IPOs/Recent Issues – WEBSENSE –

San Diego

Went public 3/28/2000 at $18 apiece

Filing Range:4 mil. shares @ $14 to $16

Shares Outstanding:19.39 mil. shares

Underwriters:Chase H&Q

SG Cowen /WitSoundView

FINANCIALS

(Data in $ millions)

Y/E Y/E

12/981 2/99

Total Revenue $6.92 $8.65

Net Loss -5.61 -9.25

The Company:

Founded in 1994, Websense provides employee Internet management solutions, enabling businesses to monitor, report and manage how their employees use the Internet. The company’s Websense Enterprise solution gives business managers the ability to implement Internet access policies for different users and groups within their businesses, and supports their efforts to improve employee productivity, conserve network bandwidth and mitigate potential legal liability. Many companies are using the Internet to streamline business processes and enable business applications that are accessed over the corporate network. These companies are making substantial investments in Internet connectivity and are providing high-speed Internet access to large numbers of their employees. However, the Internet has also become a medium for entertainment, information and commerce. International Data Corporation projects that the number of Internet users worldwide will reach 316 million by 2002. Because Internet access in the workplace is fast, convenient and essentially free to employees, workers tend to use their employers’ Internet connections for personal or recreational purposes during work hours, reducing productivitly, consuming bandwidth and opening the company to potential legal liability. Websense’s solution, which is sold on a subscription basis, consists of a scalable, multi-platform software application that references its own proprietary database of Web site addresses. As of January 31, 2000, Websense users included the employes of more than 7,500 organizations (200 of the Fortune 500 among them), spanning 50 countries. Representative customers include American Express, Bell South, Coca-Cola and Compaq Computer.

Proceeds:

Proceeds will be used for sales and marketing, product research and development, development and expansion of database technologies and systems, infrastructure and support improvements, and operating losses.

Venture Backers:

Morgan Stanley Dean Witter Venture Partners, Crosspoint Venture Partners, Edelson Technology Partners, Nippon Investment & Finance Co. Ltd.

Board Members:

John Carrington

Robert Loarie

Bruce Coleman

John Stiska

Donald Milder

Gary Sutton