Quadstone Secures $30 M to Accelerate Expansion Plans

Quadstone, a leading provider of analytical CRM solutions, has announced the closing of $30m in private equity financing. The financing round was led by Amadeus Capital Partners. The syndicate includes existing investors 3i plc, Scottish Equity Partners and Standard Life and new investors including Chase Capital Partners, Artemis and Friends Ivory & Sime.

The new funding will be used to expand Quadstone's recruitment of the highest quality staff in all its departments. This recruitment will lead to further expansion of the Quadstone business operation in the USA, as well as to take the company's products throughout the European markets. In the past year, Quadstone has developed its US operations aggressively. They now contribute substantially to turnover and employ over 50 people.

Neil Heywood, Quadstone's CEO, says "Our ability to raise this funding underlines investor confidence in our business and in the market segment it addresses. We have a solid platform from which to expand our operations. Given the analysts' consensus that the analytical CRM market is worth billions of dollars, and is growing by at least 50% per year, Quadstone's future looks very exciting indeed."

Commenting on the investment, Amadeus Director Hitesh Mehta who joins the Quadstone Board, says: "We have looked at many businesses in this area. With e-commerce becoming an increasingly important adjunct to conventional sales channels, businesses are now seeking a single view of the customer across all sales points. This is not just about assembling the data, as in many existing systems, but about making it available to the customer in a form that can be used immediately to predict and influence customer behavior. We believe Quadstone's software leads the market on both counts and, with this major funding, the company is well positioned to build on its competitive advantage."

Chase H&Q acted as private placement agent and financial advisor to Quadstone.

About Quadstone

Quadstone provides what it believes to be the most powerful customer behaviour modelling and predictive marketing software currently available. Quadstone's products allow business and marketing executives to instantly and easily employ predictive modelling techniques to produce sophisticated analyses that visually represent customer behaviour from every marketing channel - Web, direct marketing, sales, call centres and operations. Because the Quadstone System can be installed and deployed to produce results within weeks, typically faster and more precisely than any other offering available, executives can quickly measure and influence more profitable customer behaviour, while decreasing marketing's reliance on IT or statisticians.

Quadstone's international clients include market leaders in the e-tail/retail, financial services and telecommunications sectors and include Barclays Bank, CVS.com, Eircom, M&I Bank, Sainsbury's, SmarterKids.com, Telenor and Vodafone among others. Quadstone was named best "Small Start-up" of the year at the Financial Times/Cartier/BVCA awards in 1998, and earned Deloitte & Touche's "Fast 50" award in 1998/1999 and 1999/2000. Founded in 1995, Quadstone's European operations are based in London, England, and the company's research and development centre is located in Edinburgh, Scotland. Quadstone's North American operations are headquartered in Boston, MA, U.S.A. More information about Quadstone can be found at www.quadstone.com.

Contact Fiona Neil, Quadstone, 617-457-5205, fiona.neil@quadstone.com.