Black Duck Software Secures $12M in Series B Financing Led by Fidelity Ventures

With Participation from Intel, SAP Ventures, and Original Investors Flagship Ventures, General Catalyst Partners, and Red Hat

Waltham, Mass. -- June 6, 2005 -- Black Duck Software, Inc., the leading provider of software compliance management solutions, today announced it has secured $12 million in Series B funding led by Fidelity Ventures. Intel Capital and SAP Ventures, a division of SAP AG, also participated in the round, together with existing investors: Flagship Ventures, General Catalyst Partners, and Red Hat. The company also announced that Dave Power, partner, Fidelity Ventures will join its Board of Directors.

Black Duck’s protexIP(TM) suite allows businesses to identify and manage license obligations for their software assets, enabling safer and more productive use of open source and component software without compromising valuable intellectual property (IP). Black Duck will use the funds to help expand its sales, marketing and product development activities to capitalize on the strong demand for automating open source software license compliance.

"Black Duck’s business is driven by a ‘perfect storm’ of market trends that together position the company for rapid growth. Mainstream developers’ use of open source software, increased outsourcing and offshoring, new regulatory mandates, and deeper due diligence in both licensing and acquisitions are focusing executive attention on internal controls relating to software IP assets," said Douglas A. Levin, CEO, Black Duck Software. "This funding, from such a diverse set of venture capital and software industry leaders, will help fuel our next phase of growth."

"Enterprises are embracing open source software for its cost savings, quality and control benefits. Its use is rapidly becoming mainstream in IT organizations around the world," said Dave Power, partner, Fidelity Ventures. "Black Duck helps remove one of the last remaining roadblocks to wide-spread enterprise adoption of open source. Their solutions enable businesses to understand and manage complex license obligations so they can safely and productively use open source software in their critical operations. We’re very pleased to support Black Duck in addressing this market with our financial resources and extensive IT application development experience, and believe that the company is well-positioned to become the category leader."

"We see the software world as increasingly based on mixed-IP solutions that incorporate open source, commercial and proprietary software within single applications," said Jennifer Scholze, investment manager, SAP Ventures. "Companies need to understand and manage this complex and risky environment with a robust, safe and intuitive solution. Black Duck has demonstrated that they have the solution today -- and the vision, industry knowledge, and strong management team needed to meet and surpass customer expectations. We are pleased to be able to support their efforts in this important market."

"Intel Capital is investing in companies that provide valuable platforms and services for the software developer community," said Doug Fisher, general manager, Intel Core Software Division. "Intel is pleased to support Black Duck's efforts to bring software compliance management solutions for ISVs and enterprise software customers, the majority of whom are developing software on Intel platforms."

In addition, Black Duck and Intel Corporation signed a technical and marketing cooperation agreement to help Black Duck optimize its protexIP(TM) solution for use with 64-bit Intel® Xeon(TM) processor-based servers.

"Black Duck supports Red Hat’s mission to bring the vast benefits of open source computing into the enterprise environment," said Mark Webbink, deputy general counsel, Red Hat. "Black Duck has proven its ability to execute on its vision, garnering the respect of industry analysts and market leaders, as well as praise from both the legal and development communities. We believe the potential for software compliance management solutions is substantial and growing rapidly. We are excited to be a part of bringing this key technology to the market."

This new investment follows a Series A funding of $5M announced in July 2004, bringing the total capital raised to $17 million.

About Black Duck Software
Black Duck Software(TM) is the leading provider of automated software compliance management solutions that help companies govern how software assets are created, managed, and licensed. Black Duck's offerings help businesses take maximum advantage of open source software while at the same time assure they satisfy the obligations associated with the code they use. Black Duck’s customer base includes enterprises, product developers, outsourcers, law firms and other organizations worldwide that are concerned with protection of software intellectual property. For more information about Black Duck, visit www.blackducksoftware.com.

About Fidelity Ventures
Founded in 1969, Fidelity Ventures invests private equity in entrepreneurial companies preparing to "go-to-market" in the information technology and communications sectors. By combining a collaborative partnership with a global network, Fidelity Ventures enables its portfolio companies to accelerate their market entrance and become leaders in their respective fields. During the last three decades, the firm has contributed to the success of such industry leaders as GeoTel Communications (IPO subsequently acquired by Cisco), Teleport (IPO subsequently acquired by AT&T) and COLT Telecom (NASDAQ: COLTY). Recent investments include ONI Systems (IPO subsequently acquired by Ciena), WaveSmith (acquired by Ciena), Airespace (acquired by Cisco Systems), and Connected (acquired by Iron Mountain). Fidelity Ventures currently manages more than $650 million in venture capital, and invests in U.S.-based companies out of its Boston office, and in European companies out of its London office. For more information, visit www.fidelityventures.com.

About SAP Ventures
Since 1996, SAP Ventures has been investing in companies that offer exciting new technologies and applications. Leveraging years of experience and drawing on a network of powerful business relationships, SAP Ventures helps entrepreneurs and management teams recruit the best people, make the right technology decisions, win new business, and build their own partner networks. The goal of SAP Ventures is to grow businesses that create shareholder value for everyone involved. For more information, visit www.sapventures.com.

About Intel Capital
Intel Capital, Intel's strategic investment program, focuses on making equity investments and acquisitions to grow the Internet economy in support of Intel's strategic interests. Intel Capital invests in hardware, software and services companies in several market segments, including computing, networking, and wireless communications. For more information, visit www.intel.com/capital.

About Red Hat
Red Hat, the world's leading open source and Linux provider, is headquartered in Raleigh, NC with satellite offices spanning the globe. Red Hat is leading Linux and open source solutions into the mainstream by making high quality, low cost technology accessible. Red Hat provides operating system software along with middleware, applications and management solutions. Red Hat also offers support, training and consulting services to its customers worldwide and through top-tier partnerships. Red Hat's Open Source strategy offers customers a long term plan for building infrastructures that are based on and leverage open source technologies with focus on security and ease of management. Learn more: http://www.redhat.com.

About General Catalyst Partners
General Catalyst Partners is a private equity firm that invests in exceptional entrepreneurs and technical founders who are building the software solution and technology platform companies that will lead innovation and transform industries. Founded in 2000, General Catalyst Partners leverages its principals' extensive operational, business development and technological expertise to provide portfolio companies with a catalyst for success through business building and partnership development assistance. General Catalyst is headquartered in Cambridge, Mass. www.generalcatalyst.com.

About Flagship Ventures
Flagship Ventures is an early-stage venture capital firm focused on creating, financing, and building companies in the Life Science and High Technology sectors. Flagship's team of fourteen investment professionals is among the most experienced in the industry and represents a balance of venture capital, corporate executive, and entrepreneurship expertise. Headquartered in Cambridge, MA, Flagship Ventures was founded in 1999 and manages approximately $800 million. For more information, visit www.flagshipventures.com.

Black Duck Software and protexIP are trademarks of Black Duck Software, Inc. All other trademarks are the property of their respective holders.

For Black Duck:
Contact: Dan Ring
dring@blackducksoftware.com
(617) 585-2202

Other contacts:
Fidelity Ventures Media Relations
617-563-5800