UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

x   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2007

OR

o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM ___________TO ___________

COMMISSION FILE NUMBER: 814-00652

STARINVEST GROUP, INC.

(Exact name of registrant as specified in its charter)

Nevada	91-1317131
(State of Incorporation)	(I.R.S. Employer Identification Number)

3300 North A Street Suite 2-210 Midland, Texas	79705
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (432) 682-8373

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Title of each class

Common Stock, par value $0.001 per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes o No x

Indicate by checkmark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

Yes o No x

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 o

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 or any amendment to this Form 10-K. Yes  o No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨	Accelerated filer ¨
Non-accelerated filer ¨ (Do not check if a smaller reporting company)	Smaller Reporting Company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2)

Yes o  No x

The aggregate market value of common stock held by non-affiliates of the registrant on March 26, 2008, based on the closing price on that date of $0.04 on the NASDAQ Bulletin Board Market, was $1,860,065.

As of March 26, 2008, there were 68,724,046 shares of the registrant’s common stock outstanding.

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STARINVEST GROUP, INC

FORM 10-K FOR THE FISCAL YEAR

ENDED DECEMBER 31, 2007

TABLE OF CONTENTS

		Page No.
PART I
Item 1	Business	4
Item 1A	Risk Factors	11
Item 1B	Unresolved Staff Comments	22
Item 2	Properties	23
Item 3	Legal Proceedings	23
Item 4	Submission of Matters to a Vote of Security Holders	23
PART II
Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	23
Item 6	Selected Financial Data	25
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 7A	Quantitative and Qualitative Disclosure About Market Risk	31
Item 8	Financial Statements and Supplementary Data	32
Item 9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	48
Item 9A	Controls and Procedures	48
Item 9B	Other Information	48
PART III
Item 10	Directors, Executive Officers and Corporate Governance	49
Item 11	Executive Compensation	52
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	53
Item 13	Certain Relationships and Related Transactions, and Director Independence	55
Item 14	Principal Accountant Fees and Services	55
PART IV
Item 15	Exhibits, Financial Statement Schedules	56
Signatures		58

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PART I

ITEM 1.   BUSINESS

As used in this Annual Report on Form 10-K (this “Report”), references to the “Company,” the “Registrant,” “STIV,” “we,” “our” or “us” refer to StarInvest Group, Inc., unless the context otherwise indicates.

Forward-Looking Statements

This Report contains forward-looking statements.  For this purpose, any statements contained in this Report that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking information includes statements relating to future actions, prospective products, future performance, or results of current or anticipated products, sales and marketing efforts, costs and expenses, interest rates, outcome of contingencies, financial condition, and results of operations, liquidity, business strategies, cost savings, objectives of management, and other matters. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “will,” “should,” “expects,” “anticipates,” “contemplates,” “estimates,”  “believes,” “plans,” “projected,” “predicts,” “potential,” or “continue” or the negative of these similar terms.  The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking information to encourage companies to provide prospective information about themselves without fear of litigation so long as that information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in the information.

These forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In evaluating these forward-looking statements, you should consider various factors, including the following: (a) those risks and uncertainties related to general economic conditions, (b) whether we are able to manage our planned growth efficiently and operate profitable operations, (c) whether we are able to generate sufficient revenues or obtain financing to sustain and grow our operations, (d) whether we are able to successfully fulfill our primary requirements for cash, which are explained below under “Liquidity and Capital Resources”.  We assume no obligation to update forward-looking statements, except as otherwise required under the applicable federal securities laws.

Overview

StarInvest Group, Inc. is a specialty investment company principally providing capital and other assistance to start-up and micro companies. The Company intended to focus its portfolio in a wide variety of different sectors including but not limited to alternative resources, technology, biotech, insurance, and services.  As of December 31, 2007, we have invested approximately $2.09 million in 10 portfolio companies. Our investment objective was to maximize our portfolio’s total return by investing in the debt and/or equity securities of start-up and micro companies. We also sought to provide our stockholders with current income on investments in debt securities and long-term capital growth through the appreciation in the value of warrants or other equity instruments that we may receive when we make debt investments or equity investments.

Our capital is generally invested into our portfolio companies where it is used to finance organic growth, acquisitions, recapitalizations and working capital. Our investment decisions are based on analysis of potential portfolio companies’ business operations supported by an in-depth understanding of the quality of their recurring revenues and cash flow, variability of costs and the inherent value of their assets, including proprietary intangible assets and intellectual property.

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On February 21, 2008 we signed a consent order (the “Consent Order”) with the Securities and Exchange Commission consenting to the entry of an Order Instituting Administrative and Cease-And-Desist Proceedings, Making Findings, Imposing a Cease-and-Desist Order, and Permanently Suspending the Regulation E Exemption as to StarInvest Group, Inc. The order was sought by the SEC against us as a result of numerous violations by the Company for not properly complying with the rules and regulations of being a business development company under the Investment Company Act of 1940.

As a result of such Consent Order, which we expect to be executed and formalized by the SEC within several months, we will be asking shareholders to approve our termination as a business development company.

History

We were founded on September 26, 1985 as Gemini Energy Corporation under the laws of the State of Nevada. On January 28, 1994, the Company’s name was changed to Nerox Energy Corporation. On April 24, 1998 the Company’s name was changed to Nerox Holding Corporation. On December 15, 1998 the Company’s name was changed to E*twoMedia.com. As of August 31, 1999, we acquired all of the issued and outstanding shares of common stock of Free Publishing Services Limited. Operations ceased in the fourth quarter of 2000, and we became inactive pursuant to a share purchase agreement with Mintcanyon Business Ltd., entered into on December 29, 2000. We sold all our shares in Free Publishing Services Ltd. in exchange for the assumption of specified assets and liabilities. On December 19, 2000 our name was changed to Exus Networks, Inc. Pursuant to an Agreement and Plan of Reorganization (the “Exchange Agreement”) dated January 15, 2001 between the Company and the shareholders of Exus Networks, Inc., a New York corporation (“Exus”), Isaac H. Sutton became the majority stockholder and our sole director. Upon consummation of the Exchange Agreement, the Company acquired all of Exus’ common stock and the shareholders of Exus received 20,000,000 shares of the Company’s common stock. On April 10, 2003 the Company’s name was changed to Exus Global, Inc. During 2004 Exus Global was in the process of a complete reorganization, changing its core business from mobile satellite communications to that of a holding company. On March 9, 2004, we filed Form N-54 to elect to report as a business development company under the Investment Company Act of 1940. The Company’s status as a business development company can only be changed by a vote of the Company’s shareholders. On January 12, 2005 our name was changed to StarInvest Group, Inc.

We are a Nevada corporation that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended (the “1940 Act”). As a business development company, we are required to meet certain regulatory tests, including the requirement to invest at least 70% of our total assets in eligible portfolio companies. In addition, we have elected to be treated for federal income tax purposes as a regulated investment company, or RIC, under the Internal Revenue Code of 1986 (the “Code”).

Upon withdrawal of our election to be treated as a business development company, we will no longer qualify to be treated as a RIC. Accordingly, in addition to terminating our business development company status, we expect to file the appropriate documentation to withdraw our election to be treated as a RIC.

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Currently our headquarters are at 3300 North A Street, Suite 2-210, Midland, Texas 79705 and our telephone number is (432) 682-8373.

Market Opportunity

Many start-up and micro companies have merged with competitors, scaled back their operations or simply closed down in response to the credit crunch and the slowdown of the economy during the fiscal year ended December 31, 2007. At the same time, start-up and micro companies with strong balance sheets, stable revenues and efficient operating structures are benefiting from the consolidation or elimination of competitors in their markets. Our management believes that all these factors are and will create investment opportunities for our company and the management believes to be in a privileged position to take full advantage of these market conditions.

Large, underserved market for product.  An increasing number of well-positioned start-up and micro companies have been seeking to raise capital. Historically, growing micro companies have generally relied upon equity rather than debt financing. As a result, the market for debt financing for these companies is generally less developed than the debt markets serving other industries. In spite of the large number of start-up and micro companies in the United States today, we believe that these companies are significantly underserved by traditional lenders such as banks, savings and loan institutions and finance companies for the following reasons:

· Non-traditional financial profile - The high revenue growth rates characteristic of start-up and micro companies often render them difficult to evaluate from a credit perspective. Moreover, these companies often incur relatively high expenditures for research and development, utilize unconventional sales and marketing techniques and selling channels, and experience rapid shifts in technology, consumer demand and market share. These attributes can make it difficult for traditional lenders to analyze these companies using conventional analytical methods.

· Industry scale, concentration and regulation - Many companies lack the size, and the markets in which they operate lack the scale, necessary to service large loans by traditional lenders. In the banking industry, in particular, consolidation over the last decade has increased the size, and reduced the number, of surviving banks. The surviving institutions have sought to limit their credit exposures to, and the monitoring costs associated with loans to, smaller businesses. In addition, traditional lending institutions operate in a regulatory environment that favors lending to large, established businesses. In response to such regulation, many traditional lending institutions have developed loan approval processes which conflict with the entrepreneurial culture of start-up and micro companies.

For the reasons outlined above, we believe that many viable start-up and micro companies have either not been able, or have elected not, to obtain financing from traditional lending institutions. We believe that these factors are likely to continue, given the ongoing consolidation in the financial services industry.

Complementing private equity and venture capital funds.  Our investment approach of investing in their debt and equity securities complements other sources of capital available to start-up and micro companies. For example, although we may compete with private equity and venture capital funds as a source of capital for such businesses, those types of investors typically invest primarily in equity-based securities. We intend to make investments in both debt securities and equity securities. We believe that the nature of our investments in debt securities may be viewed by such entities as an attractive alternative source of capital. Private equity and venture capital funds may base their investments on anticipated annual internal rates of return that are substantially higher than the annual internal rates of return that we set as our operating target. Moreover, private equity and venture capital funds generally require a significantly greater percentage of equity ownership interests than we require. However, private equity and venture capital investments typically entail considerably more risk than the debt investments that we make, as they are usually uncollateralized and rank lower in priority in the capital structure of the portfolio companies. We believe the prospect of obtaining additional capital without incurring substantial incremental dilution makes us attractive to owner-managers as a prospective source of capital.

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Competitive Advantages

We believe that we are well positioned to provide financing to start-up and micro companies at least for the following reasons:

Identification of prospective portfolio companies.  We identify and source new prospective portfolio companies through a network of venture capital and private equity funds, investment banks, accounting and law firms and direct company relationships.

Due diligence review.  Prior to an investment, we perform a preliminary due diligence review including company and technology assessments, market analysis, competitive analysis, evaluation of management, risk analysis and transaction size, pricing and structure analysis. Upon successful completion of this preliminary evaluation process, we then decide whether to move forward towards the completion of a transaction.

Investment structuring.  We seek to achieve current income by investing a portion of our assets in debt securities, consisting primarily of senior notes, senior subordinated notes and junior subordinated notes, of start-up and micro companies. We also seek to provide our stockholders with long-term capital growth through the appreciation in the value of warrants or other equity instruments that we may receive when we make loans, and through direct equity investments.

Ongoing Relationships With Portfolio Companies

Monitoring.  We monitor the financial trends of each portfolio company to assess the appropriate course of action for each company and to evaluate overall portfolio quality. We monitor the status and performance of each individual company on at least a quarterly basis.

Managerial assistance.  As a business development company, we are required to offer, and in some cases may provide and be paid for, significant managerial assistance to portfolio companies. This assistance typically involves monitoring the operations of portfolio companies, participating in their board and management meetings, consulting with and advising their officers and providing other organizational and financial guidance.

Competition

Our primary competitors in providing financing to start-up and micro companies include private equity and venture capital funds, other equity and non-equity based investment funds and investment banks and other sources of financing, including traditional financial services companies such as commercial banks and specialty finance companies. Many of these entities have greater financial and managerial resources than we will have. For additional information concerning the competitive risks we face, see “Risk factors — we operate in a highly competitive market for investment opportunities.”

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Employees

We have three employees that manage our day-to-day investment operations:  Robert H. Cole is serving as our Chief Executive Officer and Chief Financial Officer, Cristiano Germinario serves as the Company’s Secretary and provides back-office administrative support under a consultancy agreement and Glenn Matthews is our Chief Operating Officer and China representative.

Federal Income Tax Considerations

Until we withdraw as a BDC, we will be treated as a RIC under Subchapter M of the Code. As a RIC, we generally will not have to pay corporate-level federal income taxes on any ordinary income or capital gains that we distribute to our stockholders as dividends. To continue to qualify as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements (as described below). In addition, to qualify for RIC tax treatment we must distribute to our stockholders, for each taxable year, at least 90% of our “investment company taxable income,” which is generally our ordinary income plus the excess of our realized net short-term capital gains over our realized net long-term capital losses (the “Annual Distribution Requirement”).

Taxation as a Regulated Investment Company.  If we qualify as a RIC and satisfy the Annual Distribution Requirement, we will not be subject to federal income tax on the portion of our investment company taxable income and net capital gain (i.e., realized net long-term capital gains in excess of realized net short-term capital losses) we distribute to stockholders. We will be subject to U.S. federal income tax at the regular corporate rates on any income or capital gain not distributed (or deemed undistributed) to our stockholders. We will be subject to a 4% non-deductible federal excise tax on certain undistributed income unless we distribute in a timely manner an amount at least equal to the sum of (1) 98% of our ordinary income for each calendar year, (2) 98% of our capital gain net income for the one-year period ending October 31 in that calendar year and (3) any income realized, but not distributed, in preceding years (the “Excise Tax Avoidance Requirement”). We currently intend to make sufficient distributions each taxable year to satisfy the Excise Tax Avoidance Requirement. In order to qualify as a RIC for federal income tax purposes, we must, among other things:

· at all times during each taxable year, have in effect an election to be treated as a business development company under the 1940 Act.

· derive in each taxable year at least 90% of our gross income from dividends, interest, payments with respect to certain securities loans, gains from the sale of stock or other securities, or other income derived with respect to our business of investing in such stock or securities.

· diversify our holdings so that at the end of each quarter of the taxable year:

1. at least 50% of the value of our assets consists of cash, cash equivalents, U.S. government securities, securities of other RICs, and other securities if such other securities of any one issuer do not represent more than 5% of the value of our assets or more than 10% of the outstanding voting securities of the issuer; and

2. no more than 25% of the value of our assets is invested in the securities, other than U.S. government securities or securities of other RICs, of one issuer or of two or more issuers that are controlled, as determined under applicable tax rules, by us and that are engaged in the same or similar or related trades or businesses.

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Pursuant to the American Jobs Creation Act of 2004 (the “2004 Tax Act”), for taxable years of a RIC beginning after October 22, 2004, net income derived from an interest in certain “qualified publicly traded partnerships” will be treated as qualifying income for purposes of the 90% gross income requirement, and no more than 25% of a RIC’s assets may be invested in the securities of one or more qualified publicly traded partnerships. In addition, the separate treatment for publicly traded partnerships under the passive loss rules applies to a RIC holding an interest in a qualified publicly traded partnership, with respect to items attributable to such interest.

We may be required to recognize taxable income in circumstances in which we do not receive cash. For example, if we hold debt obligations that are treated under applicable tax rules as having original issue discount (such as debt instruments with payment-in-kind interest or, in certain cases, increasing interest rates or issued with warrants), we must include in income each year a portion of the original issue discount that accrues over the life of the obligation, regardless of whether cash representing such income is received by us in the same taxable year. Because any original issue discount accrued will be included in our investment company taxable income for the year of accrual, we may be required to make a distribution to our stockholders in order to satisfy the Annual Distribution Requirement, even though we will not have received any corresponding cash amount.

Regulation as a Business Development Company

General.  A business development company (“BDC”) is regulated under applicable provisions of the 1940 Act. A BDC must be organized in the United States for the purpose of investing in or lending to primarily private companies and making managerial assistance available to them. A BDC may use capital provided by public stockholders and from other sources to invest in long-term, private investments in businesses. A BDC provides stockholders the ability to retain the liquidity of a publicly traded stock, while sharing in the possible benefits, if any, of investing in primarily privately owned companies.

We may not change the nature of our business so as to cease to be, or withdraw our election as, a BDC unless authorized by vote of a majority of the outstanding voting securities, as required by the 1940 Act. A majority of the outstanding voting securities of a company is defined under the 1940 Act as the lesser of: (i) 67% or more of such company’s voting securities present at a meeting if more than 50% of the outstanding voting securities of such company are present or represented by proxy, or (ii) more than 50% of the outstanding voting securities of such company.

As with other companies regulated by the 1940 Act, a BDC must adhere to certain substantive regulatory requirements. For instance, a majority of our directors must be persons who are not interested persons, as that term is defined in the 1940 Act. Additionally, we are required to provide and maintain a bond issued by a reputable fidelity insurance company to protect the BDC. Furthermore, as a BDC, we are prohibited from protecting any director or officer against any liability to the company or our stockholders arising from willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.

As a BDC, we are required to meet a coverage ratio of the value of total assets to total senior securities, which include all of our borrowings and any preferred stock with liquidation preference that we may issue in the future, of at least 200%.

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We may also be prohibited under the 1940 Act from knowingly participating in certain transactions with our affiliates without the prior approval of our directors who are not interested persons and, in some cases, prior approval by the SEC.

We are not generally able to issue and sell our common stock at a price below net asset value per share. See “Risk factors—Risks relating to our business and structure—Regulations governing our operation as a business development company affect our ability to, and the way in which we raise additional capital.” We may, however, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the then-current net asset value of our common stock if our Board of Directors determines that such sale is in our best interests and the best interests of our stockholders, and our stockholders approve such sale. In addition, we may generally issue new shares of our common stock at a price below net asset value in rights offerings to existing stockholders, in payment of dividends and in certain other limited circumstances.

We will be periodically examined by the SEC for compliance with the 1940 Act.

We are subject to other regulatory requirements in addition to those set forth above.

As a BDC, we are subject to certain risks and uncertainties. See “Risk factors—Risks relating to our business and structure.”

Qualifying Assets.    As a business development company, we may not acquire any asset other than “qualifying assets” unless; at the time we make the acquisition, the value of our qualifying assets represent at least 70% of the value of our total assets. The principal categories of qualifying assets relevant to our business are:

· Securities of an eligible portfolio company that are purchased in transactions not involving any public offering. An eligible portfolio company is defined under the 1940 Act to include any issuer that:

a) is organized and has its principal place of business in the U.S.; and

b) is not an investment company or a company operating pursuant to certain exemptions under the 1940 Act, other than a small business investment company wholly owned by a business development company.

· Securities received in exchange for or distributed with respect to securities described in the bullet above or pursuant to the exercise of options, warrants, or rights relating to those securities; and

· Cash, cash items, government securities, or high quality debt securities (as defined in the 1940 Act), maturing in one year or less from the time of investment.

Significant Managerial Assistance.  To include certain securities described above as qualifying assets for the purpose of the 70% test, a business development company must offer to make available to the issuer of those securities significant managerial assistance such as providing guidance and counsel concerning the management, operations, or business objectives and policies of a portfolio company. We offer to provide managerial assistance to our portfolio companies.

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Investment Concentration.  Our investment objective is to maximize our portfolio’s total return. In this respect, we intend to concentrate our investment in start-up and micro companies and invest, under normal circumstances, at least 60% of the value of our net assets (including the amount of any borrowings for investment purposes in start-up and micro companies. This 60% policy is not a fundamental policy and therefore may be changed without the approval of our stockholders. However, we may not change or modify this policy unless we provide our stockholders with at least 60 days prior notice, pursuant to Rule 35d-1 of the 1940 Act.  See “Risk factors—Risks related to our investments—Our portfolio may be concentrated in a limited number of portfolio companies.”

Code of Ethics.  As required by the 1940 Act, we maintain a code of ethics that establishes procedures for personal investments and restricts certain transactions by our personnel. See “Risk factors—Risks relating to our business and structure—There are significant potential conflicts of interest.” Our code of ethics generally does not permit investments by our employees in securities that may be purchased or held by us.  You can request a copy of our Code of Ethics free of charge by mailing a request to us at 3300 North A Street, Suite 2-210, Midland, Texas 79750.

Compliance Policies and Procedures.  We have adopted and implemented written policies and procedures reasonably designed to prevent violation of the federal securities laws, and are required to review these compliance policies and procedures annually for their adequacy and the effectiveness of their implementation. In light of the comments received by the staff of the Securities and Exchange Commission discussed in “Risk Factors—Risks Relating to Our Business and Operation As a Business Development Company—The Securities and Exchange Commission (“SEC”) has raised concerns about our regulatory compliance which if proven correct, may have material, adverse effects on our operations and financial performance.”

ITEM 1A. RISK FACTORS

An investment in our securities involves certain risks relating to our structure and investment objectives. The risks set out below are not the only risks we face, and we face other risks which are not yet predictable. If any of the following risks occur, our business, financial condition and results of operations could be materially adversely affected. In such case, our net asset value and the trading price of our common stock could decline, and you may lose all or part of your investment.

RISKS RELATING TO OUR BUSINESS AND OPERATION AS A BUSINESS DEVELOPMENT COMPANY

As a result of not being in compliance with the rules and regulations of being a business development company, we signed a consent order with the Securities and Exchange Commission and will shortly be asking our stockholders to terminate our status as a business development company. This process will cost the Company additional funds and resources and may have a material adverse effect on our operations and financial condition.

In a phone call in July 2006 and by a letter dated February 22, 2007, which we will refer to as the “February Letter”, the staff of the Office of Disclosure & Review of the SEC raised a number of concerns indicating that the Company was not in compliance with the regulatory requirements applicable to it under the 1940 Act and the 1934 Act.  The issues raised by the staff included, but were not limited to, inadequate disclosure of potential liabilities in public filings, failure to file certain required exhibits and filings with the SEC, failure to comply with applicable regulations under the 1940 Act and our internal compliance procedures, such as entering into a custody agreement with the custodian of our securities and distributing securities of our portfolio companies to affiliates, and inadequate fair value policies and methodologies.

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On August 27, 2007, the SEC conducted a field examination of the books and records of StarInvest Group, Inc. at our office in Midland, TX. On December 17, 2007, we received a letter from the SEC as results of this examination asking for further clarification on about fifteen items. We responded to this letter on February 1, 2008.

Although we did not agree with all of the issues raised by the staff, to the extent the issues represented violations of the 1940 Act or the 1934 Act, the Board of Directors came to the conclusion that it would be in the best interest of the Company to withdraw our status as a BDC and become a holding company.  We are in the process of issuing a proxy to our shareholders to vote on this election to withdraw the BDC status. Following our withdrawal as a BDC, we will no longer qualify as a RIC, and will no longer be able to raise funds under Regulation E and we will have to change the manner in which we account for our portfolio companies and several other matters relating to our operations.  In addition, some of the steps we may need to take may in themselves result in increased costs to the Company and have material adverse effects on our operations and financial performance.

We are in default in the payment of our 8% Note.

We are in default of the $775,000 note related to the Loan Agreement with Strabourger, Pearson, Tulcin, Wolff, Incorporated a privately-held NYSE Member Firm, specializes in convertible securities, and small-cap private placement (“SPTW”) dated March 12, 2006. The note bears interest at the rate of 8% per annum and is secured by all of the Company’s assets. The note was due on March 12, 2007. As of December 31, 2007, the outstanding principal amount of $450,000, together with accrued interest of $60,938 or a total of $510,938, was due and payable. We have been engaged in discussions with the lenders and at this junction, we believe to be very close to settling this matter.

Our ability to continue as a “going concern” is uncertain.

Our consolidated financial statements have been presented on the basis that we are a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The independent registered public accounting firm’s report on our consolidated financial statements as of and for the fiscal year ended December 31, 2007 includes an explanatory paragraph that states that we have an accumulated deficit and experienced recurring losses from operations that raise a substantial doubt about our ability to continue as a going concern.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

We have an accumulated deficit of $11,556,416 and $11,569,638 at December 31, 2007 and 2006, respectively. Additionally, for the years ended December 31, 2007 and 2006, we used cash in operations of $630,159 and $960,366, respectively.

Our ability to meet future cash and liquidity requirements is dependent on a variety of factors, including our ability to raise more capital, successfully negotiate extended payment terms with our lenders and the performance of our investments.  The presence of the going concern note may have an adverse impact on our relationship with third parties such as potential investors, our lenders and potential targets for investment.  If we are unable to continue as a going concern, our lenders would foreclose on their collateral and we would have to liquidate our remaining assets, if any.  This would have a material adverse effect on your investment in us.

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Our internal procedures and adherence to our compliance program are inadequate.

Based on the issues raised in the February Letter and on past and recent transactions, we believe that our internal procedures and the adherence to our compliance program are inadequate for a public company, particularly a BDC.  We are currently reviewing all of our internal procedures and our compliance program to determine what steps need to be taken by us to address any inadequacies.  To the extent that we incur any liability from any inadequacies in our internal procedures and adherence to our compliance program, our operations and financial performance may experience material adverse effects.

We have historically lost money and decreases may continue in the future.

We have historically lost money.  The net increase in net assets resulting from operations for fiscal year 2007 was approximately $13,222 but we expect that future decreases are likely to occur.  Accordingly, we may experience significant liquidity and cash flow problems if we are not able to raise additional capital as needed and on acceptable terms.  No assurances can be given that we will be successful in reaching or maintaining profitable operations.

We need additional capital to finance operations.

Our operations have relied almost entirely on external financing to fund our operations.  Such financing has historically come from a combination of borrowings and from the sale of common stock and assets to third parties.  We will need to raise additional capital to fund our anticipated operating expenses and future expansion.  Among other things, external financing will be required to cover our operating costs.  We cannot assure you that financing whether from external sources or related parties will be available in an amount sufficient to continue operations or on terms favorable to us.  If we sell shares of our common stock to raise capital, the equity interests of our existing shareholders may be diluted.  If we are unable to obtain adequate financing we may have to curtail, suspend or cease business operations.  Any of these events would be materially harmful to our business and may result in a lower stock price.

Our investments may not generate sufficient income to cover our operations.

We intend to make investments into qualified companies that will provide the greatest overall return on our investment.  However, certain of those investments may fail, in which case we will not receive any return on our investment.  In addition, our investments may not generate income, either in the immediate future, or at all.  As a result, we may have to sell additional stock, or borrow money, to cover our operating expenses.  The effect of such actions could cause our stock price to decline or, if we are not successful in raising additional capital, we could cease to continue as a going concern.

We are a Company with a limited operating history, and our management lacks experience in operating a business development company.

We elected to be regulated as a business development company, or BDC, in March of 2004 and have a limited operating history as a BDC. We are subject to all of the business risks and uncertainties associated with any new business enterprise, including the risk that we will not achieve our investment objective and that the value of your investment in us could decline substantially. In addition, none of our executive officers has any experience in managing the operations of a business development company.  This lack of experience may adversely affect the value of your investment in our Company if, for instance, our lack of experience causes us to not be in compliance with our regulatory requirements.

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Our officers and directors have the ability to exercise significant influence over matters submitted for stockholder approval and their interests may differ from other stockholders.

We have 3 shareholders that own more than a 5% interest and between the three of them, they own roughly 28.92% of the outstanding shares.  Our directors and executive officers directly and indirectly own in the aggregate approximately 8.06% of our outstanding shares. Our directors and executive officers, whether acting alone or together, may have significant influence in determining the outcome of any corporate transaction or other matter submitted to our Board for approval, including issuing common and preferred stock, and appointing officers, which could have a material impact on mergers, acquisitions, consolidations and the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control.  The interests of these board members may differ from the interests of the other stockholders.

We may change our investment policies without further shareholder approval.

Although we are limited by the Investment Company Act of 1940 with respect to the percentage of our assets that must be invested in qualified investment companies, we are not limited with respect to the minimum standard that any investment company must meet, nor the industries in which those investment companies must operate.  We may make investments without shareholder approval and such investments may deviate significantly from our historic operations.  Any change in our investment policy or selection of investments could adversely affect our stock price, liquidity, and the ability of our shareholders to sell their stock.

Our financial condition and results of operations will depend on our ability to manage our future growth effectively.

We have a limited operating history.  As such, we are subject to the business risks and uncertainties associated with any new business enterprise, including the lack of experience in managing or operating a business development company. Our ability to achieve our investment objective will depend on our ability to grow, which will depend, in turn, on our investment team’s ability to identify, analyze, and invest in and finance companies that meet our investment criteria. Accomplishing this result on a cost-effective basis is largely a function of our management’s structuring of the investment process, its ability to provide competent, attentive and efficient services to us, and our access to financing on acceptable terms. As we grow, we will need to hire, train, supervise and manage new employees. Failure to manage our future growth effectively could have a material adverse effect on our business, financial condition and results of operations.

We operate in a highly competitive market for investment opportunities.

A large number of entities compete with us to make the types of investments that we make in start-up and micro companies. We compete with a large number of private equity and venture capital funds, other equity and non-equity based investment funds, investment banks and other sources of financing, including traditional financial services companies such as commercial banks and specialty finance companies. Many of our competitors are substantially larger and have considerably greater financial, technical and marketing resources than we do. For example, some competitors may have a lower cost of funds and access to funding sources that are not available to us. In addition, some of our competitors may have higher risk tolerances or different risk assessments, which could allow them to consider a wider variety of investments and establish more relationships than us. Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on us as a business development company. There can be no assurance that the competitive pressures we face will not have a material adverse effect on our business, financial condition and results of operations. Also, as a result of this competition, we may not be able to take advantage of attractive investment opportunities from time to time, and we can offer no assurance that we will be able to identify and make investments that are consistent with our investment objective.

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Our business model depends upon the development of strong referral relationships with private equity and venture capital funds and investment banking firms.

If we fail to maintain our relationships with key firms, or if we fail to establish strong referral relationships with other firms or other sources of investment opportunities, we will not be able to grow our portfolio and achieve our investment objectives. In addition, persons with whom we have informal relationships are not obligated to provide us with investment opportunities, and therefore there is no assurance that such relationships will lead to the origination of investments.

We may not realize gains from our equity investments.

When we invest in debt securities, we generally expect to acquire warrants or other equity securities as well. However, the equity interests we receive may not appreciate in value and, in fact, may decline in value. Accordingly, we may not be able to realize gains from our equity interests, and any gains that we do realize on the disposition of any equity interests may not be sufficient to offset any other losses we experience.

The lack of liquidity in our investments may adversely affect our business.

As stated above, our investments are not generally in publicly traded securities. Substantially all of these securities are subject to legal and other restrictions on resale or will otherwise be less liquid than publicly traded securities. The illiquidity of our investments may make it difficult for us to sell such investments if the need arises. Also, if we are required to liquidate all or a portion of our portfolio quickly, we may realize significantly less than the value at which we have previously recorded our investments. We expect that our holdings of equity securities may require several years to appreciate in value, and we can offer no assurance that such appreciation will occur.

We may experience fluctuations in our quarterly results.

We may experience fluctuations in our quarterly operating results due to a number of factors, including the rate at which we make new investments, the interest rates payable on the debt securities we acquire, the default rate on such securities, the level of our expenses, variations in and the timing of the recognition of realized and unrealized gains or losses, the degree to which we encounter competition in our markets and general economic conditions. As a result of these factors, results for any period should not be relied upon as being indicative of performance in future periods.

Regulations governing our operation as a business development company affect our ability to, and the way in which we raise additional capital, which may expose us to risks, including the typical risks associated with leverage.

Notwithstanding that we will be asking shareholders to elect to withdraw our BDC status, currently, our business will require a substantial amount of capital, which we may acquire from the following sources:

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Senior securities and other indebtedness.  We may issue debt securities or preferred stock and/or borrow money from banks or other financial institutions, which we refer to collectively as “senior securities,” up to the maximum amount permitted by the 1940 Act. Under the provisions of the 1940 Act, we are permitted, as a business development company, to issue senior securities in amounts such that our asset coverage ratio, as defined in the 1940 Act, equals at least 200% of gross assets, less all liabilities and indebtedness not represented by senior securities, after each issuance of senior securities. If we issue senior securities, including preferred stock and debt securities, we will be exposed to typical risks associated with leverage, including an increased risk of loss. If we incur leverage to make investments, a decrease in the value of our investments would have a greater negative impact on the value of our common stock. If we issue debt securities or preferred stock, it is likely that such securities will be governed by an indenture or other instrument containing covenants restricting our operating flexibility. In addition, such securities may be rated by rating agencies, and in obtaining a rating for such securities, we may be required to abide by operating and investment guidelines that could further restrict our operating flexibility. Our ability to pay dividends or issue additional senior securities would be restricted if our asset coverage ratio was not at least 200%. If the value of our assets declines, we may be unable to satisfy this test. If that happens, we would be unable to issue any additional senior securities. Furthermore, any amounts that we use to service our indebtedness would not be available for distributions to our common stockholders.

Common stock.  We are not generally able to issue and sell our common stock at a price below net asset value per share. However, we may, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the then-current net asset value of our common stock if our Board of Directors determines that such sale is in our best interests and that of our stockholders, and our stockholders approve such sale. In certain limited circumstances, pursuant to an SEC staff interpretation, we may also issue shares at a price below net asset value in connection with a transferable rights offering so long as: (1) the offer does not discriminate among shareholders; (2) we use our best efforts to ensure an adequate trading market exists for the rights; and (3) the ratio of the offering does not exceed one new share for each three rights held.  If our stock price is less than our net asset value per share, it will be extremely difficult to raise capital through the sale of common stock without obtaining shareholder approval.  In the event shareholder approval is not obtained, our ability to raise adequate capital to continue as a going concern will be negatively impacted.  If we raise additional funds by issuing more common stock or senior securities convertible into, or exchangeable for, our common stock, the percentage ownership of our stockholders at that time would decrease and they may experience dilution. Moreover, we can offer no assurance that we will be able to issue and sell additional equity securities in the future, on favorable terms or at all.

A change in interest rates may adversely affect our profitability.

A portion of our income will depend upon the difference between the rate at which we borrow funds (if we do borrow) and the interest rate on the debt securities in which we invest. We anticipate using a combination of equity and long-term and short-term borrowings to finance our investment activities.  Some of our investments in debt securities are at fixed rates and others at variable rates. We may, but will not be required to, hedge against interest rate fluctuations by using standard hedging instruments such as futures, options and forward contracts, subject to applicable legal requirements. These activities may limit our ability to participate in the benefits of lower interest rates with respect to the hedged portfolio. Adverse developments resulting from changes in interest rates or hedging transactions could have a material adverse effect on our business, financial condition and results of operations. Also, we have limited experience in entering into hedging transactions, and we will initially have to purchase or develop such expertise.

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We will be subject to corporate-level income tax if we are unable to qualify, or we withdraw as a RIC.

To remain entitled to the tax benefits accorded RIC under the Code, we must meet certain income source, asset diversification and annual distribution requirements. The annual distribution requirement for a RIC is satisfied if we distribute at least 90% of our ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any, to our stockholders on an annual basis. Because we may use debt financing in the future, we may be subject to certain asset coverage ratio requirements under the 1940 Act and financial covenants under loan and credit agreements that could, under certain circumstances, restrict us from making distributions necessary to satisfy the annual distribution requirement. If we are unable to obtain cash from other sources, we may fail to qualify for special tax treatment as a RIC and, thus, may be subject to corporate-level income tax on all our income. To qualify as a RIC, we must also meet certain asset diversification requirements at the end of each calendar quarter. Failure to meet these tests may result in our having to dispose of certain investments quickly in order to prevent the loss of RIC status. Because most of our investments will be in private companies, any such dispositions could be made at disadvantageous prices and may result in substantial losses. If we fail to qualify as a RIC for any reason and remain or become subject to corporate income tax, the resulting corporate taxes could substantially reduce our net assets, the amount of income available for distribution and the amount of our distributions. Such a failure would have a material adverse effect on us and our stockholders.

We may have difficulty paying our required distributions if we recognize income before or without receiving cash representing such income.

For federal income tax purposes, we will include in income certain amounts that we have not yet received in cash, such as original issue discount, which may arise if we receive warrants in connection with the making of a loan or possibly in other circumstances, or contracted payment-in-kind interest, which represents contractual interest added to the loan balance and due at the end of the loan term. We also may be required to include in income certain other amounts that we will not receive in cash. Since in certain cases we may recognize income before or without receiving cash representing such income, we may have difficulty satisfying the annual distribution requirement applicable to RICs. Accordingly, we may have to sell some of our investments at times we would not consider advantageous, raise additional debt or equity capital or reduce new investments to meet these distribution requirements. If we are not able to obtain cash from other sources, we may fail to qualify for RIC tax treatment and thus be subject to corporate-level income tax.

Provisions of the Nevada General Corporation Law and of our charter and bylaws could deter takeover attempts and have an adverse impact on the price of our common stock.

Our charter and bylaws, as well as certain statutory and regulatory requirements, contain certain provisions that may have the effect of discouraging a third party from making an acquisition proposal for us. These anti-takeover provisions may inhibit a change of control in circumstances that could give the holders of our common stock the opportunity to realize a premium over the market price for our common stock.

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RISKS RELATED TO OUR INVESTMENTS

Start-up and micro companies are subject to many risks, including volatility, intense competition, decreasing life cycles and periodic downturns.

We invest in small and micro companies, some of which may have relatively short operating histories. The revenues, income (or losses) and valuations of start-up and micro companies can and often do fluctuate suddenly and dramatically.

Our investments in start-up and micro companies that we are targeting may be extremely risky and we could lose all or part of our investments.

Although a prospective portfolio company’s assets are one component of our analysis when determining whether to provide debt capital, we generally do not base an investment decision primarily on the liquidation value of a company’s balance sheet assets. Instead, given the nature of the companies that we invest in, we also review the company’s historical and projected cash flows, equity capital and “soft” assets, including intellectual property (patented and non-patented), databases, business relationships (both contractual and non-contractual) and the like. Accordingly, considerably higher levels of overall risk will likely be associated with our portfolio compared with that of a traditional asset-based lender whose security consists primarily of receivables, inventories, equipment and other tangible assets. Interest rates payable by our portfolio companies may not compensate for these additional risks. Specifically, investment in the start-up and micro companies that we are targeting involves a number of significant risks, including:

· these companies may have limited financial resources and may be unable to meet their obligations under their debt securities that we hold, which may be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of us realizing any value from the liquidation of such collateral;

· they typically have limited operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns;

· because they tend to be privately owned, there is generally little publicly available information about these businesses;

· they are more likely to depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation or termination of one or more of these persons could have a material adverse impact on our portfolio company and, in turn, on us; and

· they generally have less predictable operating results, may from time to time be parties to litigation, may be engaged in rapidly changing businesses with products subject to a substantial risk of obsolescence, and may require substantial additional capital to support their operations, finance expansion or maintain their competitive position.

A portfolio company’s failure to satisfy financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, termination of its loans and foreclosure on its secured assets, which could trigger cross-defaults under other agreements and jeopardize our portfolio company’s ability to meet its obligations under the debt securities that we hold. We may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with a defaulting portfolio company. In addition, if a portfolio company goes bankrupt, even though we may have structured our interest as senior debt, depending on the facts and circumstances, including the extent to which we actually provided significant “managerial assistance” to that portfolio company, a bankruptcy court might re-characterize our debt holding and subordinate all or a portion of our claim to that of other creditors.

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Elections to not make follow-on investments in our portfolio companies could impair the value of our portfolio.

Following an initial investment in a portfolio company, we may make additional investments in that portfolio company as “follow-on” investments, in order to: (1) increase or maintain in whole or in part our equity ownership percentage; (2) exercise warrants, options or convertible securities that were acquired in the original or subsequent financing; or (3) attempt to preserve or enhance the value of our investment. We may elect not to make follow-on investments or otherwise lack sufficient funds to make those investments. We have the discretion to make any follow-on investments, subject to the availability of capital resources. The failure to make follow-on investments may, in some circumstances, jeopardize the continued viability of a portfolio company and our initial investment, or may result in a missed opportunity for us to increase our participation in a successful operation. Even if we have sufficient capital to make a desired follow-on investment, we may elect not to make a follow-on investment because we may not want to increase our concentration of risk, because we prefer other opportunities, or because we are inhibited by compliance with business development company requirements or the desire to maintain our tax status.

Our portfolio companies may incur debt that ranks equally with, or senior to, our investments in such companies.

We intend to invest primarily in senior debt securities, but may also invest in subordinated debt securities, issued by our portfolio companies. In some cases portfolio companies will be permitted to have other debt that ranks equally with, or senior to, the debt securities in which we invest. By their terms, such debt instruments may provide that the holders thereof are entitled to receive payment of interest or principal on or before the dates on which we are entitled to receive payments in respect of the debt securities in which we invest. Also, in the event of insolvency, liquidation, dissolution, reorganization or bankruptcy of a portfolio company, holders of debt instruments ranking senior to our investment in that portfolio company would typically be entitled to receive payment in full before we receive any distribution in respect of our investment. After repaying such senior creditors, such portfolio company may not have any remaining assets to use for repaying its obligations to us. In the case of debt ranking equally with debt securities in which we invest, we would have to share on an equal basis any distributions with other creditors holding such debt in the event of an insolvency, liquidation, dissolution, reorganization or bankruptcy of the relevant portfolio company. In addition, we will not be in a position to control any portfolio company by investing in its debt securities. As a result, we are subject to the risk that a portfolio company in which we invest may make business decisions with which we disagree and the management of such companies, as representatives of the holders of their common equity, may take risks or otherwise act in ways that do not best serve our interests as debt investors.

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Because we generally do not hold controlling equity interests in our portfolio companies, we may not be in a position to exercise control over our portfolio companies or to prevent decisions by management of our portfolio companies that could decrease the value of our investments.

Although we may do so in the future, to date we have generally not taken controlling equity positions in our portfolio companies. As a result, we are subject to the risk that a portfolio company may make business decisions with which we disagree, and the stockholders and management of a portfolio company may take risks or otherwise act in ways that are adverse to our interests. Due to the lack of liquidity for the debt and equity investments that we typically hold in our portfolio companies, we may not be able to dispose of our investments in the event we disagree with the actions of a portfolio company, and may therefore suffer a decrease in the value of our investments.

RISKS RELATED TO AN INVESTMENT IN OUR COMMON STOCK

Our common stock price may be volatile.

The trading price of our common stock may fluctuate substantially. Many factors relating to the price of our common stock are beyond our control and may not be directly related to our operating performance. These factors include, but are not limited to, the following:

· price and volume fluctuations in the overall stock market from time to time;

· significant volatility in the market price and trading volume of securities of regulated investment companies, business development companies or other financial services companies;

· changes in regulatory policies or tax guidelines with respect to regulated investment companies or business development companies;

· actual or anticipated changes in our earnings or fluctuations in our operating results or changes in the expectations of securities analysts;

· general economic conditions and trends;

· loss of a major funding source; or

· departures of key personnel.

In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been brought against that company. Due to the potential volatility of our stock price, we may therefore be the target of securities litigation in the future. Securities litigation could result in substantial costs and divert management’s attention and resources from our business.

Our shares may trade at discounts from net asset value or at premiums that are unsustainable over the long term.

Shares of business development companies may trade at a market price that is less than the net asset value that is attributable to those shares. If we remain a BDC, the possibilities that our shares of common stock will trade at a discount from net asset value or at premiums that are unsustainable over the long term are separate and distinct from the risk that our net asset value will decrease. It is not possible to predict whether our shares will trade at, above, or below net asset value.

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There is a risk that you may not receive dividends or that our dividends may not grow over time.

We cannot assure you that we will achieve investment results or maintain a tax status that will allow or require any specified level of cash distributions or year-to-year increases in cash distributions.

Our common stock is deemed to be a “penny stock,” which may make it more difficult for you to sell your shares.

Our common stock is deemed to be “penny stock” as that term is defined and promulgated under the Securities Exchange Act of 1934. These requirements may reduce the potential market for the common stock by reducing the number of potential investors. For example many mutual funds and other institutional investors are prohibited from investing in “penny stocks.” This may make it more difficult for investors of the common stock to sell shares to third parties or to otherwise dispose of them. This could cause our stock price to decline. Penny stocks are stock with a price of less than $5.00 per share.

Broker/dealers dealing in penny stocks are required to provide potential investors with a document disclosing the risks of penny stocks. Moreover, broker/dealers are required to determine whether an investment in a penny stock is a suitable investment for a prospective investor.

Our common stock may be affected by limited trading volume and may fluctuate significantly.

There has been a limited public market for our common stock and there can be no assurance that an active trading market for our common stock will develop.  As a result, this could adversely affect our shareholders’ ability to sell our common stock in short time periods, or possibly at all.  Our common stock has experienced, and is likely to experience in the future, significant price and volume fluctuations that could adversely affect the market price of our common stock without regard to our operating performance.  In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate substantially. Substantial fluctuations in our stock price could significantly reduce the price of our stock.

Our common stock is traded on the “Over-the-Counter Bulletin Board,” which may make it more difficult for you to resell your shares due to suitability requirements.

Our common stock is currently traded on the Over the Counter Bulletin Board (OTCBB) where we expect it to remain for the foreseeable future. Broker-dealers often decline to trade in OTCBB stocks given that the market for such securities is often limited, the stocks are more volatile, and the risks to investors are greater.  These factors may reduce the potential market for our common stock by reducing the number of potential investors. This may make it more difficult for investors in our common stock to sell shares to third parties or to otherwise dispose of them.  This could cause our stock price to decline.

Future developments may cause our stock to be no longer traded on the OTCBB.

Future developments, such as a loss of assets, insolvency, or an inability to comply with certain regulatory requirements, may cause our stock to be no longer listed on the OTCBB, which may make it more difficult to sell your stock or may affect the price at which you may be able to sell your stock.

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Changes in the law or regulations that govern us could have a material effect on us or our operations.

We are regulated by the SEC.  In addition, changes in the laws or regulations that govern business development companies, regulated investment companies, and real estate investment trusts may significantly affect our business.  Any change in the law or regulations that govern our business could have a material effect on us or our operations.  Laws and regulations may be changed from time to time, and the interpretations of the relevant laws and regulations also are subject to change, which may have a material effect on our operations.

The market for our stock is limited and our stock price may be volatile.

The market for our common stock has been limited due to low trading volume and the small number of brokerage firms acting as market makers. Because of the limitations of our market and volatility of the market price of our stock you may face difficulties in selling shares at attractive prices. The average daily trading volume for our stock has varied significantly from week to week and from month to month, and the trading volume often varies widely from day to day.

We may incur significant expenses as a result of being quoted on the OTCBB, which may negatively impact our financial performance.

We may incur significant legal, accounting and other expenses as a result of being listed on the OTCBB. The Sarbanes-Oxley Act of 2002, as well as related rules implemented by the Commission has required changes in corporate governance practices of public companies. We expect that compliance with these laws, rules and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 as discussed in the following risk factor, may substantially increase our expenses, including our legal and accounting costs, and make some activities more time-consuming and costly. As a result, there may be a substantial increase in legal, accounting and certain other expenses in the future, which would negatively impact our financial performance and could have a material adverse effect on our results of operations and financial condition.

Our internal controls over financial reporting are not be considered effective, which could result in a loss of investor confidence in our financial reports and in turn have an adverse effect on our stock price.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, we are required to furnish a report by our management on our internal controls over financial reporting. Such report will contain, among other matters, an assessment of the effectiveness of our internal controls over financial reporting as of the end of the year, including a statement as to whether or not our internal controls over financial reporting are effective. This assessment must include disclosure of any material weaknesses in our internal controls over financial reporting identified by management. The report will also contain a statement that our independent registered public accounting firm has issued an attestation report on management’s assessment of internal controls. If we are unable to assert that our internal controls are effective as of December 31, 2007, or if our independent registered public accounting firm is unable to attest that our management’s report is fairly stated or they are unable to express an opinion on our management’s evaluation or on the effectiveness of our internal controls, investors could lose confidence in the accuracy and completeness of our financial reports, which in turn could cause our stock price to decline.

ITEM 1B.  UNRESOLVED STAFF COMMENTS

Not applicable.

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ITEM 2.  PROPERTIES

We do not own any real estate or other physical properties materially important to our operation. Since March 2006, our principal executive offices have been relocated to 3300 North A Street Suite 2-210, which are being provided by our CEO/CFO, Robert Cole, free of charge, on a month to month basis.  In December 2007, we opened a new office located at 61 Broadway, 16th Floor, New York, NY 10006. We pay rent in the amount of $1,500 per month for this space. Our lease will expire on April 30, 2008 and has an option to be renewed until April 30, 2009. Management believes that our offices in Texas and New York are adequate for our operations as presently conducted.

ITEM 3.  LEGAL PROCEEDINGS

Other than the Consent Order, there are no other pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company. From time to time, we may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of our rights under contracts with our portfolio companies. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations.

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

No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year ended December 31, 2007.

PART II

ITEM 5.  MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock is listed on the OTCBB under the symbol “STIV.”  Following is the range of high and low sales prices on the OTCBB for the common stock for the periods indicated. This chart was based on information obtained from the OTCBB.

	High		Low
Calendar Year 2007
First Quarter	$	0.035	$	0.01
Second Quarter	$	0.046	$	0.01
Third Quarter	$	0.050	$	0.01
Fourth Quarter	$	0.050	$	0.01
Calendar Year 2006
First Quarter	$	0.03	$	0.01
Second Quarter	$	0.04	$	0.01
Third Quarter	$	0.05	$	0.01
Fourth Quarter	$	0.05	$	0.01

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The last reported price for our common stock on March 26, 2008 was $0.04 per share.

Holders

As of March 26, 2008, we had approximately 524 shareholders of record.

Dividends

We have not paid cash dividends on our common stock and we do not plan to pay cash dividends in the foreseeable future.

Recent Sales of Unregistered Securities

Between April 27, 2007, and September 11, 2007, the Company accepted subscriptions from approximately 20 investors for 41,131,075 shares of common stock, at a purchase price of $0.03 per share for an aggregate value of $1,233,932. The foregoing shares were issued pursuant to Subscription Agreements and all such shares were issued under Section 4(2) of the Securities Act of 1933, as amended.

Including in the subscriptions discussed above, 18 investors purchased 32,243,334 shares of common stock, at a purchase price of $0.03 per share for gross proceeds to the Company of $967,300.

Included in the subscriptions discussed above, on June 29, 2007, the Company reached an agreement with New Canaan Investment Partners, Ltd a company which is controlled by certain minority shareholders of StarInvest whereby New Canaan Investment Partners Ltd agreed to convert the outstanding principal of $187,500 and accrued interest of $53,420 due under the terms of the note between New Canaan Investment Partners Ltd. and the Company into shares of the Company’s common stock. The debt was converted at a price per share of $0.03 for an aggregate of 8,030,664 restricted shares of the Company’s common stock.

In addition, and included in the subscriptions discussed above, on June 29, 2007, Allen Notowitz agreed to convert an aggregate amount of $25,712.33 in principal of accrued interest pursuant to a promissory note between Mr. Notowitz and the Company, into shares of the Company’s common stock. The note, on which the Company had been in default, was converted into shares of the Company’s common stock at $0.03 per share for an aggregate of 857,078 shares.

Issuer Purchases of Equity Securities

In March 2006, we issued a press release announcing that our Board approved a buy back of up to 2,000,000 of our shares at a price up to $.10 per share. As of March 26, 2008, we had repurchased 70,000 shares in 2 separate open market transactions which occurred in March 2006 (25,000 shares at $0.041) and in April 2006 (45,000 shares at $0.043). We did not repurchase any of our own shares during our fiscal year ended December 31, 2007.

Securities authorized for issuance under equity compensation plans.

We do not have any equity compensation plans.

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ITEM 6.  SELECTED FINANCIAL DATA

The following selected financial data for the each of the last five fiscal years for the Company is derived from our financial statements which have been audited by Larry O’Donnell, CPA, our independent registered public accounting firm. The data should be read in conjunction with our financial statements and related notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this report.

Statement of Operations

	Year Ended December 31,
Statement of Operations	2007			2006			2005			2004			2003
Interest, Dividends and consulting / net sales	$	186,934		$	86,707		$	41,931		$	94,226			-
Cost of sales					-			-			-			-
Total Investment Income / Gross profit		186,934			86,707			41,931			94,226			-
Selling, administrative and   general & stock based expenses		148,585			241,134			865,829			260,821			1,529,005
Net investment income (loss)		38,349			(154,427	)		(823,898	)		(166,595	)		(1,529,005	)
Interest expense		76,697			51,532			22,362			218,072			20,000
Net realized unrealized gain (loss)/(Other expense)		(25,127	)		868,480			219,503			-			(663,420	)
Net decrease in net assets resulting from   Operations / Net loss	$	13,222		$	(1,022,907	)	$	(626,757	)	$	(384,667	)	$	(885,585	)
EARNINGS PER COMMON SHARE:
Basic & diluted loss per common share	$	0.00		$	(.04	)	$	(.03	)	$	(2.02	)	$	(74.60	)

Balance Sheet

	December 31,
Balance Sheet	2007			2006			2005			2004			2003
Working capital	$	(527,692	)	$	(1,257,206	)	$	(827,045	)	$	(34,891	)	$	(1,427,512	)
Total assets	$	2,155,537		$	1,734,537		$	2,697,660		$	914,162		$	14,162
Long-term debt, capital leases and due to officer	$	-		$	-		$	-		$	-		$	-
Shareholders’ Equity (Deficit)	$	1,541,904		$	335,450		$	1,825,465		$	(34,891	)	$	(1,427,512	)

25

ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Certain statements contained in this Annual Report, including statements regarding the anticipated development and expansion of our business, our intent, belief or current expectations, primarily with respect to the future operating performance of the Company and the services we expect to offer and other statements contained herein regarding matters that are not historical facts, are “forward-looking” statements. Future filings with the Securities and Exchange Commission, future press releases and future oral or written statements made by us or with our approval, which are not statements of historical fact, may contain forward-looking statements, because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.

All forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made. The following analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes thereto contained elsewhere in this Annual Report.

Overview

Our investment objective is to maximize our portfolio’s total return, principally by investing in the debt and/or equity securities of start-up and micro companies. Our primary focus is to seek current income through investment in non-public debt and long-term capital appreciation by acquiring accompanying warrants or other equity securities. We have elected to be treated as a business development company under the 1940 Act. We have elected to be treated for tax purposes as a RIC under the Code beginning with the 2004 taxable year.

We concentrate our investments in companies having annual revenues of more than $1 million and/or a market capitalization of more than $2 million. We focus on companies that create products or provide services requiring advanced technology and companies that compete in industries characterized by such products or services.

We seek to invest in entities that have been operating for at least one year prior to the date of our investment and at the time of our investment have employees and revenues. Most of these companies will have financial backing provided by private equity or venture capital funds or other financial or strategic sponsors at the time we make an investment. Our investments typically range from $25,000 to $500,000, mature in up to seven years and accrue interest at fixed or variable rates.

To the extent possible, our loans are collateralized by a security interest in the borrower’s assets or guaranteed by a principal to the transaction. Interest payments, if not deferred, are normally payable quarterly. In addition, we seek an equity component in connection with a substantial portion of our investments, in the form of warrants to purchase stock or similar equity instruments. When we receive a warrant to purchase stock in a portfolio company, the warrant will frequently have a nominal strike price, and will entitle us to purchase a modest percentage of the borrower’s stock.

In addition, as a business development company under the 1940 Act, we are required to offer to make available significant managerial assistance, for which we may receive fees, to our portfolio companies. These fees are generally non-recurring, however in some instances they may have a recurring component. We have received no fee income for managerial assistance to date.

26

During the period from our initial election in March 2004 through December 31, 2007, we made 18 investments in target companies in the total amount of $3.1 million in funded capital.  We completed the following transactions since our election to be regulated as a BDC:

Portfolio Company	Investment	Cost
AGI Partners, LTD	Common Stock + Secured Loan	$	222,941
Amazon Biotech	Common Stock	$	15,000
Asia Payment	Common Stock	$	100,000
GoIP Global, Inc	Common Stock - Secured Loan	$	214,921
Miscor Ltd (1)	Common Stock + Secured Loan	$	800,845
New Life Scientific	Common Stock	$	226,062
Premier Indemnity	Common Stock	$	125,000
Retail Rep e-Promotion	Common Stock	$	200,000
Sun Coast Naturals	Loan	$	35,000
Western Roses	Secured Loan	$	450,000
Food Products Inc	Common stock	$	10,814
Secure X LLC	Common Stock	$	140,000
Wireless Ink LLC	Secured Loan	$	60,000
Net2 Auction Inc.	Common Stock	$	40,000
ICT Technologies	Common Stock	$	50,000
SBD International, Inc.	Common Stock	$	100,000
Promana	Common Stock	$	150,000
Health Rush, Inc	Common Stock	$	250,000
	Total	$	3,190,583

We are currently in negotiations with respect to several potential future transactions. We continue to conduct due diligence and finalize terms regarding such transactions. However, there can be no assurance or certainty when or if these transactions will close.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified our investment valuation policy as a critical accounting policy.

Investment Valuation

The most significant estimate inherent in the preparation of our financial statements is the valuation of investments and the related amounts of unrealized appreciation and depreciation of investments recorded. We value our investment portfolio each quarter. For investments in which there is no readily available, reliable market information, the Company utilized the “fair value method” for ascribing value.  This valuation method has members of our portfolio management team provide information to our Board of Directors on each portfolio company including the most recent financial statements and forecasts, if any.  The Board of Directors then uses the information provided by the portfolio management team in its determination of the final fair value of investments, as noted in the Schedule of Investments.

27

The Board of Directors’ final determination of fair value is based on some or all of the following factors, as applicable, and any other factors considered relevant:

· the nature of any restrictions on the disposition of the securities;

· assessment of the general liquidity/illiquidity of the securities;

· the issuer’s financial condition, including its ability to make payments and its earnings and discounted cash flow;

· the markets in which the issuer does business;

· the cost of the investment;

· the size of the holding and the capitalization of issuer;

· the nature and value of any collateral;

· the prices of any recent transactions or bids/offers for the securities or similar securities or any comparable securities that are publicly traded;

· any available analyst, media or other reports or information deemed reliable by the independent valuation firm regarding the issuer or the markets or industry in which it operates;

· certified appraisal reports

· past experience with the valuation of the securities; and

· the sensitivity of the securities to fluctuations in interest rates.

The fair value method for valuing securities may be applied to the following types of investments:

· private placements and restricted securities that do not have an active trading market;

· securities whose trading has been suspended or for which market quotes are no longer available;

· debt securities that have recently gone into default and for which there is no current market;

· securities whose prices are stale; and

· securities affected by significant events.

Due to the uncertainty inherent in the valuation process, such estimates of fair value may differ significantly from the values that would have resulted had a readily available market for the securities existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the amount ultimately realized on these investments to be different than the valuation currently assigned.

Interest Income Recognition

Interest income is recorded on the accrual basis to the extent that such amounts are expected to be collected.

Managerial Assistance Fees

The 1940 Act requires a business development company to offer to make available managerial assistance to its portfolio companies. We offer to provide managerial assistance to our portfolio companies in connection with our investments and may receive fees for our services. We have not received any cash fees for such services since inception.

28

Federal Income Taxes

We intend to operate so as to qualify to be taxed as a RIC under the Code and, as such, will not be subject to federal income tax on the portion of our taxable income and gains distributed to stockholders. To qualify as a RIC, we are required to distribute at least 90% of our investment company taxable income, as defined by the Code. Because federal income tax regulations differ from accounting principles generally accepted in the United States, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the financial statement to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.

Results of Operations

Year ended December 31, 2007 compared to year ended December 31, 2006

Investment Income

For the year ended, December 31, 2007 gross investment income totaled $186,934 as compared to $86,707 for the year ended December 31, 2006.  During the past three years the Company has shifted its focus to becoming an investment company.  As such, its operations now consist of making investments into small, developing businesses.  Future revenues are expected to be generated as our investments are either liquidated for a profit, pay dividends, earn interest, or pay management fees.

Expenses

For the year ended December 31, 2007, expenses totaled $148,585 as compared to $241,134 for the year ended December 31, 2006, a decrease of 38%.  The decrease was a result of extraordinary income created by a release of payroll taxes owed.  Taking out this one-time item, expenses increased $171,595 to $412,729.  Professional fees and consulting services required to operate the Company caused the increase in expenses in 2007.

Net Investment Income

The company’s net investment income totaled $38,349 as compared to a loss of $154,427, respectively for the years ended December 31, 2007 and 2006.  This increase to income is primarily due to increased investment income and the one-time extraordinary item in 2007 as compared to 2006.

Net Realized Gains/Losses

The Company had net realized gain for the year ended December 31, 2007 of $225,427 as compared to a loss of $277,956 in 2006.  The Company sold some performing investments in 2007 versus non-performing investments in 2006 that created the realized loss.

Net Unrealized Appreciation/Depreciation on Investments

Net unrealized losses were $250,554 for the year ended December 31, 2007 as compared to losses of $590,524 for the year ended December 31, 2006, primarily as a result of decreases in the value of the Company’s portfolio investments.

29

Net Decrease in Net Assets from Operations

As a results of the foregoing, for the years ended December 31, 2007 and 2006, the Company incurred a net increase in net assets resulting from operations of $13,222 and a net decrease of $1,022,907 respectively. The net change in net assets from operations per share was $0.00 and ($0.04), respectively, for the years ended December 31, 2007 and 2006.

Year ended December 31, 2006 compared to year ended December 31, 2005

Investment Income

Net investment income for the years ended December 31, 2006 and 2005 were $86,707 and $41,931, respectively.  During these years the Company shifted its focus to becoming an investment company.  As such, its operations now consist of making investments into small, developing businesses.  Future revenues are expected to be generated as our investments are either liquidated for a profit, pay dividends, earn interest, or pay management fees.

Expenses

For the year ended December 31, 2006, general and administrative expenses were $142,177 as compared to $663,194 for the year ended December 31, 2005, a decrease of 79%.  The decrease was a result of decreased operating and professional expenses due to the resignation of Isaac Sutton and the Company being in survival mode.

During the year ended December 31, 2006, no stock was issued for services. Under the rules of the Investment Company Act of 1940, the Company is prohibited from issuing stock for services except in certain circumstances under a stock option plan.  As a result, future costs associated with issuing stock for services are expected to be negligible.

Net Investment Income

The Company’s net investment loss totaled $154,427 and $846,260 respectively for the years ended December 31, 2006 and 2005.  This decrease is due primarily to the Company operations being in survival mode for 2006.

Net Unrealized Appreciation/Depreciation on Investments

Net unrealized losses were $590,524 in the year ended December 31, 2006 as compared to an unrealized gain of $215,585 for the year ended December 31, 2005, primarily as a result of the write down of company investments in 2006.

Net Decrease in Net Assets from Operations

As a result of the foregoing, the Company incurred a net decrease in assets of $1,022,907 as compared to net decrease in assets of $626,757 for the years ended December 31, 2006 and 2005, respectively.

30

Liquidity and Capital Resources

In 2007, the Company has funded its requirements for working capital primarily through the sale of 32,243,334 unregistered shares of its common stock raising an aggregate of $967,300.

For the year ended December 31, 2007, net cash used in operating activities was $630,159, which was attributable to a net increase in net assets resulting from operations of $13,222, a net change in unrealized depreciation of $250,554, and investments totaling $600,000.  This compares to net cash used in operating activities of $960,336 for the year ended December 31, 2006.  The primary difference was the expenditure of $600,000 in 2007 for purchases of investments.

For the year ended December 31, 2007, net cash provided by financing activities was $666,986 which was attributable to proceeds from the issuance of common stock of $926,600, loans repaid of $526,247, and debt converted to shares of $266,633.  This compares to $976,567 provided by financing activities in 2006.

The Company anticipates a significant increase in capital expenditures subject to obtaining additional financing, of which there can be no assurance.  The Company’s capital requirements depend on numerous factors, including market acceptance of the Company’s investment ability to obtain additional financing, technological developments, capital expenditures and other factors. The Company has an immediate need for additional financing to continue operations.  The Company is seeking to obtain additional capital through the sale of its securities and loans.  If the Company does not immediately receive additional financing, the Company will be required to cease operations. If the Company obtains additional financing, of which there can be no assurance, the Company may sell its equity securities.  The sale of additional equity or convertible debt securities could result in additional dilution to stockholders. There can be no assurance that financing will be available in the required amounts or on terms acceptable to the Company, if at all.

Off-Balance Sheet Arrangements

At December 31, 2007, we did not have any off-balance sheet liabilities or other contractual obligations that are reasonably likely to have a current or future material effect on our financial condition.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Our portfolio is concentrated in a limited number of portfolio companies, which subjects us to a risk of significant loss if any of these companies defaults on its obligations under any of its debt securities that we hold.  In particular, our investment in Miscor Limited represents approximately 58% of our portfolio holdings. Accordingly, our aggregate returns may be significantly adversely affected if this investment performs poorly or if we need to write down the value of any one of our major investments.  Beyond our income tax asset diversification requirements, we do not have fixed guidelines for diversification, and our investments could be concentrated in relatively few issuers.

31

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	Page
Report of Independent Registered Public Accounting Firm	33
Statement of Assets and Liabilities for the year ending December 31, 2007 and December 31, 2006	34
Statements of Operations for the year ending December 31, 2007, 2006, and 2005	35
Statements of Changes in Net Assets for the year ending December 31, 2007 and December 31, 2006	36
Statement of Cash Flows for the year ending December 31, 2007, 2006 and 2005	37
Schedule of Investments for the year ending December 31, 2007	38
Notes to Financial Statements	41

32

Larry O'Donnell, CPA, P.C.

Telephone (303)745-4545	2228 South Fraser Street
	Unit 1
	Aurora, Colorado 80014

Report of Independent Registered Public Accounting Firm

To the Board of Directors

StarInvest Group, Inc.

Midland, Texas

I have audited the accompanying balance sheets of StarInvest Group, Inc. including the schedule of investments as of December 31, 2007 and 2006, and the related statements of operations, changes in net assets and cash flows for the years then ended and the financial highlights for the years ended December 31, 2007 and 2006. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audits.

I conducted my audits in accordance with standards of the Public Company Accounting Oversight Board (United States).  Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor was I engaged to perform, an audit of its internal control over financial reporting. My audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, I express no such opinion.  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.  I believe that my audits provide a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of StarInvest Group, Inc. as of December 31, 2007 and 2006, and the results of its operations and cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has an accumulated deficit of $11,556,416 at December 31, 2007. Additionally, for the year ended December 31, 2007, the Company used cash in operations of $630,159. These matters raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regards to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Larry O’Donnell, CPA, P.C.

March 26, 2008

33

StarInvest Group, Inc.

Statements of Assets and Liabilities

	December 31, 2007			December 31, 2006
Assets
Investments, at fair value(cost- $2,118,174 and $1,740,592, respectively)	$	2,094,594		$	1,617,656
Cash		53,208			16,381
Receivable, deposit and other		7,735			100,500
Total assets	$	2,155,537		$	1,734,537
Liabilities
Loans payable	$	543,336		$	1,069,583
Accounts payable and accrued expenses		45,297			304,504
Due to officer		-			-
Obligation to repurchase shares		25,000			25,000
Total liabilities	$	613,633		$	1,399,087
Net Assets
Series B preferred stock, par value $.001 per share, 10,000,000 shares
authorized, 0 and 3,400,000 shares issued and outstanding,
Respectively	$	-		$	-
Common stock, par value $.001 per share, 900,000,000 shares authorized 68,679,047 and 27,592,971 shares issued and outstanding respectively		68,679			27,593
Additional paid-in capital		13,029,641			12,445,014
Treasury stock		-			(387,519	)
Stock subscription receivable		-			(180,000	)
Accumulated deficit		(11,556,416	)		(11,569,638	)
Total Net Assets	$	1,541,904		$	335,450
Total liabilities and net assets	$	2,155,537		$	1,734,537
Net Asset Value per Share	$	0.02		$	0.01

See notes to financial statements.

34

STARINVEST GROUP, INC.

STATEMENTS OF OPERATIONS

	Year Ended			Year Ended			Year Ended
INVESTMENT INCOME:	December 31, 2007			December 31, 2006			December 31, 2005
Interest	$	151,934		$	30,707		$	41,931
Consulting Income		35,000			56,000			-
Total Investment Income		186,934			86,707			41,931
EXPENSES:
General and administrative expenses		243,776			142,177			663,194
Professional fees		92,256			88,319			202,635
Other (Income) expense		(264,144	)		(40,894	)		-
Interest expense		76,697			51,532			22,362
Total expenses		148,585			241,134			888,191
Net investment income (loss)		38,349			(154,427	)		(846,260	)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments		225,427			(277,956	)		3,918
Net change in unrealized gain or loss on investments		(250,554	)		(590,524	)		215,585
Net realized and unrealized gain (loss) from investments		(25,127	)		(868,480	)		219,503
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	13,222		$	(1,022,907	)	$	(626,757	)
LOSS PER COMMON SHARE	$	0.00		$	(0.04	)	$	(0.03	)

See notes to financial statements.

35

STARINVEST GROUP, INC.

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
Increase in net assets from operations:	December 31, 2007			December 31, 2006
Net investment income (loss)	$	38,349		$	(154,427	)
Net realized gains (losses)		225,427			(277,956	)
Net change in unrealized gain (loss)		(250,554	)		(590,524	)
Net increase (decrease) in net assets resulting from operations		13,222			(1,022,907	)
Dividends and distributions to shareholders		-			(200,000	)
Net increase from capital share transactions
Sold 32,243,334 and 498,901 common shares, respectively		967,300			59,868
Cost of raising capital		(40,700	)		-
Converted debt for 8,887,742 common shares		266,633			-
Redeemed 1,697,950 shares for treasury stock		----			(389,744	)
Subscribed stock		- --			62,768
Net increase from capital share transactions		1,193,233			(267,108	)
Total increase (decrease) in net assets:		1,206,455			(1,490,015	)
Net assets at beginning of period		335,450			1,825,465
Net assets at end of period		1,541,905		$	335,450
Capital share activity
Shares sold		32,243,334			498,901
Shares converted		8,887,742			3,400,000
Shares retired		(45,000	)		(1,697,950	)
Net increase (decrease) in capital share activity		41,086,076			2,200,951

See notes to financial statements.

36

STARINVEST GROUP, INC.

STATEMENTS OF CASH FLOWS

	Year Ended			Year Ended			Year Ended
Cash Flows from Operating Activities	December 31, 2007			December 31, 2006			December 31, 2005
Net increase (decrease) in Net Assets Resulting from Operations	$	13,222		$	(1,022,907	)	$	(626,757	)
Adjustments to reconcile net decrease:
Purchase of investment securities		(300,000	)		(281,104	)		1,523,115
Loans to investment companies		(300,000	)		-			-
Other investments		(24,491	)		-			-
Decrease (increase) in receivable		100,000			(100,500	)
Interest Income		(151,934	)		-			-
Consulting income		(35,000	)		(56,000	)
Extraordinary income		(264,144	)		-			-
Increase (decrease) in accounts payable  and accrued expenses		(259,207	)		(75,662	)		198,023
Non-cash decrease in accounts payable		264,144			-			-
Decrease (increase) in other assets		-			26,207			(25,707	)
Forgiveness of debt		-			(40,894	)		-
Interest expense		76,697			-			22,362
Net change in unrealized (appreciation)/depreciation on investment		250,554			590,524			(236,720	)
Net Cash Used by Operating Activities		(630,159	)		(960,336	)		(2,191,914	)
Cash Flows from Financing Activities:
Net proceeds from the issuance of common stock		926,600			59,868			2,2960,020
Net proceeds from (issuance of) subscribed stock		-			260,268			(440,268	)
Debt converted to shares		266,633			-			-
Payments to repurchase shares		-			(64,761	)		(10,000	)
Net proceeds (repayments) from loans		(526,247	)		734,252			(156,932	)
Repayments of officer loan		-			(13,060	)		(162,907	)
Net Cash Provided by Financing Activities		666,986			976,567			2,189,913
Net Increase in Cash		36,827			16,231			(2,001	)
Cash, Beginning of period		16,381			150			2,151
Cash, End of period	$	53,208		$	16,381		$	150

See notes to financial statements.

37

STARINVEST GROUP, INC.

SCHEDULE OF INVESTMENTS

Portfolio Company
Common Equity - 23.41%	Industry	Shares		Cost		Fair Value
Amazon Biotech, Inc	Biotech		161,388	$	107,329	$	16,138
Miscor Limited	Power Service		200,000	$	845	$	134,000
Net2Auction, Inc	Online Retailer		40,000	$	40,000	$	400
Promana Solutions, Inc	Payroll Software Solutions		3,000,000	$	150,000	$	3,000
Health Rush, Inc	Food		500,000	$	250,000	$	250,000
SBD International, Inc	Real Estate Developer		400	$	100,000	$	400
Total Common Equity				$	648,174	$	403,938
Unsecured Promissory Note - ­­%	Industry	Par Amount		Cost		Fair Value
Premier Indemnity, Inc – 6%, 3/11/08	Insurance		125,000	$	125,000	$	143,169
Total Unsecured Promissory Note				$	125,000	$	143,169
Secured Promissory Note – 13.01%	Industry	Par Amount		Cost		Fair Value
Gambino Apparel, Inc 10%, 7/18/05	Apparel	$	35,000	$	35,000	$	35,000
Western Roses, Inc	Cemetery	$	450,000	$	450,000	$	517,331
Total Secured Promissory Note				$	485,000	$	552,331
Subordinated Convertible Debenture - 55.85%	Industry	Par Amount		Cost		Fair Value
Miscor Limited 6%, 2/28/08	Power Service	$	800,000	$	800,000	$	935,156
Wireless Link, Inc	New Media	$	60,000	$	60,000	$	60,000
Total Subordinated Convertible Debenture				$	860,000	$	995,156
Total Investments				$	2,118,174	$	2,094,594

38

Portfolio Company	Fair value		% of Total Asset
Miscor Limited	$	1,069,156		51.04	%
Western Roses, Inc	$	517,331		24.69	%
Health Rush, Inc	$	250,000		11.93	%
Premier Indemnity, Inc	$	143,169		6,85	%
Wireless, Inc	$	60,000		2,86	%
Gambino Apparel, Inc	$	35,000		1,67	%
Amazon Biotech, Inc	$	16,138		0.78	%
Promana Solutions, Inc	$	3,000		0.14	%
Net2Auction, Inc	$	400		0.02	%
SBD International, Inc	$	400		0.02	%
	$	2,094,594		100.00	%
Industry
Power				51.04	%
Cemetery				24.69	%
Food				11.93	%
Insurance				6.85	%
Software				0.14	%
Telecommunications				2.86	%
Biotech				0.78	%
Retail				1.69	%
Real Estate developers				0.02	%

39

STARINVEST GROUP, INC

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2007

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business

StarInvest Group, Inc. (“StarInvest” or the “Company”) was incorporated on September 26, 1985 as Gemini Energy Corporation under the laws of the State of Nevada.  On January 28, 1994, the Company’s name was changed to Nerox Energy Corporation.  On April 24, 1998 the Company’s name was changed to Nerox Holding Corporation.  On December 15, 1998 the Company’s name was changed to E*twoMedia.com.  On December 19, 2000 the Company’s name was changed to Exus Networks, Inc.  On November 22, 2002 the Company’s name was changed to Exus Global, Inc.  On January 13, 2005 the Company’s name was changed to StarInvest Group, Inc.

In January 2001, an Agreement to Exchange Stock dated January 15, 2001 was entered into by and between Exus and Exus New York (the “Agreement”).  Under terms of the Agreement, Exus New York exchanged all of its issued and outstanding shares for 20,000,000 shares of the Company.  After the Agreement, the Company owned 79% of the outstanding common stock of the combined entity and became the surviving corporation.  The transaction has been accounted for as a reverse acquisition under the purchase method for business combinations.  On November 25, 2002, the Company amended its articles of incorporation to change the name of the Company to Exus Global, Inc.  On March 9, 2004, the Company filed Form N-54 to elect to report as a business development company (BDC) under the Investment Company Act of 1940.  On January 12, 2005, the Company changed its name to StarInvest Group Inc.

The results of operations for 2007 and 2006 reflect the Company’s operating as a BDC from March 2004 through Dec 31, 2007.  There was no cumulative effect of accounting change for the conversion to a BDC.  Accounting principles used in the preparation of the financial statements as a BDC differ primarily related to the carrying value of investments and the accounting for income taxes.

Currently, the Company is a business development company engaged in the business of investing in small to mid-sized companies in technology-related companies.

Revenue Recognition

We record interest income on an accrual basis for loans on which we expect to collect such amounts.  We will not accrue interest if we have reason to doubt our ability to collect such interest.  Consulting revenue is recognized at the time the services are performed.

Cash and Cash Equivalents

Cash and cash equivalents consist of demand deposits and highly liquid investments with original maturities of three months or less.  Cash and cash equivalents are carried at cost or amortized cost, which approximates fair value.

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Property and Equipment

Property, equipment and leasehold improvements are stated at cost.  Depreciation is being provided on the straight-line method over the estimated useful lives of the assets (generally five to ten years).  Amortization of leasehold improvements is being provided on the straight-line method over the various lease terms or estimated useful lives, if shorter.  At December 31, 2002 all property and equipment were written down to $0.

Loss per Common Share

The Company complies with SFAS No. 128, “Earnings per Share”.  SFAS No. 128 requires dual presentation of basic and diluted earnings per share for all periods presented.  Basic earnings per share excludes dilution and is computed by dividing loss applicable to common stockholders by the weighted average number of common shares outstanding for the period.  Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity.  Since the effect of the outstanding options, and convertible debentures and preferred stock is antidilutive, they have been excluded from the Company’s computation of loss per common share.

Stock-Based Compensation

Statement of Financial Accounting Standards No. 123, “Accounting for Stock-Based Compensation” (“SFAS 123”), encourages, but does not require, companies to record compensation cost for stock-based employee compensation plans at fair value.  The Company has chosen to account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees”, and related Interpretations.  Accordingly, compensation cost for stock options is measured as the excess, if any, of the estimated fair value of the Company’s stock at the date of the grant over the amount an employee must pay to acquire the stock.  The Company has adopted the “disclosure only” alternative described in SFAS 123 and SFAS 148, which require pro forma disclosures of net income and earnings per share as if the fair value method of accounting had been applied.

Fair Value of Financial Instruments

The carrying amount reported in the consolidated balance sheets for cash, accounts payable and accrued expenses approximate fair value because of the immediate or short-term maturity of the financial instruments.

Use of Estimates

The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America that require management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results may differ from those estimates.  In the normal course of business, the Company may enter into contracts that contain a variety of representations and provide indemnifications.  The Company’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Company that have not yet occurred.  However, based upon experience, the Company expects the risk of loss to be remote.

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Investment Valuation

The Company carries its investments at fair value, as determined in good faith by the Board of Directors.  Securities that are publicly traded are valued at the closing price on the valuation date.  Debt and equity securities that are not publicly traded are valued at fair value as determined in good faith by the Board of Directors.  In making such determination, the Board of Directors values non-convertible debt securities at cost plus amortized original issue discount plus payment-in-kind (“PIK”) interest, if any, unless adverse factors lead to a determination of a lesser valuation.  Due to the uncertainty inherent in the valuation process, such estimates of fair value may differ significantly from the values that would have resulted had a readily available market for the securities existed, and the differences could be material.  Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the valuation currently assigned.

Federal Income Taxes

The Company intends to operate so as to qualify to be taxed as a RIC under the Internal Revenue Code and, as such, would not be subject to federal income tax on the portion of its taxable income and gains distributed to stockholders.  To qualify as a RIC, the Company is required to distribute at least 90% of its investment company taxable income, as defined by the Code.  Because federal income tax regulations differ from accounting principles generally accepted in the United States, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes.  Differences may be permanent or temporary.  Permanent differences are reclassified among capital accounts in the financial statement to reflect their tax character.  Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.  Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.

The Company utilizes the asset and liability method of accounting for deferred income taxes.  Under this method, deferred tax assets and liabilities are established based on the differences between financial statement and income tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.  The Company provides a valuation allowance against deferred tax assets if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Recently Issued Accounting Pronouncements

In June 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes - An Interpretation of FASB Statement No. 109, (FIN 48). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes. FIN 48 also prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return that results in a tax benefit. Additionally, FIN 48 provides guidance on de-recognition, income statement classification of interest and penalties, accounting in interim periods, disclosure, and transition. The application of FIN48 does not have a material effect on the Company’s results of operations and financial condition.

In September 2006 the FASB issued SFAS No. 157, “Fair Value Measurements”. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands fair value disclosure requirements. SFAS No. 157 applies whenever another accounting standard requires (or permits) assets or liabilities to be measured at fair value, but does not expand the use of fair value to new circumstances. SFAS No. 157 is effective beginning in 2008. The Company has not yet determined the effect SFAS No. 157 will have on its financial statements.

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In September 2006 the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Post Retirement Plans”. SFAS No. 158 requires the Company to recognize the funded status of its post retirement plans on the balance sheet and recognize as a component of accumulated other comprehensive income the gains and losses, prior service costs or credits that occur during the financial year but are not recognized as components of the Company’s pension costs This  Statement  is effective as of the beginning of its first fiscal year that begins after December 15, 2008.   The Company does not expect  application of SFAS No. 156 to have a material effect on its financial statements.

In February 2007 the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – Including an amendment of FASB Statement No. 115”. SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value. The amendment to SFAS No. 115 applies to all entities with investments in available-for-sale or trading securities. The statement is effective for fiscal years beginning after November 15, 2007. The Company has not yet determined the effect SFAS No. 159 will have on its financial statements.

In June 2007, the EITF reached consensus on Issue No. 06-11, “Accounting for Income Tax Benefits of Dividends on Share-Based Payment Awards.” EITF 06-11 requires that the tax benefit related to dividend equivalents paid on restricted stock units, which are expected to vest, be recorded as an increase to additional paid-in capital. EITF 06-11 is to be applied prospectively for tax benefits on dividends declared in fiscal years beginning after December 15, 2007, and we will adopt the provisions of EITF 06-11 beginning in the first quarter of 2008. EITF 06-11 is not expected to have a material impact on our results of operations or financial condition.

In December 2007 the FASB issued Statement No. 141(R) “Business Combinations” (“FAS 141(R)”). FAS 141(R) requires the acquiring entity in a business combination to recognize the full fair value of assets acquired and liabilities assumed in the transaction (whether a full or partial acquisition); establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed; requires expensing of most transaction and restructuring costs; and requires the acquirer to disclose to investors and other users all of the information needed to evaluate and understand the nature and financial effect of the business combination. FAS 141(R) applies prospectively to business combinations for which the acquisition date is on or after January 1, 2009. The impact of FAS No. 141R on our consolidated financial statements will depend upon the nature, terms and size of the acquisitions we consummate after the effective date.

In December 2007, the FASB issued FAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements—an amendment of Accounting Research Bulletin No. 51” (“FAS 160”). FAS 160 requires reporting entities to present noncontrolling (minority) interests as equity (as opposed to as a liability or mezzanine equity) and provides guidance on the accounting for transactions between an entity and noncontrolling interests.  FAS 160 applies prospectively as of January 1, 2009, except for the presentation and disclosure requirements which will be applied retrospectively for all periods presented.

NOTE 2 - GOING CONCERN

The accompanying consolidated financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has an accumulated deficit of $11,556,416 at December 31, 2007.  Additionally, for the year ended December 31, 2007, the Company had  net cash used by operating activities of $630,159.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

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Management is taking steps to address this situation.  The Company is in the process of implementing its business plan and in March 2004 the Company filed Form N-54 to elect to report as a business development company (BDC) under the Investment Company Act of 1940.  Management expects operations to generate negative cash flow at least through December 2007 and the Company does not have existing capital resources or credit lines available that are sufficient to fund operations and capital requirements as presently planned over the next twelve months.  The ability of the Company to continue as a going concern is dependent on the Company’s ability to further implement its business plan.  The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.  Management believes that the actions presently being taken to further implement its business plan and generate additional revenues provide the opportunity for the Company to continue as a going concern.  Management intends to attempt to raise additional funds by way of a public or private offering.  While the Company believes in its ability to raise additional funds, there can be no assurances to that effect.

NOTE 3 - INCOME TAXES

Current income taxes are computed at statutory rates on pretax income.  Deferred taxes would be recorded based on differences in financial statements and taxable income.  At December 31, 2007, the Company had elected to carry forward net operating losses for federal and state income tax purposes of approximately $6,175,000 that are available to reduce future taxable income through 2020.  As utilization of such operating losses for tax purposes is not assured, the deferred tax asset has been fully reserved through the recording of a 100% valuation allowance.  These operating losses may be limited to the extent an “ownership change”, as defined under section 382 of the Internal Revenue Code, occurs.  The provision (benefit) for income taxes differs from the amounts computed by applying the statutory Federal income tax rate of 35% to income (loss) before provision for income taxes is as follows:

	2007			2006
Tax benefit computed at statutory rates	$	(417,370	)	$	(422,000	)
State income tax benefit (net of Federal Tax)		(58,000	)		(59,000	)
Permanent differences		125,000			125,000
Income tax benefit not utilized		350,370			356,000
Net income tax benefit	$	-		$	-

The components of the deferred tax asset as of December 31, 2007 are as follows:

	2007			2006
Deferred Tax Asset:
Net Operating Loss Carryforward	$	2,471,500		$	2,476,000
Accrued compensation		-			-
		2,471,500			2,476,000
Less: Valuation Allowance		(2,471,500	)		(2,476,000	)
Net Deferred Tax Asset	$	-		$	-

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NOTE 4 – LOANS PAYABLE

		2007		2006
Current loans payable with an aggregate principal of $775,000, due May 10, 2007, principal and interest at 8% per annum, interest paid quarterly.  Accrued interest on these loans at December 31, 2007 is approximately $60,938.  These loans are unsecured.			510,938		800,989
Related parties notes payable, due immediately, no interest accruing.  These notes are unsecured.			32,398		32,398
	Totals	$	543,336	$	1,069,583

NOTE 5 - COMMITMENTS AND CONTINGENCIES

Employment Agreements

The Company has a contract with Robert H. Cole to serve as its CEO/CFO.  This contract, which commenced on May 10, 2006 and expires on December 31, 2008, agrees to pay Mr. Cole $2,500 per month. The Company has a contract with Mr. Cristiano Germinario to serve as consultant of the Company.  He has been serving in this capacity since April 1, 2006 and continues to serve in this position.  Under its consulting agreement with Mr. Germinario the Company was paying $3,500 per month up to January 2007, but it has been raised to $5,000 per month starting in February 2007.  This contract expires in March 2008.  All contracts can be extended from year to year.

Litigation

There are no lawsuits that we are aware of as of March 26, 2008.

NOTE 6 - STOCKHOLDERS’ DEFICIT

Stock as settlement of debt

The Company issued stock for settlement of debt to two shareholders, valuing such issues at the fair market value of the stock.  During the year ended December 31, 2005, the Company issued an aggregate of 210,000 shares of common stock in consideration of debt owed by the Company.  Such shares were valued at an aggregate of $35,000 representing the fair value of the shares issued.  As of December 31, 2005, these shareholders have the right to put back to the Company 100,000 shares at .50 per share for a net liability of $45,000.  As of December 31, 2006, the company settled with one shareholder and for $10,000 and we still have a net liability of $25,000 for the other shareholder.

On June 29, 2007, we reached an agreement with New Canaan Partners, Ltd a company, which is controlled by certain minority shareholders of StarInvest Group, Inc. New Canaan Partners Ltd agreed to convert at a fix conversation rate of $0.03 per share their defaulted 8% note, which was collateralized by all of the assets of the Company, into 8,030,664 restricted common shares of StarInvest Group, Inc. The principal of $187,500 and accrued interest of $53,420 outstanding on the defaulted 8% note was aggregated for a total conversion amount of $240,920.

On June 29, 2007, we instructed our transfer agent to issue 857,078 restricted common shares to Mr. Notowitz as per his conversion at a fix conversation rate of $0.03 per share of his 8% Note dated May 10, 2006 due on May 12, 2007. The principal of $25,000 and accrued interest of $712.33 outstanding on the note was aggregated for a total conversion amount of $25,712.33.

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Stock Sold

During the year ended December 31, 2007, the Company sold 32,243,334 shares of its common stock under a Regulation D offering for a total of $967,300.

Stock Options

As of December 31, 2007 there were no outstanding options.  No warrants or options were granted in 2007.

NOTE 7 - SUBSEQUENT EVENTS

On January 15, 2008, the Board of Directors of StarInvest Group, Inc. (the “Company”) received the resignations of Ronald Signore and Steve Cole-Hatchard as Directors of the Company.  Mr. Cole-Hatchard served on the Company’s Board of Directors since May 10, 2006. Mr. Signore was appointed by the Board of Directors on December 20, 2006.  The resignations became effective on January 10, 2008.

NOTE 8 - EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted net increase (decrease) in stockholders’ equity resulting from operations per share for the year ended December 31, 2007 and for the period from inception through December 31, 2006:

	Year ended December 31, 2007		Year ended December 31, 2006
Numerator for basic and diluted gain (loss) per share	$	13,222	$	(1,205,410	)
Denominator for basic and diluted weighted average shares		52,707,483		27,931,122
Basic and diluted net increase (decrease) in stockholders’ equity resulting from operations per common share	$	0.00	$	(0.04	)

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NOTE 9 - OTHER INCOME

Other income includes primarily closing fees, or origination fees, associated with investments in portfolio companies.  Such fees are normally paid at closing of the Company’s investments, are fully earned and non-refundable, and are generally non-recurring.  The 1940 Act requires that a business development company to offer to make available managerial assistance to its portfolio companies.  The Company may receive fee income for managerial assistance it renders to portfolio companies in connection with its investments.  For the year ended December 31, 2007 and the period ended December 31, 2006, the Company received no fee income for managerial assistance.

NOTE 10 - FINANCIAL HIGHLIGHTS

Statement of Operations Data:	For the Year Ended December 31, 2007			For the Year Ended December 31, 2006
Total Investment Income	$	186,934		$	86,707
Total Expenses		148,585			241,134
Net Investment Income (Loss)		38,349			(154,427	)
Net Realized and Unrealized (Losses) Gains		(25,127	)		(868,480	)
Net Decrease in Stockholders’ Equity Resulting from Operations		13,222			(1,022,907	)
Per Share Data:
Net Asset Value	$	0.02		$	0.01
Net Decrease in Stockholders’ Equity Resulting from Operations		0.04			(0.04	)
Balance Sheet Data:
Total Assets	$	2,155,537		$	1,734,537
Borrowings Outstanding		543,336			1,069,583
Total Net Assets		1,541,904			335,450

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ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON ACCOUNTING AND FINANCIAL DISCLOSURE

There were no changes in or disagreements on accounting or financial disclosure with Larry O’Donnell, CPA, the Company’s independent public accounting firm during the fiscal year ended December 31, 2007.

ITEM 9A(T).  CONTROLS AND PROCEDURES.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the company.  Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America.  Internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions: providing reasonable assurance that receipts and expenditures of company assets are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis.  Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.

Management's Report on Internal Controls over Financial Reporting

Management acknowledges its responsibility for establishing and maintaining adequate internal controls over financial reporting. We are not currently in compliance with Section 404 of the Act but intend to commence shortly the system and process documentation and evaluation needed to comply with Section 404 and to have the evaluation audited by Larry O'Donnell, CPA.

ITEM 9B.  OTHER INFORMATION

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PART III

ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following table sets forth information concerning our directors and executive officers:

Name	Age	Position
Robert H. Cole	64	Chief Executive, Chief Financial Officer and Director
Roger Moreau	48	Director
Cristiano Germinario	37	Secretary and Director
Glenn Matthew	55	Chief Operating Officer

The following is a brief summary of the background of each executive officer and director:

Robert H. Cole

Robert H. Cole has been a Director of our Company since March 9, 2006 and our Chief Executive Officer, Chief Financial Officer since May 10, 2006. Since 1981 he has been President of Permian Business Group, a business consulting company founded by Mr. Cole specialized in the sale and installation of computer solutions.  From 1970 to 1980, Mr. Cole was a Senior Analyst with Gulf Oil Company, and in 1989 he became Chairman of Aplex Industries where he grew the company to $8 million in sales.  Mr. Cole founded Stadium Chair Company in 1999, and sold it in 2003.  Mr. Cole holds a Bachelor’s Degree in Electrical Engineering, a Masters of Science in Computing Science from Texas A&M, and a MBA from Houston Baptist University.

Roger Moreau

Roger Moreau has been a Director of our Company since December 21, 2006. Mr. Moreau has been President and Portfolio Manager for Moreau Investment Management Company since 1993.  Prior to 1993, Mr. Moreau worked in the Research Department at Advest, Inc., in Financial Consulting at Shearson Lehman Hutton, Inc., and the International Department at Morgan Guaranty Trust Corp of New York.

Cristiano Germinario 

Cristiano Germinario has been a Director of our company since November 20, 2006 and Secretary of the Company since August 2007. From April 2000 to May 2006, Cristiano D. Germinario worked as a financial analyst at IIG International Investment Company, a New York based fund specialized in Trade Financing.  Cristiano D. Germinario holds a Masters Degree in Political Science from the University of Bologna, Italy.

Glenn Matthews

 Glenn Matthews joined StarInvest Group on June 12, 2007 and was appointed Executive Vice President and Chief Operating Officer.  Glenn has over 25 years of business experience in manufacturing, distribution, and financial services sectors, having served most recently as the managing partner of a financial services and business consultancy focused on the greater Asia market.  Prior to this position, Glenn served as chairman of regional broker dealer focused on wealth management and preservation, managing director of a specialty offshore financial services provider, and a senior vice president of a bank owned financial services subsidiary.

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Except as indicated above, none of our directors holds any directorships in companies with a class of securities registered pursuant to Section 12 of the Securities Exchange Act or subject to the requirements of Section 15(d) of such Act or any company registered as an investment company under the Investment Company Act of 1940, as amended. There are no family relationships among any of our directors or executive officers.

Board Composition

The Company’s board of directors consists of three directors.  At each annual meeting of its stockholders, all of its directors are elected to serve from the time of election and qualification until the next annual meeting following election.  In addition, the Company’s bylaws provide that the maximum authorized number of directors may be changed by resolution of the stockholders or by resolution of the board of directors.  The non-officer directors received no pay for their services.

Meetings and Committees of the Board of Directors

Our Board of Directors conducts its business through meetings of the Board and through activities of its committees.  During the fiscal year ended December 31, 2007, our Board of Directors did not hold any meetings, but took 11 actions by unanimous consent.  Roger Moreau is currently the sole member of the Audit Committee and is “independent” as defined by the 1940 Act. The Audit Committee operates pursuant to a charter adopted by the Board of Directors. The charter sets forth the responsibilities of the Audit Committee. Following the resignation of Ronald Signore as a director on January 10, 2008, we no longer have an Audit Committee financial expert.  The primary function of the Audit Committee is to serve as an independent and objective party to assist the Board of Directors in fulfilling its responsibilities for overseeing and monitoring the quality and integrity of the Company’s financial statements, the adequacy of the Company’s system of internal controls, the review of the independence, qualifications and performance of the Company’s independent registered public accounting firm, and the performance of the Company’s internal audit function.  Roger Moreau is now the sole member of the investment committee. The Board does not have compensation or nominating committees. Nominations and compensation decisions are considered and made by the full Board.  The Audit Committee did not hold any meetings during 2007.

Limitations of Liability and Indemnification of Directors and Officers

Our bylaws limit the liability of directors and officers to the maximum extent permitted by Nevada law.  We will indemnify any person who was or is a party, or is threatened to be made a party to, an action, suit or proceeding, whether civil, criminal, administrative or investigative, if that person is or was a director, officer, employee or agent of ours or serves or served any other enterprise at our request.

We have been advised that it is the position of the SEC that insofar as the indemnification provisions referenced above may be invoked to disclaim liability for damages arising under the Securities Act, these provisions are against public policy as expressed in the Securities Act and are, therefore, unenforceable.

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Compliance with Section 16(a) of the Exchange Act

Section 16(a) of the Exchange Act requires our executive officers, directors and persons who beneficially own more than 10% of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock.  Such persons are required by SEC regulations to furnish us with copies of all Section 16(a) report which they file.  Based upon our review of the Forms 3, 4 and 5 submitted by these reporting persons, during the fiscal year ended December 31, 2007, New Canaan Investment Partners, LLC and David Cohen did not file Form 3s timely to disclose the acquisition of the shares of the Company’s common stock reported herein. Glenn Matthews did not file Form 3s disclosing his appointments as officers of the Company. In addition, following their resignations as directors of the Company effective January 15, 2007, neither Steven Cole-Hatchard or Ronald Signore filed Form 4s.

Code of Ethics

We have adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.  For purposes of this Item, the term code of ethics means written standards that are reasonably designed to deter wrongdoing and to promote:

· honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

· full, fair, accurate, timely, and understandable disclosure in reports and documents that the issuer files with, or submits to, the SEC and in other public communications made by us;

· compliance with applicable governmental laws, rules and regulations;

· the prompt internal reporting of violations of the code to the board of directors or another appropriate person or persons; and

· accountability for adherence to the code.

We will provide to any person without charge, upon request, a copy of our code of ethics.  Such request may be made in writing to the board of directors at the address of our company.

Involvement in Certain Legal Proceedings

There are no legal proceedings that have occurred within the past five years concerning our directors, or control persons which involved a criminal conviction, a criminal proceeding, an administrative or civil proceeding limiting one's participation in the securities or banking industries, or a finding of securities or commodities law violations.

There are no material legal proceedings to which any director, officer or affiliate of the Company, any owner of record or beneficially of more than five percent of any class of voting securities of the Company, or any associate of any such director, officer, affiliate of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company.

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ITEM 11.  EXECUTIVE COMPENSATION

The following table sets forth information regarding compensation earned in or with respect to each of our last three completed fiscal years by:

· each person who served as our chief executive officer in 2007;

· each person who served as our chief financial officer in 2007; and

· our three most highly compensated executive officers, other than our chief executive officer and our chief financial officer, who were serving as executive officers at the end of 2007 and, were compensated in excess of $100,000.

We refer to these officers collectively as our named executive officers.

Summary Compensation Table

Name and principal position	Year	Salary	Bonus	Stock awards	Option awards	Nonequity incentive plan Compensation	Nonqualified deferred compensation earnings	All other compensation	Total
		($)	($)	($)	($)	($)	($)	($)	($)
(a)	(b)	(c)	(d)	(e)	(f)	(g)	(h)	(i)	(j)
	2007	27,500(3)	0	0	0	0	0	0	27,500
Robert H. Cole(1)	2006	0	0	0	0	0	0	0	0
	2005	0	0	0	0	0	0	0	0
	2007	0	0	0	0	0	0	0	0
Isaac H. Sutton(2)	2006	240,000(4)	0	0	0	0	0	0	240,000
	2005	60,000(4)	0	0	0	0	0	0	60,000

(1)  Robert H. Cole became our Chief Executive Officer and Chief Financial Officer on May 10, 2006.

(2)  Mr. Sutton resigned from his positions as Chief Executive Officer and Chief Financial Officer on May 10, 2006.

(3)  Beginning in February 2007, we paid R & J Cole, Inc. $2,500 per month pursuant to an employment agreement between the Company, and Robert H. Cole, President of R&J Cole, Inc. dated May 10, 2006

(4)   Represents amounts we paid Mr. Sutton under an employment agreement dated January 1, 2002.

Employment Agreements –  The Company has a contract with R & J Cole, Inc,  This contract, which commenced on May 10, 2006 and expires on December 31, 2008, agrees to pay Mr. Cole  $2,500 per month to serve as  the Chief Executive Officer and Chief Financial Officer of the Company. The Company has a contract with Mr. Cristiano Germinario to serve as consultant of the Company.  He has been serving in this capacity since April 1, 2006 and continues to serve in this position.  Under its consulting agreement with Mr. Germinario the Company was paying $3,500 per month up to January 2007, but it has been raised to $5,000 per month starting in February 2007.  This contract expires in March 2008.  All contracts can be extended from year to year.

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Outstanding Equity Awards

As of December 31, 2007, none of our directors or executive officers held unexercised options, stock that had not vested, or equity incentive plan awards. No stock options or stock appreciation rights were granted to any of our directors or executive officers during the period from the date of our incorporation through December 31, 2007.

Other Compensation

We have no pension, health, annuity, bonus, insurance, equity incentive, non-equity incentive, stock options, profit sharing or similar benefit plans.

Director Compensation

The following table sets forth information concerning compensation paid to or earned by our directors during 2007 under contractual agreements or other, arrangements.

Name (a)	Fees earned or paid in cash ($) (b)	Stock Awards ($) (c)	Option Awards ($) (d)	Non-equity incentive plan compensation ($) (e)	Nonqualified deferred compensation earnings ($) (f)	All other compensation ($) (g)	Total ($) (h)
Robert H. Cole	0	0	0	0	0	0
Steven Cole-Hatchard(1)	0	0	0	0	0	2,000	2,000
Ronald Signore	0	0	0	0	0	0
Roger Moreau	0	0	0	0	0	0
Cristiano Germinario(2)	0	0	0	0	0	60,000	60,000

(1)           Although Mr. Cole-Hatchard did not receive any compensation as a Director in 2007, he received $2,000 from the Company in his capacity as Chief Compliance Officer.

(2)           Although Mr. Germinario did not receive any compensation as a Director in 2007, he received $60,000 from the Company in his capacity as consultant to the Company.

Summary of Director Compensation

During the fiscal year ended December 31, 2007, no compensation has been paid to any of our directors in consideration for their services rendered in their capacity as directors.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table lists, as of March 26, 2008, the number of shares of common stock of our Company that are beneficially owned by (i) each person or entity known to our Company to be the beneficial owner of more than 5% of the outstanding common stock; (ii) each officer and director of our Company; and (iii) all officers and directors as a group. Information relating to beneficial ownership of common stock by our principal shareholders and management is based upon information furnished by each person using “beneficial ownership” concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power.

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The percentages below are calculated based on 68,724,046 shares of our common stock issued and outstanding as of March 26, 2008. We have no warrants, options or other securities exercisable for or convertible into shares of our common stock.

Except as indicated by footnote, and subject to community property laws where applicable, to our knowledge, each person listed is believed to have sole voting and investment power with respect to all shares of common stock owned by such person.

Name of Beneficial Owner	Number of Shares of Common Stock Beneficially Owned	Percent of Common Stock Beneficially Owned
Beneficial Owners of 5%
New Canaan Investment Partners LLC 62 Main St. New Canaan, CT 06840-4748	8,210,750	11.9%
David Cohen 1800 Rockaway Ave. Hewlett, NY 11557-1665	7,466,666	10.86%
Michael Poujol & Angela Poujol 22 E Rivercrest Dr Houston, TX 77042-2514	4,233,333	6.16%
Security Ownership of Management
Robert H. Cole(1) 5102 Los Alamitos Ct. Midland, Texas 79705	2,211,667	3.21%
Cristiano Germinario  198 Arlington Avenue Jersey City, New Jersey 07305	0	0%
Roger Moreau 436 North Lake Street Litchfield, CT 06759	0	0%
Glenn Matthews(2) 101 North Ocean Drive, Suite 8 Hollywood, FL 33019	3,333,333	4.85%
All directors and executive officers as a group (four people)	5,545,000	8.06%

(1)      Robert H. Cole directly owns 295,000 common shares. Also Mr. Cole owns 50% of R&J Cole, Inc the general partner and owner of 1% of  Reese-Cole Partnership LTD, that directly owns 1,666,667 common shares. In addition, Mr. Cole is acting as the custodian for his son Mr. David R. Cole, who directly owns 250,000 common shares.

(2)      Glenn Matthews is the Company’s Chief Operating Officer. Mr. Matthew is also Managing Agent of Aranha Investments Co. Ltd. which owns 3,333,333 shares of the Company’s common stock.

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ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Included in the subscriptions discussed above, on June 29, 2007, the Company reached an agreement with New Canaan Investment Partners, Ltd a company which is controlled by certain minority shareholders of StarInvest whereby New Canaan Investment Partners Ltd agreed to convert the outstanding principal of $187,500 and accrued interest of $53,420 due under the terms of the note between New Canaan Investment Partners Ltd. and the Company into shares of the Company’s common stock. The debt was converted at a price per share of $0.03 for an aggregate of 8,030,664 restricted shares of the Company’s common stock. The note, on which the Company was in default in their payments, was collateralized by all of the assets of the Company. Following conversion of all principal and accrued interest, the Note and security interest in the Company’s assets were cancelled.

In addition, and included in the subscriptions discussed above, on June 29, 2007, Allen Notowitz agreed to convert an aggregate amount of $25,712.33 in principal of accrued interest pursuant to a promissory note between Mr. Notowitz and the Company, into shares of the Company’s common stock. The note, on which the Company had been in default, was converted into shares of the Company’s common stock at $0.03 per share for an aggregate of 857,078 shares.

The Company has a an employment agreement with Robert H. Cole, President of R & J Cole, Inc. dated May 10, 2006. Pursuant to the terms of the agreement, the Company agreed to pay Mr. Cole $2,500 per month to serve as the Chief Executive Officer and Chief Financial Officer of the Company. The term expires December 31, 2008.

In addition, the Company has a consultant agreement with Cristiano Germinario, our Secretary and a director, to serve as consultant of the Company.  He has been serving in this capacity since April 1, 2006 and continues to serve in this position. Under its consulting agreement with Mr. Germinario, the Company was paying $3,500 per month up to January 2007, but it has been raised to $5,000 per month starting in February 2007. This agreement  expires in March 2008 but can be extended from year to year.

On June 12, 2007, the Company entered into an employment agreement with Glenn Matthews our Chief Operating Officer. Pursuant to the employment agreement, the Company agreed to pay Mr. Matthews a base annual salary of $48,000. In addition, the Company will pay for the expenses of the China office up to $6,000 per month.

Currently, we utilize space in Midland, Texas that is provided to us without charge by Mr. Robert Cole, our Chief Executive Officer and Chief Financial Officer and a director.

 ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES.

From April 2005 to present, our principal independent accountant has been Larry O'Donnell, CPA, P.C. Their pre-approved fees billed to the Company are summarized below:

	Fiscal year ending December 31, 2007		Fiscal year ending December 31, 2006
Audit Fees	$	7,100	$	5,930
Audit Related Fees	$	0	$	0
Tax Fees	$	0	$	0
All Other Fees	$	0	$	0

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(1) AUDIT FEES

The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s Form 10-Q (17 CFR 249.308a) or 10-QSB (17 CFR 249.308b) or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years was $5,930 for the fiscal year ended December 31, 2006 and $7,100 for the fiscal year ended December 31, 2007.

(2) AUDIT-RELATED FEES

No fees were billed in each of the last two fiscal years for assurance and related services by the principal accountant related to the performance of the audit or review of the Company’s financial statements.

(3) TAX FEES

No fees were billed for each of the fiscal years ended December 31, 2006 and 2007 for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning.

(4) ALL OTHER FEES

No fees billed were bill for each of the fiscal years ended December 31, 2006 and 2007 for professional services rendered by the principal accountant for any other services.

(5) PRE-APPROVAL POLICIES AND PROCEDURES

Before the accountant is engaged by the issuer to render audit or non-audit services, the engagement is nominated by the members of the Audit Committee and approved by the Company’s board of directors.

PART IV  

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES

Exhibit No.	Description
3.1	Restated Articles of Incorporation (annexed as Exhibit 3.(I) to the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2003 filed with the Securities and Exchange Commission on May 22, 2003 and incorporated herein by reference).
3.2	Certificate of Amendment to the Articles of Incorporation (annexed as Annex I to the Registrant’s Information Statement filed with the Securities and Exchange Commission on February 10, 2004 and incorporated herein by reference).
3.3	By-Laws (annexed as Annex I to the Registrant’s Information Statement on Form 14C filed with the Securities and Exchange Commission on December 23, 2002and incorporated herein by reference).
4.1	Series A Preferred Stock Certificate of Designation (annexed as Appendix II to the Registrant’s Information Statement filed on December 20, 2002 filed with the Securities and Exchange Commission on December 20, 2002 and incorporated herein by reference).

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4.2	Series B Preferred Stock Certificate of Designation (annexed as Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2004 filed with the Securities and Exchange Commission on June 4, 2004 and incorporated herein by reference).
10.1	Employment Agreement dated as of November 1, 2001 between the Registrant and Isaac Sutton (annexed as Exhibit 10.4 to the Registrant’s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2001 filed with the Securities and Exchange Commission on May 20, 2002 and incorporated herein by reference).
10.2	Registration Rights Agreement (annexed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on November 20, 2002 and incorporated herein by reference).
10.3	Shareholder Agreement and Irrevocable Proxy (annexed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on November 20, 2002 and incorporated herein by reference).
10.4	Asset Acquisition Agreement dated October 28, 2002 between the Registrant and New Millennium Development Group, Inc. (annexed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on November 20, 2002 and incorporated herein by reference).
10.5	2002 Stock Option Plan (annexed as Appendix III to the Registrant’s Information Statement filed with the Securities and Exchange Commission on December 20, 2002 and incorporated herein by reference).
10.6	Loan Agreement Modification and Conversion dated December 31, 2002 between the Registrant and New Canaan Investment Partners, LLC (annexed as Exhibit 20 to the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2003 filed with the Securities and Exchange Commission on May 22, 2003 and incorporated herein by reference).
10.7	Assignment and Assumption of Lease, dated March 12, 2006 (annexed as Exhibit 10.4 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2005 filed with the Securities and Exchange Commission on March 31, 2006 and incorporated herein by reference).
10.8	Secured Promissory Note for $775,000 with Strasbourger Pearson Tulcin & Wolff, dated March 12, 2006 (annexed as Exhibit 10.8 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006, filed with the Securities and Exchange Commission on April 17, 2007, and incorporated herein by reference).
10.9	Loan and Security Agreement with Strasbourger Pearson Tulcin & Wolff, dated March 12, 2006 (annexed as Exhibit 10.9 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006, filed with the Securities and Exchange Commission on April 17, 2007, and incorporated herein by reference).

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10.10	Assignment of GoIP Global, Inc. Debt to Isaac H. Sutton, dated March 12, 2006 (annexed as Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006, filed with the Securities and Exchange Commission on April 17, 2007, and incorporated herein by reference).
10.11	Employment contract with Mr. Robert H. Cole (annexed as Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006, filed with the Securities and Exchange Commission on April 17, 2007, and incorporated herein by reference).
10.12	Consultant agreement with Mr. Cristiano Germinario (annexed as Exhibit 10.8 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006, filed with the Securities and Exchange Commission on April 17, 2007, and incorporated herein by reference).

31.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.*
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of The Sarbanes-Oxley Act of 2002.*

* Filed herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

March 28, 2008	STARINVEST GROUP, INC.
	By:	/s/ Robert H. Cole
	Name:	Robert H. Cole
	Title:	Chief Executive Officer, Chief Financial Officer and Director
		(Principal Executive and Financial Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

	Signatures	Title
By:	/s/ Robert H. Cole	Chief Executive Officer, Chief Financial Officer and Director
	Robert H. Cole
Date:	March 28, 2008

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By:	/s/ Cristiano Germinario	Secretary and Director
	Cristiano Germinario
Date:	March 28, 2008
By:	/s/ Roger Moreau	Director
	Roger Moreau
Date:	March 28, 2008

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