law or rates.

                                       10
<PAGE>
 
Note 2 -- Sale of Securities
----------------------------

As of September 30, 1997, the Fund had received subscriptions for 2,069,333
shares of its common stock under the Offering.  The proceeds from these
subscriptions were required to be deposited in an escrow account with the Fund's
escrow agent, PNC Bank, until such time as the escrow account reached $1
million.  At that time, the Fund was permitted to withdraw the funds from the
escrow account and begin to invest in portfolio securities.

As of July 11, 1997, the Fund had received subscriptions for 1,860,100 shares of
common stock under the Offering.  The proceeds from these subscriptions totaled
$1,860,100 and were being held by the escrow agent.  On that date, the Fund
withdrew substantially all of the funds from the escrow account.

The funds released from escrow have been temporarily invested, pending
investment in Portfolio Securities, in cash equivalents, government securities,
and high quality debt securities.  A portion of the funds released from escrow
were disbursed to pay accumulated obligations whose payment was deferred until
funds were released from escrow.  As of September 30, 1997, proceeds received
from subscribers under the Offering totaled $2,069,333.


Note 3 -- Demand Note Payable
-----------------------------

On September 12, 1996, the Fund entered into a promissory note agreement with
Enterprise whereby Enterprise agreed to lend the Fund $1,000.  The note is
payable upon demand and accrues interest at 8% per annum.  The note and all
accrued interest were paid in July, 1997.


Note 4 -- Interest on Escrow Funds
----------------------------------

Under the terms of the Offering, any interest earned on any subscriptions held
in the escrow account for more than 90 days is to be paid to the subscribers at
the time funds are released from the escrow account.  This interest, which
totaled $20,327, was paid to subscribers when the Fund withdrew funds from
escrow in July, 1997.

                                       11
<PAGE>
 
Note 5 -- Co-Investor Agreement
-------------------------------

On September 11, 1997, the Board of Directors of the Urban Redevelopment
Authority of Pittsburgh ("URA") approved a resolution authorizing the URA to
enter into a co-investment agreement with the Fund.  Under the terms of this
agreement, the URA will set up an escrow account, or its equivalent, in the
amount of $1,000,000.  These funds will be available for co-investment with the
Fund, on a dollar-for-dollar basis, in Portfolio Companies, subject to certain
exclusions, that either are located in the City of Pittsburgh or commit to
locate in the City of Pittsburgh within six months of closing on the investment.
The URA may withhold releasing funds if it is convinced that the Fund does not
have adequate funding.  The URA will have observer rights to attend Fund Board
of Directors meetings.


Note 6 -- Short Term Investments
--------------------------------

The Fund, pending investment in Portfolio Securities, has temporarily invested
its excess funds in short term high quality commercial paper and U.S. Government
securities.  These investments generally are purchased at a discount from face
value and are redeemed at maturity at face value.  The discount from face value
represents unearned interest income and is recognized over the remaining term of
the security using the effective yield to maturity method.



<TABLE>
<CAPTION>
         Investment                   Face Value        Carrying Value       Market Value
         ----------                   ----------        --------------       ------------
<S>                                   <C>                <C>                 <C>
Commercial Paper                      $  986,000          $  966,642          $  964,909
 
U.S. Government Securities               125,000             120,779             120,763
                                      ----------          ----------          ----------
 
Total                                 $1,111,000          $1,087,421          $1,085,672
                                      ==========          ==========          ==========
</TABLE>
                                                                                

                                       12
<PAGE>
 
Item 2.   Management's Discussion and Analysis of Financial Condition and
-------------------------------------------------------------------------
Results of Operations
---------------------


Results of Operations
---------------------

Revenues for both the three month and nine month periods ending September 30,
1997 were $47,712 and consisted of interest income earned on escrowed funds,
short term investments and money market funds.  Expenses for the three and nine
month periods ending September 30, 1997 were $23,139 and $36,828, respectively,
and consisted primarily of professional fees of $1,976 and $14,800,
respectively, for the audit of the Registrant's financial statements for the
period from inception (May 23, 1996) through December 31, 1996, and the reviews
of the Registrant's financial statements for the three and six month periods
ended June 30, 1997, and interest paid to subscribers whose funds were held in
escrow for more than 90 days, of $20,327.

The Registrant is soliciting subscriptions for the purchase of a minimum of
1,000,000 shares and a maximum of 5,000,000 shares of its Common Stock under an
offering circular dated November 7, 1996 (the "Offering Circular").  Under the
terms of the Offering Circular, shares are being offered at $1.00 per share,
with a minimum purchase of 10,000 shares per investor, subject to the discretion
of the Registrant to accept subscriptions for fewer shares.  The shares are
being offered directly by the Registrant.  There are no brokers, placement
agents or other persons who will receive commissions or placement fees from the
sale of shares under the Offering Circular.


Financial Condition, Liquidity and Capital Resources
----------------------------------------------------

The Registrant's liquidity and financial resources will be dependent upon the
sale of its Common Stock in the Offering.  As of July 11, 1997, subscriptions
for purchase of 1,860,100 shares of the Registrant's Common Stock had been
received, and the funds, $1,860,100, were held by the escrow agent.

On July 11, 1997, the Fund withdrew substantially all of the funds from the
escrow account, and in accordance with the terms of the Offering, authorized the
payment of interest to all subscribers whose funds had been held in the escrow
account for more than 90 days.  This interest totaled $20,327.

The funds released from escrow have been temporarily invested, pending
investment in Portfolio Securities, in cash equivalents, government securities,
and high quality debt securities.  A portion of the funds released from escrow
were disbursed to pay accumulated obligations whose payment was deferred until
funds were released from escrow.

                                       13
<PAGE>
 
         Statement by Management Concerning Review of Interim Financial
            Information by Independent Certified Public Accountants



The September 30, 1997 financial statements included in this filing on Form 10-Q
have been reviewed by Goff, Ellenbogen, Backa & Alfera, LLC, independent
certified public accountants, in accordance with established professional
standards and procedures for such review.  The report of Goff, Ellenbogen, Backa
& Alfera, LLC commenting on their review accompanies the financial statements
included in Item 1 of Part I.

                                       14
<PAGE>
 
            Statement by Management Concerning the Fair Presentation
                        of Interim Financial Information



The financial information included herein is unaudited; however, such
information reflects all adjustments (consisting solely of normal recurring
adjustments), which are, in the opinion of management, necessary to a fair
statement of the results for the interim period.  The report of Goff,
Ellenbogen, Backa & Alfera, LLC commenting upon their review accompanies the
financial statements included in Item 1 of Part I.

                                       15
<PAGE>
 
                          Part II -- Other Information

                                        

Item 6.  Exhibits and Reports on Form 8-K

     (a) List of Exhibits

         11    Computation of earnings per share for the three months and
               nine months ended September 30, 1997

         27    Financial Data Schedule

     (b) Reports on Form 8-K

         There were no reports on Form 8-K filed during the quarter
         ended September 30, 1997

                                       16
<PAGE>
 
                                   SIGNATURES

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


Western Pennsylvania Adventure Capital Fund
(Registrant)



                                  s/ G. Richard Patton
                                  ----------------------------
Date   October 24, 1997           G. Richard Patton
       -----------------          President, Chief Executive Officer
                                  and Director



                                  s/ Alvin J. Catz
                                  ----------------------------
Date   October 24, 1997           Alvin J. Catz
       -----------------          Chief Financial Officer, Treasurer
                                  and Director

                                       17