# THINKEQUITY LLC X-17A-5 (2023-03-14) — Broker-dealer annual report

- Company: THINKEQUITY LLC
- Form: X-17A-5
- Filed: 2023-03-14
- Period: 2022-12-31
- Accession: 0000822489-23-000004
- CIK: 822489
- File #: 8-38622
- Type: Broker-dealer
- Material weakness: No
- Auditor: Grassi Advisors & Accountants
- Auditor location: ny, NY
- Contact: Richard j Adams
- Phone: 2127328500
- Email: radams@think-equity.com
- Website: think-equity.com
- Signed by: William Baquet (President)

Original filing: https://www.sec.gov/Archives/edgar/data/822489/000082248923000004/think22.pdf

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## UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

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# ANNUAL REPORTS FORM X-17A-5 PART Ill

| SEC FILE NUMBER |  |
|-----------------|--|
| 8-38622         |  |

FACING PAGE

Information Required Pursuant to Rules 17a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934

| FILING FOR THE PERIOD BEGINNING 01/01/2022 |  | AND ENDING 12/31/2022 |
|--------------------------------------------|--|-----------------------|
|                                            |  |                       |

MM/DD/YY

MM/DD/YY

A. REGISTRANT IDENTIFICATION

# NAME OF FIRM: THINKEQUITY LLC

TYPE OF REGISTRANT (check all applicable boxes):

0 Broker-dealer 0 Security-based swap dealer 0 Major security-based swap participant 0 Check here if respondent is also an OTC derivatives dealer

ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.)

# 17 STATE STREET, 41ST FLOOR

|                                                                           | (No. and Street)              |         |                         |  |
|---------------------------------------------------------------------------|-------------------------------|---------|-------------------------|--|
| NEW YORK                                                                  | NY                            |         | 10004                   |  |
| (City)                                                                    | (State)                       |         | (Zip Code)              |  |
| PERSON TO CONTACT WITH REGARD TO THIS FILING                              |                               |         |                         |  |
| RICHARD ADAMS                                                             | (646) 467-5487                |         | radams@think-equity.com |  |
| (Name)                                                                    | (Area Code- Telephone Number) |         | (Email Address)         |  |
| B. ACCOUNTANT IDENTIFICATION                                              |                               |         |                         |  |
| INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing* |                               |         |                         |  |
| Grassi Advisors & Accountants                                             |                               |         |                         |  |
| (Name- if individual, state last, first, and middle name)                 |                               |         |                         |  |
| 750 Third Avenue                                                          | NEW YORK                      | NY      | 10017                   |  |
| (Address)                                                                 | (City)                        | (State) | (Zip Code)              |  |

October 22, 2003 606

# FOR OFFICIAL USE ONLY (PCAOB ''''""''" N pm bee, if'""" ble)l

\* Claims for exemption from the requirement that the annual reports be covered by the reports of an independent public accountant must be supported by a statement of facts and circumstances relied on as the basis of the exemption. See 17 CFR 240.17a-S(e)(l)(ii), if applicable.

Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMS control number.

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#### **OATH OR AFFIRMATION**

| 1, William Baquet                                          | swear (or affirm) that, to the best of my knowledge and belief, the                                                                 |
|------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------|
| financial report pertaining to the firm of THINKEQUITY LLC | as of                                                                                                                               |
| _1 2_/_3_1~------<br>~--'                                  | 2~ is true and correct. I further swear (or affirm) that neither the company nor any                                                |
|                                                            | partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely |
| as that of a custo 1<br>. e                                | Signature:                                                                                                                          |

#### **This filing\*\* contains (check all applicable boxes):**

- **ii** (a) Statement of financial condition.
- ~ (b) Notes to consolidated statement of financial condition .
- ii (c) Statement of income (loss) or, if there is other comprehensive income in the period(s) presented, a statement of comprehensive income (as defined in§ 210.1-02 of Regulation S-X).
- **iii** (d) Statement of cash flows.
- ii (e) Statement of changes in stockholders' or partners' or sole proprietor's equity.
- 0 (f) Statement of changes in liabilities subordinated to claims of creditors.
- **ii** (g) Notes to consolidated financial statements.
- ~ (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable.
- 0 (i) Computation of tangible net worth under 17 CFR 240.18a-2.
- 0 (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3.
- 0 (k) Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable.
- 0 (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3.
- 0 (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3.
- 0 (n) Information relating to possession or control requirements for securit y-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.18a-4, as applicable.
- 0 (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-l, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist.
- 0 (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition.
- ~ (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable.
- 0 (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as appl icable.
- 0 (s) Exemption report in accordance with 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable.
- 0 (t) Independent public accountant's report based on an examination of the statement of financial condition.
- 0 (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable.
- 0 (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable.
- 0 (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable.
- 0 (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e or 17 CFR 240.17a-12, as applicable.
- 0 (y) Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). 0 (z) Other: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_
- 
- *\*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5{e)(3) or 17 CFR 240.18a-7(d)(2), as applicable.*

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## FINANCIAL STATEMENTS WITH SUPPLEMENTAL INFORMATION AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

#### FOR THE YEAR ENDED DECEMBER31, 2022

is deerncd CC!NF!DE:NT!AL in accordance of l934, A statcrnenl of tinancial condition bound Con; mission herewith a PLH3!JC document ut !c~e~· the Securities

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#### **FOR THE YEAR ENDED DECEMBER31, 2022**

#### **TABLE OF CONTENTS**

|                                                                                                                | Page No(s). |
|----------------------------------------------------------------------------------------------------------------|-------------|
| Report of Independent Registered Public Accounting Firm                                                        |             |
| Financial Statements:                                                                                          |             |
| Statement of Financial Condition                                                                               | 2           |
| Statement of Operations                                                                                        | 3           |
| Statement of Changes in Member's Equity                                                                        | 4           |
| Statement of Cash Flows                                                                                        | 5           |
| Notes to Financial Statements                                                                                  | 6-<br>12    |
| Supplemental Information:                                                                                      |             |
| Computation of Net Capital Under Rule 15c3-1<br>Schedule 1:                                                    | 13          |
| Schedule II: Computation for Determination ofReserve Requirements<br>Under Ru le 15c3-3                        | 14          |
| Supplemental Reports:                                                                                          |             |
| 1ndepenclent Registered Public Accounting Finn 's Report on Exemption Report                                   | 15          |
| Independent Registered Public Accounting Firm's Report on Schedule of<br>Assessment and Payments (Form S!PC-7) | 16          |

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![](_page_4_Picture_0.jpeg)

#### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Managing Member of ThinkEquity LLC

#### Opinion on the Financial Statements

We have audited the accompanying statement of financial condition of ThinkEquity LLC (the "Company") as of December 31 , 2022, and the related statements of operations, changes in member's equity, and cash flows for the year then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects , the financial position of ThinkEquity LLC as of December 31 , 2022, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

#### Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC") and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

#### Auditors' Report on Supplemental Information

The supplemental information in Schedules I and II ("Supplemental Information") has been subjected to audit procedures performed in conjunction with the audit of the Company's financial statements. The Supplemental Information is the responsibility of the Company's management. Our audit procedures included determining whether the Supplemental Information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the Supplemental Information. In forming our opinion on the Supplemental Information, we evaluated whether the Supplemental Information, including its form and content, is presented in conformity with 17 C.F.R. §240.17a-5. In our opinion, the Supplemental Information is fairly stated, in all material respects, in relation to the financial statements as a whole.

~'!\_0\_:~\_~f~~~!9.:

GRASSl & CO., CPAs, P.C.

We have served as ThinkEquity LLC's auditors since 2020.

New York, New York February 28, 2023

![](_page_4_Picture_15.jpeg)

AN IND EP ENDE NT F RM ASSOCIATED >VITH MOORE GLOBAL NETVVORK LIMITED

:~ <sup>o</sup>T H IPD AVE t'..J UE. 2 8T'H LO Or~, NEVJ YOR K, N Y <sup>00</sup> <sup>7</sup> F 21 2 .GG1.G1GG • F: 212.755.6748 • GRASSICPAS.COM NE\V YORJ< NEVV JERSEY ! lv1:\SSt.\CHUSETTS i FLO RIDt\

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## **STATEMENT OF FINANCIAL CONDITION**

### **AS OF DECEMBER 31, 2022**

## **ASSETS**

| Assets                               |                  |
|--------------------------------------|------------------|
| Cash and cash equivalents            | \$<br>27,893,105 |
| Deposits with clearing organizations | 13,769,940       |
| Due from broker dealers              | 376,361          |
| Forgivable loans                     | 344,722          |
| Right-of-use asset                   | 8,743,061        |
| Prepaid expenses                     | 175,216          |
| Security deposits                    | 524,909          |
|                                      |                  |

#### **Total assets**

## \$ **51,827,314**

## **LIABILITIES AND MEMBER'S EQUITY**

| Liabilities                           |                 |                  |
|---------------------------------------|-----------------|------------------|
| Accounts payable and accrued expenses | \$<br>1,651,449 |                  |
| Securities not yet owned              | 280,500         |                  |
| Deferred revenue                      | 1,524,817       |                  |
| Commissions payable                   | 1,351 '1 04     |                  |
| Operating lease liability             | 9,224,659       |                  |
|                                       |                 |                  |
| Total liabilities                     |                 | \$<br>14,032,529 |
|                                       |                 |                  |
| Commitments and contingencies         |                 |                  |
|                                       |                 |                  |
| Member's equity                       |                 | 37,794,785       |
|                                       |                 |                  |

#### **Total liabilities and member's equity**

## \$ **51,827,314**

The accompanying notes are an integral part of these financial statements

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## **STATEMENT OF OPERATIONS**

## **FOR THE YEAR ENDED DECEMBER 31, 2022**

| Revenue                                |                  |                    |
|----------------------------------------|------------------|--------------------|
| Corporate finance income               | \$<br>22,374,396 |                    |
| Commissions income                     | 2,321,407        |                    |
| Corporate finance income -<br>warrants | 420,749          |                    |
| Trading income                         | 114,822          |                    |
| Rebates and handling fee income        | 114,713          |                    |
| Total revenue                          |                  | \$<br>25,346,087   |
|                                        |                  |                    |
| Expenses                               |                  |                    |
| Compensation and related benefits      | 21,066,501       |                    |
| General and administrative             | 7,630,684        |                    |
| Brokerage, exchange and clearing fees  | 618,525          |                    |
|                                        |                  |                    |
| Total expenses                         |                  | 29,315,710         |
| Operating loss                         |                  | (3,969,623)        |
|                                        |                  |                    |
|                                        |                  |                    |
| Other income                           |                  |                    |
| Conference income                      | 1,038,958        |                    |
| Settlement income                      | 1,024,620        |                    |
| Interest income                        | 321,979          |                    |
| Total other income                     |                  | 2,385,557          |
|                                        |                  |                    |
| Net loss                               |                  | \$<br>(1 ,584,066) |
|                                        |                  |                    |

The accompanying notes are an integral part of these financial statements

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## **STATEMENT OF CHANGES IN MEMBER'S EQUITY**

**FOR THE YEAR ENDED DECEMBER 31, 2022** 

|                            | Member's<br>Equity |              |  |
|----------------------------|--------------------|--------------|--|
| Balance, January 1, 2022   | \$                 | 39,378,851   |  |
| Net loss                   |                    | (1 ,584,066) |  |
| Balance, December 31, 2022 | \$                 | 37,794,785   |  |

The accompanying notes are an integral part of these financial statements

4

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## **STATEMENT OF CASH FLOWS**

#### **FOR THE YEAR ENDED DECEMBER 31, 2022**

| Cash flows from operating activities:<br>Net loss       | \$<br>(1 ,584,066) |                  |
|---------------------------------------------------------|--------------------|------------------|
| Adjustments to reconcile net loss to net cash           |                    |                  |
| provided by operating activities:                       |                    |                  |
| Forgivable loans                                        | (236,569)          |                  |
| Decrease (increase) in operating assets:                |                    |                  |
| Deposits with clearing organizations                    | 22,262,600         |                  |
| Receivable from broker dealers                          | (128,019)          |                  |
| Prepaid expenses                                        | (28,720)           |                  |
| Right-of-use asset                                      | (3,489,994)        |                  |
| Security deposits                                       | 17,391             |                  |
| Increase (decrease) in operating liabilities:           |                    |                  |
| Accounts payable and accrued expenses                   | (6,701 ,669)       |                  |
| Deferred revenue                                        | 497,817            |                  |
| Bonus payable                                           | (4,492,500)        |                  |
| Securities not yet owned                                | 280,500            |                  |
| Operating lease liability                               | 3,763,522          |                  |
| Commissions payable                                     | 65,902             |                  |
| Income taxes payable, net                               | (5,649,379)        |                  |
|                                                         |                    |                  |
| Net cash provided by operating activities               |                    | \$<br>4,576,816  |
|                                                         |                    |                  |
|                                                         |                    |                  |
| Net increase in cash and cash equivalents               |                    | 4,576,816        |
|                                                         |                    |                  |
| Cash and cash equivalents - beginning of the year       |                    | 23,316,289       |
| Cash and cash equivalents - end of the year             |                    | \$<br>27,893,105 |
|                                                         |                    |                  |
| Supplemental disclosure of cash flow information:       |                    |                  |
| Cash paid during the year for interest                  |                    | \$<br>8,202      |
| Supplemental schedule of non-cash financing activities: |                    |                  |
| Right-of-use asset                                      |                    | \$<br>3,289,794  |

The accompanying notes are an integral part of these financial statements

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#### **NOTES TO FINANCIAL STATEMENTS**

#### **FOR THE YEAR ENDED DECEMBER 31, 2022**

## **Note 1- Organization and Nature of Business**

·rhinkEquity LLC (the "Company'") formerly known as Fordham Financial Management, Inc . is a broker-dealer registered with the United States Securities and Exchang~ Commission (the ··SEC') and is a member ofth~ Financial Industry R~gulatory Authority ("FTNRA") and th~ Securities Investor Protection Corporation ("SIPC'). Effective August 16.2021, Fordham Financial Management, Inc. converted from a Colorado corporation into a Dodawarc limited liability company changing its nam~ to ThinkEquity LLC. Th~ Company is a wholly -owned subsidiary of Fordham Ho ldings. lnc. (the "Parent"). ·rhe Company is engaged in a single line of business as a securities bmkerdealer, which comprise~ ~evera <sup>l</sup>classes of services, includ ing private placements and investment banking.

T'lle Company operates under the provisions of Paragraph (k)(2)(ii) of Rule 15c3-3 of the Securities Exchange Act of 1934 and, accordingly, is exempt from the remaining provisions of that rule. Essentially, the requirements of Paragraph lk)l2)(ii) provide that the Company clear all transactions on behalf of customers on a fully disclosed basis witl1 a clearing broker and promptly transmit all customer funds and securities to clearing broker dealer. The clearing brokcr-dcaicr carries all the accounts of customers and mainta ins al l related books and records as arc customari ly kept . by a clearing brokcrc.dea.ler.

## **Note 2- Summary of Significant Accounting Policies**

#### **Basis of presentation**

The Company follows accounting standards established by the Financial Accounting Standards Board (the " FASB'') to ensure consistent reporting of financial condition, results of operations, and cash flows. Relert'nces to accounting principles generally accepted in the United States of America ("U .S. GAAP'') in these notes are to the FASB Accounting Standards Codification, sometimes referred to as the "Codification'' or "ASC."

#### **Use of estimates**

The preparation of financial statements in conformity with U.S. GAAP requires that management 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.

#### **Cash and cash equivalents**

For the purpose of the statement of cash flows. the Company considers highly liquid investments with an original maturity of three months or less to be cash equivalents.

#### **Property and equipment**

Properly and equipment ar~ stated at cost. Depreciation is provided using a straight line approach using estimated useful lives of five to seven years. Major additions and improvements are capitalized. and repairs and maint.:nancc are charged to operations as incurred. All property and equipment was fully depreciated as of December 31. 2018, and there were no purchas.:;; during the year ended December 31. 2022.

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## **NOTES TO FINANCIAL STATEMENTS**

## **FOR THE YEAR ENDED DECEMBER31, 2022**

#### **Note 2 - Summar·y of Significant Accounting Policies (Continued)**

#### **Revenue recognition**

'fhc Company l'l1llows t.he provisions off,.ASR :\SC 'fopic 606. *Revenue ji-om Comracts with C11stomers* ("'ASC ·ropic 606"). ·rhe revenue recognition guidance requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expect;: to be entitled in exchange of those goods or service.

The guidance requires an entity to follow a five-step model to(]) identit)' the contract(s) with a customer. (2) identify tile performance obligations in the contracL (3) dekrrnine the transact ion price. (4) allocate the transaction price to the perf(mnancc obligations in the contract and (5) recognize r~vcnue when (or as) the ~ntity satisfies a perf(Jrmancc obligation. In determining the transaction price, an entity may include variable consideration on.ly to the extent that it is probable that a sign ificant reversal in the amount of cumulative revenue recognized would nut occur when the uncertainty associated \Vith the variable consideration is resolved, The revenue recognition guidance docs not apply to revenue associated with financial instruments, interest income and expense, and .leasing and insurance contracts. The IC1llowing is a description of the principal activities from which the Company generates its revenue .

·rhe Company provides corporate 1inance and commissions transaction related services tc1 its customers. The bencllts of the Company's services arc generally transferred to the c.ustom.: rs at a point in time upon executing a transaction . The timing of the Company's revenue recognition may differ from the timing of payment by irs customers. ·rho:? Company records a receivable when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue, which represents a contract liability until the performance obligations are satisfied. ·rhcrc were no contract assets or contract liabilities at the beginning and end of the year.

#### **Corpor·ate finance income**

Corporate finance income is earned fi·om providing private placement, underwriting and advisory ~crviccs. 'T'hc benefits of the Company's services arc generally transferred to the Company's cu:<tomers over time. since the customers simultano:?ously receive and consume tb.: benefits as the Company performs the service. 'fhe Company's contracts are usually cancellable by either party at any time and the considerations typically include expcns.: advance;; and success fees. Expense advanc.:s are generally collected near the beginning of each deal as deferred revenue and recognized into revenue as expenses related to the dea.ls are incurred. However. success fees are variable and subject to Gonstraints. and are typically not recognized un til the transaction completion date . due to the uncertainty associated with those events. As of [)ecember 31. 2022. expense advances inc.luded in the accompanying statement of financiai condition as deferred revenue totaled \$1.524.817.

'fhe Company may receive stock. warrants as part of agreed-upon compensation l'lw services. In accordance with ASC ·ropic 606. these \varrants arc valued at fi1ir valu.: at the initiation of the contract, if determinable. Otherwise, the warrants are valued based on the typical charge for the service pwvided. /\t the completion of the contract. the warrant fair values are recognized into revenue as corporate finance income - warrants and as compensation expense. as these warrants are allocated at closing to certain employees. The Company utilizes valuation techniques to deter min.: the fair val ue of the warrants at the elate of grant utilizing market data to convert fi.1ture amounts to a single amount based on current mark..:.£ expectations about the future amounts (lattice models). For the year ended December 31. 2022, the Company recorded revenue and compensation expense from receipt and issuance of these warrants totaling \$420,749.

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## **NOTES TO FINANCIAL STATEMENTS**

## **FOR THE YEAR ENDED DECEMBER31, 2022**

## **Note 2- Summary of Significant Accounting Policies (Continued)**

#### **Com mission Income**

Securities transactions and the recognition of related income and expenses are recorded on a trade date ba sis. Commissions and related clearing charges are also recorded on a trade-date basis as securities transactions occur.

#### **Income taxes**

As a limited liability company, the Company has e lected to be treated as a partnership under the provisions of the Internal Revenue Code (" lRC"). Under those provisions, the Company is not required to pay federal or state income taxes on its tax able income. In stead, the members are li able for individu al federal and state income taxes on their respective share of the Company's taxable income.

U.S. GAAP requires the eva luati on of tax positions taken or expected to be taken in the course of preparing the Company's tax returns to determine whether the tax positions are more-l ike ly than-not to be susta ined upon examination by the applicable tax authority , based on the technical merits of the tax position. Management believes any such positions would be immate rial to the overall fin ancia l statements.

#### **Note 3 - Receivable from Clearing Broker/Securities Held at Broker**

The Company conducts bu siness and clears its proprietary and customer transaction s through one cle aring broker on a fully disclosed basis. The Company earns commissions as an introducing broker for the transactions of its customers. The clearing and depository operations for the Company's customer accounts are performed by its clearing broker pursuant to a clearance agreement.

{12}------------------------------------------------

## **NOTES TO FINANCIAL STATEMENTS**

#### **FOR THE YEAR ENDED DECEMBER31, 2022**

## **Note 4- Commitments and Contingencies**

#### **Lease commitments**

As of January I, 2021 , the Company adopted the accounting standard, FASB ASC Topic 842, *Leases* ("ASC 842"). ASC 842 requires all lessees to recogni ze a right-of-use asset for the underly ing leased asset and a lease liability for the corresponding lease liability for a ll lease agreements with a term greater than 12 months, initially measured at the present value of the lease payments. In accordance with ASC 842, the modified retrospective method was applied to all lease agreeme nts in effect at January I, 2021 . Under the modified retrospective method, the cumulative effect of applying the standard is recognized at the date of initial application.

Right-of-use assets and the co rresponding lease liabilities are recogni zed at the lease comme ncement date based on the present value of lease payments over the life of the lease term. In determining the present value of lease payments, the Company uses the rate implicit in the lease if it is readily determinable, a borrowing rate based on similar debt, or a risk-free rate for a period comparable to the lease term to discount the lease payments to present value. The Company has elected to use the risk-free rate by class of underlying asset as a practical ex ped ie nt. However, if any of the Company's leases contain an implicit interest rate, that rate is used to determine the present value of those lease payments. The Company considers the lease term to be the noncancellable period that it has the right to use the underlying asset, including all periods covered by an option to ( I) extend the lease, if the Company is reaso nably certain to exercise the option, (2) terminate the lease if the Com pany is reasonably certain not to exercise th at option, and (3) extend or not to terminate the lease, in which exercise of the option is controlled by the lessor.

In accordance with Topic 842, the Company, at the inception of the contract, evaluates if an arrangement is or contains a lease and thus recognizes a right-of-use asset and the corresponding lease liability. The Company's right-of-use assets and lease liabilities relate to the rental of office space. The Company recogni zes right-of-use assets and lease li abilities for leases with terms of greater than 12 months.

Leases are classified e ither finance or operating leases. For operating leases, the lease liability is initially and subsequently measured at the present value of the future payments at the lease commencement date. For fin ance leases, the lease liab ility is initially measured in the same manner. The classification between operating and fi nance leases determines whether lease expenses are recogni zed based on an effective interest method or on a straight-line basis, respective ly, over the term of the lease. Lease payments included in the measurement of the lease liab ility comprise a fixed payment owed over the lease term.

The right-of-use assets asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payme nts made at or before the lease commencement date, plus any initial direct costs incurred less any ince nti ves received. right-of-use assets under finance leases are amortized on a straight-line basis over the lease term. ri ght-of-use rightof-use assets for o perating and finance leases are periodically reduced by impairment losses.

The Company mo nitors for eve nts or changes that can require a reassessment of its leases. When a reassessment results in the remeasurement of a lease li ability, a corresponding adjustment is made to the carryin g amo unt of the corresponding ri ght-ofuse asset unless do ing so wo uld reduce the carrying amount of the right-of-use asset to an amount less than ze ro.

Operating lease right-of-use assets are prese nted as operating lease right-of-u se assets on the statement of fin anci al condition. The Company has no fin ance leases and no related party leases.

The Company's right-of-use assets and lease liabilities primarily relate to its noncancelable operating lease obligations for the rental of office space. Generally, leases covering office space include renewa l options and are subject to rent escalation s based on increased operating costs and rea l estate taxes. Lease components in the Company's leases are accounted for following the gu idance in ASC 842 for the cap itali zation of long-term leases. At December 3 1, 2022, the lease liability is equal to the prese nt va lue of the remaining lease payments, discounted using the risk-free rate.

{13}------------------------------------------------

#### **NOTES TO FINANCIAL STATEMENTS**

#### **FOR THE YEAR ENDED DECEMBER31, 2022**

## **Note 4- Commitments and Contingencies (Continued)**

Lease activity for the year ended December 3 1, 2022 was as follows:

| Lease cost:                                 |                      |
|---------------------------------------------|----------------------|
| Operating lease cost<br>Variable lease cost | \$ 500,693<br>78.125 |
| Total lease cost                            | \$578 818            |
| Other information:                          |                      |
| Cash paid for amounts in the measurement    |                      |
| of lease liab ilities:                      |                      |
| Operating cash flows from operating leases  | \$ 283,483           |
| We ighted average remaining lease term:     |                      |
| Operating leases                            | 10 Years             |
| We ighted average discount rate:            |                      |
| Operating leases                            | 2%                   |

Future minimum lease payments and reconciliation to the statement of financi a l condition at December 31,2022 are as foll ows:

| Years ending December 3 1,                        | Operating<br>Leases                                |
|---------------------------------------------------|----------------------------------------------------|
| 2023<br>2024                                      | \$ 370,293<br>888,348                              |
| 2025<br>2026<br>2027<br>Thereafter                | I ,043,000<br>I ,043,000<br>1,080,250<br>5,680.625 |
| Total future minimum undiscou nted least payments | \$ 10,105,5 16                                     |
| Less: amo unt representi ng interest              |                                                    |
| Total operating lease liability                   |                                                    |

{14}------------------------------------------------

## **NOTES TO FINANCIAL STATEMENTS**

#### **FOR THE YEAR ENDED DECEMBER31, 2022**

## **Note 4- Commitments and Contingencies (Continued)**

ln the ordinary course of business, the Company may been named as a defendant in lega l and regul atory proceedings, as we ll as exams, investigations, and similar reviews by governmental and self-regulatory agencies. These legal and regulatory proceeding could give rise to potential injunctions, judgments, settlements, fines and/or penalties. The Company typically includes an indemnification clause with a ll of their investment banking clients. The Company recogni zes a liability for a contingency in accrued expen ses and other liabilities when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated.

As of the date of the financial statements, the Company has not had any matters which have required the Company to determine a loss to be probable and reaso nab ly estimable; accordingly, no such adjustments have been made in the Company's accompanying fin anc ial statements. The Company believes that any pending legal actions or regu latory proceedings and any other exams, investigations or similar rev iews will not have a material adverse effect on its results of operations, cash fl ows or fin ancial condition

#### **Brokerage activities**

In the normal course of business, the Company is engaged in various brokerage activities on an agency basis through a clearing broker. In connection with these activities, a customer's unsettled transactions may ex pose the Company to off-balance sheet risk in the event the customer is unable to fulfill its contractual obligations. Significant credit exposure may resu lt in the event that the Company 's clearing broker is unable to fulfill its contractual obligation.

## **Note 5- Forgivable Loans**

The Company extended credit (" forgivable loans") to new advisors in 2022 in the form of signing bonuses and commissio n advances. The decision to extend credit to adv isors is generally based on the advisor's ability to gene rate future commissions. These advances are forg ivable over the terms of the adv isor agreement prov ided the advisor remain s licensed through the Company for a period of time. At December 31, 2022, \$344,722 of extended credit is forgivable .

{15}------------------------------------------------

#### **NOTES TO FINANCIAL STATEMENTS**

#### **FOR THE YEAR ENDED DECEMBER31, 2022**

## **Note 6- Net Capital Requirements**

The Company is subject to the SEC Uniform Rule (SEC Rule 15c3-1), which requires the ma intenance of minimum net capita l and requires th at the ratio of aggregate indebtedness to net capita l, both as defined, shall not exceed 15 to I (and the rule of the "applicable" exchange also provi des that equity capital may not be withdrawn or cash dividends paid if the resultin g net capital rati o would exceed I 0 to I). At December 31 , 2022, the Company had net capita l of \$37, 134,767, which was \$36,832,94 1 in excess of its required net capital of \$3 0 I ,826. The Company's aggregate indebtedness to net capital ratio was 0.1218 to I at December 3 1, 2022.

Certain advances, dividend payments and other equity withdrawals a re restri cted by the provisions of the rules of the Securiti es and Exchange Commission.

Unde r the arrangements with the clearing broker-dealer, the Company is required to ma intain certain minimum levels of capita l and comply with other financial ratio requirements.

#### **Note 7 - Concent.-ations and Credit Risks**

The Company c lears its securities transactions thro ugh a major fin ancia l service firm . These activities may ex pose the Company to off-balance-sheet risk in the eve nt that the in stitution is unable to fulfill its obligation and the Company has to purchase or se ll the securities at a loss.

The Company maintains its cash balances in various commercial banks whi ch, at times, can exceed the Federal Deposit In suran ce Co rporation ("FDl C") I im it of \$250,000 per depositor. At December 31, 2022, the Company's cash ba lances he ld at the commerc ial banks exceeded the F DIC limit. The Company has not experienced any losses in such acco unts, and these accounts currently exceed the FDIC limit by \$26,889,840.

Financ ia l instruments that potentially subject the Company to concentrations of credit risk consist princ ipally of the clearing organi zations rece ivable. The Company has cash on deposit with a clearing organi zation. The amount of cred it risk assoc iated with the deposits with clearing organization is approximately \$13,069,940 and is reflected in the statement of fin anc ial cond ition.

#### **Note 8- Subsequent Events**

The Company has evaluated subsequent events thro ugh February 28 , 2023, the date the financi a l statements we re avai lable to be issued. During this period, the re were no mate rial subsequent event requiring disclosure.

{16}------------------------------------------------

#### SUPPLEMENTAL 1NFORMATTON

{17}------------------------------------------------

## **SCHEDULE I- COMPUTATION OF NET CAPITAL UNDER SEC RULE 15c-3-1**

#### **AS OF DECEMBER 31, 2022**

| Total member's equity                                                                                                                                 | \$<br>37,794,785 |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|------------------|
| Addback Focus Line 3525<br>Difference between right-of-use asset and operating lease liabiity                                                         | 481 ,598         |
|                                                                                                                                                       |                  |
| Deduction/charges<br>Non-allowable assets                                                                                                             |                  |
| Prepaid expenses<br>175,216<br>344,722<br>Forgivable loans                                                                                            |                  |
| Security deposits<br>524,909                                                                                                                          |                  |
| Aged account receivable<br>54,694                                                                                                                     |                  |
| Total deduction/charges                                                                                                                               | 1,099,541        |
| Net Capital before haircuts                                                                                                                           | \$<br>37,176,842 |
| Haircuts on securities pursuant to 15c31 (f)                                                                                                          | 42 ,075          |
| Net Capital per Rule 15c3-1                                                                                                                           | \$<br>37,134,767 |
| Aggregate indebtedness<br>Accounts payable and accrued expenses<br>\$ 1,651,449<br>Deferred revenue<br>1,524,817<br>1,351 ,104<br>Commissions payable |                  |
| Total aggregate indebtedness:                                                                                                                         | \$<br>4,527,370  |
| Computed minimum net capital required (The greater of)<br>(\$1 00,000 or 6 2/3% of aggregate indebtedness)                                            | \$<br>301,826    |
| Excess Net Capital                                                                                                                                    | \$<br>36,832,941 |
| Percentage of Aggregate Indebtedness to Net Capital                                                                                                   | 12.18%           |

There are no material differences between the computation required pursuant to Rule 15c3-1 and the corresponding computation prepared by the Company and included in the Company's unaudited for X-17a-5 Part !Ia filing as of December 31 , 2022.

> See report of independent public accounting firm. 13

{18}------------------------------------------------

SCHEDULE II - Schedule of Computation for Determination of Reserve Requirements and Information Relating to Possession or Control Requirements pursuant to Rule 15c3-3 of the U.S. Securities and Exchange Commission

DECEMBER 31 , 2022

The Company is exempt under the provisions of paragraph (k)(2)(ii) of Rule 15c3-3. Accordingly, there are no items to reportunder the requirements of this rule.

{19}------------------------------------------------

![](_page_19_Picture_0.jpeg)

#### REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Managing Member of ThinkEquity LLC

We have reviewed management's statements, included in the accompanying Exemption Report, in which (1) ThinkEquity LLC (the "Company") identified the following provisions of 17 C.F.R. § 15c3-3(k) under which the Company claimed an exemption from 17 C.F.R. § 240.15c3-3 under the following provisions of 17 C.F.R. § 240.15c3-3 (k)(2)(ii) (the "exemption provisions") and (2) management stated that the Company met the identified exemption provisions throughout the most recent fiscal year without exception.

The Company's management is responsible for compliance with the exemption provisions and its statements.

Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about the Company's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in paragraph (k)(2)(ii) of Rule 15c3-3 under the Securities Exchange Act of 1934.

~~ *Co:l!JlAs;* PC.

GRASSl & CO., CPAs, P.C.

New York , New York .February 28,.2023

"/SO TH!RD AVEi\lU[ . 2BT'H FLOOR, NEV:/ YORK, NY ~001? P 212.6G1.6166 • F. 212.755.6748 • GR.'\SSICPAS.CCM HEW YCRI< NEW .JERSEY I M.AS SAC HU SETTS i FLORID,\

![](_page_19_Picture_11.jpeg)

>'IN INDEPENDENT FiRM ;\SSOCI1~TED I:VIT H MOORE GLOBAL t'ETWORK LIMITED

{20}------------------------------------------------

## EXEMPTION REPORT FOR THE YEAR ENDED DECEMBER 3 1 ,2022

ThinkEquity LLC (the "Company") is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission (17 C.F.R 240. J7a-5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R.240.17a-5(d)(l) and ( 4). To the best of its knowledge and belief, the Company assets the following:

(1) The Company claimed an exemption from 17 C. F.R 240, 15c3-3 under the provisions of 17 C.F.R. 240.15c3-3 (k)(2)(ii) throughout the year January I, 2022 through December 31 , 2022.

(2) The Company met the identified exemption provisions in 17 C.F.R. 240. 15c3- 3(k)(2)(ii) throughout the year January 1, 2022 through December 31, 2022 without exception.

These assertions are the responsibility of management. The Company acknowledges it is also management's responsibility for compliance with the identified exemption provisions throughout the year ended December 31, 2022.

The Company has made avai !able to the accountants all records and other information relevant to the Company's assertions, includingall communications from regulatory agencies, external auditors, others who perform an equivalent function, compliance functions and other auditors concerning possible exceptions to the exemption provisions, received through the date of the review opinion .

There were no events, subsequent to the period addressed in the Company's assettions other factors that might significantly affect the broker's or dealer's compliance with the identified exemption provisions.

ThinkEquity LLC

1, William Baquet swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct.

Sec report of independent accounting finn


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