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BlueArc Corporation Completes $72 Million Funding Round

Substantial Investment Provides Additional Momentum to the Developer of the First Network Storage Solution Designed for the Optical Age

MOUNTAIN VIEW, Calif. - May 7, 2001

BlueArc Corporation, developer of the world's highest performance enterprise-class network storage systems, today announced the completion of a $72 million round of financing led by Weston Presidio and previous BlueArc investors Celtic House International, Apax Partners & Co., and Patricof & Co. Ventures. Also joining this round of funding are Dell Ventures, EUROQUBE, New York State Retirement Co-Investment Fund, J.P. Morgan Partners, and Fort Washington Capital.

The investment will be used to drive the growth of BlueArc in the extremely fast moving network storage market. Since the company's founding in 1998 BlueArc has secured over $100 million in funding. Coinciding with the completion of this round of funding, BlueArc announced today that James B. McElwee, general partner of Weston Presidio, has joined BlueArc's board of directors.

"The success of this round is yet another external validation of BlueArc's compelling value proposition," said Enrico Pesatori, president and chief executive officer of BlueArc. "This round of financing illustrates the potential of our revolutionary SiliconServer technology and shows our investors' confidence in our ability to deliver on that potential."

Weston Presidio, a San Francisco and Boston based venture capital firm, led this round of funding for BlueArc. Weston Presidio has a long and successful track record and has been involved with the building of more than 200 companies, including Vitria Technology, MapQuest, Cypress Semiconductor, Virage, MIPS Computer Systems, Sequent, Vitesse, and Xilinx.

"Not only has BlueArc developed a very exciting network storage technology and compelling customer solution, the company has assembled an extremely experienced management team," said James B. McElwee, general partner of Weston Presidio. "In BlueArc we found a company possessing a unique combination of technology and management committed to deliver customer value with network storage systems designed for the optical age."

BlueArc recently introduced the BlueArc Si7500, the world's first network storage system capable of true multi-gigabit throughput (2000 Megabits/second), at PC Forum 2001. The Si7500, powered by BlueArc's revolutionary SiliconServer™ architecture, brings together the ease-of-installation and management of a network attached storage (NAS) system, and the scalability and speed of a storage area network (SAN). The Si7500 utilizes the SiliconServer architecture to scale to tens of thousands of concurrent user connections, with 99.999% solid-state reliability and 250 Terabytes (TB) of storage capacity behind a single server. Additionally, the Si7500 provides users with significantly lower total cost-of-ownership that can translate up to an 80% saving of customers' capital investment over time.

About Patricof & Co. Ventures and Apax Partners

Patricof & Co. Ventures and Apax Partners together represent one of the leading international private equity investment groups. Patricof & Co. Ventures and Apax Partners pursue a balanced equity portfolio strategy investing in companies at all stages of development from start-up to buy-out. The group focuses primarily on Telecommunications, Information Technologies, Media, Healthcare & Bio-technologies, Retail & Consumer Products, and Financial Services. The group's investment team includes more than 170 private equity investment professionals in 13 offices across the United States, Europe, Japan and Israel. Founded in 1969 in the USA and in 1972 in Europe, Patricof & Co. Ventures and Apax Partners manage and advise over $12 billion on behalf of leading institutional investors around the world. For more information, visit www.patricof.com

About Celtic House

Established in 1994, Celtic House International is a leading venture capital firm with offices in Canada, the U.K., and the U.S. The company has US$1 billion under management in more than 50 companies. For more information, visit www.celtic-house.com

About Weston Presidio

Weston Presidio was founded in 1991 as a touchstone for growth businesses and privately held companies in need of equity capital. With offices in San Francisco, Boston and Menlo Park, the firm has over $2.3 billion under management. For more information, visit www.westonpresidio.com

About the Other Investors

For more information on the other investors participating in this round, please visit their respective Web sites: EUROQUBE S.A. www.euroqube.com; Dell Ventures www.dellventures.com; New York State Retirement Co-Investment Fund L.P. in care of Pacific Corporate Group www.pcgfunds.com; J.P. Morgan Partners www.jpmorganpartners.com; and Fort Washington Capital www.fortwashington.com.

About BlueArc

BlueArc Corporation was founded in 1998 and delivers the world's highest-performance enterprise-class network storage system. BlueArc's systems are designed to simplify the way our enterprise customers design and build their storage infrastructures, allowing them to fully exploit their networks while dramatically lowering their total cost of ownership. BlueArc is able to provide products with groundbreaking speed, scalability and low total cost-of-ownership as a result of its unique SiliconServer architecture. This revolutionary technology removes the bottlenecks that limit performance in other network storage systems on the market today. The company is headquartered in Mountain View, California with UK operations based in Bracknell, England. More information on BlueArc is available on the Internet at www.bluearc.com