Lancope Secures $12.5 Million in Oversubscribed Series C Round of Funding

ATLANTA, Ga., April 13, 2004

Lancope, Inc., the leading provider of network integrity solutions, today announced the closing of its Series C round of financing, led by Canaan Partners. The new $12.5 Million Series C funding round brings the total amount of equity investment in Lancope to over $24 Million. The round, which also includes participation from existing investors Council Ventures, GMG Capital Partners and H.I.G. Ventures, will be used to accelerate product development initiatives, rapidly expand sales coverage and support aggressive marketing programs.

“Lancope is poised to transform the network security marketplace,” said Eric Young, general partner with Canaan Partners and member of Lancope’s Board of Directors. “Given its experienced leadership, proven technology and large base of established customers, Lancope is well positioned to dominate the rapidly emerging Network Integrity market. With StealthWatch, Lancope has a compelling and unique approach to securing and optimizing network operations that is increasingly recognized by the analyst community and embraced by the company’s growing roster of Global 2000, government and higher education customers.”

“Throughout this round, we were overwhelmed with the positive and enthusiastic interest from the venture community, particularly in what has been a tight IT spending and investment environment" said Harland LaVigne, president and CEO of Lancope. “This investment from Canaan Partners, a top-tier venture firm with a successful track record, is a tremendous validation of Lancope’s progress and potential. It enables us to aggressively pursue market penetration and continue to deliver innovative network security solutions.”

In 2003 Lancope gained considerable momentum and success by achieving several critical milestones:

Doubled customer base to over 100 enterprise, government and higher educations entities

Tripled Channel Partner Program to 18 domestic and global resellers and distributors-

Gained broad industry penetration with significant inroads in Financial, Higher Education, Telecom and Energy industries. Government-related customers include national security and Department of Defense agencies as well as state governments.

StealthWatch deployments monitor more than 6 million hosts worldwide

Recent adopters of StealthWatch include AGL Resources, Boyd Gaming, Chick-fil-A, Nielsen Media Research, Rand-McNally, Stanford University School of Medicine, Northwestern University, Naval Postgraduate School and Georgia Technology Authority.

Canaan Partners (www.canaan.com) is a $2 billion national venture capital investment firm formed in 1987. Canaan specializes in startup and emerging-growth companies in information technology and services, as well as health care and medical technology. Canaan Partners was an early backer in AdvancePCS (ADVP), Capstone Turbine (CPST), CommerceOne (CMRC), Concord Communications (CCRD), Copper Mountain Networks (CMTN), DoubleClick (DCLK), Eon Labs (ELAB), Esperion (ESPR), Genaissance Pharmaceuticals (GNSC), International Network Services (acquired by Lucent Technologies - LU), IntraWare (ITRA), iPrint (IPRT), Network Engines (NENG), ONI Systems (ONIS), Orapharma (OPHM), Pozen (POZN), Praecis Pharmaceuticals (PRCS), Rightpoint (acquired by E.piphany - EPNY) and SalesLogix (acquired by The Sage Group plc - SGE:FTSE), along with dozens of other market-leading companies.

About Council Ventures

Council Ventures is a venture capital firm founded in late 2000 and headquartered in Nashville, TN. In working towards its mission of creating great returns, Council Ventures brings a balanced mix of traditional venture capital experience needed to analyze opportunities and structure deals and, with the Council Ventures CEO Council, senior executive operating experience needed to help portfolio companies to grow. For more information, visit http://www.councilventures.com and http://www.councilventures.com/ceocouncil.html.

About H.I.G. Ventures

H.I.G. Ventures is one of the largest and most successful venture capital firms in the Southeast United States. H.I.G. is dedicated to helping talented entrepreneurs build market-leading businesses. H.I.G.’s investment activity is focused on early stage, high growth technology and healthcare companies. Its most recent venture capital fund has total capital of over $US 250 million. In addition, H.I.G.’s affiliate, H.I.G. Capital, manages more than $US 1 billion of equity capital dedicated to investments in private equity and management buyouts. http://www.higventures.com

About GMG Capital Partners

GMG Capital Partners is an early-stage venture capital firm based in New York, with additional offices in Salt Lake City, Portland and Atlanta. With over $170 million in assets under management, GMG Capital Partners' investment focus is on high-growth enterprise and Internet infrastructure companies, with a focus on network security, network storage and network access technologies. GMG's investment model places heavy emphasis on operational involvement, partnering with founders and entrepreneurs to build enterprises of lasting value. For more information, visit http://www.gmgpartners.net/.

About Lancope and StealthWatch

Founded in 2000, Lancope is the leading provider of next-generation network integrity solutions that deliver behavior-based threat defense, policy enforcement and insightful network intelligence. With integrated visibility across network security, traffic characteristics and host-level activity, Lancope's StealthWatch solutions provide unparalleled network protection and optimization. Both OPSEC and Common Criteria certified, StealthWatch has received numerous accolades. Most recently StealthWatch received a 5-star rating for technology excellence from CRN Magazine. In addition, StealthWatch has received the Innovation In Infrastructure Award from eWeek and PC Magazine and was honored "Most Impressive" by eWeek. Defending the networks of Global 2000 organizations, academic institutions and government entities, Lancope protects the critical assets of today's sophisticated enterprises. For more information, visit www.lancope.com.