$100 Million Venture Capital Fund Debuts on the Internet Tuesday; Technology Funding's VC-6 Fund Opens the Door for Ordinary Investors to Become Venture Capitalists Via the Internet.

SAN MATEO, Calif.--(BUSINESS WIRE)--Jan. 6, 1998--Technology Funding (www.techfunding.com), a leading Silicon Valley venture capital firm, began selling shares of its newest venture capital fund over the Internet at 12:01 a.m. Tuesday.

Charles R. Kokesh, chairman and founder of Technology Funding, noted that VC-6 marks a significant first for both the venture capital and online securities industries.

Technology Funding received final authorization in December from the Securities and Exchange Commission (SEC) and National Association of Securities Dealers (NASD) to offer its fund electronically.

"This is a landmark event for the small investor," Kokesh said. "Once again, the Internet becomes the great equalizer, bringing the same class of investment to individual investors that until now has been the exclusive province of large institutions, pension funds and very wealthy families."

Kokesh added that venture capital investments historically have outperformed mutual funds and other asset categories. According to Venture Economics, venture capital returned an average 18.8 percent annually from 1974 through 1996.

Kokesh founded Technology Funding nearly 20 years ago on the principal that small investors should have access to venture capital investments. The company's 21 previous funds have raised and invested more than $315 million since 1979. Unlike the earlier funds, which were available only through investment advisors and brokers, Technology Funding Venture Capital Fund VI (VC-6) will sell its $100 million fund directly to investors, exclusively over the Internet.

"Institutional investors use aggressive-growth investments like venture capital as `portfolio drivers,'" Kokesh said. "By allocating just 5 to 10 percent of their capital to high-risk, high-reward investments, professional money managers aim for substantial long-term portfolio growth together with capital preservation. Now, VC-6 can be used as a potential `portfolio driver' for individual investors."

Venture Capital's performance over the last two decades explains why pension funds, insurance companies and endowments -- traditionally conservative, risk-averse institutions -- have invested more than half of the nearly $21.5 billion raised by the venture industry during the past five years, according to VentureOne Corp.

As with any aggressive-growth investment, VC-6 should not represent a large percentage of an investor's assets, and potential investors must meet suitability standards outlined in the fund's prospectus. A full explanation of asset allocation techniques used by bankers, insurance executives and pension fund managers to determine the risk vs. reward implications of venture capital is available at http://www.techfunding.com/html/newfund/aggrow.html .

Fund To Concentrate Investments on Information, Medical and Industrial Technologies

Like Technology Funding's preceding funds, VC-6 is a professionally managed, diversified venture capital fund that targets investments in companies with the potential to grow to a market capitalization of $100 million or more in a five-year time frame.

VC-6 will focus its investments on three industry sectors with significant potential for growth-information technologies, including the Internet, medical technologies and industrial automation technologies. VC-6's portfolio companies will have a distinctive product or service based on proprietary technology and a management team with the business and technical expertise to executive innovative business models.

Unlike the earlier funds, VC-6 takes advantage of e-mail and the Web to achieve significant cost savings over traditional methods of distributing required information to investors. "Communicating with investors has always been a huge cost of offering venture capital to a mass audience. The Internet has just slashed that expense to a fraction of what it has cost us with previous funds," Kokesh said.

About Technology Funding

Since 1979, Technology Funding has raised and managed venture capital and related funds that have invested more than $315 million directly in more than 225 venture-backed companies and indirectly through 14 venture capital partnerships. Recognized as an innovator in the venture capital industry, Technology Funding has managed 10 private funds and 11 SEC-registered public funds with more than 42,000 investors.

With headquarters in San Mateo, the company also has offices in Santa Fe, N.M. For more information, visit Technology Funding's Web site at www.techfunding.com .

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