Tumbleweed Communications –

REDWOOD CITY, Calif. – Tumbleweed Communications Corp., a provider of secure Internet communication services, went public August 6, offering 4 million shares at $12 apiece. The company’s stock priced at the low end of its $12 to $14 filing range.

Credit Suisse First Boston, Hambrecht & Quist and ING Barings underwrote the initial public offering, which left 21.3 million shares outstanding.

There were no selling shareholders. Hikari Tsushin Inc., August Capital, Draper Fisher Jurvetson, H&Q Adobe Ventures II and United Parcel Service General Services Co. were venture backers.

Tumbleweed services its customers with the Tumbleweed Integrated Messaging Exchange, a software and services solution that combines the personal proactive nature of e-mail with the ease of the Web. The Internet-based software offers businesses comprehensive technology including multi-level security, end-to-end trackability and personalized communication.

The expected $43.5 million generated by the IPO will be used for working capital and for other general corporate purposes. The company also is considering acquiring complementary products, technologies or businesses.

Tumbleweed has never been profitable, losing $4.7 million in 1997 and $6.6 million in 1998.

Timothy Draper, founder and managing director of Draper Fisher Jurvetson, joined the board in August 1996, followed in October 1996 by Eric Hautemont, managing director of Ridge Ventures. David Marquardt, a founding general partner of August Capital, and Standish O’Grady, a managing director of H&Q Venture Associates, both joined the board in August 1997.

Tumbleweed Communications – Selected Financial

(in thousands, except per share data)

Year Ended December 31 Six Months Ended June 30

1997 1998 1998 1999

Total revenue 729 2,015 999 1,701

Net loss -4,691 -6,590 -3,268 -6,053

Net loss per share -1.41 -1.74 -0.89 -1.43