August 2007 Newsletter

On September 25, PCV will celebrate our success and our network at our annual PCV Forum, from 11:30 am – 1:30 pm, at the Pacific Athletic Club in Redwood City. Get your seats before they sell out!

To reserve a seat and learn more about the event, please go to www.registerone.com/pcv/register.asp.

The theme for this year's PCV Forum is "Investing for Change. Human, Financial and Intellectual Capital for California Communities." The featured speaker will be Manuel Pastor, Jr., Professor of Geography and American Studies & Ethnicity at the University of Southern California. The event will also feature a Portfolio Company Showcase and short film as well as great networking opportunities.

Event sponsors include: Accel Partners, Fenwick & West, Morrison Foerster and Rustic Canyon Partners (Gold Sponsors); Citibank, GKM Newport, Kimball Small Properties & Mercados Suvianda, Los Angeles Times, Merrill Lynch, New Resource Bank, Tallwood Venture Capital, Union Bank of California and Wells Fargo (Silver Sponsors); El Monterey, Lenders for Community Development and the Wonderland Center (Bronze Sponsors)

Pacific Community Ventures, with its affiliates, is proud to announce that it is now investing out of its third investment fund, Pacific Community Ventures Investment Partners III ("PCV III"). We are actively seeking investment opportunities in small, high-growth California companies. PCV III's mission is to build wealth for all of the stakeholders in a transaction – investors, owners, management and employees – by building, developing and maximizing value within the companies in which we invest. In addition to providing capital, we work closely with companies, providing hands-on strategic and operational guidance to create better economic results for all parties.

PCV and its affiliates manage Pacific Community Ventures Investment Partners I, II and III, and through the funds invests in high-potential companies across diverse industries, with a particular focus on the following sectors: food distribution and services, value-added manufacturing, and consumer and business services.

Employee Onramp, PCV's line of business that reaches hundreds of low-income workers of our portfolio businesses, continues to gain traction and produce positive outcomes. Through financial literacy education and asset-building programs, we are helping these workers build a more stable financial future.

In 2007, in partnership with Citibank, PCV has delivered 28 workplace-based financial literacy workshops -- in three different languages, reaching over 350 lower-income employees from 18 PCV Portfolio companies – across California. Forty-seven of these employees opened new bank accounts at workshops. Our financial literacy program has proven successful in helping employees improve their financial knowledge and move further into the financial mainstream, while reducing their reliance on predatory practices such as payday lending and check cashing services.

In June 2007, in partnership with Lenders for Community Development, PCV completed our fifth workplace-based Individual Development Account cohort. Eight employees from Give Something Back (Oakland, CA) opened new IDA accounts and began saving for an asset such as a house, retirement or education. Their savings will be matched two-to-one for their asset purchase when they complete the program.

In June 2007, Eduardo Rallo, Partner at PCV, was honored as one of "The 100 Most Influential Latinos in the Silicon Valley" by the Mexican American Community Services Agency, Inc. (MACSA). The Agency recognized Hispanic leaders in a number of categories including Business, Government, Arts, and Community Service. In addition to his work at PCV, Eduardo has also co-founded Brainstorm Ventures, World Wrapps Inc. restaurants, and is the founder and chairman of Farmacia Remedios and Resmex Restaurant Group. He serves as board member and has provided growth financing for many companies in California. We would like to congratulate Eduardo on this well-deserved recognition.

On July 19, 2007 the New York Times Business Section article "Community Investment in San Jose" featured Pacific Community Ventures' partnership with the City of San Jose to invest capital for financial and community benefit in San Jose. The piece focused on the City of San Jose's Economic Development Catalyst Fund -- which is managed by PCV, and recently invested in Bentek Manufacturing and Mercados SuVianda. These two companies will generate sales of more than $55 million and employ over 180 residents of San Jose's underserved communities in 2007. Click here to view the New York Times article.

PCV has had an article accepted for publication by the Stanford Social Innovation Review, the journal published by the Center for Social Innovation at Stanford's Graduate School of Business. Entitled "Private Equity, Public Good," the piece will appear in the Fall 2007 edition.

PCV has delivered Business Roundtables to seven companies from the Bay Area, Los Angeles and San Diego this year. Business Roundtables are structured strategy sessions where a single PCV company presents its business and growth strategies to a panel of approximately five to ten volunteer business advisors from a range of disciplines. These dynamic two-hour lunchtime sessions prove to be extremely valuable for the presenting company and a great networking opportunity for advisors. Companies and advisors alike often provide very positive unsolicited feedback following a Business Roundtable:

"I found the Roundtable to be very valuable for the company and a great use of advisors' time."

--PCV Business Advisor Ron Yara, Partner, Tallwood Venture Capital

"Thank you very much for organizing yesterday's Roundtable. It was a hugely insightful and helpful process for me. The range of topics covered in such a short period of time was very impressive! I could not have imagined a better group to offer advice on our existing business and new growth opportunities; it seemed that every discipline and such a broad range of perspectives were represented. I only wish I could have kept them in there for a few more hours!"

--Kathryn Money, President & COO, Melissa Joy Manning

Crunchy Foods, located in Oakland, produces branded and private label biscotti sold in a variety of gourmet groceries, retailers and specialty stores including Andronico's, Mollie Stones, and Peet's Coffee and Tea.

Lyon Technologies, located in San Diego, manufactures equipment used in the poultry and veterinary industries.

Marin Designworks, located in Sebastapol, designs and manufactures high-quality art glass tile.

Melissa Joy Manning designs, manufactures, and distributes unique handmade jewelry through its production studio and showroom in Oakland.

Sleepquest, located in Redwood City, provides diagnostic and remediation services and products for people with sleep disorders.

SunMan Engineering located in San Jose, provides high-quality and cost- efficient mechanical and electronic engineering services spanning the range from product concept to final product manufacturing to OEM's in the high technology and electronics industry.

Wah King Noodle Co., located in the Boyle Heights area of Los Angeles, produces high-quality dry Chinese noodles for the restaurant industry.