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KnowledgeNet Secures $17.5M
in Strategic Funding
PHOENIX--(June 17, 2002)--KnowledgeNet(R) Inc., the
fastest-growing provider of enterprise e-learning solutions, today announced
that it has raised $17.5 million in Series E financing. The lead investor
in this round is General Motors Investment Management Corporation -- a
first-time investor in both the e-learning sector and KnowledgeNet. All
previous investors also participated in this round of financing, including
Cisco Systems, Morgenthaler Ventures, Sierra Ventures, Trinity Ventures,
and Berkeley International Capital Corporation. KnowledgeNet's total private
funding including this round is over $82 million.
"We are excited about e-learning, and have closely
tracked the market for several years to determine which company offered
the right mix of product innovation, leadership potential and ability
to execute. Until now, we were generally unimpressed with what we saw
in both the private and public sectors," said Charles Froland, managing
director at General Motors Investment Management Corporation. "KnowledgeNet
may be the best-kept secret in enterprise software, not just in e-learning.
We didn't realize they were roughly equivalent in size to Docent, Saba,
and DigitalThink, and were growing faster than all of these players. As
we did our due diligence, KnowledgeNet stood head-and-shoulders above
the rest in terms of management team depth and experience, the quality
of its e-learning solutions and technology, and the company's rock-solid
financial track record of growth--despite the downturn in the economy.
We are very excited to be investors in what we believe will be the break-out
winner in e-learning."
KnowledgeNet's recent financial performance underscores
its market momentum; the company has now delivered eleven consecutive
quarters of revenue growth, including 70% revenue growth in Q1 2002, as
compared to Q1 2001. The company accomplished this at a time when most
other e-learning companies experienced negative growth. In 2001, KnowledgeNet
realized revenue growth of 193%, adding over 1,000 new customers, including
Bank of America, Cisco Systems, EMC Corporation, McDonald's and the United
States Postal Service. For the first quarter of 2002, the company exceeded
its board-approved targets in both revenues and the bottom line.
"We continue to win enterprise business in competitive
situations with a sound, simple formula: an obsessive focus on quality
blended e-learning solutions, superior customer satisfaction, and solid
execution," said Tom Graunke, founder and CEO of KnowledgeNet. "While
the economic climate for IT products as a whole remains challenging, we
are witnessing growing demand for our solutions and technologies from
companies looking for e-learning that really delivers on both learner
expectations and enterprise-learning ROI. Our customers are e-learning
savvy--they are either "switchers" who have had less than satisfactory
experiences with e-learning, or they are "converts" who have
waited to find the right partner to help them with a low-cost, high-value
alternative to an all-classroom enterprise learning program. This round
of funding will enable us to drive demand, increase our competitive wins,
and seize what we see as window of opportunity for accelerated growth."
While competitors are downsizing, KnowledgeNet will
use the funds to hire additional personnel; to accelerate the innovation
of its next-generation, internet-based training content and technology;
to increase its sales and marketing activities; and to expand services
efforts in the enterprise sector. With its library of e-learning content
now exceeding 1,500 titles, KnowledgeNet plans to add breadth and depth
to its blended offering of IT training, and to rapidly expand its best-in-class
business skills training through its relationship with the American Management
"With the launch of the Monsoon5 platform earlier
this year, we now have the ability to offer companies a complete suite
of off-the-shelf courseware, live classroom-based e-learning, content
development and management tools, and a fully integrated next-generation
LMS--either hosted, or behind the corporate firewall," added Graunke.
"From this position of strength we intend to rapidly expand our e-learning
offerings and position ourselves as the compelling choice for companies
intent on realizing the knowledge transfer they expect to attain from
their e-learning investment."
About General Motors Investment Management Corporation
General Motors Investment Management Corporation ("GMIMCo.")
and its affiliates have more than $700 million to invest on behalf of
their clients, in direct private equity deals. GMIMCo's direct private
equity program focuses on high-potential companies in selected growth
industries, including telecommunications, software, electronics, business
services, financial services and healthcare. In the past ten years, GMIMCo's
private equity team has invested over $1 billion in more than 50 direct
private equity transactions.
About KnowledgeNet Inc.
KnowledgeNet is the fastest-growing company in the e-learning industry.
KnowledgeNet offers a second-wave, internet-based learning suite - "enterprise
e-learning" - that transfers knowledge with more precision and better
retention than classroom training. The Company's over 1,500 titles of
synchronous and asynchronous content and delivery solutions constitute
an integrated suite of e-learning products that can be easily customized
to suit individual learning styles. KnowledgeNet has received nearly a
dozen industry distinctions for its e-learning solutions. KnowledgeNet
is a Cisco Learning Solutions Partner, and is a Microsoft Certified Technical
Education Center (CTEC) as well as a Microsoft Certified Partner. Of the
Fortune 50, 47 companies are KnowledgeNet customers, including blue-chip
companies and institutions such as AT&T, Cisco, EMC, GE, Lockheed
Martin, Sun Microsystems and WorldCom. Founded in 1998, KnowledgeNet is
a privately held company based in Phoenix, Arizona.
Visit KnowledgeNet at http://www.knowledgenet.com.
For more information, call 1-888-577-5779.
KnowledgeNet is a registered trademark of KnowledgeNet
Inc. All other company and product names may be trademarks of their respective
Steve Krell, CFO, (480) 315-4016
Z!ng Public Relations
Tim Cox, (650) 369-7784