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Exalt Communications Raises $15 Million in Series C Funding for Rapid Global Expansion

Investment by InterWest Partners, Velocity Interactive Group and Trinity Ventures supports worldwide expansion delivering licensed and license-exempt wireless backhaul systems to carriers, governments and enterprises

Campbell, Calif., February 17, 2009 — Exalt Communications, a leading provider of high performance licensed and license-exempt microwave radio systems for wireless backhaul applications, announced today that it has raised $15M in Series C funding. InterWest Partners led the financing, joining existing investors Velocity Interactive Group and Trinity Ventures, who were full participants in the round, on the company’s board of directors. Exalt will use the funds to accelerate international growth, expand marketing and sales to carriers, governments and enterprises, strengthen its presence in North America and continue expanding its robust product portfolio.

“Exalt is clearly well-positioned as a market leader with a broad and compelling product line in a high growth market space,” said Khaled Nasr, partner at InterWest Partners. “With its innovative technology platform and outstanding execution, the Exalt team has developed microwave radio systems that enable its customers to break the customary bottlenecks associated with wireless transmission of voice, data and video. In this time of ever-increasing demand for the delivery of high bandwidth traffic through wireless networks, the use of Exalt systems for wireless backhaul has become even more critical to keep networks congestion-free.”

In the four years since its founding, Exalt has successfully developed and delivered an entirely new class of high-performance microwave radio systems to more than 500 customers including wireline carriers, mobile operators, government agencies and enterprises.

“The founders of Exalt knew that network capacity would become one of the single largest challenges faced by network operators, and that wireless backhaul would play a critical role in meeting that challenge,” said David Britts, founding partner, Velocity Interactive Group. “Their vision – and the technology Exalt had developed – were enough to convince us to invest early on, when backhaul was not perceived as a ‘hot’ investment. We made the right decision then, and we are renewing our commitment to Exalt now with an additional investment in the company.”

“At the time of our initial investment, no one was interested in wireless backhaul,” said Fred Wang, general partner, Trinity Ventures. “All the investment talk then surrounded Wi-Fi® and WiMAX™. But the founders of Exalt made a compelling argument for the future of wireless backhaul, and we were inspired to invest by their track record, confidence and excitement for the technology, and well thought out business plan. Today, the growing global market need for Exalt products validates the founders’ foresight, and we are pleased to increase our investment in the company at this time.” 

Exalt licensed and license-exempt microwave radios are available in bands covering 2 - 40 GHz. The product family now includes Gigabit Ethernet interfaces and the highest capacity 5 GHz radio in the world. The radios feature guaranteed throughput, software upgradeable capacity, low latency and native TDM and native Ethernet support. Exalt radio systems are available in all-indoor, all-outdoor, and split-mount models, enabling customers to choose the configuration that best meets the needs of any given site.

“Over the past year, Exalt has built tremendous momentum, validating our business plan with significant customer wins, partnerships, funding and new talent,” said Amir Zoufonoun, Exalt co-founder and CEO. “We are poised to accelerate our aggressive global business operations expansion and help customers eliminate network bottlenecks as bandwidth demands continue to increase exponentially across all segments.”

About InterWest Partners
InterWest Partners, founded in 1979, is a leading diversified venture capital firm focused on building long-term relationships with entrepreneurs and portfolio companies. Currently investing its tenth fund, IW X, a $650 million fund, InterWest has raised more than $2.8 billion of capital since inception. InterWest has 14 investing partners in Menlo Park, CA and Dallas, TX, who bring together deep domain knowledge in life sciences and information technology.
www.interwest.com

About Velocity Interactive Group
Velocity Interactive Group is a leading investment firm that focuses on digital media and communications. The firm brings a unique approach to investing by bringing not just financial capital, but also human capital to its investment companies. Velocity Interactive Group has a global presence in Palo Alto, Los Angeles, New York, India and China.
www.velocityig.com

About Trinity Ventures
Trinity Ventures a 22-year veteran in the venture business with more than $1 billion under management, partners with exceptional entrepreneurs to build great companies. Trinity Ventures focuses on early-stage technology investment opportunities with a particular emphasis on the digital media, Internet services, mobility, security and software markets. Trinity has invested in more than 100 ventures, including such leading companies as Aruba Networks (NASDAQ: ARUN), Blue Nile (NASDAQ: NILE), Crescendo Communications, Extreme Networks (NASDAQ: EXTR), Forte Software, Illustra, LoopNet (NASDAQ: LOOP), Photobucket (acquired by News Corporation: NWS), Speedera Networks (acquired by Akamai Technologies: AKAM), Starbucks (NASDAQ: SBUX) and Sygate Technologies (acquired by Symantec: SYMC).
www.trinityventures.com

About Exalt Communications
Exalt Communications provides next generation wireless backhaul systems for service providers and enterprises worldwide. Exalt products are designed to solve the network bottlenecks associated with the growing demand for IP- based voice, data and video applications and the resulting migration from TDM to IP-based networks. With a flexible architecture and technology-agnostic product platform covering multiple market segments, Exalt provides a full range of carrier-class microwave radio systems that meet the demand for a cost-effective and flexible alternative to fiber and leased lines.

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