Achronix Completes First Close of $52 Million Series B Preferred Stock Financing

FPGA vendor completes one of the largest semiconductor venture financings in recent history, defying challenging market environment

SAN JOSE, Calif. -- October 15, 2008 -- Achronix Semiconductor Corp., provider of the world’s fastest field-programmable gate arrays (FPGAs), today announced the first closing of a $52 million Series B preferred stock financing. The first $43 million of the unprecedented $52 million financing was closed on Oct. 10, with the remainder to close in the next several weeks. The proceeds from the financing will be used to fund the development of next-generation products and to support the rapidly accelerating demand for the recently-announced Speedster family of 1.5 GHz FPGAs.

Argonaut Private Equity led the financing, with the original group of Series A investors including Battery Ventures, New Science Ventures, Easton Capital Investment Group and Entrepia Ventures all participating significantly.

"The challenging macroeconomic environment has raised the bar for companies seeking financing of this magnitude," said Jason Martin, managing director at Argonaut Private Equity. "Achronix's disruptive FPGA technology packaged in a familiar design environment, a strong track record of execution and tremendous customer traction for Speedster all presented a compelling opportunity for us. With Speedster and a variety of exciting next-generation products, Achronix is in a unique position to address the current and future demands of high-performance ASIC and FPGA users," Martin added.

The Achronix Series B financing is one of the largest for a venture-backed semiconductor company in recent history and occurs on the heels of the successful global launch of the Speedster family of FPGAs. Speedster FPGAs provide a three-fold increase in performance compared to traditional FPGAs and are ideally suited for high-performance applications typically dominated by ASICs, such as networking, telecommunications, test and measurement, and encryption.

“We are very pleased to welcome Argonaut Private Equity to our Board and to have the continued strong support from our original investors,” said John Lofton Holt, Achronix co-founder, chairman and CEO. “Being armed with this large amount of capital allows us to focus on execution and making our customers successful. We are excited about the opportunity ahead of us and look forward to expanding the already strong Speedster market traction while building next-generation products for our rapidly growing and demanding customer base,” Holt said.

About Achronix Semiconductor

Achronix Semiconductor is a privately held fabless corporation based in San Jose, California. Achronix builds the world's fastest field programmable gate arrays (FPGAs) capable of up to 1.5 GHz peak performance. Achronix has sales offices and representatives in the United States, Europe, China, Japan, and Korea, and has research and design offices in Ithaca, N.Y., and Bangalore, India. Find out more at http://www.achronix.com.

About Argonaut Private Equity

Argonaut Private Equity is a diversified global private equity fund with more than $3.5 billion under management. Argonaut exercises wide discretion on investment size, stage, sector and geography. Its equity investments span such diverse markets as alternative energy, technology, financial services, media, telecommunications, medical devices, aviation, retail and healthcare. In addition to an active investment pace in India, Argonaut's portfolio includes investments in the United States, China, Israel, Japan, Eastern Europe and Australia.

About Battery Ventures

Since 1983, Battery has been investing in technology and innovation worldwide. The firm partners with entrepreneurs and management teams across technology sectors, geographies and stages of a company’s life, from start-up and expansion financing, to growth equity and buyouts. Battery has supported many breakthrough companies around the world. From offices in Boston, Silicon Valley and Israel, Battery manages more than $3B in committed capital. For more information, visit www.battery.com.

About Easton Capital Investment Group

Easton Capital Investment Group is a New York-based venture capital firm with a broad portfolio of investments, primarily in growth capital and healthcare opportunities. It manages approximately $200 million on behalf of a number of significant institutional investors in its three funds, Easton Capital Partners, L.P., Easton Hunt Capital Partners, L.P. and Easton Hunt New York LP. Easton makes investments ranging in size from $2 million to $7.5 million and has strategic co-investment relationships with many of its institutional investors which allow it to participate in larger initial and follow-on rounds of funding. Easton has offices in New York and Florida. For more information, visit www.eastoncapital.com

About New Science Ventures

(NSV) is a New York-based venture capital firm which invests in both early and late stage companies using novel scientific approaches to address significant unmet needs and create order of magnitude improvements in performance. NSV manages over $125 million and has invested in more than 20 companies located in the United States, Europe, India and China in the life sciences and information technology sectors. For more information, visit www.newscienceventures.com.

About Entrepia Ventures

Entrepia Ventures invests in private, technology-based, expansion-stage companies that stand to benefit from market or technology affiliation with Japan. Operating out of offices in Santa Clara, Montreal and Tokyo, Entrepia helps its portfolio companies generate incremental top-line growth to become more competitive, successful and valuable. Anchored on access, relationships, a hands-on approach, and on-the-ground presence, Entrepia’s “Japan link” strategy is directed towards investment opportunities worldwide in IT, communications, electronics and core technologies.