Filed Pursuant to Rule 433

Issuer Free Writing Prospectus dated March 25, 2024

Relating to Preliminary Prospectus Supplement dated March 25, 2024

Registration No. 333-269060

This free writing prospectus relates to the proposed public offering of shares of common stock of Ideal Power Inc. (the “Company”, “we”, “us” and “our”) and pre-funded warrants to purchase shares of common stock of the Company. This free writing prospectus should be read together with the preliminary prospectus supplement dated March 25, 2024, including the documents incorporated by reference therein (the “Preliminary Prospectus Supplement”), as well as the Registration Statement on Form S-3 (File No. 333-269060) and the prospectus included therein.

Unaudited Preliminary Estimated Results for the Year Ended December 31, 2023

Set forth below are certain of our unaudited preliminary estimated financial results for the year ended December 31, 2023 based on information available to us as of the date of this filing. The estimated financial information contained in this free writing prospectus, therefor, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended. Actual results for the year ended December 31, 2023 remain subject to the completion of management’s and our audit committee’s final reviews and our other financial closing procedures and the completion of the preparation of our audited financial statements. Our actual audited financial statements and related notes as of and for the year ended December 31, 2023 will not be filed with the SEC until after the offering is completed, and consequently will not be available to you prior to you investing in the offering.

The preliminary financial data included in this filing has been prepared by and is the responsibility of our management. Our independent registered public accounting firm, BPM LLP, has not audited, reviewed, compiled or performed any procedures with respect to the preliminary financial data. Accordingly, BPM LLP does not express an opinion or any other form of assurance with respect thereto.

IDEAL POWER INC.

Balance Sheets

(unaudited)

	December 31, 2023			December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	8,474,835		$	16,345,623
Accounts receivable, net		70,000			65,936
Inventory		81,450			-
Prepayments and other current assets		482,890			491,365
Total current assets		9,109,175			16,902,924
Property and equipment, net		359,225			200,103
Intangible assets, net		2,580,066			2,036,431
Right of use asset		186,570			248,720
Other assets		13,034			11,189
Total assets	$	12,248,070		$	19,399,367
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	405,098		$	130,503
Accrued expenses		455,112			254,218
Current portion of lease liability		70,683			64,597
Total current liabilities		930,893			449,318
Long-term lease liability		132,304			202,987
Other long-term liabilities		1,125,173			838,458
Total liabilities		2,188,370			1,490,763
Stockholders’ equity:
Common stock		5,998			5,926
Additional paid-in capital		107,116,362			105,011,318
Treasury stock		(13,210	)		(13,210	)
Accumulated deficit		(97,049,450	)		(87,095,430	)
Total stockholders’ equity		10,059,700			17,908,604
Total liabilities and stockholders’ equity	$	12,248,070		$	19,399,367

IDEAL POWER INC.

Statements of Operations

(unaudited)

	Year Ended
	December 31,
	2023			2022
Commercial revenue	$	161,483		$	-
Grant revenue		37,388			203,269
Total revenue		198,871			203,269
Cost of commercial revenue		123,225			-
Cost of grant revenue		37,388			203,269
Total cost of revenue		160,613			203,269
Gross profit		38,258			-
Operating expenses:
Research and development		5,743,211			3,366,776
General and administrative		3,533,383			3,123,852
Sales and marketing		1,113,752			852,331
Total operating expenses		10,390,346			7,342,959
Loss from operations		(10,352,088	)		(7,342,959	)
Interest income, net		398,068			153,609
Net loss	$	(9,954,020	)	$	(7,189,350	)
Net loss per share – basic and diluted	$	(1.61	)	$	(1.17	)
Weighted average number of shares outstanding – basic and diluted		6,190,746			6,157,866

IDEAL POWER INC.

Statements of Cash Flows

(unaudited)

	Year Ended
	December 31,
	2023			2022
Cash flows from operating activities:
Net loss	$	(9,954,020	)		(7,189,350	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		271,746			187,077
Amortization of right of use asset		62,150			58,452
Write-off of fixed assets		-			937
Stock-based compensation		2,321,380			975,801
Stock issued for services		-			100,100
Decrease (increase) in operating assets:
Accounts receivable		(4,064	)		167,326
Inventory		(81,450	)		-
Prepaid expenses and other assets		6,630			(447,465	)
Increase (decrease) in operating liabilities:
Accounts payable		274,595			3
Accrued expenses and other liabilities		36,052			(177,931	)
Lease liability		(64,597	)		(58,864	)
Net cash used in operating activities		(7,131,578	)		(6,383,914	)
Cash flows from investing activities:
Purchase of property and equipment		(240,825	)		(182,651	)
Acquisition of intangible assets		(282,121	)		(130,089	)
Net cash used in investing activities		(522,946	)		(312,740	)
Cash flows from financing activities:
Payment of taxes on restricted stock unit vestings		(216,264	)		(127,872	)
Net cash used in financing activities		(216,264	)		(127,872	)
Net decrease in cash and cash equivalents		(7,870,788	)		(6,824,526	)
Cash and cash equivalents at beginning of period		16,345,623			23,170,149
Cash and cash equivalents at end of the period	$	8,474,835		$	16,345,623

THE ISSUER HAS FILED A REGISTRATION STATEMENT (INCLUDING A PROSPECTUS AND PRELIMINARY PROSPECTUS SUPPLEMENT) WITH THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) FOR THE OFFERING TO WHICH THIS COMMUNICATION RELATES. BEFORE YOU INVEST, YOU SHOULD READ THE PROSPECTUS IN THAT REGISTRATION STATEMENT AND THE PRELIMINARY PROSPECTUS SUPPLEMENT AND OTHER DOCUMENTS THE ISSUER HAS FILED WITH THE SEC FOR MORE COMPLETE INFORMATION ABOUT THE ISSUER AND THIS OFFERING. YOU MAY GET THESE DOCUMENTS FOR FREE BY VISITING EDGAR ON THE SEC WEB SITE AT WWW.SEC.GOV. ALTERNATIVELY, THE ISSUER, ANY UNDERWRITER OR ANY DEALER PARTICIPATING IN THE OFFERING WILL ARRANGE TO SEND TO YOU THE PROSPECTUS AND PRELIMINARY PROSPECTUS SUPPLEMENT IF YOU REQUEST IT BY CALLING (929) 833-1246.