10-K: MDB Capital Holdings Reports 2025 Net Loss Amid Strategic Shifts

MDB Capital Holdings reports a significant net loss for 2025, driven by deconsolidation of eXoZymes and increased equity method losses, despite growth in investment banking fees.

Summary

• MDB Capital Holdings, LLC operates as a holding company with subsidiaries Public Ventures (broker-dealer), PatentVest (IP services), and a majority-owned partner company MDB Minnesota One (M1), focusing on a 'public venture capital' model for early-stage technology companies.
• Public Ventures expanded its capabilities to act as a licensed self-clearing firm for U.S. equity securities in January 2024.
• PatentVest provides integrated intellectual property (IP) strategy and analysis, operating as an Alternative Business Structure (ABS) law firm licensed in Arizona.
• MDB Minnesota One (M1), created in mid-2024, is in the pre-clinical development stage, working on a small molecule anti-senescence platform under an exclusive worldwide license from Mayo Foundation.
• eXoZymes Inc. (formerly Invizyne Technologies Inc.) completed its initial public offering (IPO) on November 14, 2024, which reduced MDB's ownership from approximately 60% to 47%, leading to its deconsolidation and accounting as an equity method investment.
• The company reported a consolidated net loss of $(21.266) million for the year ended December 31, 2025, a significant decrease from a net income of $11.601 million in 2024.
• Operating income increased to $4.911 million in 2025 from $2.157 million in 2024, primarily due to higher investment banking fees.
• Total operating costs decreased to $22.637 million in 2025 from $30.790 million in 2024, largely due to the deconsolidation of eXoZymes.
• Cash and cash equivalents decreased to $13.217 million at December 31, 2025, from $20.437 million at December 31, 2024.
• Working capital decreased by $6.6 million, from $19.8 million in 2024 to $13.2 million in 2025.
• M1 issued 1.98 million shares (representing 33% ownership) to Mayo and paid an initial license fee of $150,000 on July 1, 2024, for the patent rights and technology.
• MDB Capital S.A., an affiliated Nicaraguan company, provided outsourced services, for which MDB paid $1.8 million in 2025 and $1.6 million in 2024.
• Executive officers Christopher Marlett, Mo Hayat, and Anthony DiGiandomenico each exchanged 900,000 Restricted Stock Units (RSUs) for 900,000 stock options in April 2025.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a mixed filing. While strategic initiatives like the eXoZymes IPO and M1 licensing demonstrate progress in the public venture model, the significant net loss and decrease in cash and working capital for 2025 raise concerns about short-term financial performance and liquidity.

Positives

• Operating income increased significantly to $4.911 million in 2025 from $2.157 million in 2024, driven by larger investment banking transactions.
• Public Ventures successfully expanded its capabilities to act as a licensed self-clearing firm in January 2024.
• MDB Minnesota One (M1) secured an exclusive worldwide license from Mayo Foundation for a small molecule anti-senescence platform, targeting a global longevity market projected to reach nearly $45 billion by 2030.
• eXoZymes Inc. successfully completed its IPO on November 14, 2024, demonstrating the viability of MDB's 'public venture capital' model.
• The company recognized a significant gain of $39.307 million on the deconsolidation of eXoZymes in 2024.
• MDB's broker-dealer subsidiary, Public Ventures, has a successful operating history of over 28 years, specializing in public venture companies.
• The company benefits from a community of over 500 sophisticated investors, entrepreneurs, and market participants supporting its public venture model.
• PatentVest, licensed as an Alternative Business Structure (ABS) in Arizona, provides a unique integrated IP solution, leveraging a database of over 148 million patents across 116 countries.

Negatives

• Reported a net loss of $(21.266) million for the year ended December 31, 2025, a substantial decline from a net income of $11.601 million in 2024.
• Cash and cash equivalents decreased by $7.220 million, from $20.437 million in 2024 to $13.217 million in 2025.
• Working capital decreased by $6.6 million, from $19.8 million in 2024 to $13.2 million in 2025.
• Equity in loss of equity method investee (eXoZymes) increased significantly to $(4.282) million in 2025 from $(420) thousand in 2024.
• Interest income from U.S. Treasury Bills decreased to $617 thousand in 2025 from $1.179 million in 2024.
• The company's business model does not rely on operating cash flows from partner companies, necessitating monetization of holdings or external capital raises to fund operations and new partner companies.
• M1 is currently in the pre-clinical development stage, with no commercial products or revenues to date, and faces significant development milestones and associated payments to Mayo.
• The company's significant and concentrated equity investment in eXoZymes (47% ownership) exposes it to market fluctuations and potential impairment charges.

Risks

• Shareholders may be subject to U.S. federal income tax on their share of taxable income regardless of cash distributions, potentially leading to tax liabilities exceeding distributions.
• Allocations of income and loss may be re-determined by the IRS, and delayed final Schedules K-1 may require shareholders to obtain tax filing extensions.
• There is a risk of being treated as a corporation for U.S. federal income tax purposes, which would materially adversely affect share value and reduce cash available for distribution.
• No assurance of continued success in selecting partner companies or generating similar income returns as in the past, given the company's limited operating history as a reorganized holding company.
• The company might require additional capital to support operations and business growth and to fund its partner companies, which may not be available on favorable terms or at all, leading to dilution.
• The business depends on good decisions regarding capital deployment and partner company performance, which is inherently uncertain, and failure of one or more partner companies could significantly reduce asset value.
• Public Ventures (broker-dealer) is subject to extensive SEC, FINRA, DTCC, and NSCC regulations, with potential for fines, limitations on activity, and financial impairment if non-compliant, and is currently under review for past activities.
• Partner companies are likely subject to extensive regulation (e.g., medical/pharmaceutical therapies), with non-compliance leading to investigations, fines, limitations, and reputational damage.
• MDB plans to operate as a company not regulated under the Investment Company Act of 1940, which may require it to buy, sell, or retain assets when it would otherwise not wish to do so to avoid registration.
• The ability to retain senior professionals and recruit additional professionals is critical; failure to do so may adversely affect reputation and business, and the company does not maintain key-man insurance.
• Potential adverse impact of U.S. and Nicaraguan political and regulatory environments on operations, especially concerning outsourced services from MDB Capital S.A. in Nicaragua due to sanctions and instability.
• Significant and concentrated equity investment in eXoZymes (47% ownership) exposes MDB to market fluctuations and potential impairment charges, directly affecting financial statements.
• Competition from other capital providers and acquisition-oriented entities when seeking to establish partner companies may result in higher valuations and increased risk of loss.
• Partner companies may be unable to protect proprietary rights or may infringe on others' rights, leading to costly litigation, diversion of personnel, and potential loss of license agreements.
• Limited foreign intellectual property rights and enforceability challenges in certain countries may hinder global protection of partner companies' IP.
• Patent terms may be inadequate to protect a competitive position for an adequate amount of time, especially given the long development cycles for new products.
• Inability to enter into or maintain collaboration arrangements (research, clinical trials, manufacturing, distribution) could delay partner company business development or increase costs.
• M1 has a limited operating history, no commercial products, and no assurance of successful development of its anti-senescence platform.
• PatentVest's reputation could be harmed, and it may face liability if it fails to identify the full range of patent opportunities relevant to clients' IP portfolios.
• PatentVest is dependent on relationships with third parties and public sources for data, and changes in these relationships could adversely affect its business.
• Challenges in scaling PatentVest's business while maintaining service quality and developing widespread brand awareness in a highly competitive market.
• Public Ventures' self-clearing capabilities expose the business to operational risks, including business and technology disruption, liquidity, financing, and regulatory risks, and potentially increased expenses.
• Public Ventures must maintain adequate capitalization levels to conduct its broker-dealer and clearing businesses, which may require additional capital as settlement operations move to T+0.
• Control by management (Class B Common Shares holders) limits other shareholders' ability to influence director elections and other transactions requiring shareholder approval.
• The dual-class structure of equity securities may adversely affect the trading market for Class A Common Shares and prevent inclusion in certain stock indices.
• The existence of the registered broker-dealer subsidiary may delay or prevent takeover attempts of the company due to FINRA approval requirements.
• The company's capital structure, including preferred shares and Class B Common Shares, has anti-takeover effects.
• The company incurs significant costs as a public company, requiring substantial time for compliance and corporate governance practices.
• The price of Class A Common Shares may be volatile, and a relatively small public float may lead to rapid and substantial price volatility, lower trading volume, and less liquidity.

Future Outlook

MDB plans to seek one or two new partner company opportunities annually, though there is no assurance of finding suitable opportunities at that rate. The company anticipates value creation after several years of patient ownership and corporate effort, with realization methods including IPOs, joint ventures, licensing, asset sales, and mergers. Public Ventures expects regulations for self-clearing operations to undergo substantial changes, potentially requiring additional capital as settlement moves to T+0. M1 is currently in pre-clinical development, undertaking feasibility studies, iterative testing, and drug safety/toxicity data collection, targeting a global longevity and anti-senescence therapy market projected to reach nearly $45 billion by 2030. The company expects to continue investing in its business and partner companies, anticipating growth in employees and consultants. MDB is monitoring indications of a potential U.S. economic recession and will adjust its business and financing plans accordingly.

Management Comments

• We believe that the Big Idea Pipeline showcases the progression of tech initiatives from discovery to commercialization stages.
• We believe that we successfully have used the private and public capital markets to finance growth companies.
• We believe that we now have a different model for helping companies grow than that of the typical private venture capital model. We refer to our approach as public venture capital.
• We believe that one gauge of the partner company success is that the partner company will successfully complete a private and public follow-on offering to continue supporting their research, development, growth and marketing of their technologies potential.
• We believe that venture-stage businesses are more likely to succeed when supported and financed by a community of long-term oriented, like-minded investors and entrepreneurs who have experience building successful companies.
• We believe that our approach provides multiple benefits compared to existing models and traditional methods.
• We believe that PatentVest has one of the most comprehensive global patent databases available, containing more than 148 million patents and covering 116 countries.
• Management is committed to providing the Audit Committee with regular cybersecurity updates, at least annually or more often as needed, based on emerging threats or specific incidents.
• Management holds the responsibility for preparing accurate financial statements and ensuring they faithfully represent our financial status and operations in line with accounting principles generally accepted in the Untied States (GAAP).

Industry Context

StockSavvy.ai notes that MDB Capital Holdings operates in a niche but potentially high-growth segment of the financial services industry, combining broker-dealer services with a 'public venture capital' model. This model aims to address the trend of traditional venture-backed companies staying private longer by providing early-stage public market access. The expansion into self-clearing operations by Public Ventures positions it to capture more revenue and control over its brokerage activities, a strategic move in a market increasingly dominated by high-volume trading and payment for order flow. PatentVest's ABS license in Arizona highlights an innovative approach to integrating legal IP services directly into the venture creation process, differentiating MDB from traditional investment banks or VCs. The investment in M1's anti-senescence platform aligns with the burgeoning longevity and biotech markets, indicating a diversified approach to technology investment. The deconsolidation of eXoZymes, while impacting short-term financials, reflects the successful public market transition of a partner company, validating MDB's core strategy.

Comparison to Industry Standards

• MDB's 'public venture capital' model contrasts with traditional private venture capital funds by taking companies public at earlier stages and fostering a community of long-term investors.
• The company cites past successes like Provention Bio, Inc., Cue BioPharma, Inc., and Pulse Biosciences, Inc., which traded at or over $1 billion in market value after their IPOs, as evidence of its model's effectiveness in enabling capital raising for commercialization.
• The self-clearing broker-dealer model for microcap and small-cap companies aims to fill a gap left by larger brokerage firms that have shifted focus to high-volume, popular equities.
• PatentVest's ABS license in Arizona is a novel approach, as only Colorado offers a more limited similar authorization, suggesting a unique competitive edge in integrated IP services.

Management Changes

Corporate Governance

Legal Proceedings

• The company is not currently subject to any material legal proceedings.
• From time to time, the company may be a party to various legal proceedings arising in the ordinary course of business, including those related to contract enforcement and regulatory reviews, which may result in penalties such as censures and monetary fines.

Related Party Transactions

• Christopher Marlett and Anthony DiGiandomenico, who own all Class B Common Shares, collectively hold 90.8% of the aggregate voting authority as of March 31, 2026.
• Marlett and DiGiandomenico also own MDB Capital S.A., a Nicaraguan entity that provides outsourced services to MDB and its subsidiaries. Payments to MDB Capital S.A. were $1.8 million in 2025 and $1.6 million in 2024.
• PatentVest engaged in transactions with ENDRA Life Sciences Inc. (NDRA), a company where Anthony DiGiandomenico serves as a board member. No revenue was recognized in 2025, but $81 thousand in costs were incurred in 2024.
• PatentVest engaged in transactions with eXoZymes (47% owned by MDB), recognizing revenue of $91 thousand in 2025 and $41 thousand in 2024.
• Related party accrued receivables of $13 thousand were recorded in 2025 for PatentVest services provided to eXoZymes.
• Related party accrued payables of $1 thousand were recorded in 2025 to PatentVest for reimbursable expenses.
• In 2024, related party accrued receivables totaled $64 thousand, including $42 thousand for PatentVest services to eXoZymes and $22 thousand for taxes paid on behalf of certain officers, which was fully reimbursed by January 31, 2025.
• Accrued expenses of $23 thousand were payable to officers and directors in 2024 for reimbursable expenses.
• All related party transactions were conducted on an arms-length basis and are expected to be settled in the normal course of operations, with review by the audit committee.

Stakeholder Impact

• **Shareholders**: Class A Common Shareholders face potential voting dilution due to the superior voting rights of Class B shares and the company's controlled status, which may limit their influence on corporate actions. They may receive distributions of partner company securities, rights to purchase equity, or cash, but these are not planned as regular income items. As a pass-through entity for tax purposes, shareholders may incur tax liabilities that exceed cash distributions.
• **Employees**: Equity-based awards (RSUs, stock options) are used as a key component of compensation and retention strategy. The effects of becoming a public company, including potential changes in compensation structure, could impact the company's culture and ability to attract and retain talent.
• **Customers (Public Ventures)**: Customers of Public Ventures benefit from its self-clearing operations and a community-driven financing model designed for microcap and small-cap companies. They are subject to stringent Know Your Client (KYC) and Anti-Money Laundering (AML) requirements, as well as data privacy regulations.
• **Partner Companies**: Partner companies receive crucial seed capital, management guidance, intellectual property strategy development (from PatentVest), and financing support (from Public Ventures). Their operational and commercial success is directly linked to MDB's overall value creation.
• **Regulatory Bodies**: MDB and its subsidiaries are subject to extensive oversight from various regulatory bodies, including the SEC, FINRA, state securities regulators, Depository Trust Clearing Corporation (DTCC), National Securities Clearing Corporation (NSCC), and the Arizona Supreme Court (for PatentVest's ABS license). Compliance with these regulations requires significant resources and attention.

Next Steps

• M1 to continue pre-clinical development, undertaking feasibility studies, iterative testing, and collection of drug safety and toxicity data.
• M1 is required to achieve certain development milestones, including Phase II clinical trial initiation ($0.25 million payment), Phase III clinical trial initiation ($1.5 million payment), FDA New Drug Application (NDA) acceptance ($2 million payment), and NDA approval ($5 million payment).
• MDB plans to seek one or two new partner company opportunities annually.
• MDB will continue to monitor political developments and assess potential risks related to its outsourced services in Nicaragua.
• MDB will continue to enhance security controls for cybersecurity, with any significant issues promptly reported to the Audit Committee.
• MDB will adjust its current business and financing plans as more information and guidance become available regarding a potential U.S. economic recession.
• MDB will amortize $14.2 million in stock option compensation over a 10-year life.
• MDB granted 161,500 restricted stock units (RSUs) to employees on February 3, 2026, pursuant to its equity incentive plan.

Key Dates

Recommendation

MDB Capital Holdings presents a high-risk, high-reward profile. While its 'public venture capital' model has shown past successes with companies like eXoZymes reaching IPO, the current financial performance, marked by a substantial net loss and declining liquidity in 2025, warrants caution. The company's reliance on future capital raises and the inherent uncertainties of early-stage partner company development, coupled with complex regulatory and geopolitical risks, suggest a 'hold' position. Investors should monitor the company's ability to secure additional funding, demonstrate profitability from its core broker-dealer and IP services, and successfully advance its partner companies like M1 through clinical development.

Keywords

Public Venture Capital, SEC Filing, 10-K, Financial Report, MDB Capital Holdings, Broker-Dealer, Investment Banking, Intellectual Property, PatentVest, MDB Minnesota One, Anti-Senescence, Longevity, eXoZymes, IPO, Corporate Governance, Risk Factors, Financial Performance, Equity Method Investment, Self-Clearing, Capital Markets, Startup Financing, Technology Development, Regulatory Compliance, Dual-Class Shares