A Seed-Stage Venture Fund

October 2004

These summary materials are not complete and do not constitute an offer to sell or a solicitation of an offer to buy an interest
Confidential in First Round Capital. An offer is made only by a private placement memorandum (“PPM”). These materials are qualified in
their entirety by such PPM, which discusses numerous risk factors and other considerations.
Fund Profile
Fund Status A series of annual funds, initial fund targeted for $7 million
($3.5M initial investment, $3.5M reserved for follow-on)

Stage Seed and early-stage

Sectors Technology

Geography Nationwide

Team Josh Kopelman and Howard Morgan

Track Record Proven entrepreneurs and angel investors

Invested in over 50+ startups

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Why a Seed Stage Fund?

Huge demand/supply imbalance favors seed/early

investing
Less than 3% of VC funds invest pre-revenue
No “auctions” that increase valuations
Pace of innovation, new startups increasing
Plenty of follow-on capital if early milestones
achieved

Critical to Get in Early at Low Valuations

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State of Seed Funding
Despite stronger long term results, early stage funding has
been dramatically decreasing as a percentage of VC
funding as investors move “up market”
20%
19%
Seed/Startup Funding % VC)

18%
16%
14%
13%
12%
10% 9% 9%
8%
6%
6%
4% 3% 2%
2% 2% 2%
0%
1995 1996 1997 1998 1999 2000 2001 2002 2003

% of Total VC

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Source: PWC MoneyTree Survey, 2003.
Challenges of Seed Stage Funds

Often limited to narrow geographic footprint

Normally structured as “angel” funds – consisting

of “hobbyists”

Inability to gain economies of scale or deploy

significant capital

Key differentiator is deal flow

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Our Team
Josh Kopelman, Managing Director

Dr. Howard Morgan, Director

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Josh Kopelman
Josh has been an active entrepreneur and investor in the Internet
industry since its commercialization.

In 1992, Josh co-founded Infonautics Corporation – an Internet

information company. In 1996, Infonautics went public on the
NASDAQ stock exchange.

Josh left Infonautics to found Half.com in July of 1999. Half.com

was acquired by eBay in July 2000 for $355 Million -- and Josh
remained with eBay for three years, growing eBay’s Media
business to almost half a billion dollars in annual gross
merchandise sales.

In January 2004 Josh was the founding investor in TurnTide an

anti-spam company that created the world's first anti-spam
router. In July 2004, TurnTide sold to Symantec for $28 Million.

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Dr. Howard Morgan
President of Arca Group Inc., a consulting and venture capital
investment management firm specializing in the area of
computer and communications technologies, and a Director of
Idealab, where was a founding investor in 1996

He has more than 25 years of experience with more than

thirty high-tech entrepreneurial ventures.

Dr. Morgan serves on a number of public company Boards,

including Franklin Electronic Publishers, Inc., Segue Software
Corporation, and Unitronix Corp.

He is also Chairman or a member of the board of numerous

private companies including CarsDirect.com, Partsearch
Technology, Energy Innovations, MagicWorks LLC, and
Planalytics, Inc.

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Risk Factors
Deal flow could not live up to our expectations
Companies might not accept our terms
Annual fund structure doesn’t provide diversity of
“vintages”
Technology focus doesn’t provide diversification

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Disclosures
This is not either GP’s full-time endeavor

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