STRONG SHORT-TERM PERFORMANCE DRIVES VENTURE RETURNS IN POSITIVE DIRECTION AS OF FIRST QUARTER 2011

Venture capital performance continued on a gradual upward trajectory as of the first quarter of 2011 according to the Cambridge Associates U.S. Venture Capital Index®, the performance benchmark of the National Venture Capital Association (NVCA). The improvements were seen across all time horizons, with the exception of the 15- year numbers, and were driven by the strong one-year venture capital return of 18.5 percent. The quarter marks the second consecutive one in which there were double digit returns for the oneyear horizon and modest improvements in the three-, five-, and ten- year performance numbers. Venture capital returns outperformed the public indices in the one-, five-, 15- and 20-year horizons.

The Cambridge Associates LLC U.S. Venture Capital Index® is an end-to-end calculation based on data compiled from 1,308 U.S. venture capital funds (867 early stage, 170 late & expansion stage, 268 multi-stage and 3 venture debt funds), including fully liquidated partnerships, formed between 1981 and 2010. 1 Pooled end-to-end return, net of fees, expenses, and carried interest as of 3/31/2011. Sources: Barclays Capital, Bloomberg L.P., Cambridge Associates LLC U.S. Venture Capital Index®, Frank Russell Company, Standard & Poor's, Thomson Datastream, The Wall Street Journal, and Wilshire Associates, Inc.

*Capital change only. “Slow and steady improvement has been the name of the game in venture performance for the last several quarters,” said Mark Heesen, president of NVCA. “The venture capital industry is coming through a very turbulent period in U.S. economic history and recovery is going to take time, even with the improving exit market we have seen in the last year. But make no mistake that we are headed in the right direction and we expect these gains to continue throughout the coming year. Overall, this should be encouraging for the upcoming class of companies preparing to exit as well as new companies just entering the pipeline.”

“The one-year return was strong and the longer-term performance continued to improve. The five-year return, which outperformed public indices, encompasses the recent recessionary period, the recovery and now three quarters of good IPO activity. The improving exit environment is encouraging and should continue to boost performance in 2011,” said Theresa Sorrentino Hajer, Managing Director and Venture Capital Research Consultant at Cambridge Associates.





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