Ownership Submission
FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
Donaghy Brian Patrick
  2. Issuer Name and Ticker or Trading Symbol
SMART ONLINE INC [SOLN]
5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
VP of Product Strategy
(Last)
(First)
(Middle)
2530 MERIDIAN PARKWAY, 2ND FLOOR
3. Date of Earliest Transaction (Month/Day/Year)
08/21/2007
(Street)

DURHAM, NC 27713
4. If Amendment, Date Original Filed(Month/Day/Year)
6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)
2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)
4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)
5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)
6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)
7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 08/21/2007   S   5,000 D $ 2.4 35,000 (1) I See Footnote (2)
Common Stock 08/22/2007   S   5,800 A $ 2.35 29,200 (1) I See Footnote (2)
Common Stock 08/24/2007   S   50 D $ 2.5 29,150 (1) I See Footnote (2)
Common Stock 09/05/2007   G   9,000 (3) D $ 0 78,652 D  

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)
2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)
5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)
6. Date Exercisable and Expiration Date
(Month/Day/Year)
7. Title and Amount of Underlying Securities
(Instr. 3 and 4)
8. Price of Derivative Security
(Instr. 5)
9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)
10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)
11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
Donaghy Brian Patrick
2530 MERIDIAN PARKWAY
2ND FLOOR
DURHAM, NC 27713
      VP of Product Strategy  

Signatures

 /s/ Brian Donaghy   09/05/2007
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) This sale of securities being reported is for shares of the issuer owned by Growth Ventures Group, Inc., for which corporation the reporting person is 1/3 owner. The remaining shares listed are the remaining shares held by this corporation.
(2) Reporting person disclaims beneficial ownership of these securities, and this portion of this report shall not be deemed an adminssion that the reporting person is the beneficial owner of such securities for purposes of Section 16 or for any other purpose.
(3) These shares were shares held directly by reporting person and was a charitable contribution by the reporting person.

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