Greyhound House 23-24
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Richard Irving (Silicon Valley)
(408) 776-3137
richard

$78 Million available for early-stage European communications companies

August 29^th, 2000 – Pond Venture Partners Ltd., the only Silicon Valley-style venture fund to focus exclusively on early-stage technology investing in Europe, announced today that it had held the final closing of Pond Ventures II. The heavily oversubscribed new fund of $78 million will be invested in early-stage core technology communications companies in Europe.

"Following the significant success and high returns of Pond's first fund, closed in August 1998, we are delighted to welcome top-tier individual and institutional investors into this new fund," said Richard Irving, CEO of Pond. "We can now extend Pond's proven value-added model from the UK into Europe, while continuing to focus on communications companies."

Pond targets companies whose technology enables the migration of bandwidth and services to the edge of the network. Pond's strategy follows the venture capital principles which made Silicon Valley great. By working closely with founders and management to add value to its companies, through customer introductions at senior levels, helping establish US and Japanese operations, and managing subsequent venture rounds, Pond is bringing Silicon Valley-style venture capital to Europe.

"This approach is essential when investing in early-stage European companies who require more help in building their management team and international strategy than the Silicon Valley equivalent. Pond also adds global value through its Tokyo and Silicon Valley-based partners, crucial to worldwide due diligence and assisting the portfolio company to enter US and Asian markets. Without this intelligence it is like trying to ride a motorbike blindfolded," said Pond's Chairman, Charles Irving.

Pond's first fund enjoyed considerable success with the exit of its first portfolio company Microcosm Communications of Bristol, which was acquired by Conexant Systems in January for $180 million, yielding a twenty-times return to Pond. The three other companies in the portfolio all continue to grow successfully. These are SealedMedia, (www.sealedmedia.com) a leading company in the digital rights management area, Eccord Systems (www.eccordsystems.com) a London-based software company in the exciting space of network management software and services; and Artisan Software Tools (www.artisansw.com) a leading company whose tools facilitate developing software for real-time and embedded systems.

"Given the very enthusiastic reception from a broad array of prestigious customers to its digital rights management technology, we believe SealedMedia has the potential to grow its market capitalization well beyond the billion dollar mark," said Richard Irving, CEO of Pond Ventures.

Pond will apply the successful Pond I philosophy to investing Pond II. This includes investing in a few companies per fund to allow intensive hands-on nurturing to accelerate growth and using technologists and operating people, rather than traditional portfolio fund managers, to make investment decisions.

Pond II expects to make only 10 investments, which will typically include first rounds of around $5 million plus follow-on investments. The London team has been enhanced by the arrival of Dr. Michael Gera from Merrill Lynch and Rolf Westfal-Larsen from Anderson Consulting Scandinavia. Pond's limited partners are mainly European institutions and individuals who provide a wide-ranging European network to assist with pan-European investing. The Fund is guided with help from a top-quality advisory board of leading technology entrepreneurs and executives from Silicon Valley and Europe.

Pond has already made itself an excellent name as one of Europe's few early-stage investors and looks forward to further success with Pond II. With offices in London, Silicon Valley and Tokyo, Pond is regulated by IMRO. For more information please see our web site at www.pondventures.com.