Venture-Backed Exit Market Remains a Concern in the First Quarter

No IPO Activity for Two Consecutive Quarters; First Time on Record

NEW YORK, April 1 /PRNewswire/ -- Venture-backed company exits remained
problematic in the first quarter of 2009, according to the Exit Poll report by
Thomson Reuters and the National Venture Capital Association (NVCA). There
were no venture-backed IPOs in the quarter, and the tally of M&A exits as of
the last day of the quarter came to a modest 56 transactions for the period,
13 of which had disclosed volumes totaling $645.3 million.

Venture-Backed Liquidity Events by Year/Quarter, 2002-1Q 2009

*Total
M&A Disclosed *Average Total Average
Total Deals with M&A M&A Offer IPO Offer
M&A Disclosed Value Deal Size **Number Amount Amount
Quarter/Year Deals Values ($M) ($M) of IPOs ($M) ($M)

2003 284 119 7,460.1 62.7 29 2,022.7 69.7
2004 346 187 15,919.6 85.1 94 11,378.0 121.0
2005 352 166 17,410.6 104.9 57 4,485.0 78.7
2006-1 107 52 5,607.5 107.8 10 540.8 54.1
2006-2 106 40 4,018.5 100.5 19 2,011.0 105.8
2006-3 94 42 3,450.8 82.2 8 934.2 116.8
2006-4 62 26 5,616.8 216.0 19 1,589.1 83.6
2006 369 160 18,693.6 116.8 56 5,075.1 90.6
2007-1 85 29 4,540.3 156.6 18 2,190.6 121.7
2007-2 88 37 4,002.3 108.2 25 4,146.8 165.9
2007-3 107 54 11,265.4 208.6 12 945.2 78.8
2007-4 93 47 9,743.8 207.3 31 3,043.8 98.2
2007 373 167 29,551.9 177.0 86 10,326.3 120.1
2008-1 106 40 4,543.2 113.6 5 282.7 56.5
2008-2 84 26 3,293.4 126.7 0 0.0 n/a
2008-3 86 32 3,080.2 96.3 1 187.5 187.5
2008-4 61 17 2,385.9 140.3 0 0.0 n/a
2008 337 115 13,302.7 115.7 6 470.2 78.4
2009-1 56 13 645.3 49.6 0 0.0 0.0
2009 56 13 645.3 49.6 0 0.0 0.0

Thomson Reuters & National Venture Capital Association
* Only accounts for deals with disclosed values
** Includes all companies with at least one U.S. VC investor that trade on
U.S. exchanges, regardless of domicile.

IPO Activity Overview
There were no venture-backed IPOs in the first quarter of 2009, marking the
second consecutive quarter in which there were no issues. Since data has been
recorded, there are no other incidences of two quarters without a
venture-backed offering. Furthermore, no companies that received US venture
financing went public on foreign exchanges in the first quarter.

Twenty-six venture-backed companies are currently filed for an initial public
offering with the SEC. This level falls short of 4Q 2008 when 28
venture-backed companies were in registration. Additionally, there were six
venture-backed IPOs withdrawn from registration in the first quarter.

"We predicted that the venture-backed IPO market was going to get worse before
it was going to get better, and we were unfortunately correct," said Mark
Heesen, president of the NVCA. "Today our concerns are not limited to the
zero IPO issues but have now expanded to the shrinking pipeline of companies
in registration. Once we begin to see a recovery, there won't be many
companies prepared to take advantage of it, effectively extending the
lackluster market until the pipeline rebuilds."

Mergers and Acquisitions Overview
As of March 31, 2009, 56 venture-backed M&A deals were reported for the first
quarter, 13 of which had an aggregate deal value of $645.3 million. The
average disclosed deal value was $49.6 million.

"Given the non-existent IPO market, corporate acquirers are in a position to
be more selective and bide their time when considering acquisitions,"
continued Heesen. "We expect to see a slowing of transactions this year as the
best venture-backed companies will wait for market conditions to improve
rather than accepting the lower valuations associated with the challenging
market."

The Information Technology sector led the venture-backed M&A landscape, with
42 deals and a disclosed total dollar value of $348.2 million. Within this
sector, Computer Software and Services companies accounted for the bulk of the
target companies, with 24 transactions across this sector subset. Life
Sciences saw the next highest level of activity with 11 deals and a combined
disclosed value of $297 million. Finally, Non-High Technology deals accounted
for three exits with undisclosed values.

Venture-Backed M&A Industry Breakdown
Q1 2009

Number
of
Venture- Total
Number Backed Disclosed
of M&A Venture-
Venture- deals Backed
Backed with a Deal
M&A disclosed Value
Industry deals value ($M)

Communications and Media 5 1 47.0
Internet Specific 9 0 0.0
Computer Software and Services 24 5 107.7
Semiconductors/Other Elect. 3 2 193.5
Information Computer Hardware 1 0 0.0
Technology TOTAL 42 8 348.2

Medical/Health 6 3 262.3
Biotechnology 5 2 34.7
Life Sciences TOTAL 11 5 297.0

Non-High Other Products 3 0 0.0
Technology TOTAL 3 0 0.0

TOTAL 56 13 645.2

Source: Thomson Reuters & National Venture Capital Association

The largest transaction of the quarter was the acquisition of medical
equipment manufacturer Ablation Frontiers by Meditronic, also a medical
equipment concern. The transaction, valued at $225.0 million, was completed
in February.

Deals bringing in the top returns, those with disclosed values greater than
four times the venture investment, accounted for 23 percent of the total in
the first quarter of 2009, significantly lower than in the first quarter of
2008 when these deals accounted for 46 percent. Those deals returning less
than the amount invested accounted for 54 percent of the quarter's total,
compared to 29 percent of the total in the comparable period of 2008.

Analysis of Transaction Values versus Amount Invested

Relationship between transaction value
and investment Q108 Q109
M&A** M&A**

Deals where transaction value is less than
total venture investment 10 7
Deals where transaction value is 1-4x total
venture investment 9 3
Deals where transaction value is 4x-10x
total venture investment 11 3
Deals where transaction value is greater
than 10x venture investment 5 0
Total Disclosed Deals 35 13

Source: Thomson Reuters & National Venture Capital Association
** Disclosed deals that do not have a disclosed total investment amount
are not included.

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About National Venture Capital Association
The National Venture Capital Association (NVCA) represents approximately 460
venture capital firms in the United States. NVCA's mission is to foster
greater understanding of the importance of venture capital to the U.S. economy
and support entrepreneurial activity and innovation. According to a 2007
Global Insight study, venture-backed companies accounted for 10.4 million jobs
and $2.3 trillion in revenue in the United States in 2006. The NVCA represents
the public policy interests of the venture capital community, strives to
maintain high professional standards, provides reliable industry data,
sponsors professional development, and facilitates interaction among its
members. For more information about the NVCA, please visit www.nvca.org.

SOURCE Thomson Reuters

Emily Mendell of NVCA, +1-610-565-3904, emendell@nvca.org; or Sandy Anglin,
Thomson Reuters, Research Analyst, +1-646-223-6997,
sandy.anglin@thomsonreuters.com, or Sandra Lee, Thomson Reuters, Public
Relations, +1-646-223-5292, sandra.lee@thomsonreuters.com