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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

Commission file number 1-15213

Braun Consulting, Inc.
(Exact name of registrant as specified in its charter)

        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 ý No o

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes o No ý

        The number of shares outstanding of the registrant's common stock as of March 31, 2003 was 17,082,522 shares.

PART I—FINANCIAL INFORMATION

Item 1.    Financial Statements

BRAUN CONSULTING, INC.
STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)

See notes to unaudited financial statements.

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BRAUN CONSULTING, INC.
BALANCE SHEETS
(In thousands, except share and per share data)
(Unaudited)

See notes to unaudited financial statements.

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BRAUN CONSULTING, INC.
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

See notes to unaudited financial statements.

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BRAUN CONSULTING, INC.

NOTES TO FINANCIAL STATEMENTS

(In thousands, except share and per share data)

(Unaudited)

1.     Basis of Presentation

        The accompanying unaudited financial statements have been prepared from the records of Braun Consulting, Inc. (the "Company" or "Braun Consulting"), and, in the opinion of management, include all adjustments (consisting only of normal and recurring adjustments) necessary to present fairly the Company's financial position, results of operations and cash flows as of the dates and for the periods presented. The balance sheet as of December 31, 2002, presented herein, has been derived from the audited financial statements for the year then ended.

        Accounting policies followed by the Company are described in Note 2 to the audited financial statements for the year ended December 31, 2002, included in the Company's Annual Report on Form 10-K for the year ended December 31, 2002. Certain other information and footnote disclosures normally included in annual financial statements, prepared in accordance with generally accepted accounting principles, have been condensed or omitted for purposes of the interim financial statements. The interim financial statements should be read in conjunction with the audited financial statements, including the notes thereto, for the year ended December 31, 2002.

        Revenue Recognition:    The Company enters into various consulting arrangements that are billed either on a time-and-materials basis or on a fixed-price basis. The majority of these contracts generally range from 60-120 days and either require an up-front payment or are billed in bi-weekly installments ratably over the term of the contract. Termination of the contract by the customer would require the customer to pay the Company for hours incurred to date. Costs under the Company's contracts are expensed as incurred.

        The Company's revenue before expense reimbursements derived from fixed-price contracts was approximately 56% of revenue before expense reimbursements for the quarter ended March 31, 2003 as compared to 74% for the quarter ended March 31, 2002. Revenue on fixed-price projects is based upon the ratio of hours worked to total estimated hours to complete the project. The cumulative impact of any revision in estimates of the percentage-of-completion is reflected in the period in which the revision becomes known. Losses on contracts, if any, are provided for in full in the period when first determined. The Company recognizes unearned revenue when client billing exceeds the amount of revenue recognized. In certain instances, client arrangements require that a project milestone must be reached and written acceptance received from the client prior to billing. In these cases, revenue is recognized when milestones are reached, written acceptance from the client is received and other contractual specifications have been achieved. In addition, the Company recognizes a portion of its revenue before expense reimbursements on a time-and-materials basis.

        The Company also recognizes a limited amount of revenue from product sales on a gross basis as a value-added reseller of software products. The Company currently resells software products primarily as an occasional accommodation to clients who prefer to retain a single-source provider.

        The results of operations for the periods presented herein are not necessarily indicative of the results to be expected for the full year.

2.     Equipment, Furniture and Software

        Equipment, furniture, and software are stated at cost, less accumulated depreciation and amortization of $10,175 at March 31, 2003 and $9,571 at December 31, 2002.

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3.     Loss Per Share

        Basic loss per share is computed based on the weighted average number of common shares outstanding during the period. Diluted loss per share is computed based on the weighted average number of common shares outstanding plus the dilutive effect of stock options outstanding during the period. The Company is in a net loss position for the three months ended March 31, 2003 and 2002, respectively. Therefore, the common stock equivalents are not considered in loss per share-diluted, since their effect is anti-dilutive.

        Potentially dilutive securities of 58,778 and 330,912, respectively, were excluded from the diluted loss per share calculation for the three months ended March 31, 2003 and 2002.

        At March 31, 2003 and 2002, the closing stock prices per share did not exceed the exercise prices for 2,260,951 and 528,979 stock options outstanding, respectively. Accordingly, those options have also been excluded from the impact of dilutive securities in determining the weighted average common shares—diluted.

4.     Commitments and Contingencies

        Braun Consulting and Steven Braun, Thomas Duvall, and John Burke, as officers of Braun Consulting, are defendants in a lawsuit, Luciano Mor v. Braun Consulting, Inc.; Steven Braun; Thomas Duvall; John Burke; Adams, Harkness & Hill, Inc.; Credit Suisse First Boston Corp.; FleetBoston Robertson Stephenson, Inc.; J.P. Morgan Chase & Co.; Lehman Brothers Holdings, Inc.; Prudential Securities Incorporated; and Salomon Smith Barney Holdings, Inc., Case No. 01 CV 10629, filed on November 26, 2001, in the United States District Court for the Southern District of New York. Messrs. Duvall and Burke are former officers of Braun Consulting. The complaint alleges violations of federal securities laws in connection with the Company's initial public offering occurring in August 1999 based on alleged omissions in the Company's prospectus relating to compensation payable to, and the manner of distribution of the Company's initial public offering shares by, Braun Consulting's underwriters. The complaint does not allege any claims relating to any alleged misrepresentations or omissions with respect to the Company's business. The plaintiffs are seeking unspecified damages. The Company believes it and its officers have meritorious defenses to the claims and is vigorously defending the lawsuit.

        Braun Consulting is a defendant in an adversary proceeding filed on September 23, 2002, in the United States District Bankruptcy Court for the District of Columbia, styled Wendell W. Webster, Trustee v. Braun Consulting, Inc., Adversary Case No. 02-0108, with respect to the NETtel Corporation, Inc. ("NETtel") Chapter 7 bankruptcy case. Prior to the filing of its bankruptcy case, NETtel was a customer of the Company. The proceeding seeks to avoid and recover certain payments on account made to Braun by NETtel within the ninety days prior to the filing of NETtel's bankruptcy case, pursuant to Section 547 of the United States Bankruptcy Code. The Chapter 7 bankruptcy trustee, as the plaintiff in the adversary proceeding, is seeking to recover $350,000, plus interest. On April 10, 2003, the Company paid $205,000 to settle the lawsuit. As of December 31, 2002 the Company had reserved an amount equal to the amount for which the lawsuit was settled. Accordingly, there was no impact on the Company's net loss for the three months ended March 31, 2003.

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5.     Restructuring Charges

        Restructuring reserve activities during the three months ended March 31, 2003 were as follows:

        Restructuring charges of $164 are included in the Statements of Operations in general and administrative expenses. Of the total restructuring charges utilized during the first three months of 2003, $804 was in cash. Estimated office closing expenses of $14 that were accrued in prior quarters were reversed as a non-cash reduction of general and administrative expenses during the first quarter.

        Remaining severance and benefits are expected to be paid during 2003. Facilities costs of $1,703 are expected to be paid during the remainder of 2003 with the remaining costs of $2,948 expected to be paid during 2004 through 2007, based on the required lease payments under the subject operating leases.

6.     Income Taxes

        At March 31, 2003, Braun Consulting had approximately $38,300 of federal and $34,500 of state net operating loss carryforwards available to offset future taxable income, which expire from 2019 to 2023, respectively. Under the Tax Reform Act of 1986, the amounts of and benefits from net operating loss carryforwards may be impaired or limited in certain circumstances. Events which cause limitations in the amount of net operating losses that Braun Consulting may utilize in any one year include, but are not limited to, Braun Consulting's ability to generate profits.

        During the fourth quarter of 2002, a valuation allowance was recorded for the entire deferred tax asset as a result of uncertainties regarding the realization of the asset including: growing net operating losses in 2002; three years of increasing net losses; uncertainty associated with forecasting a recovery in IT spending; loss of a significant client, Pharmacia, during the third quarter 2002, which represented 26% of the Company's 2002 revenue before expense reimbursements; and, given the Company's current cost structure, the current revenue base is not expected to generate substantial taxable income in the near term. As of March 31, 2003, the Company had a valuation allowance of $17.5 million relating to its deferred tax asset.

7.     Common Stock

        On November 4, 2002, the Board of Directors approved a second Stock Repurchase Program (the "Second Program"). Under the Second Program, the Company is authorized to purchase up to two million dollars of its shares over the 24 months beginning November 4, 2002. For the three months ended March 31, 2003, the Company had purchased 294,300 shares of its common stock at an average price of $1.00 per share. As of March 31, 2003, the Company had purchased 2,055,848 shares of its common stock at an average price of $0.97 per share. The par value method of accounting was used for these share repurchases and all shares purchased were retired. The cost of shares acquired was allocated to par value and additional paid-in-capital.

        On February 4, 2003, the Board of Directors approved a third Stock Repurchase Program (the "Third Program"). Under the Third Program, the Company is authorized to purchase up to two million dollars of its shares over the 24 months beginning February 4, 2003. For the three months ended March 31, 2003, the Company had purchased 940,700 shares of its common stock at an average price of $1.12 per share. The par value method of accounting was used for these share repurchases and all

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shares purchased were retired. The cost of shares acquired was allocated to par value and additional paid-in-capital.

8.     Stock Option Compensation Plans

        As permitted by SFAS No. 123, and amended by SFAS No. 148, the Company continues to measure the plans' cost in accordance with APB Opinion No. 25. Had compensation cost for the Company's plans been determined consistent with the fair value method prescribed by SFAS No. 123, as amended, the impact on the Company's loss and pro forma loss per share would have been as follows:

        The effects of applying SFAS No. 123 in this pro forma disclosure may not be indicative of effects on reported net income (loss) for future years. Common stock equivalents are not considered in loss per share-diluted, since their effect was anti-dilutive.

9.     Significant Clients

        For the quarters ended March 31, 2003 and 2002, our ten largest clients generated approximately 78% and 76% of revenue before expense reimbursements, respectively. For the quarter ended March 31, 2003 there were three clients that accounted for 14.7%, 14.5% and 14.2% of revenue before expense reimbursements, respectively, as compared to one client that accounted 37.8% of revenue before expense reimbursements for the quarter ended March 31, 2002. Loss of any significant client can seriously harm our business.

10.   Recent Accounting Pronouncements

        In November 2002, the Financial Accounting Standards Board ("FASB") issued FASB Interpretation No. 45 ("FIN 45"), "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Guarantees of Indebtedness of Others." This interpretation expands the disclosures to be made by a guarantor in its financial statements about its obligations under certain guarantees and requires the guarantor to recognize a liability for the fair value of an obligation assumed under a guarantee. FIN 45 clarifies the requirements of SFAS No. 5, "Accounting for Contingencies," relating to guarantees. In general, FIN 45 applies to contracts or indemnification agreements that contingently require the guarantor to make payments to a guaranteed party and requires disclosure of the nature of the guarantee, the maximum potential amount of future payments

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that the guarantor could be required to make under the guarantee, and the current amount of the liability, if any, for the guarantor's obligations under the guarantee. The recognition requirements of FIN 45 are to be applied prospectively to guarantees issued or modified after December 31, 2002. The adoption of FIN 45 did not have a material impact on results of operations, financial position, or liquidity.

        In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities." The objective of this interpretation is to provide guidance on how to identify a variable interest entity ("VIE") and to determine when the assets, liabilities, noncontrolling interests, and results of operations of a VIE need to be included in a company's consolidated financial statements. A company that holds variable interests in an entity will need to consolidate the entity if the company's interest in the VIE is such that the company will absorb a majority of the VIE's expected losses and/or receive a majority of the entity's expected residual returns, if they occur. FIN 46 also requires additional disclosure by primary beneficiaries and other significant variable interest holders. The provisions of this interpretation became effective upon issuance. As of March 31, 2003, the Company does not have any VIEs.

        In April 2003, the FASB issued a new pronouncement: Statement of Financial Accounting Standards ("SFAS") No. 149, "Amendment of Statement 133 on Derivative Instruments and Hedging Activities." Generally, SFAS No. 149 clarifies financial accounting and reporting for derivative instruments and hedging activities. The provisions for this statement are effective for contracts entered into or modified after June 30, 2003. The Company is still evaluating the effect of SFAS No. 149, but does not expect the adoption of SFAS No. 149 will have a material impact on results of operations, financial position, or liquidity.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Overview

        The following section should be read in conjunction with the Financial Statements and Notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

        Statements in this Quarterly Report on Form 10-Q that are not strictly historical are "forward-looking" statements that involve risks or uncertainties, many of which are not under the control of the Company. The risks and uncertainties could cause actual results to differ materially from those described in the forward-looking statement. Such risks and uncertainties include, but are not limited to, the nature of the market and demand for our service offerings, competition, overall general business and economic conditions, the nature of our clients and project engagements, loss of a significant client, attracting and retaining highly skilled employees, the ability of our clients to pay for our services, timely payment by clients for services rendered, our ability to effectively manage growth and client relationships, and our ability to maintain our NASDAQ National Market listing, as well as other risks identified in the Company's Annual Report on Form 10-K for the year ended December 31, 2002, and other filings with the Securities and Exchange Commission. The Company is under no duty to update any of the forward-looking statements after the date of this report or to conform these statements to actual results or changes in its expectations.

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        Braun Consulting, Inc. is a professional services firm delivering customer-focused business solutions. Founded in 1993, Braun Consulting helps companies solve complex business problems through the delivery of integrated strategy and technology solutions ("Business Solutions"). Our Business Solutions span the functional disciplines of sales, marketing, customer and field service, manufacturing, finance, and information technology primarily across the following industry sectors: healthcare and pharmaceuticals; media and telecommunications; financial services; manufacturing and technology; retail and consumer packaged goods; and other sectors. We work with Fortune 1000 and middle market companies to develop business and information technology strategies, integrated marketing programs, organizational change plans and technology solutions. Business Solutions enable organizations to realize value from their customer base, optimize the relationship between supply and customer demand, and ultimately, improve business performance.

        The Company enters into various consulting arrangements that are billed either on a time-and-materials basis or on a fixed-price basis. The majority of these contracts generally range from 60-120 days and either require an up-front payment or are billed in bi-weekly installments ratably over the term of the contract. Termination of the contract by the customer would require the customer to pay the Company for hours incurred to date. Costs under the Company's contracts are expenses as incurred.

        The Company's revenue before expense reimbursements derived from fixed-price contracts was approximately 56% of revenue before expense reimbursements for the quarter ended March 31, 2003 as compared to 74% for the quarter ended March 31, 2002. Revenue on fixed-price projects is based upon the ratio of hours worked to total estimated hours to complete the project. The cumulative impact of any revision in estimates of the percentage-of-completion is reflected in the period in which the revision becomes known. Losses on contracts, if any, are provided for in full in the period when first determined. The Company recognizes unearned revenue when client billing exceeds the amount of revenue recognized. In certain instances, client arrangements require that a project milestone must be reached and written acceptance received from the client prior to billing. In these cases, revenue is recognized when milestones are reached, written acceptance from the client is received and other contractual specifications have been achieved. In addition, the Company recognizes a portion of its revenue before expense reimbursements on a time-and-materials basis.

        The Company also recognizes a limited amount of revenue from product sales on a gross basis as a value-added reseller of software products. The Company currently resells software products primarily as an occasional accommodation to clients who prefer to retain a single-source provider. For the three months ended March 31, 2003, product sales accounted for 1.1% of revenue before expense reimbursements as compared to 4.5% for the three months ended March 31, 2002.

        During the first quarter of 2003, market demand for strategy consulting and IT services continued to be soft. Revenue, excluding reimbursements of client expenses, decreased from the prior year period by $8.4 million or 53.0%, and decreased from the fourth quarter 2002 by $521,000 or 6.5%.

        Existing clients from the previous fiscal year accounted for approximately 52% of our revenue for the three months ended March 31, 2003, and approximately 74% for the three months ended March 31, 2002. The Company manages client development efforts through specific account management efforts.

        The Company's most significant expense is project personnel and expenses, which consist primarily of project personnel salaries and benefits, and non-reimbursed direct expenses incurred to complete projects. The Company continues to manage employee expenses by calculating a variable portion of employee compensation payable upon the achievement of measurable performance goals.

        The Company's project personnel and expenses as a percentage of revenue is related to consultant utilization. The Company manages utilization by monitoring project requirements and timetables. The

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number of consultants assigned to a project varies according to the size, complexity, duration and demands of the project. Project completions and scheduling delays may result in periods when consultants are not fully utilized. An unanticipated termination of a significant project could also cause us to experience lower consultant utilization, resulting in a higher than expected number of unassigned consultants. In addition, the Company does not fully utilize consulting personnel on billable projects during the initial months of their employment. During that time they undergo training and become integrated into the Company's operations.

        Selling and marketing expenses consist primarily of: salaries, employee benefits and travel costs of selling and marketing personnel and promotional costs. General and administrative expenses consist primarily of: costs associated with executive management, finance and administrative groups, including personnel devoted to recruiting, employee retention and training; occupancy costs including depreciation, amortization and office equipment leases; travel; and all other branch and corporate costs.

Management's Use of Estimates

        The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. For example, significant estimates and assumptions have been made with regard to the revenue recognition under fixed-price contracts, deferred taxes, and estimated costs associated with restructuring charges. Actual results could differ from those estimates.

Results of Operations

        The following table sets forth, for the periods indicated, selected statements of operations data as a percentage of total revenue:

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        Revenue.    Revenue before reimbursements decreased 53.0% to $7.5 million for the three months ended March 31, 2003, from $15.9 million for the three months ended March 31, 2002. The decrease in revenue before expense reimbursements was due primarily to a decrease of 35.6% in consulting hours worked and a 27% decrease in average hourly bill rates for the three months ended March 31, 2003 as compared to the three months ended March 31, 2002 and a reduction in revenue from the sale of third party software ($600,000). In addition, the continued weakening in IT spending, lower utilization per consultant, the deferment of $850,000 in revenue recognition on one milestone project, and the loss of a major client during the third quarter of 2002 contributed to the decline in revenue before expense reimbursements. Continued uncertainty around IT spending and an economic recovery inhibit the Company's ability to forecast demand for our products and services and the impact. The Company had 203 project personnel at March 31, 2003 as compared to 324 project personnel at March 31, 2002. The Company continues to sell some software products as an occasional accommodation to clients. Such sales represented approximately 1.1% of revenue before expense reimbursements for the three months ended March 31, 2003 and approximately 4.5% for the three months ended March 31, 2002. Reimbursements, including travel and out-of-pocket expenses, are included in revenue, and equivalent amounts of reimbursable expenses are included in costs and expenses.

        Project Personnel and Expenses.    Project personnel and expenses decreased 35.7% to $6.9 million for the three months ended March 31, 2003 from $10.7 million for the three months ended March 31, 2002. The decrease in project personnel and expenses was due primarily to a decrease in compensation costs ($3.2 million) and a reduction in third party software costs ($600,000) for the three months ended March 31, 2003, as compared to the three months ended March 31, 2002 as a result of reductions in headcount from 2002 cost reduction initiatives, lower incentive compensation payments and a reduction in the sales of third party software. The Company had 203 project personnel at March 31, 2003 as compared to 324 project personnel at March 31, 2002. Project personnel and expenses increased as a percentage of revenue before expense reimbursements to 91.9% for the three months ended March 31, 2003 from 67.3% for the three months ended March 31, 2002.

        Selling and Marketing Expenses.    Selling and marketing expenses increased 9.2% to $889,000 for the three months ended March 31, 2003 from $814,000 for the three months ended March 31, 2002. The increase was due primarily to an increase in compensation costs ($99,000) offset slightly by the decision to reduce business development costs. The Company had 11 selling and marketing personnel at March 31, 2003, compared to 19 at March 31, 2002. Selling and marketing expenses increased as a percentage of revenue before expense reimbursements to 11.9% in 2003 from 5.1% in 2002.

        General and Administrative Expenses.    General and administrative expenses decreased 19.7% to $4.0 million for the three months ended March 31, 2003, from $5.0 million for the three months ended March 31, 2002. The decrease in general and administrative costs is due primarily to a reduction in personnel compensation costs from our 2002 cost reduction initiatives ($823,000), a decrease in depreciation expense due to fixed assets taken out of service in 2002 ($132,000), and a decrease in rent expense due to office closings and consolidations ($109,000) (the Company closed offices in Dallas, Texas; Denver, Colorado and Minneapolis, Minnesota and reduced office space in Boston, Massachusetts and Chicago, Illinois during 2002) and a net increase in other costs of $70,000. There were 52 general and administrative personnel at March 31, 2003, compared to 77 at March 31, 2002. General and administrative costs increased as a percentage of revenue before reimbursements to 54.0% for the three months ended March 31, 2003, from 31.7% for the three months ended March 31, 2002.

        Interest Income.    Interest income decreased to $95,000 for the three months ended March 31, 2003, from $204,000 for the three months ended March 31, 2002. The decrease was due primarily to a decrease in interest rates from an average yield of 2.13% for the quarter ended March 31, 2002 as compared to 1.16% for the quarter ended March 31, 2003, and the use of cash and marketable securities to fund both operations and share repurchase activities in the quarter.

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        Provision (Benefit) for Income Taxes.    For the three months ended March 31, 2003, there was a current tax expense of $138,000 as compared to a tax benefit of $129,000 for the three months ended March 31, 2002. The tax expense for the first quarter of 2003 relates to revenue based state taxes not impacted by the Company's net operating losses. In addition, the Company recorded a valuation allowance for the entire deferred tax asset balance of $15.7 million as of December 31, 2002 due to uncertainties regarding the realization of the asset, including: growing net operating losses in 2002; three years of increasing net losses; uncertainty associated with forecasting a recovery in IT spending; loss of a significant client, Pharmacia, during the third quarter 2002 which represented 26% of the Company's 2002 revenue before expense reimbursements, and given the Company's current cost structure, the current revenue base is not expected to generate substantial taxable income in the near term. The Company recorded an additional $1.7 million increase in the valuation allowance for all deferred tax assets due to operating losses incurred during the first quarter of 2003.

        Net Loss.    Net loss increased to $4.4 million for the quarter ended March 31, 2003, as compared to the net loss of $326,000 for the quarter ended March 31, 2002. The increase is due primarily to a significant decline in revenue partially offset by a reduction in total costs and expenses.

        Liquidity and Capital Resources.    As of March 31, 2003, the Company maintains a line of credit with LaSalle Bank, N.A. ("LaSalle"), providing for borrowings of up to $3.5 million. The Company's line of credit bears interest at LaSalle's prime rate and expires on September 30, 2003. The Company's line of credit is secured with $3.5 million in restricted cash held in escrow by LaSalle. The restricted cash is invested at the Company's direction. There is no restriction on the interest earned on the restricted cash. The Company expects to renew this line of credit upon its expiration. As of March 31, 2003, there were no borrowings outstanding under the $3.5 million line of credit. As of March 31, 2003, there were two letters of credit totaling $799,375 for office leases drawn on the line of credit.

        Capital expenditures of approximately $61,000 for the three months ended March 31, 2003, and approximately $190,000 for the three months ended March 31, 2002, were primarily used for computers, office equipment and leasehold improvements. The Company estimates capital expenditures for 2003 will be less than $500,000. Additionally, the Company may continue to purchase shares under the Company's Stock Repurchase Program as discussed in Note 7.

        Inflation did not have a material impact on the Company's revenue or loss from operations for the three months ended March 31, 2003 and 2002.

        As of March 31, 2003, the Company had cash, cash equivalents, restricted cash and marketable securities of approximately $25.0 million. Based on the Company's current business plan, the Company believes that its existing cash position and borrowings available under its credit facility will be sufficient to meet working capital and capital expenditure requirements for at least the next 12 months. To the extent future revenue is inadequate or recoverability of its receivables may be impaired to support costs and expenditures, the Company's liquidity may be materially and adversely affected.

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Contractual Obligations and Commercial Commitments

        The Company maintains two letters of credit against the line of credit for office leases in New York and Boston as follows:

        The terms of the leases allow the lessor to draw on the line of credit should the Company be in default of the lease payment terms.

Recent Accounting Pronouncements

        In November 2002, the Financial Accounting Standards Board ("FASB") issued FASB Interpretation No. 45 ("FIN 45"), "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Guarantees of Indebtedness of Others." This interpretation expands the disclosures to be made by a guarantor in its financial statements about its obligations under certain guarantees and requires the guarantor to recognize a liability for the fair value of an obligation assumed under a guarantee. FIN 45 clarifies the requirements of SFAS No. 5, "Accounting for Contingencies," relating to guarantees. In general, FIN 45 applies to contracts or indemnification agreements that contingently require the guarantor to make payments to a guaranteed party and requires disclosure of the nature of the guarantee, the maximum potential amount of future payments that the guarantor could be required to make under the guarantee, and the current amount of the liability, if any, for the guarantor's obligations under the guarantee. The recognition requirements of FIN 45 are to be applied prospectively to guarantees issued or modified after December 31, 2002. The adoption of FIN 45 did not have a material impact on results of operations, financial position, or liquidity.

        In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities." The objective of this interpretation is to provide guidance on how to identify a variable interest entity ("VIE") and to determine when the assets, liabilities, noncontrolling interests, and results of operations of a VIE need to be included in a company's consolidated financial statements. A company that holds variable interests in an entity will need to consolidate the entity if the company's interest in the VIE is such that the company will absorb a majority of the VIE's expected losses and/or receive a majority of the entity's expected residual returns, if they occur. FIN 46 also requires additional disclosure by primary beneficiaries and other significant variable interest holders. The provisions of this interpretation became effective upon issuance. As of March 31, 2003, the Company does not have any VIEs.

        In April 2003, the FASB issued a new pronouncement: Statement of Financial Accounting Standards ("SFAS") No. 149, "Amendment of Statement 133 on Derivative Instruments and Hedging Activities." Generally, SFAS No. 149 clarifies financial accounting and reporting for derivative instruments and hedging activities. The provisions for this statement are effective for contracts entered into or modified after June 30, 2003. The Company is still evaluating the effect of SFAS No. 149, but does not expect the adoption of SFAS No. 149 will have a material impact on results of operations, financial position, or liquidity.

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Item 3.    Quantitative and Qualitative Disclosure About Market Risk.

        The Company may be exposed to market risk related to changes in interest rates. The Company's borrowing arrangements and short-term investments are based on variable rates of varying maturities. The Company does not have any agreements to protect against the risk presented by a change in interest rates. If interest rates on borrowings were to increase immediately and uniformly by 10% from levels as of March 31, 2003, from 4.25% to 4.68%, the Company's net loss would be unchanged. There were no outstanding bank borrowings as of March 31, 2003.

        The Company's investments in cash, cash equivalents, restricted cash and marketable securities of approximately $25.0 million at March 31, 2003, primarily consist of investment grade debt securities of varying short-term maturities (28-30 days) issued by various organizations. The Company does not invest in complex derivatives. Based on the nature of these investments, the cost of the securities equals the fair market value of the securities at March 31, 2003. If interest rates on investments were to decrease immediately and uniformly by 10% from levels at March 31, 2003, from approximately 1.17% to 1.05%, pre-tax net loss would increase by $7,500, which is equal to the product of the 10% decrease in the interest rate multiplied by the approximately $25.0 million of short-term investments in cash, cash equivalents, restricted cash and marketable securities as of March 31, 2003.

Item 4.    Controls and Procedures

(a)

Evaluation of disclosure controls and procedures

        The term "disclosure controls and procedures" is defined in Rules 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934 ("Exchange Act"). These rules refer to the controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed, summarized and reported within required time periods. Our Chief Executive Officer and our Principal Financial Officer have evaluated the effectiveness of our disclosure controls and procedures as of a date within 90 days before the filing of this quarterly report (the "Evaluation Date"), and they have concluded that, as of the Evaluation Date, such controls and procedures were effective at ensuring that required information will be disclosed on a timely basis in our reports filed under the Exchange Act.

(b)

Changes in internal controls

        We maintain a system of internal accounting controls that are designed to provide reasonable assurance that our books and records accurately reflect our transactions and that our established policies and procedures are followed. There were no significant changes to the Company's internal controls or in other factors that could significantly affect our internal controls based on an evaluation of controls within 90 days of the filing of this report.

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PART II—OTHER INFORMATION

Item 6.    Exhibits and Reports on Form 8-K.

(a)

Exhibits

(b)

Reports on Form 8-K.

        None.

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SIGNATURES

        Pursuant to the requirements 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, in the City of Chicago, and State of Illinois, on the 15th day of May, 2003.

17

Braun Consulting, Inc.
a Delaware corporation

CERTIFICATION OF CHIEF EXECUTIVE OFFICER
Section 302 Certification

I, Steven J. Braun, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Braun Consulting, Inc., a Delaware corporation (the "registrant");

2.

Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)

designed such disclosure controls and procedures to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b)

evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and

c)

presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):

a)

all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.

The registrant's other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: May 15, 2003

Braun Consulting, Inc.
a Delaware corporation

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
Section 302 Certification

I, Thomas A. Schuler, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Braun Consulting, Inc., a Delaware corporation (the "registrant");

2.

Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)

designed such disclosure controls and procedures to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b)

evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and

c)

presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):

a)

all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.

The registrant's other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: May 15, 2003

QuickLinks

Item 1. Financial Statements

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Item 3. Quantitative and Qualitative Disclosure About Market Risk.
Item 4. Controls and Procedures

Item 6. Exhibits and Reports on Form 8-K.