KnowledgeFirst Receives $12 Million in Second Round of Venture Funding.

Business Editors & High-Tech Writers

FOSTER CITY, Calif.--(BUSINESS WIRE)--July 18, 2000

Crystal Internet Ventures Leads Investment Round, Followed by

CMGI@Ventures, Sienna Holdings, and Angel Investors LP

KnowledgeFirst (www.knowledgefirst.com), the Internet's premier marketplace for financing higher education, today announced that it has secured an additional $12 million in Series B financing from several venture capital investors. The round was led by Crystal Internet Ventures and includes follow-on investments by all the major Series A investors including CMGI@Ventures, Sienna Holdings, and Angel Investors LP.

This announcement follows the company's re-launch of a completely redesigned and transaction-enabled Web site, providing a much more efficient mechanism for the delivery of financial aid. By offering an open platform to industry participants, KnowledgeFirst enables financial service partners to more effectively reach target customers while reducing processing costs. The company plans to apply the new funds to ramp up product development efforts, accelerate school and lender acquisition and build strong brand awareness among key customer segments.

"This financing round is an important milestone in the development of our company and reflects favorably on our progress to date. We are very pleased that experienced investors continue to express confidence in the strength of our business model and in our ability to execute on our growth plans," stated Lindsay Lee, KnowledgeFirst's CEO and co-founder. "We now have the resources in place to continue our mission of streamlining the financial aid process for all customers including schools, lenders, guarantors, students and parents."

As the cost of a college education continues to rise, more students and families are depending on financial aid to bridge the gap. In fact, almost 40% of college undergraduates currently rely on some form of financial aid to support their educational goals. However, the amount of scholarship and grant money available to students has not kept pace with the increase in costs. As a result, student loans now account for about 60% of all aid, as compared to 40% in 1980. KnowledgeFirst recognizes the importance of financing to the pursuit of higher education, providing resources and tools that empower students and parents to make more informed financial aid decisions and to execute those decisions more conveniently than ever before.

"KnowledgeFirst is well positioned to reinvent the way financial aid is administered and delivered. Through their innovative web-based application, the company is bringing new levels of customer service and satisfaction to the world of education finance," commented Brian Goncher, Crystal Internet Ventures partner and newest member of the KnowledgeFirst board. "We believe KnowledgeFirst's unique role in the education process enables them to provide substantial value to business partners and to develop lasting customer relationships with both students and parents. We are excited to be part of their continued growth."

About KnowledgeFirst

KnowledgeFirst (www.knowledgefirst.com) is a destination site for students, parents, and recent graduates that helps members of its online community obtain educational funding information, comparison shop with different lenders, and apply for, manage, and repay loans online. In addition, KnowledgeFirst electronically facilitates the processing of loan applications and the disbursement of funds by using web technology to link lenders, schools, and guarantee agencies across its network, thus accelerating processing cycle time, reducing errors, and hastening the availability of loan funds to schools and students. KnowledgeFirst is making dramatic inroads in building relationships with leading educational lenders and is adding educational institutions to its network at a rapid pace.

About Crystal Internet Ventures

Primarily focused on the development of early stage companies, Crystal Internet Venture Funds LP ("CIVF") currently manages $240M in capital and maintains offices in Ohio, Silicon Valley, Singapore, and Taiwan. Since its inception in January 1997, CIVF has been dedicated to supporting the Internet revolution by investing solely in Internet and Internet-related companies with top quality management teams and innovative approaches to their markets and technologies. CIVF's portfolio companies include BabyCenter, About.com, Cobalt Networks, Open Solutions, MiFund, Reversi Networks and Sina.com. For more information, please visit their web site at www.crystalventure.com.