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Benchmark Capital Funds Profitable ServiceSource

Premier Silicon Valley Venture Capital Firm Funds Leading Outsource Sales Organizatiom

June 28, 2005: ServiceSource, an outsource sales organization focused exclusively on increasing support and maintenance revenue for technology companies, today announced $10M in funding from Silicon Valley-based Benchmark Capital. This recent funding is combined with existing investments from Housatonic Partners, high-tech executives and other notable individual investors. ServiceSource joins Benchmark Capital's prestigious list of successful portfolio companies, which includes eBay (Nasdaq: EBAY), Juniper Networks (Nasdaq: JNPR), and Red Hat (Nasdaq: RHAT). ServiceSource will use the recent funding to acquire new customers, scale operations and expand its global reach.

“ServiceSource has capitalized on a tremendous market opportunity to uncover and close more service revenue for high-tech companies, which is especially important in a period of weaker IT spending,” said Benchmark Capital general partner, Bruce Dunlevie. “ServiceSource sets a new level of accountability, working only on a pay-for-performance basis as it delivers significantly increased revenue for its clients. We believe the company’s blue-chip client base, history of profitability and clear market leadership make it a compelling investment opportunity.”

“We are growing at an extraordinary pace, but we are profitable and we weren’t actively pursuing funding” said ServiceSource’s CEO, Mike Smerklo. “When Benchmark approached us, we jumped at the opportunity to work with one of the brightest, most talented groups of venture capitalists in Silicon Valley . We feel fortunate to have Benchmark’s insight as we deepen our relationships with domestic clients and accelerate our international expansion. This investment allows us to evolve our service offering more quickly, while remaining focused on exceptional client satisfaction.”

Since its inception in 1999, ServiceSource has been committed to the single purpose of helping high technology companies maximize the revenue from annuity service streams. Working with ServiceSource, clients improve overall renewal rates, reduce contract discounting and tap into incremental revenue by up-selling customers to higher service levels, consolidating contracts and co-terminating renewals.