Features - Financial Plays Of The Week:

BlueArc SECURES $47 MILLION IN NEW FUNDING

At the conclusion of a quarter marked by record revenue and customer growth, BlueArc Corporation has secured an additional $47 million in funding that will further promote the company's rapid expansion in the network attached storage (NAS) market. Fully funding the company to a positive cash flow position, this latest infusion of capital, led by Meritech Capital Partners, with co-investments from Crosslink Capital and RWI Group, comes on the heels of BlueArc's record second quarter, ending June 30, 2003, during which the company increased its customer ranks by more than 20 percent and achieved a 57 percent increase in revenue over that of the second quarter 2002.

During the quarter, BlueArc added to its strength in key vertical industries, such as Entertainment, Education, Technology and Oil and Gas, by securing new accounts with Accunet Solutions, Columbia University, Harvard University, Huron Consulting, Listen.com, Vanguard Animation and WesternGeco, among others. Additionally, new purchases from existing customers, including, but not limited to, Altera Corporation, Everyone's Internet, Lawrence Livermore National Laboratories, NASA's Jet Propulsion Laboratory and Oxford Magnet Technology Ltd, contributed to BlueArc's growth.

Customers' investments in the BlueArc SiliconServer point to a movement toward increasingly scalable and flexible solutions for networked storage. With their initial investment in the SiliconServer architecture, these customers will have the opportunity to leverage BlueArc's Multi-Tiered Storage (MTS) solution, also announced in the second quarter, to realize even greater advantages with an infinitely flexible and upgradeable storage infrastructure.

"BlueArc's substantial growth is due largely to its ability to enhance the value of business data through leading-edge solutions and unrivaled customer service," said Paul Madera, managing director of Meritech Capital Partners. "BlueArc has already established itself as a leading supplier in the network attached storage market with the phenomenal success of the SiliconServer. With the recent introduction of its Multi-Tiered Storage solution, BlueArc has strengthened its position as a winner in the storage market."

The addition of Meritech Capital Partners, Crosslink Capital and RWI Group, whose active involvement includes special limited partner Donald L. Lucas, a 40-year veteran of venture capital and the founding investor in companies such as Oracle Corporation, National Semiconductor and Macromedia, continues BlueArc's track record of attracting capital investors with a history of building market-leading companies. Supplementing their capital investments, these investors will also facilitate high-level introductions to companies in their respective investment portfolios and established technology industry leaders, creating additional opportunities for BlueArc to scale its customer and strategic partnership base.

"BlueArc has all the obvious keys to success, but what really separates it from the pack is the company's capability to deliver innovative, customer-centric solutions to market ahead of its competitors," said Donald L. Lucas, special limited partner of the RWI Group. "That capability, evidenced by BlueArc's strong customer and partner network, is indicative of its growing influence on the greater storage market and a key reason we were attracted to the company."

"An investment of this size and nature in the current economic climate reinforces that customers and partners recognize that BlueArc is changing the economics of network storage," said Gianluca Rattazzi, Chairman and CEO of BlueArc. "BlueArc's record quarter is a reflection of our continuing ability to deliver scalable, flexible and cost-efficient solutions, accelerating our customers' ability to derive economic benefit from their storage environment and enabling them to remain competitive against changing market pressures."