SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   Form 10-QSB

                   Quarterly Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

For Quarter Ended August 31, 1999           Commission File No.    33-23430-D

                                NETCOMMERCE, INC.
                      (Formerly Virtual Enterprises, Inc.)
             (Exact name of registrant as specified in its charter)

             Nevada                                        84-1091271
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
incorporation or organization)



        4695 MacArthur Court, Suite 530, Newport Beach, California 92660
               (Address of principal executive offices) (Zip Code)

                                 (949) 475-6755
              (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 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

                     APPLICABLE ONLY TO CORPORATE ISSUERS:


     As of August 31, 1999,  there were  16,119,372  shares of the  Registrant's
$.01 par value common stock issued and  outstanding. There were also outstanding
warrants to  purchase  up to 668,014  shares of the  Registrant's  common  stock
issued in September 6, 1990 and expiring December 31, 2000.


                                                              [NETCOM\10Q:83199]
<PAGE>

                                NETCOMMERCE, INC.
                                      INDEX



                                      Page
                                     PART I

Item 1.   Financial Statements

          Consolidated Balance Sheet - August 31, 1999 ........................1

          Consolidated Statements of Operations - Three Months Ended
             August 31, 1999 and 1998..........................................2

          Consolidated Statements of Stockholders Equity
             Three Months Ended - August 31, 1999 .............................3

          Consolidated Statements of Cash Flows - Three Months Ended
             August 31, 1999 and 1998..........................................4

          Notes to Financial Statements........................................5


Item 2.   Management's Discussion and Analysis of

          Financial Condition and Results of Operations........................8



                                     PART II

Item 1.   Legal Proceedings................................................... 9

Item 2.   Changes In Securities............................................... 9

Item 3.   Defaults Upon Senior Securities..................................... 9

Item 4.   Submission of Matters to a Vote of Security Holders................. 9

Item 5.   Other Information...................................................10

Item 6.   Exhibits and Reports on Form 8-K....................................10






                                        I

                                                              [NETCOM\10Q:83199]
<PAGE>

                                NetCommerce, Inc.
                      (Formerly, Virtual Enterprises, Inc.)
                           Consolidated Balance Sheet
                                 August 31, 1999

<TABLE>
<CAPTION>




ASSETS
<S>                                                              <C>

Cash                                                             $       53,761
Accounts Receivable                                                      10,950

   Total current assets                                                  64,711

Property and equipment, net of accumulated
  depreciation of $135,574                                              248,111
Goodwill, net of accumulated amortization
  of $143,649                                                           738,493
Client lists, net of accumulated amortization
  of $57,135                                                            195,865
Prepaid Expenses                                                        150,000
Deposits                                                                  9,692

   Total assets                                                  $    1,406,872

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable                                                 $      203,869
Accrued compensation to officers                                         42,000
Accrued consulting fees                                                 186,000
Other accrued liabilities                                               158,570
Deferred revenue                                                         70,522
Notes Payable                                                           250,000

   Total current liabilities                                            910,961

Notes payable to officers                                               287,133

   Total liabilities                                                  1,198,094


Stockholders' equity:
  Common stock, par value $0.01; 50,000,000 shares
   authorized, 16,119,372 shares issued and outstanding
  Additional paid in capital                                            161,194
  Accumulated deficit
                                                                      2,684,345
                                                                     (2,636,761)

   Total stockholders' equity                                           208,778

   Total liabilities and stockholders equity                    $     1,406,872

</TABLE>


          See accompanying notes to consolidated financial statements.

                                        1
                                                              [NETCOM\10Q:83199]
<PAGE>

                                NetCommerce, Inc.
                      (Formerly, Virtual Enterprises, Inc.)
                      Consolidated Statements of Operations
               For The Three Months Ended August 31, 1999 and 1998


<TABLE>
<CAPTION>



                                                 1999           1998
<S>                                       <C>              <C>
Net revenues                              $       206,159  $     38,280

Expenses:
  Salaries and wages                               49,204        32,592
  Consulting fees and commissions                  89,141       124,536
  Common stock issued to employees for
     services rendered                                  -        42,445
  Other operating expenses                        485,923       131,722
         Total expenses                           624,268       331,294

Operating loss                                   (418,109)     (293,015)

Interest expense                                  111,172        21,417

Other income                                            -          (155)

Loss before income taxes                         (529,281)     (314,277)

Income taxes                                        1,600             -


Net loss                                  $      (530,881) $   (314,277)

Basic and diluted earnings per share      $          (.03) $       (.21)

</TABLE>














          See accompanying notes to consolidated financial statements.

                                                              [NETCOM\10Q:83199]
                                        2
<PAGE>

                                NetCommerce, Inc.
                      (Formerly, Virtual Enterprises, Inc.)
                 Consolidated Statements of Stockholders Equity
                   For The Three Months Ended August 31, 1999


<TABLE>
<CAPTION>


                                      Common Stock             Additional
                                                                Paid-In    Accumulated
                                    Shares        Amount        Capital       Deficit       Total

<S>                              <C>         <C>           <C>            <C>           <C>

Balances, May 31, 1999           15,919,372  $    159,194  $   2,486,345  $ (2,105,880) $    539,659
Shares issued in connection
with loan funding                   200,000         2,000        198,000             -       200,000

Net loss for period                       -             -              -      (530,881)     (530,881)

Balances for August 31, 1999     16,119,372       161,195  $   2,684,345  $ (2,686,761) $    208,778

</TABLE>





























          See accompanying notes to consolidated financial statements.
                                                              [NETCOM\10Q:83199]
                                        3
<PAGE>

                                NetCommerce, Inc.
                      (Formerly, Virtual Enterprises, Inc.)
                      Consolidated Statement of Cash Flows
               For The Three Months Ended August 31, 1999 and 1998



<TABLE>
<CAPTION>


                                                                         1999          1998

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                 <C>          <C>

Net loss                                                            $  (530,881) $  (314,277)
   Adjustments to reconcile net loss to net cash used in operating
      activities:
      Depreciation                                                       29,000       15,600
      Amortization                                                       38,882            -
      Issuance of common stock for services rendered by employees             -       42,445

 Change in operating assets and liabilities:
      Issuance of common stock for interest, net of amortization
         of $50,000 in 1999                                             150,000       20,000
      Increase in accounts payable                                      138,435       24,250
      Increase in accrued compensation to officers                       14,000        7,000
      Increase in accrued consulting fees                                28,000       45,000
      Other                                                             (17,038)      56,482

Net cash used in operating activities                                  (259,602)    (110,500)

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures                                                    (46,637)     (14,500)

CASH FLOWS FROM FINANCING ACTIVITIES:

Issuance of notes payable                                               250,000            -
Issuance of notes payable to officers                                         -      125,000

Net cash provided by financing activities                               250,000      125,000

Net increase in cash                                                 $   53,761  $         -


</TABLE>










          See accompanying notes to consolidated financial statements.

                                                              [NETCOM\10Q:83199]
                                        4

<PAGE>

                                NetCommerce, Inc.
                      (Formerly, Virtual Enterprises, Inc.)
                   Notes to Consolidated Financial Statements



Note 1 - Organization and History

     On August 31, 1999, the Company received notice of filing and acceptance by
the  Nevada  Secretary  of  State  of  its  restated  and  amended  Articles  of
Incorporation.  In the process, the name of the Company was changed from Virtual
Enterprises,  Inc.(VTUE) to  NetCommerce,  Inc. (NEET) to better reflect its new
corporate direction.

     On May 5, 1999, NEET acquired the assets and assumed certain liabilities of
MetroplexWeb,  Inc. (Metroplex) for 10,000,000 shares of common stock, valued at
$3,000,000.  Metroplex,  a Texas  corporation  was formed on September 12, 1996.
Metroplex is engaged primarily in the development,  design,  hosting and support
of Internet web pages. Metroplex also creates,  designs and administers Internet
malls,  where users can search for products  and services in their  geographical
area known as virtual  cities.  Metroplexs  operations are primarily  located in
Dallas/Forth Worth, Texas and are expanding into other metropolitan  cities. The
acquisition  of Metroplex is accounted  for as a reverse  merger as if Metroplex
was recapitalized by NEET.

     On June 30, 1998,  Metroplex entered into an asset purchase  agreement with
InteleSell, Inc. (InteleSell). In connection therewith,  Metroplex issued common
stock and notes aggregating  $1,335,142 to acquire these assets. The acquisition
was accounted for as a purchase. InteleSell develops, designs and hosts Internet
web pages. See Note 3 for further discussion of this acquisition.

Recent Developments

     Consistent  with its  operating  strategy,  on July 23,  1999,  the Company
entered into a Memorandum of  Understanding  with Anyuser.Net  (Anyuser),  South
Korean corporation,  of Seoul,  Korea,  whereby the Company intends to invest $3
million  into  Anyuser  to  acquire  approximately  47% of the total  issued and
outstanding common stock of Anyuser.  Anyuser has developed proprietary Internet
and  data/video/voice  switching software for one touch video communicating over
the  Internet.  Under the  agreement,  Anyuser will provide  hardware and market
video  Internet  services  in the  Asian  market  and the  Company  will  obtain
exclusive  licensing for Anyusers  products  including  the  exclusive  right to
market the Web Video Phone and related  services in the North and South American
marketplace.  Anyuser will license and market the Companys products in the Asian
market,  including  the  Metroplex  city  guides,  web  design,  web hosting and
e-commerce  products.  Royalty payments will be made by the parties for licensed
products.

     On August 2, 1999 the Company formed InterCom,  Inc., a Nevada  corporation
(InterCom) as a wholly owned  subsidiary to conduct all of the Companys  planned
ventures in the telecommunications arena.

Note 2 - Summary of Significant Accounting Policies

Principles of Consolidation

     The  accompanying  consolidated  financial  statements  at August 31, 1999,
include the  accounts  of NEET,  Metroplex  and  InteleSell  (collectively,  the
Company). All intercompany accounts have been eliminated in consolidation.

     The accompanying  consolidated  financial statements reflect the historical
operations of Metroplex for all periods presented. The accompanying consolidated
financial  statements  include the  operations of InteleSell  beginning  July 1,
1998.



                                                              [NETCOM\10Q:83199]
                                        5

<PAGE>

                                NetCommerce, Inc.
                      (Formerly, Virtual Enterprises, Inc.)
             Notes to Consolidated Financial Statements (Continued)


Note 2 - Summary of Significant Accounting Policies (Contd)

Liquidity

     The  accompanying  consolidated  financial  statements  have been  prepared
assuming that the Company will continue as a going concern. Since inception, the
Company has generated cash flows from  financing  activities to fund losses from
operations.  The Company,  through  NEET,  expects to raise  equity  and/or debt
financing through a private placement of securities.  The Company expects to use
the financing to fund losses from operations for the foreseeable future.  Losses
from operations are expected to increase due to managements belief that expanded
marketing and sales efforts is required to  significantly  increase the Companys
revenues.  There are no  assurances  that NEET will be  successful  in obtaining
additional  funding on terms  satisfactory  to the Company.  These factors raise
substantial  doubt  about  its  ability  to  continue  as a going  concern.  The
consolidated  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.

Property and Equipment

     Property and equipment are depreciated  over their  estimated  useful lives
using the straight-line  method ranging from three to five years.  Additions and
betterments are  capitalized.  The cost of maintenance and repairs is charged to
expense as incurred.  When depreciable property is retired or otherwise disposed
of, the related cost and accumulated  depreciation  and amortization are removed
from  the  accounts  and  any  gain or loss  is  reflected  in the  consolidated
statements of operations.

Intangible Assets

     Customer lists represent the value of customers acquired from InteleSell on
June 30, 1998. The Company  assigned the value based on comparable  acquisitions
of customer  lists in the  Companys  industry.  Management  assigned a value of
$1,000 per customer  acquired,  or $253,000.  The Company  amortizes these costs
over its expected benefit period from the customer. In managements opinion, the
expected  benefit  period of its customers  acquired is  approximately  five (5)
years, and  accordingly,  customer lists are amortized over five (5) years using
the straight line basis. In the event circumstances affecting customer retention
change, management will adjust the period to be benefitted prospectively.

     Goodwill represents the excess of purchase price over the fair value of the
net assets of acquired  businesses.  Goodwill is stated at cost and is amortized
on a  straight-line  basis  over  seven (7)  years.  The  Company  assesses  the
recoverability  of this intangible asset quarterly,  by determining  whether the
amortization  of the goodwill  balance over its remaining  life can be recovered
through projected undiscounted cash flows. The amount of goodwill impairment, if
any, is measured  based on projected  undiscounted  cash flows and is charged to
operations  in  the  period  in  which  goodwill  impairment  is  determined  by
management. To date, management has not identified any impairment of goodwill.

Revenue Recognition / Deferred Revenue

     Revenue  is  recognized  when  earned.  The  Companys  revenue  recognition
policies  are  in  compliance  with  American   Institute  of  Certified  Public
Accountants, Statements of Position 97-2 and 98-4, Software Revenue Recognition.
Revenue from web site development is recorded when the web site is completed and
operational.  Web site hosting  revenue is recognized  ratably over the contract
period. Provisions for losses are recorded for bad debts for credit customers.


                                                              [NETCOM\10Q:83199]
                                        6
<PAGE>

Note 2 - Summary of Significant Accounting Policies (Contd)

Research and Development

     Research  and  development  costs are  expensed as  incurred.  Statement of
Financial  Accounting  Standards (SFAS) 86, Accounting for the Costs of Computer
Software to Be Sold, Leased, or Otherwise  Marketed,  does not materially affect
the Company.

Advertising Costs

The Company expenses the costs of advertising as incurred.

Provision for Income Taxes

     The Company  accounts  for its income  taxes  under an asset and  liability
method  whereby  deferred tax assets and  liabilities  are  determined  based on
temporary  differences between bases used for financial reporting and income tax
reporting purposes.  Income taxes are provided based on the enacted tax rates in
effect at the time  such  temporary  differences  are  expected  to  reverse.  A
valuation  allowance is provided  for certain  deferred tax assets if it is more
likely than not that the Company  will not  realize  tax assets  through  future
operations.

Estimates

     The  preparation of  consolidated  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 consolidated
financial  statements and the reported  amounts of revenues and expenses  during
the reporting period. Actual results could differ from those estimates.

Unaudited Interim Financial Statements

     The interim  financial data as of August 31, 1999, and for the three months
ended  August  31,  1999 and 1998,  is  unaudited;  however,  in the  opinion of
management, the interim data includes all adjustments, consisting only of normal
recurring  adjustments,  necessary  to present  fairly the  Company's  financial
position as of August 31, 1999, and the results of its operations and cash flows
for the three months ended August 31, 1999 and 1998.










                                                              [NETCOM\10Q:83199]
                                        7
<PAGE>

PART I

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

     Overview

     NetCommerce  is an  Internet-related  holding  company  which  invests  in,
develops and operates  Internet service  companies from majority or wholly owned
subsidiaries.  NetCommerce's  Internet  services,  including  web  page  design,
web-hosting  and ISP  marketing  activities  are  conducted  through  Metroplex.
NetCommerce's      Internet-related      telecommunications     services     are
developmental-stage  and include  prepaid  calling cards,  re-marketing  of long
distance  services  and its  recent  venture to  license  and  acquire an equity
interest for AnyUser,  market for the new Web Video Phone  software.  All of the
company's  telecommunication  services will be conducted through InterCom,  Inc.
Both Metroplex and InterCom are wholly-owned subsidiaries.

     The  consolidated   financial   statements  presented  herein  reflect  the
acquisition of Metroplex on May 5, 1999. As the acquisition resulted in a change
of control of the Company,  generally accepted  accounting  principles  required
that the transaction be accounted for as a  recapitalization  of Metroplex.  The
accompanying consolidated financial statements reflect the historical operations
of  Metroplex  for  the  two  years  in the  period  ended  May  31,  1999.  The
accompanying  consolidated  financial  statements  include the operations of the
Company from May 5, 1999, the date of the reverse acquisition. On June 30, 1998,
Metroplex  entered  into  an  asset  purchase  agreement  with  InteleSell.  The
acquisition was accounted for as a purchase.  InteleSell  develops,  designs and
hosts internet web pages. The  accompanying  consolidated  financial  statements
include the operations of Intelesell from July 1, 1998.  Therefore,  the results
of operations presented are substantially those of Metroplex for the years ended
May 31, 1999 and 1998.

     Consistent  with its  operating  strategy,  on July 23,  1999,  the Company
entered into a Memorandum of  Understanding  with  Anyuser,  whereby the Company
intends to invest $3 million  into Anyuser to acquire  approximately  47% of the
total  issued and  outstanding  common stock of Anyuser.  Anyuser has  developed
proprietary Internet and data/video/voice switching software for one touch video
communicating  over the  Internet.  Under the  agreement,  Anyuser  will provide
hardware and market video Internet  services in the Asian market and the Company
will obtain exclusive  licensing for Anyusers  products including the exclusive
right to market the Web Video Phone and related  services in the North and South
American marketplace.  Anyuser will license and market the Companys products in
the Asian market,  including the Metroplex city guides,  web design, web hosting
and  e-commerce  products.  Royalty  payments  will be made by the  parties  for
licensed products.

     The Company is currently  planning  expansion  into the  telecommunications
arena. Accordingly, on August 2, 1999, InterCom was formed with the intention of
conducting the Companys  telecommunications business as well as the licensing of
the Web Video Phone software acquired from Anyuser.

Results of Operations

     Three Months  Ended  August 31, 1999  Compared to Three Months Ended August
31, 1998

     Revenues for the three months ended August 31, 1999,  were $206,000  versus
$38,000 in 1998, a 539% increase over the prior year.  Revenues increased as the
Company continued to expand its operations, as well as the 1999 quarter included
the  operations of  Intellesell  for the full quarter  versus only two months in
1998. The Companys  revenues from web  development and hosting were $176,000 and
$30,000,  respectively  for the current quarter versus total revenues of $38,000
for the 1998 quarter.  The Company recognizes hosting fee revenues over the term
of the  contract,  usually one year.  This  increase  can be  attributed  to the
Companys emphasis on expanding its operations.

     Expenses were $624,000 in the first quarter of 1999 compared to $331,000 in
the  first  quarter  of  1998,  an 89%  increase.  The  increase  was  primarily
attributable to an increase in marketing and sales efforts resulting from a full
year of city  mall  operation,  as well as  expansion  into  additional  cities.
Increased sales efforts required additional production and support staff for web
page design and support.

                                                              [NETCOM\10Q:83199]
                                        8
<PAGE>


Liquidity and Capital Resources.

     As of August 31,  1999,  the Company had a working  capital  deficiency  of
$846,000,  a decrease  of  $540,000  from  August 31,  1998.  The  decrease  was
attributable to the continued accrual of professional,  consulting, and advisory
services  incurred but not paid and the incurrence of short term debt during the
quarter ended August 31, 1999.

     The  Company had a cash  balance of $54,000 at August 31,  1999  against an
overdraft in 1998.  The limited  available  cash balances are a direct result of
the Company having negative capital  resources and losses from operations during
the year  ended May 31,  1999 and the  current  quarter.  On June 6,  1999,  the
Company issued 8% notes payable totaling $250,000, due and payable June 6, 2000.
As an inducement to obtain the  financing,  the Company issued 200,000 shares of
its common  stock.  Management  estimates  the value of such  shares at $200,000
which will be amortized to interest costs over the next 12 months.

     The  Companys  plan is to seek for  additional  sources of capital  and new
operating opportunities.  Management believes that $1 to $3 million is needed to
fund sale,  marketing,  and product  development.  In the interim,  the Companys
existence is  dependent  on  continuing  financial  support  from an  affiliate.
Furthermore,  the  Company  intends  to  utilize  its  common  stock for  future
financial support to finance its needs. There are no assurances that the Company
will be successful  in  completing an offering  sufficient to meet its operating
needs.  Such conditions  raise  substantial  doubt about the Companys ability to
continue as a going concern unless  substantial funds can be raised through debt
or equity capital. As such, the Companys  independent  accountants have modified
their  report  to  include  an   explanatory   paragraph  with  respect  to  the
uncertainty.

     The  Company has no  commitments  for capital  expenditures  or  additional
equity or debt financing and no assurances can be made that its working  capital
needs can be met.

Impact of Year 2000

     Based on a recent and ongoing  assessment,  the Company has determined that
all of its  operating  software  and  systems  are year 2000  compliant.  It has
further  determined  that it will not be  required  to modify  the  software  or
replace  portions  of the  software  that has  been  sold to  customers  so that
customers  computer systems will function  properly with respect to dates in the
year 2000 and  thereafter.  The costs of becoming year 2000  compliant  have not
been material to the Company.


Part II   OTHER INFORMATION


Item 1.   Legal Proceedings

     There have been no changes  since the Companys last report in Item 3, Legal
Proceedings of Form 10-KSB for the fiscal year ended May 31, 1999.

Item 2.   Changes in Securities

     Not Applicable

Item 3.   Defaults upon Senior Securities

     Not Applicable

Item 4.   Submission of Matters to Vote of Securities Holders

     None

                                                              [NETCOM\10Q:83199]
                                        9
<PAGE>

Item 5.   Other Information

     None

Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits - None

          (b)  Form 8-K

On July 20,  1999,  the  Company  filed a Form 8-K  reporting  the  consolidated
financial  statements of the Company reflecting the acquisition of MetroplexWeb,
Inc.

On August 31, 1999,  the Company  filed a Form 8-K  reporting  the change of its
name from Virtual Enterprises, Inc. to NetCopmmerce, Inc.


                                                               NETCOM\10Q:83199]
                                       10

<PAGE>

                                   SIGNATURES


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

                                       NetCommerce, Inc.



Date:   November 3, 1999               By:   /s/ Fred G. Luke
                                             Fred G. Luke,
                                             Chairman of the Board and President

                                                              [NETCOM\10Q:83199]
                                       11