Schoffstall Ventures Teams With Village Ventures Launches Pennsylvania Fund; Fund Will Invest Exclusively in Central and Northern Pennsylvania Technology.

Business Editors & High Tech Writers

HARRISBURG, Pa.--(BUSINESS WIRE)--July 24, 2002

The principals of Pennsylvania-based Schoffstall Ventures, LLC (www.schoffstall.com/ventures.htm), will collaborate with Village Ventures, Inc. (www.villageventures.com), a network of regional venture capital funds, to establish an early-stage venture capital fund to invest in high-growth technology businesses, specifically targeting opportunities in information technology and communications as well as life sciences and materials sciences companies in Central and Northern Pennsylvania. The new Fund will be based in Central Pennsylvania, where Schoffstall Ventures has been located for the previous seven years.

The Fund will be managed by Schoffstall Ventures, LLC, whose management team brings over 20 years in venture capital investment experience to the partnership. The new fund will be managed by Martin Schoffstall, a 20-year veteran of multiple internet start-ups, Dean Kline, formerly of the World Bank, as well as Mark Fedor and Wengyik Yeong, former executives with PSINet. Richard Glaser, Village Ventures' Regional Managing Director, will represent Village Ventures as a member of the fund's investment committee. The new fund will become the 16th fund in the Village Ventures, Inc. network.

"There are significant opportunities throughout the Commonwealth for seed and early stage venture capital," said Community and Economic Development Secretary Sam McCullough. "Pennsylvania's central and northern regions offer tremendous opportunities emerging from our world class scientific and clinical research centers. This fund intends to invest in those opportunities and bring much needed capital and professional management assistance to Central and Northern Pennsylvania entrepreneurs."

Marty Schoffstall, Managing Partner of Schoffstall Ventures and a native of Central Pennsylvania, stated that "Investment in early-stage technology companies has historically produced the most significant employment, corporate headquarters, Research and Development jobs, and return to investors. We at Schoffstall Ventures are enthusiastic about the opportunity to focus the new Fund, our fourth seed and early-stage technology fund, on Central and Northern Pennsylvania - the "T" - and exclusively invest in Pennsylvania technology."

"Central and Northern Pennsylvania are technology-rich regions with all the attributes we seek in looking for good venture capital opportunities," noted Todd Tidgewell, Vice President of Fund Development for Village Ventures. "They combine good demographics, strong educational institutions with high technology expertise, but lack locally focused venture capital, and have been overlooked by the larger firms in Philadelphia and Pittsburgh. This is the kind of market that appeals to Village Ventures and adds huge value to the Village Ventures model."

The targeted size of the Fund is not disclosed. The average closed fund in the Village Ventures network is $16 million, with funds ranging in size from $10 million to $56 million. Village Ventures, based in Williamstown, Massachusetts, is a financial services company focused on venture capital investing in emerging technology markets. The company provides financial services to a network of 16 early-stage venture capital funds operating in 14 states. Village Ventures co-invests alongside those funds and is a potential source of follow-on financing to companies in those portfolios, along with Village Ventures' investors Bain Capital, Highland Partners, Janus Capital, and Sandler Capital.

Village Ventures Chief Executive Officer Matt Harris said, "The team at Schoffstall Ventures has unique insight to the opportunities and needs of young emerging technology companies in Pennsylvania. They have a proven track record in nurturing entrepreneurs and in finding value. We're excited about working with them in this market."

The Schoffstall Ventures team, starting as co-originators of the Internet, and evolving through a myriad of associated technologies, has pioneered technologies employed by enterprises throughout the world. The new Fund will be Schoffstall Ventures' fourth fund: 57 investments have been made in the previous funds, which have led to numerous IPO's and acquisitions over the past seven years.

Martin Schoffstall has over 20 years of experience developing emerging companies. He has helped finance and build multiple Internet startups and was co-founder of the Commercial Internet Exchange, and PSINet, in addition to being a founding Director of Go2Net and a member of the Board of Directors of Ascend prior to its acquisition by Lucent for $27 billion. He also was a co-inventor of a number of Internet standards, including the Internet network management standard, SNMP, has published in the areas of network management and bibliographic retrieval, and is a member of the Science Board at Rensselaer Polytechnic Institute and the Board of the Harrisburg Polytechnic.

Also on the Schoffstall team is Dean Kline, a proven executive in the finance business, having served as Assistant to the Executive Director at the World Bank. Kline also spent six years at the U.S. Treasury Department in international finance.

The Schoffstall team also includes several demonstrated executives with hands-on technology expertise. Mark Fedor (also a co-investor of the SNMP standard) was an original member and Senior Vice President of Engineering at PSINet. Wengyik Yeong was CTO at Conducent Technologies and a staff scientist at PSINet.

Richard Glaser, Village Ventures' Regional Managing Director, has had deep experience in venture capital. He was a partner with Hudson Ventures and was a former Managing Director of Manning & Napier.