UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549

                                  FORM 10-KSB
                    Annual Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

                                   (Mark One)
         [X]  Annual Report Pursuant to Section 13 or 15(d) of the Securities
               Exchange Act of 1934 for the year ended December 31, 2000

            [   ] Transition Report Pursuant to Section 13 or 15(d) of the
                            Securities Exchange Act of 1934

                        Commission File Number 000-30652

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

                 Wisconsin                                39-1976286
       --------------------------------     -----------------------------------
      (State or other jurisdiction of       (IRS Employer Identification Number)
       incorporation or organization)

       251 Info Highway, Slinger, Wisconsin                              53086
       ------------------------------------                              -----
       (Address of principal executive offices)                       Zip code

                                (262)  644-1000
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              (Registrant's telephone number, including area code)
         SECURITIES REGISTERED UNDER SECTION 12(B) OF THE EXCHANGE ACT:
                                      NONE
        SECURITIES REGISTERED UNDER SECTION 12 (G) OF THE EXCHANGE ACT:
                 NONE.  SHARES OF COMMON STOCK, PAR VALUE $0.01

       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
       requirements for the past 90 days.  YES [X]  NO [--]

       Indicate  by  check  mark if  disclosure  of  delinquent  filers
       pursuant to Item 405 of Regulation S-K  is not contained herein,
       and  will  not  be  contained,  to   the  best  of  registrant's
       knowledge,  in   definitive  proxy  or  information   statements
       incorporated by reference in Part III of this form 10-K. [--]

       As  of  April  9,  2001,  the   Company  had  18,534,448  shares
       outstanding.   The aggregate  value of  the 8,284,012 shares  of
       Common  Stock  held   by  non-affiliates  of  the   Company  was
       approximately  $1,325,442, based  on the  closing  bid price  of
       $0.16 per share on February 28, 2001 on  the OTC Bulletin Board.
       This calculation does  not reflect a determination  that certain
       persons are affiliates of the Registrant for any other purpose.

       The Company's  revenue for  the fiscal  year ended December  31,
       2000 is $570,892.

                               TABLE OF CONTENTS

PART I
Item 1.  Description Of Business
Item 2.  Description Of Properties
Item 3.  Legal Proceedings
Item 4.  Submission of Matters to a Vote of Security Holders

PART II
Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters
Item 6.  Management's Discussion and Analysis or Plan of Operations
Item 7.  Financial Statements.
Item 8.  Changes in and Disagreements With Accountants On Accounting And
         Financial Matters

PART III
Item 9 - Directors, Executive Officers, Promoters and Control Persons:
         Compliance with Section 16   (a) of the Exchange Act.
Item 10. Executive Compensation
Item 11. Security Ownership of Certain Beneficial Owners and Management
Item 12. Certain relationships and Related Transactions

PART IV
Item 13. Exhibits, Financial Statement Schedules and Reports on Form 8-K

SIGNATURES

                                     PART I
ITEM 1.  DESCRIPTION OF BUSINESS

NOTE ABOUT FORWARD-LOOKING STATEMENTS
     This Form  10-KSB Annual  Report contains  forward-looking statements  that
     relate to future events  or future financial performance.   In some  cases,
     forward-looking statements can be identified by terminology such as  "may,"
     "will,"   "should,"   "expects,"   "plans,"   "anticipates,"    "believes,"
     "estimates,"  "predicts,"  "intend,"  "potential,"  or  "continue"  or  the
     negative of such terms or other  comparable terminology.  These  statements
     are  only  predictions.    Although  management  of  VideoPropulsion,  Inc.
     believes that the expectations reflected in the forward-looking  statements
     are reasonable, we  cannot guarantee  future results,  levels of  activity,
     performance or achievements.  Actual  results could differ materially  from
     those anticipated  in  these  forward-looking statements  as  a  result  of
     various  factors,  including   the  risks   outlined  under   "Management's
     Discussion and Analysis of Financial  Condition and Results of  Operations"
     and elsewhere in this Form 10-KSB.  All forward-looking statements included
     in this document are based on  information available to VideoPropulsion  on
     the date hereof. VideoPropulsion assumes no  obligation to update any  such
     forward-looking statements.

OVERVIEW OF THE COMPANY

     VideoPropulsion designs  and sells  digital  video products  which  provide
     enabling technology for a variety of  applications that allow consumers  to
     use their TV sets for interactive services including email, home  shopping,
     web browsing, video-on-demand,  and Internet  based telephony.   A  typical
     application for the  Company's products is  providing connectivity  between
     the video servers  (which store  media that is  available to  be sent,  via
     cable TV, to a set-top decoder box at a consumers location) in the  central
     office of any given cable TV provider  and the cable headend (which is  the
     electronic device in the central office of the cable company that  forwards
     all TV  signals  from the  central  office to  the  cables leading  to  the
     consumers' set-top box).

     VideoPropulsion's products are enabling these solutions and providing  what
     management of the Company believes to be low cost-per-stream delivery.  The
     Company's Internet address is www.videopropulsion.com.
                                   -----------------------

     The Company is located  at 251 Info Highway,  Slinger, Wisconsin (30  miles
     north of Milwaukee) and has 8 employees.  The Company (initially a  wholly-
     owned subsidiary of GENROCO, Inc.) has existed as a product line of GENROCO
     since 1996 and was organized as a  corporation under the laws of the  State
     of Wisconsin in 1999 as VideoPropulsion, Inc.  The Company was spun-off  of
     GENROCO in  July 2000.   Initial  sales  of digital  video products,  as  a
     separate product line for GENROCO, began in March of 1997.

VIDEOPROPULSION OPERATIONAL STRATEGY

     The Company's first objective is to place DVB interface cards into  digital
     television application servers by offering products with low cost per video
     stream.    After  reaching  that  goal,  the  Company  intends  to  produce
     additional types of hardware interfaces to utilize the software both it and
     its customers have developed.

     The Company intends to seek strategic alliances at the product  development
     level as well as the sales and service levels of customer support.

PRODUCTS

     VideoPropulsion's product offering at this  date consists of seven  primary
     product designs, some  in test production  and some  in current  commercial
     production, which form the foundation for different product offerings  with
     variations is speed, function and features.

1.VDOPRO DVB RAW TRANSMIT (DVP-2732AT)
     VideoPropulsion's Raw  DVB  transmit products  are  DMA engines  which  are
     designed to  pump 216Mbps  of precisely  timed  transport streams.    These
     transmit-only devices  are  designed  with  a  simple  application  program
     interface (API) that  gives developers the  ability to  closely couple  and
     control the output of their data.  The Company believes this is one of  the
     most cost-effective offering on the market  for OEMs who want to add  value
     and for application providers  who need to lower  their cost per stream  in
     transmission-only environments.  Device drivers  for Windows NT, Solaris  &
     Linux are currently available.

2.VDOPRO DVB RAW TRANSCEIVE (DVP-2732AF)
     VideoPropulsion's VDOPro DVB  ASI transceive products  provide full  duplex
     transmission and capture of transport streams.  The devices are designed to
     simultaneously send  and  receive  a full  pipe,  216Mbps,  of  MPEG  data.
     Developer kits provide sample programs for sending and receiving  transport
     streams, as well as sources to sample programs, to assist in interfacing to
     the card.  The data is transmitted using  a precise 270 MHz clock.   Device
     drivers for Windows NT, Solaris & Linux are currently available.

3.VDOPRO DVB MULTIPLEX TRANSMIT  (DVP-2732MF)
     VideoPropulsion's VDOPro DVB ASI  multiplexing products deliver 216Mbps  of
     transport streams  using custom  parts,  and efficient,  low  host-overhead
     device drivers.  These products are  the result of extensive experience  in
     cross-platform support of high  performance networking and video  streaming
     applications.   A  flexible API  offers  customers the  ability  to  define
     options and provides high levels of functionality facilitating  integration
     with application layers.  Multiple streams  of MPEG video and  encapsulated
     IP data are multiplexed  into a single MPTS  for transmission to any  other
     DVB ASI compliant  device.   The data   is  transmitted using  a precise
     270MHz clock and the multiplexor  inserts and modifies  timing information
     in  the streams as appropriate.  Device drivers for Windows NT, Solaris &
     Linux are currently available.

4.  VDOPRO DVB SINGLE CHANNEL H/W MULTIPLEX TRANSMIT (DVP-2764)
     VideoPropulsion's VDOPro DVB ASI H/W multiplexing product delivers  216Mbps
     of transport  streams  using  custom firmware,  and  efficient,  low  host-
     overhead device drivers.   This product  accomplishes the Transport  Stream
     multiplexing in hardware, reducing  host CPU usage a  lower level.  A  high
     performance 64 bit  66 MHz  PCI bus interface  is used  for data  transfer.
     Device drivers for Windows NT, Solaris & Linux are currently available.

5.  VDOPRO DVB DUAL CHANNEL H/W MULTIPLEX TRANSMIT (DVP-5464)
     VideoPropulsion's VDOPro  DVB  ASI  H/W multiplexing  product  delivers  2x
     216Mbps of  transport streams  using custom  firmware, and  efficient,  low
     host-overhead device  drivers.   This  product accomplishes  the  Transport
     Stream multiplexing in hardware, minimizing host CPU usage.  A high
     performance 64  bit 66  MHz  PCI bus  interface  is used  for  data
     transfer.  Device  drivers for Windows  NT, Solaris &  Linux are  currently
     available.

6.VDOPRO DVBOVS TRANSMIT- DVB TRANSMIT SUPPORT FOR ORACLE VIDEO SERVER ITV
  SOLUTIONS
     Oracle Video Server, release 3.0, offers greatly enhanced features such  as
     simplified startup  and  system  management; full  VCR  controls;  patented
     Visual Scan;  integration with  the  Oracle8 database;  patented  real-time
     RAID; DVB support; and a robust  distribution solution for delivering  from
     hundreds to thousands of concurrent video streams.

     VideoPropulsion   is   working   with   Oracle's   OVS   team   to    match
     VideoPropulsion's  device  drivers  to  Oracle's  multiplexing  and   video
     management software.   VideoPropulsion's experience and  expertise in  high
     performance controllers for networking and digital video in a wide  variety
     of superserver configurations  has produced drivers  that are  specifically
     tailored.  The VDOPro  Raw Transmit (DVP-2732/AT) card  acts as a  hardware
     platform for  this powerful  and flexible  combination.   VideoPropulsion's
     hardware and software  have been carefully  integrated into  the OVS  video
     pump to provide seamless output of content from the Oracle Media Data Store
     (MDS) to digital QAMs, QPSK, and other DVB ASI compliant devices.


     VDOPro DVBASI  for OVS  is available  on SGI  Origin platforms  with  IRIX,
     Compaq Alphastations with  Tru64 UNIX, and  Sun Microsystems Sparc  servers
     with Solaris.


7.  VDOHUB DVB EXTENDER/CONVERTER/SPLITTER
     The VideoPropulsion VDOHub is a stand-alone device that is used to convert,
     split, or extend DVB-ASI links.

     Data input  can  be  either  DVB-ASI-C  (75  ohm  Coax  copper  cable  with
     BNCconnectors)  copper  or  DVB-ASI-O  (62.5  ohm  optical  cable  with  SC
     connectors}optical.  Three  data outputs are  provided: two DVB-ASI-C,  and
     one DVB-ASI-O.

MARKET - OVERVIEW

     The market can generally be broken into three categories:

     1. The "Broadcast" category which includes a wide variety of video  servers
        used for video  editing, store-and-forward applications,  pre-production
        applications and archiving applications in  digital studios, as well  as
        organizations engaged  in the  broadcasting  of television  content  via
        towers or  satellite.   This market  is being  addressed by  most  major
        platform vendors, plus  a variety of  companies specializing in  digital
        video devices and applications.

     2. The "Cable and Telco" category which consists primarily of products  for
        Video-on-Demand (VOD)  and interactive  services being  provided by  the
        cable and telephone industry,  as part of  the widespread deployment  of
        the digital cable infrastructure mandated  by the FCC over the next  few
        years.

     3. "Other" which includes non-broadcast applications such as high-end  non-
        linear editing  for content  creation, hospitality  services, in  flight
        communication, distance learning, enterprise training, etc.

     The opportunities  for  VideoPropulsion's  products  are  perceived  to  be
     primarily in  the Broadcast  and Cable/Telco  segments but  VideoPropulsion
     hopes to become active  with efforts to respond  to opportunities in  other
     areas, as well.

MARKETING STRATEGIES

     The Company  currently uses  a  direct sales  force  of one  employee,  who
     receives technical and sales  support from the engineering  staff on an  as
     needed basis.  Products are typically shipped from the Company's  Wisconsin
     facility direct to the customer via an independent shipping service.

     The  Company   sells  the   majority  of   its  products   and   technology
     internationally.  Approximately 52% of fiscal  2000 net sales were made  to
     non-U.S. customers.

COMPETITION

     The Company competes  with domestic  and foreign-based  competitors on  the
     basis of custom  product design,  engineering support,  quality and  price.
     While the number of direct competitors  is at the moment relatively  small,
     the emergence of the Digital TV market is expected to encourage competition
     among potential suppliers.

INTELLECTUAL PROPERTY
     -- The  Company  has  a  license  to  U.S.  patent  #  5,420,984  (covering
        peripheral controllers and methods for  rapid task switching and  memory
        caching) which was issued  on May 30, 1995,  owned by GENROCO, Inc.  and
        licensed to us.

     -- The Company  has  pending  U.S. patent  #  09/495,671  (Video  Transport
        Metering Compressed Video to Playing Rates).

     The  Company  is  seeking  to  register  the  following  trademarks:    (1)
     VideoPropulsion, (2) VDOPro, (3) VDOfibre, (4)  VDOQAM, (5) VpiTV, and  (6)
     VDOHub.  Any use of the marks by  others on U.S. products in other  classes
     may cause dilution of the mark and the goodwill the Company has created  in
     the mark.

EMPLOYEES

     As of  February  28, 2001,  the  Company had  8  employees.   None  of  the
     Company's employees are  represented by  a labor  union or  subject to  any
     collective bargaining agreement.   The Company  has never experienced  work
     stoppages, and it believes its employee relations are good.

ITEM 2.  DESCRIPTION OF PROPERTIES

     The Company's  principal  administrative,  sales  and  marketing,  customer
     support and research  and development facilities  are located  in a  single
     office building at 251  Info Highway, Slinger,  Wisconsin and it  currently
     occupies approximately 2200 square feet of  space in the Slinger  facility,
     owned by GENROCO, Inc.  The Company pays $2,500 per month, which management
     believes approximates fair market rates.

ITEM 3.  LEGAL PROCEEDINGS

     The Company is, from  time to time,  a party to  litigation arising in  the
     normal course of  its business.   The Company believes  that none of  these
     actions will have a material adverse  effect on the financial condition  or
     results of operations of  the Company.  Currently  there are no  litigation
     claims open.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None

                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     The Company's common  stock has been  quoted on the  NASD OTC market  since
     August 2000.    Prior  to  August 2000,  the  Company  was  a  wholly-owned
     subsidiary of GENROCO,  Inc.  The  Company was spun-off  effective in  July
     2000.

                                        Quarterly Stock Prices
                                         Bid Quotation Range
                                       -----------------------
                                        High               Low
                                        ----               ---
      Quarter of 2000
       July 10 to September 30, 2000   $1.13             $0.69
       December 31, 2000               $0.84             $0.34

     Source:  Dow Jones News Retrieval Service (Invest-text database)

     These quotations represent bid prices  without retail markup, markdown,  or
     commission,  and  may  not  reflect  actual  transactions.    Such   market
     quotations reflect inter-dealer prices, without retail markup, markdown  or
     commission and may  not represent  actual transactions.   Trading  activity
     with respect  to  the Common  Stock  has been  limited  and the  volume  of
     transactions may not  of itself  be deemed to  constitute an  established
     public  trading   market.      A   public  trading   market   having   the
     characteristics of  depth,  liquidity  and  orderliness  depends  upon  the
     existence of market makers  as well as the  presence of willing buyers  and
     sellers, which are  circumstances over which the Company does not have
     control.

     As of  December 31,  2000, there  were  approximately 190  shareholders  of
     record of the Company's common stock.

     The Company has not paid any cash dividends for the year ended December 31,
     2000 and has no intention to pay a cash dividend in the future.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

     YEARS ENDED DECEMBER, 2000 and 1999

     Net sales for  the Company for  the twelve months  ended December 31,  2000
     ("2000") were $570,892  compared to $598,482  for the  twelve month  period
     ending December 31, 1999  ("1999").  Revenue  has remained relatively  flat
     over the year due to the fact that most orders continue to be for  products
     being used in  development, beta test,  and initial  trials of  interactive
     television.  Included  in 2000 revenue  was $72,772  of commission  revenue
     received from  GENROCO for  GENROCO products  sold by  our employees.    No
     commission revenue was received in 1999.

     While traditional  television  has  grown to  serve  over  100  million  US
     households during the  past fifty years,  digital TV has  only begun to  be
     deployed.  As cable, satellite, and  terrestrial providers begin the  shift
     to digital broadcasting, volumes of enabling technology products  hopefully
     may ramp up  dramatically.   Management is trying  to implement  a plan  to
     place its hardware and  software products into a  sufficient number of  key
     players in this emerging marketplace in order to garner significant  future
     sales as the rollout unfolds.

     In addition, interactive TV is expected to combine the established force of
     television with the  budding success of  the internet.   This evolution  is
     referred to as the  convergence, and it will  define new markets and  shape
     the future  of  broadcasting.    Management  believes  that  the  Company's
     existing products and current developments will position VideoPropulsion to
     achieve sales growth via this emerging opportunity.

     Cost of goods sold for 2000 was $102,542 compared to $132,269 in 1999.  The
     slight decline is directly related to the reduction in sales for the  year.
     This expense, which is  comprised of parts,  labor and overhead  associated
     with production and testing of the  products shipped to customers  declined
     as sales decreased.

     Gross profit for  2000 was  $468,350 compared to  $466,213 for  1999.   The
     resulting gross margin percentages were 82.0%,  and 77.9% of net sales  for
     2000  and  1999,  respectively.    Although  the  gross  margins   remained
     relatively the same  between the two  years, these percentages  may not  be
     indicative of future  performance as  anticipated price  reductions due  to
     increased competition and volume discount  pricing may affect gross  margin
     percentages in the future.

     Research and  development  expenses  for 2000  were  $513,317  compared  to
     $261,389 in  1999,  or  90%  and  44% of  net  sales  for  2000  and  1999,
     respectively.   This  increase is  a  direct result  of  hiring  additional
     engineering personnel and stepped up new product development.

     Selling,  marketing,  customer  service  and  general  and   administrative
     expenses for 2000 were  $643,469 compared to $253,004  in 1999 or 113%  and
     42% of  net sales  for 2000  and  1999, respectively.   The  increases  are
     primarily associated with additional  sales and marketing personnel  costs.
     In addition,  start  up expenditures,  new  overhead costs  resulting  from
     separation from  parent corporation,  and  attendance at  several  industry
     trade  shows  added  to  the  overall  increase  in  operational  expenses.
     Approximately $300,000 of the 2000 expense relates to compensation  expense
     amortized for the employees stock purchase plans of GENROCO stock.  Certain
     VPI employees  have stock  purchase plans  for GENROCO  stock.   The  notes
     receivable from the employees are amortized over a three-year period.   VPI
     reimburses GENROCO  for  the  compensation  expense  relating  to  the  VPI
     employees.  The receivables are reflected as a contra-equity account in the
     Statement of Stockholders' Investment.

     Loss from operations in 2000 was $691,252 compared to a loss of $48,180  in
     1999.  The changes  in earnings are  the direct result  of lower sales  and
     increased corporate overhead and research expense.


LIQUIDITY AND CAPITAL RESOURCES

     The Company's cash position at December 31, 2000, was $13,964, an  increase
     from $9,947 at  December 31, 1999.   The Company  received interim  funding
     from Mr. Pick, a director and  shareholder, for $180,000 in December  2000.
     Subsequent to year end, the  Company received a loan  from Mr. Pick for  an
     additional $300,000.

     Stockholders' equity decreased by $751,082 to a deficit of $688,199  as  of
     December 31, 2000, from $62,883 at December 31, 1999.  The decrease is  the
     result of a net loss from operations totaling $691,252 offset by a $304,487
     capital contribution by  the former parent  company, GENROCO  prior to  the
     July spin-off transaction.

     The Company's  ratio  of current  assets  to current  liabilities  (current
     ratio) was .19 to 1 at December 31, 2000,  versus 4.0 to 1 at December  31,
     1999.   The Company  has  been unable  to  remain current  with  short-term
     obligations due to cash flow constraints.  The Company has relied solely on
     funding made available from GENROCO or existing shareholders.  The  Company
     received a loan of $300,000 from a shareholder subsequent to year to  cover
     short-term operational funding.  There can be no assurances that GENROCO or
     existing shareholders will  continue to  fund the  Company's operations  in
     this manner.

     The Company  continues to  generate negative  cash flows  from  operations.
     Current forecasts indicate that the Company  may be unable to fund  current
     plans beyond the second quarter of fiscal  2001 unless it is able to  raise
     additional capital.   The Company currently  owes $533,893  to GENROCO  for
     interim operational funding and  reimbursement to GENROCO for  compensation
     expense relating to GENROCO stock purchase plans granted to VPI  employees.
     The Company has $180,000 outstanding at December 31, 2000, due on demand to
     a shareholder.

    The  Company is considered a  development stage company.   A market for  the
    Company's  products may not develop.  The  Company's growth will be  limited
    if  Digital Video Boadcast  ("DVB") technology and  solutions do not  become
    widely  accepted.  The Company's development efforts are focused on the  DVB
    market which has only begun to develop and is rapidly evolving.

    The  Company believes that the combination of current existing cash and  the
    Company's  ability  to  obtain  additional  long-term  indebtedness  is  not
    currently  adequate to  finance  the Company's  operations for  the  current
    activities  and foreseeable future.  As a result, the Company does not  have
    adequate  cash to meet current obligations and is delinquent in payments  to
    its  vendors.  Management is currently  seeking to raise additional  capital
    either  through a private placement or an  offering of VPI stock.  To  date,
    no additional capital has been raised.

    If the Company is not successful in raising additional capital, the  Company
    will  not  be  able  to  continue  its  current  operations  and  there   is
    substantial  doubt  as to  the  Company's ability  to  continue as  a  going
    concern.   There can be no assurance that the Company will be successful  in
    raising  such capital  at all  or on  terms commercially  acceptable to  the
    Company or shareholders.

    In  addition, the sale of equitable securities  could result in dilution  to
    the  percentage ownership interests of existing shareholders and could  also
    adversely affect the market price of the Company's common stock.

     As a result  of the  spin-off from  its parent,  GENROCO, 4,633,612  common
     shares of VideoPropulsion stock were issued to shareholders of record as of
     June 30, 2000.   On July  3, 2000, the  board of directors  of the  Company
     declared  a  4:1  forward  split,  which  resulted  in  18,543,448   shares
     outstanding on a post split basis.  The Articles of Incorporation have been
     amended and authorized shares now consist  of 24,900,000 common shares  and
     100,000 preferred shares.

     At December 31, 2000, the Company did not  have bank line of credit and  is
     dependent upon favorable business terms from its ex-parent, GENROCO,  Inc.,
     and Mr. Pick, a director, for sources of working capital.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     The Company  has no  history of,  and does  not anticipate  in the  future,
     investing  in  derivative   financial  instruments,  derivative   commodity
     instruments  or  other   such  financial  instruments.     Contracts   with
     international customers are entered into in US dollars, precluding the need
     for foreign  currency hedges.   Additionally,  we  invest in  money  market
     funds, in U.S government obligations and other investment grade securities,
     which experience minimal volatility.  Thus, the exposure to market risk  is
     not significant.

ITEM 7.  FINANCIAL STATEMENTS.

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of VideoPropulsion, Inc.:

We have audited the accompanying balance sheets of VideoPropulsion, Inc. (a
Wisconsin corporation in the development stage) (the "Company") as of December
31, 2000 and 1999, and the related statements of operations, stockholders'
investment and cash flows for the years then ended.  These financial statements
are the responsibility of the Company's management.  Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States.  Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.  An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of VideoPropulsion, Inc. as of
December 31, 2000 and 1999, and the results of its operations and its cash flows
for the years then ended in conformity with accounting principles generally
accepted in the United States.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern.  As shown in the accompanying
financial statements, the Company is a development stage company with recurring
losses from operations.  The factors discussed in Note 2 to the financial
statements raise a substantial doubt about the ability of the Company to
continue as a going concern.  Management's plans in regards to those matters are
also described in Note 2.  The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

/s/ Arthur Andersen LLP

ARTHUR ANDERSEN LLP

Milwaukee, Wisconsin
March 16, 2001

VIDEOPROPULSION, INC.
(A DEVELOPMENT STAGE COMPANY)

Balance Sheets
As of December 31, 2000 and 1999

                                                2000       1999
                                                ----       ----
                Assets
                ------

Current Assets:
 Cash                                           $13,964    $9,947
 Accounts Receivable                             11,495    11,990
 Inventories                                    132,177    61,706
 Prepaid Expenses                                 6,167         -
                                               --------   -------

     Total Current Assets                       163,803    83,643

 Property, Plant and Equipment, Net of
   Accumulated Depreciation of $1,683            10,828         -
                                               --------   -------

     Total Assets                              $174,631   $83,643
                                               --------   -------
                                               --------   -------

     Liabilities and Stockholders'
     -----------------------------
         (Deficit) Investment
         --------------------

Current Liabilities:
 Accounts Payable                               $63,051   $
                                                                -
 Accrued Payroll and Payroll Taxes               29,094    12,807
 Other Accrued Liabilities                       56,792     7,953
 Note Payable to Shareholder                    180,000         -
 Due to Related Party                           188,532         -
                                               --------   -------
     Total Current Liabilities                  517,469    20,760

Due to Related Party                            345,361         -

Stockholders' (Deficit) Investment:
 Common Stock (24,900,000 Shares
  Authorized, 18,534,448 and 4,000
  Shares Outstanding, Respectively,
  $0.01 Par Value)                              185,344        40
 Additional Paid-In Capital                     192,354   498,492
 Accumulated Deficit                           (376,212  (110,281)
 Unearned Compensation                         (689,685) (325,368)
                                               --------   -------

     Total Stockholders' (Deficit)
     Investment                                (688,199)   62,883
                                               --------   -------

     Total Liabilities and
     Stockholders' Investment                  $174,631   $83,643
                                               --------   -------
                                               --------   -------

The accompanying notes to financial statements are an integral part of these
balance sheets.

VIDEOPROPULSION, INC.
(A DEVELOPMENT STAGE COMPANY)

Statements of Operations
For the Years Ended December 31, 2000 and 1999

                                                2000         1999
                                                ----         ----

Net Sales                                     $570,892    $598,482

Cost of Goods Sold                             102,542     132,269
                                            ----------   ---------

    Gross Profit                               468,350     466,213
                                            ----------   ---------
Operating Expenses:
 Research and Development                      513,317     261,389
 Selling and Marketing                         384,744     165,229
 General and Administrative                    258,725      87,775
                                            ----------   ---------

     Total Operating Expenses                1,156,786     514,393
                                            ----------   ---------

     Operating Loss                           (688,436     (48,180)

 Interest Expense, Net                           2,816           -
                                            ----------   ---------

Loss Before Income Taxes                      (691,252     (48,180)

Income Taxes                                         -           -
                                            ----------   ---------

Net Loss                                     $(691,252    $(48,180)
                                            ----------   ---------
                                            ----------   ---------

Net Loss Per Share:
 Basic and Diluted                               $(0.0)    $(12.05)
 Weighted Average Number of Shares           18,534,44       4,000
   Outstanding

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

VIDEOPROPULSION, INC.
(A DEVELOPMENT STAGE COMPANY)

Statements of Stockholders' Investment (Deficit)
For the Years Ended December 31, 2000 and 1999
<TABLE>
                                                                                                                    Deficit
                                                                                                      Total       Accumulated
                                Common Stock     Additional    Parent's                            Stockholders'     During
                             ------------------   Paid-in     Divisional   Retained    Unearned     Investment     Development
                             Shares      Amount   Capital       Equity      Deficit   Compensation  (Deficit)        Stage
   (Deficit)                 ------------------  ----------   ----------   --------   ------------ ------------   ------------

<S>                          <C>        <C>      <C>          <C>          <C>        <C>          <C>            <C>
Balance,
 December 31, 1998                -    $      -         -      $280,334  $       -    $(261,156)     $19,178         $(388,441)

 Net Income to October 4,         -           -         -        62,101          -            -       62,101            62,101
  1999
 Net Loss from October 4          -           -         -             -   (110,281)           -     (110,281)         (110,281)
                                                                                                   -----------       ---------
  to December 31, 1999
     Net Loss for 1999            -           -         -             -          -            -      (48,180)          (48,180)
                                                                                                   -----------       ---------

 Capital Contribution from        -           -         -       146,097          -            -      146,097                 -
  Parent Prior to
  October 4, 1999
 October 4 Transfer Due to        -           -   488,532      (488,532)         -            -            -                 -
  Incorporation of Company
 Sale of Stock to Parent      4,000          40     9,960             -          -            -       10,000                 -
 Unearned Compensation            -           -         -             -          -     (192,750)    (192,750)                -
 Amortization of Unearned
  Compensation                    -           -         -             -          -      128,538      128,538                 -
                         ----------     -------  --------      --------   --------    ---------    ----------     ------------


Balance,
 December 31, 1999            4,000          40   498,492             -   (110,281)    (325,368)      62,883          (436,621)

Distribution of Shares   18,530,448     185,304  (185,304)            -          -            -            -                 -
 Issued Upon Spin-Off
 from Parent
 Net Loss Prior to Spin-          -           -         -             -   (315,040)           -     (315,040)         (315,040)
  off on July 10, 2000
 Net Loss After Spin-off          -           -         -             -   (376,212)           -     (376,212)         (376,212)
                                                                                                   -----------       ---------
  on July 10, 2000
     Net Loss for 2000                                                                              (691,252)         (691,252)
                                                                                                   -----------       ---------

 Capital Contribution from        -           -   304,487             -          -            -      304,487                 -
  Parent Prior to Spin-off
 Reclassification of Pre-         -           -  (425,321)            -    425,321            -            -                 -
  Spin-off Retained
  Earnings
 Unearned Compensation            -           -         -             -          -     (661,803)    (661,803)                -
 Amortization of
 Unearned Compensation            -           -         -             -          -      297,486      297,486                 -
                         ----------     -------  --------      --------   --------    ---------    ----------     ------------

Balance,
 December 31, 2000       18,534,448    $185,344  $192,354      $      -  $(376,212)   $(689,685)   $(688,199)      $(1,127,873)
                         ----------     -------  --------      --------   --------    ---------    ----------     ------------
                         ----------     -------  --------      --------   --------    ---------    ----------     ------------
</TABLE>

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

VIDEOPROPULSION, INC.
(A DEVELOPMENT STAGE COMPANY)

Statements of Cash Flows
For the Years Ended December 31, 2000 and 1999

                                              2000           1999
                                              ----           ----
Cash Flows from Operating Activities:
 Net Loss                                $(691,252)      $(48,180)
 Adjustments to Reconcile Net Income to
  Net Cash Provided by (Used in)
  Operating Activities-
   Depreciation                              1,683              -
   Amortization of Unearned                297,486        128,538
   Compensation
   Unearned Compensation                  (661,803)      (192,750)
   Change in Assets and Liabilities-
     Accounts Receivable                       495         (1,000)
     Inventories                           (70,471)       (25,284)
     Prepaid Expenses                       (6,167)             -
     Accounts Payable                       63,051              -
     Accrued Liabilities                    65,126         (7,474)
                                         ----------      ---------

      Total Adjustments                   (310,600)       (97,970)
                                         ----------      ---------

      Net Cash Used in Operating        (1,001,852)      (146,150)
                                         ----------      ---------
       Activities

Cash Flows from Investing Activities:

 Purchase of Fixed Assets                  (12,511)             -

Cash Flows from Financing Activities:
 Proceeds from Note Payable from           180,000              -
  Shareholder
 Capital Contribution from Parent          304,487        146,097
 Increase (Decrease) in Funding from       533,893              -
  Related Party
 Issuance of Common Stock                        -         10,000
                                         ----------      ---------

      Net Cash Provided by Financing      1,018,380       156,097
                                         ----------      ---------
       Activities

Net Increase in Cash                         4,017          9,947

Cash, Beginning of Year                      9,947              -

Cash, End of Year                          $13,964         $9,947

Supplemental Cash Flow Information:
 Interest Paid                              $2,186         $   -
                                         ----------      ---------
                                         ----------      ---------

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

VIDEOPROPULSION, INC.
(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements
December 31, 2000 and 1999

(1)  Description of the Company-
     ---------------------------

     In October 1999, VideoPropulsion, Inc. (the "Company" or "VPI"), a
     development stage company, became a Wisconsin corporation and a wholly
     owned subsidiary of GENROCO, Inc. ("GENROCO" or "Parent").  Prior to
     October 1999, VPI was operated as the digital video division of GENROCO.
     The Company designs and sells a range of Digital Video Broadcast (DVB)
     products which are being utilized in a wide variety of applications that
     allow consumers to use their TV sets for interactive services including e-
     mail, home shopping, web browsing, video-on demand, IP telephony, and other
     functions.  DVB is the digital standard that has been successfully deployed
     throughout Europe, Asia, the Pacific and Latin America and is rapidly
     becoming accepted in North America.

     In August of 1999, the Board of Directors of GENROCO, Inc. (VDOP's parent
     corporation) began contemplating the spin-off and distribution of the
     Company's Digital Video Broadcast (DVB) business as a separate company to
     be named VideoPropulsion, Inc.  The Company executed the distribution on
     July 10, 2000 by issuing one new share of VideoPropulsion Inc. stock, for
     each share of Company stock held by GENROCO shareholders of record, as of
     the close of business on June 30, 2000.

(2)  Development Stage-
     ------------------

     The Company continues to generate negative cash flows from operations.
     Current forecasts indicate that the Company may be unable to fund current
     plans beyond the second quarter of fiscal 2001 unless it is able to raise
     additional capital.  The Company currently owes $533,893 to GENROCO for
     interim operational funding and reimbursement to GENROCO for compensation
     expense relating to GENROCO stock purchase plans granted to VPI employees.

     The Company has $180,000 outstanding at December 31, 2000, due on demand to
     a shareholder.

     The Company is considered a development stage company.  A market for the
     Company's products may not develop.  The Company's growth will be limited
     if DVB technology and solutions do not become widely accepted.  The
     Company's development efforts are focused on the DVB market, which has only
     begun to develop and is rapidly evolving.

     The Company believes that the combination of current existing cash and the
     Company's ability to obtain additional long-term indebtedness is not
     adequate to finance the Company's operations for the current activities and
     foreseeable future.  As a result, the Company does not have adequate cash
     to meet current obligations and is currently delinquent in payments to its
     vendors.  Management is currently seeking to raise additional capital
     either through a private placement or an offering of VPI stock.  To date,
     no additional capital has been raised.

     If the Company is not successful in raising additional capital, the Company
     will not be able to continue its current operations and there is
     substantial doubt as to the Company's ability to continue as a going
     concern.  There can be no assurance that the Company will be successful in
     raising such capital at all or on terms commercially acceptable to the
     Company or shareholders.

     If the Company is not successful in raising additional capital, the Company
     will not be able to continue its current operations and there is
     substantial doubt as to the Company's ability to continue as a going
     concern.  There can be no assurance that the Company will be successful in
     raising such capital at all or on terms commercially acceptable to the
     Company or shareholders.  The financial statements do not include any
     adjustments that might result from the outcome of this uncertainty.

(3)  Summary of Significant Accounting Policies-
     -------------------------------------------

    (a)  Basis for Presentation-
         -----------------------

          Certain items have been incorporated into the preparation of these
          December 31, 1999 financial statements to reflect the Company as a
          stand-alone entity.  The financial information included herein may not
          necessarily reflect the financial position and results of operations
          for the Company if the Company would have been a separate, stand-alone
          entity during the periods presented.  The results for the period
          ending December 31, 2000, are entirely on a stand-alone basis.

    (b)  Revenue Recognition-
         --------------------

          Revenue from product sales is recognized when the products are shipped
          and customer acceptance is achieved.

          The Company had five customers that individually accounted for 14.1%,
          12.8%, 12.7%, 12.0%  and 10.6% of net sales in 2000.  The Company had
          four customers that individually accounted 24.2%, 24.0%, 15.5% and
          12.0% of net sales in 1999.

          Exports accounted for approximately 52.8% and 39.5% of the Company's
          net sales for 2000 and 1999, respectively.

    (c)  Inventories-
         ------------

          Inventories are stated at the lower of average cost, determined using
          the first-in, first-out method, or market.  Inventories consist of:

                                                   December 31,
                                                 ----------------
                                                 2000        1999
                                                 ----        ----

          Raw Materials and Work-in-Process   $54,503     $38,350
          Finished Goods                       77,674      23,356
                                             --------     -------

                                             $132,177     $61,706
                                             --------     -------
                                             --------     -------

    (d)  Property, Plant and Equipment-
         ------------------------------

          Additions to property, plant and equipment are recorded at cost.
          Repairs and maintenance are expensed as incurred.  Depreciation is
          provided using the straight-line method over the estimated useful
          lives of the assets.  The Company's fixed assets consist entirely of
          testing and marketing equipment and are depreciated over an estimated
          useful life of five years.  Depreciation expense for the years ending
          December 31, 2000 and 1999, was approximately $1,700 and $0,
          respectively.

    (e)  Research and Development Costs-
         -------------------------------

          Research and development costs are expensed as incurred and are
          presented as a separate component of the income statement.

    (f)  Operating Expenses-
         -------------------

          The Company subcontracts a majority of its production activities,
          including the manufacture and assembly of certain products, from
          GENROCO (see Note 13).

          During 1999, certain operating expenses were allocated based on the
          percentage of hours spent on the digital video division at GENROCO
          compared to total hours of employees each year multiplied by GENROCO's
          total operating expenses.  Management estimates if the Company had
          been on a stand-alone basis during 1999, operating expenses would have
          been substantially identical to the allocated expenses included in the
          financial statements.  Operating expenses during 2000 are actual costs
          incurred as a separate entity.

    (g)  Use of Estimates-
         -----------------

          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.

    (h)  Net Income Per Common Share-
         ----------------------------

          The Company accounts for earnings per share according to provisions of
          Statement of Financial Accounting Standards No. 128, "Earnings Per
          Share" for purposes of calculating earnings per share.

          Basic earnings per share is computed assuming that the number of VPI
          shares outstanding was 18,534,448 for 2000 and 1999.  The company does
          not have common stock equivalents and therefore diluted earnings per
          share equals basic earnings per share.

(4)  Income Taxes-
     -------------

     The Company accounts for income taxes according to provisions of Statement
     of Financial Accounting Standards No. 109 "Accounting for Income Taxes."
     For 1999, the Company is included in the consolidated federal income tax
     returns of GENROCO.  Income tax benefits and liabilities are based on the
     Company's activity on a stand-alone basis.

     The Company and GENROCO entered into an agreement effective January 1, 2000
     under which GENROCO will be responsible for substantially all United States
     federal, state and local income taxes for periods prior to the date of
     spin-off.  The Company will be responsible for all taxes applicable to
     periods after the spin-off and amounts exceeding certain thresholds
     resulting from tax audit adjustments for periods prior to spin-off.
     Management believes there are no tax liabilities over these thresholds.

     Net operating losses generated prior to the date of distribution will
     remain with GENROCO.  The Company has therefore recorded a full valuation
     allowance against the tax benefits.

     Components of the deferred income taxes are as follows:


                                                    December 31,
                                                 ------------------
                                                 2000          1999
                                                 ----          ----
     Current Deferred Tax Assets:
     Inventory Reserves                         $6,456       $2,418
     Accrued Employee Costs                      1,428        1,151
                                              --------      --------

     Total Current Deferred Tax Assets           7,884        3,569

     Current Valuation Allowance                (7,884)      (3,569)

     Net Current Deferred Taxes               $      -      $    -
                                              --------      --------
                                              --------      --------

     Noncurrent Deferred Tax Assets:
     Operating Loss Carryforwards             $254,685      $117,440
                                              --------      --------

     Total Net Noncurrent Deferred Tax         254,685       117,440
      Assets

     Noncurrent Valuation Allowance           (254,685)     (117,440)
                                              --------      --------

     Net Noncurrent Deferred Taxes            $      -      $      -
                                              --------      --------

     A summary of the Company's effective tax rates is as follows:

                                                    December 31,
                                                 ------------------
                                                 2000          1999
                                                 ----          ----

     Federal Tax at Statutory Rate           $(246,183)     $(16,381)
     State Taxes, Net of Federal Benefit       (36,696)       (2,505)
     Valuation Allowance                       282,879        18,886
                                              --------      --------

          Total Provision                    $       -      $      -
                                              --------      --------
                                              --------      --------

(5)  Lease Commitments-
     ------------------

     The Company leases its operating facility located in Slinger, Wisconsin,
     under an agreement expiring December 31, 2001 with the Parent.  The Company
     has options from the Parent to renew the lease agreement.  Total rent
     expense was approximately $30,000 and $22,800 in 2000 and 1999,
     respectively.

     As of December 31, 2000, the approximate future minimum lease payments
     under operating leases are as follows:

     Year                   Amount
     ----                   ------

     2001                 $30,000
     2002 and Thereafter        -

(6)  Employee Benefit Plans-
     -----------------------

     GENROCO has an Employee Stock Ownership Plan and Trust (the "Plan"),
     covering substantially all domestic employees.  Employees of VPI are
     participants in the Plan.  GENROCO's contribution to the Plan is
     discretionary and is determined annually by the Board of Directors of the
     Parent.  VPI is charged a portion of this contribution relating to the VPI
     employees participating.  Expense recorded by VPI under the Plan was
     approximately $0 and $9,504 in 2000 and 1999, respectively.  The Plan owned
     11% of the shares outstanding of VPI stock as of December 31, 2000.

     In order to recruit and retain personnel, GENROCO offered its employees
     stock in GENROCO.  Stock was granted to a participating employee in
     exchange for a three-year note from the employee.  To the extent the
     employee remained employed at GENROCO, the note is forgiven over the three-
     year period.  New notes for GENROCO stock, totalling $661,803, were issued
     to VPI employees in 2000.  These notes were assumed by VPI for employees
     that were transferred from GENROCO to VPI.  These amounts were recorded as
     unearned compensation in equity and are amortized on a straight-line basis
     as compensation expense over the life of the notes.  Expense recorded by
     VPI under the Agreement as a reimbursement to GENROCO was $297,486 and
     $128,538 for 2000 and 1999.  VPI records the compensation expense over the
     term of the original note with GENROCO and reimburses GENROCO for the
     compensation expense, associated with the VPI employees.  The amounts due
     to GENROCO are included in the Due to Related Party line item on the
     Balance Sheet.  The remaining balance due on these notes was $689,685 at
     December 31, 2000 of which $533,893 remained unpaid to GENROCO.  Amounts
     owed to GENROCO during the year ending December 31, 1999 were forgiven by
     the Parent (see Note 8).

     An Employee Benefits and Compensation Agreement governs the rights and
     obligations of GENROCO, Inc. and VPI with respect to various matters and
     obligations concerning employee benefits for the former GENROCO, Inc.
     employees who became employees of VPI as of January 1, 2000.  The Benefits
     Agreement covers VPI's assumption of certain compensation and benefits
     obligations relative to VPI's employees.  Pursuant to the Benefits
     Agreement, VPI will assume responsibility for certain benefits previously
     offered by GENROCO, Inc. to its employees prior to the spin-off who became
     employed by VPI and will receive funds from GENROCO, Inc. for disbursement
     to such employees for compensation and certain employee benefits earned
     prior to the spin-off.  No benefit obligation is outstanding as of December
     31, 2000.

(7)  Stockholders' (Deficit) Investment-
     -----------------------------------

     Effective October 4, 1999, common stock authorized was 9,000 shares.  Prior
     to October 4, 1999, the Company was operated as a division of the Parent
     and no stock was authorized.  As of December 31, 1999, 1,000 shares were
     issued and outstanding and owned entirely by GENROCO.  In 2000, prior to
     the spin-off, authorized shares were increased to 24,900,000 shares.

     GENROCO executed the spin-off of VPI on July 10, 2000 by issuing one new
     share of VPI stock for each share of GENROCO stock held by GENROCO
     shareholders of records, as of June 30, 2000.

     In July 2000, VPI declared a four for one stock split as of July 3, 2000,
     with a distribution date of July 13, 2000.  As a result, shareholders
     received 13,900,836 new shares to bring the total outstanding amount to
     18,534,448.  All share amounts have been restated to reflect the impact of
     the stock split.

(8)  Related Party Funding-
     ----------------------

     The Company's financing requirements have historically been funded almost
     entirely by GENROCO.  During 1999 amounts previously classified as due to
     related party were forgiven and reflected as capital contributions from
     GENROCO.  For the years ending December 31, 1999, the amount due to
     GENROCO, which was converted to capital contributions, was $146,097.

     During 1999, GENROCO paid all trade payables on behalf of VPI and reflected
     the amount due with an intercompany loan.  Effective January 1, 2000, the
     Company's operating expenses ceased being funded in this manner and GENROCO
     required the Company to fund trade payables through operating income and
     other financing resources.  Additional funding arrangements have been made
     between the Company and GENROCO, which are outlined in Note 2.

(9)  Administrative Services Agreement-
     ----------------------------------

     As of January 1, 2000, the Company and the Parent entered into an Interim
     Administrative Services Agreement.  This agreement governs the
     administrative and manufacturing services that the Parent will continue to
     provide to the company on an interim basis.  In general, the Parent will
     provide certain financial, human resource and information system services
     (including use of the hardware and furniture and fixtures associated with
     these services).  Under the terms of the agreement, the Company will
     compensate the parent at negotiated fees which, the Company believes, would
     be comparable to rates the Company could have achieved through arms-length
     negotiations.  Management does not believe this agreement will result in
     expenses materially different from the amount allocated in these carved-out
     financial statements.  During 2000, the Company paid approximately $60,000
     in management fees to GENROCO.

(10) Commitments and Contingencies-
     ------------------------------

     As of January 1, 2000, the Company and the Parent entered into a General
     Assignment and Assumption Agreement.  Pursuant to the General Assignment
     and Assumption Agreement regarding Litigation, Claims and other
     Liabilities, in general VPI assumed and agreed to indemnify GENROCO, Inc.
     and acquire substantially all the liabilities, litigation and claims
     arising out of the digital video business including all environmental
     liabilities.  GENROCO, Inc. retained and indemnified VPI against
     substantially all liabilities, litigation and claims arising out of its
     storage area networking business and other items not transferred to VPI.
     The indemnification obligations does not entitle the indemnified party to
     recover to the extent that such liabilities are covered by proceeds
     received from a third party insurer.  In circumstances in which the
     potential inability of GENROCO, Inc. and VPI is joint, the parties will
     share responsibility for such liability on a mutually agreed basis
     consistent with the principles established in the Agreement.  As of
     December 31, 2000, there were no outstanding commitments or contingencies
     governed by this agreement.

(11) Transitional Trademark Use and License Agreement-
     -------------------------------------------------

     As of January 1, 2000, the Company and the Parent entered into a
     Transitional Trademark Use and License Agreement.  Pursuant to the
     Transitional Trademark Use and License Agreement, GENROCO, Inc.  granted
     to VPI certain rights to continue to use, for a limited period of time and
     under certain defined circumstances, certain GENROCO, Inc. trademarks
     already inscribed upon VPI's existing inventory of labels, promotional
     materials, product materials and other materials relating to VPI's existing
     inventory of products.  Also, GENROCO, Inc. has granted VPI a royalty free,
     nontransferable, nonexclusive license to use certain GENROCO, Inc.
     trademarks and certain products.

(12) Insurance Matters-
     ------------------

     As of January 1, 2000, the Company and the Parent entered into an Insurance
     Matters Agreement.  The Insurance Matters Agreement governs the rights and
     obligations of GENROCO, Inc. and VPI with respect to various pre-existing
     contracts insuring GENROCO, Inc. and covering risks associated with, or
     arising out of, the digital video business.  The types of policies covered
     by the insurance Agreement include, without limitation, automobile
     liability, comprehensive and general liability.  This agreement also
     established certain procedures for dealing with pending litigation, new
     litigation and the resolution of disputes between the parties concerning
     the Insurance Agreement.

(13) Related Party Transaction-
     --------------------------

     The Company subcontracts the manufacture and assembly of its products to
     GENROCO.  The Company paid $98,070 to GENROCO during 2000 for these
     services.

     The Company receives a management fee for the President of VPI to continue
     to support and manage the customer relationship with certain GENROCO
     customers.  VPI receives a fifteen percent commission on GENROCO's sales to
     these specified customers.  VPI received $72,772 and $0 in commission
     revenue during 2000 and 1999, respectively.  The commission revenue is
     reflected as a component of net sales.

     The Company received a loan from a shareholder for $180,000 in December
     2000.  The note is currently due on demand and bears no interest.
     Subsequent to year end, the Company received an additional note for
     $300,000 from the same shareholder.  The second note is also due on demand
     and bears no interest.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL MATTERS

Not applicable.


                                    PART III
ITEM 9 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS:
         COMPLIANCE WITH SECTION 16 (A) OF THE EXCHANGE ACT.

The following is a listing of all directors and executive officers of the
Company.  An officer remains in office until he or she resigns, dies or a
different person is appointed to the office.  Directors shall hold office until
the next annual shareholders' meeting and until the director's successor has
been elected or until his or her resignation, death or removal.

  NAME                  AGE       POSITION
  ----                  ----      --------

  Carl A. Pick          52        Chairman and Director

  Keith Brue            62        Former Secretary Treasurer, Director
  (Deceased)

  Barbara Pick          49        President, CEO, Director

  Chris Good            49        Executive VP, Chief Tech Officer,
                                  Director

  Bob Hildreth          43        VP of Market Development (20
                                  Hours/week)

CARL A.  PICK  -  Chairman, and  Director.    He is  responsible  for  corporate
development,  marketing  strategy,  and  overall  corporate  management  of  the
Company.  Mr.  Pick graduated  from Yale University  in 1971  with a  Bachelor's
degree in  Computer Engineering.   He  received a  Master's degree  in  Computer
Science from Yale  in 1974.   He,  along with  Barbara Pick,  his wife,  founded
General Robotics Corporation  ("GRC") in August  1974 and  reorganized GRC  into
GENROCO, Inc. in 1987.  Mr. Pick is married to Barbara R. Pick.  Mr. Pick is the
Chairman the High Speed Networking Forum.

KEITH BRUE (Deceased)

BARBARA PICK - Chief  Executive Officer and  President of VideoPropulsion,  Inc.
since incorporation on October  1, 1999.   Director of GENROCO,  Inc.  She  also
served as a Vice President of Sales  for GENROCO since incorporation in 1974  to
September 30, 1999 and DVB Product manager for DVB and President of GENROCO from
1997 to September 30, 1999.  Ms. Pick is married to Carl A. Pick.

CHRIS  GOOD  -  Executive  Vice  President   and  Chief  Technical  Officer   of
VideoPropulsion, Inc.  since incorporation  on October  1,  1999.   Director  of
GENROCO.  He  graduated with an  honors degree in  Mathematics and Physics  from
King's College, University of London  in 1971.  He  was formerly with ITT,  then
Compaq Computer Corporation, UK.  He also served as Executive Vice President and
Chief Technical Officer of GENROCO, Inc. from 1987 to September 30, 1999.

BOB HILDRETH -  Vice President of  Market Development.   Mr. Hildreth  graduated
from the University of California San Diego in 1982 with a bachelor's degree  in
Chemistry.  He  has held  engineering positions  with Priam  Corp., Cipher  Data
Products, and  prior  to  joining  VideoPropulsion,  held  a  lead  program  and
marketing position for the windows media group at Microsoft Corporation.

ITEM 10.  EXECUTIVE COMPENSATION

The following  table  sets  forth  the  compensation  paid  by  the  Company  to
executives for services rendered during 2000

                                             All Other
                                             Compensation
   Name and Principal Position   Salary ($)   ($)(1)<F1>

   ---------------------------   ----------  ------------

   Barbara Pick, President          $44,655      $5,138
   and CEO

(1)<F1> These amounts  are related  to the value  of health  and life  insurance
      premiums paid by the Company on behalf of the employee.

DIRECTORS' COMPENSATION

The Company  pays  director fees  to  each of  its  four directors.    Directors
compensation varies each  year, and by  individual based on  performance of  the
Company and at the discretion of the board.  The following table illustrates the
total amount of director fees paid to each director for 2000.  No director  fees
were paid in 1999 and 1998 on behalf of VideoPropulsion.

                             2000
                             ----

Carl Pick                   $    -
Barbara Pick                12,045
Chris Good                     530
Keith Brue                     500

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

                                              At December 31, 2000
                                    ----------------------------------------
                                                                    % of
                                    Position With   Number of    Outstanding
Name of Beneficial Owner (1)<F2>    The Company       Shares        Shares
--------------------------------    -------------   ---------    -----------

Carl A. Pick (Husband of Barbara)   Director
                                    Chairman        4,119,340       22.2%

Barbara R. Pick (Wife of Carl)      CEO, President  4,038,546       21.8%
                                    Director

Chris Good                          Exec VP, Chief  1,262,862         6.8%
                                    Tech Officer,
                                    and Director

Keith E. Brue (Deceased)            Former            829,688         4.5%
                                    Director,
                                    Secretary and
                                    Treasurer

All  Directors  and  Officers  as  a
Group (4 persons) (3)<F4>                          10,250,436       55.3%

GENROCO ESOP  (2)<F3>                               2,039,512         11%

(1)<F2>The securities  "beneficially  owned"  by  a  person  are  determined  in
      accordance with the definition of "beneficial ownership" set forth in  the
      regulations  of the Securities and  Exchange Commission and,  accordingly,
      may  include  securities  owned  by or  for,  among  others,  the  spouse,
      children  or certain  other relatives  of  such person  as well  as  other
      securities  as to  which the  person has  or shares  voting or  investment
      power or has the right to acquire within 60 days.

(2)<F3>The GENROCO ESOP owns 2,039,512 shares of VideoPropulsion stock,  663,336
      of  which  are  included  in  the  amounts  attributed  to  Officers   and
      Directors.

(3)<F4>


Section 16 (a) Beneficial Ownership Reporting Compliance

    Under  the securities laws  of the Unites  States, the Company's  directors,
    its  executive  officers, and  any  persons holding  more  than 10%  of  the
    company's  common Stock are  required to report  their initial ownership  of
    the Company's common  Stock and any subsequent changes in that ownership  to
    the  Securities and  exchange  commission.   Specific  due dates  for  these
    reports have been  established, and the Company is required to disclose  any
    failure  to file by  these dates.   The Company believes  that all of  these
    filing  requirements were satisfied  during the fiscal  year ended  December
    31, 2000 and  to the date of this report.  In making these disclosures,  the
    Company has  relied solely on written  representations of its directors  and
    executive officers and  copies of the reports that they have filed with  the
    commission.

    Meetings and Committees

    The Board of  Directors of the Company held a total of four meetings  during
    the fiscal year ended December 31, 2000.  During fiscal year ended  December
    31,  2000, no  director attended  fewer that  75% of  the aggregate  of  all
    meeting of  the Board.  The Company has  no standing nominating or audit  or
    compensation committee.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In order to effect the spin-off  of VideoPropulsion, Inc. (previously a  wholly-
owned subsidiary), GENROCO, Inc. and VideoPropulsion, Inc. entered into a series
of agreements designed to allow the two businesses to operate on an  arms-length
basis in the future.  These include, but are not limited to:

o Facilities Lease Agreement
o Transitional Trademark Use and License Agreement
o Interim Administrative Services Agreement
o Confidentiality and Non Disclosure Agreement

                                    PART IV

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

None

SIGNATURES

In accordance with Section 13 or 15(d)  of the Exchange Act, the registrant  has
duly caused this report to be signed on its behalf by the undersigned  thereunto
duly authorized.

In accordance with the  Exchange Act, the  report has been  signed below by  the
following persons on behalf of the registrant  and in the capacities and on  the
dates indicated.

VIDEOPROPULSION, INC.
 (Registrant)

Name                      Title                               Date
----                      -----                               ----

/s/ Barbara R. Pick
--------------------
Barbara R. Pick           Director, President and CEO         April 16, 2001
                          (principal executive officer)

/s/ Carl A. Pick
--------------------
Carl A. Pick              Director, Chairman                  April 16, 2001
                          (principal financial officer)

/s/ Brad Powers
--------------------
Brad Powers               Interim Chief Financial             April 16, 2001
                          Officer
                          (principal financial officer)

/s/ Chris Good
---------------------
Chris Good                Director, Chief Technology          April 16, 2001
                          Officer

DATE:  April 16, 2001