Liquid Engines Secures $9.2 Million Series C Led by The Carlyle Group; Charles Rossotti, Carlyle Senior Advisor and Former IRS Commissioner, Joins Board; Software Exec Gwen Spertell Joins as New CEO

Sunnyvale, CA – Liquid Engines, Inc., a cash flow and tax management software company, announced a $9.2 million Series C round of funding led by The Carlyle Group. The funding will enable Liquid Engines to expand the company’s sales and marketing operations. Additional investors in this round include Advanced Technology Ventures, Charles River Ventures, Catamount Ventures, Oak Hill Venture Partners, and Silicon Valley Bank. Liquid Engines has raised a total of $21 million since the company’s founding in March 2000.

Liquid Engines delivers to the CFO’s office a high-quality, high-integrity, low-risk way to manage cash flow and taxes, that is essential to survive in the post-Sarbanes era and that has been conspicuously absent until this time. The system provided by Liquid Engines is a first-of-its-kind, enabling corporations to save time and millions of dollars by replacing the cumbersome and error-prone practice of linking hundreds of spreadsheets to analyze and manage cash and tax effects in corporate transactions. The archaic approach of using spreadsheets is widely regarded as inefficient, inaccurate and not up to the scrutiny of financial auditors.

Liquid Engines also announced today that The Carlyle Group’s Senior Advisor, Charles O. Rossotti, has joined the board of directors. Mr. Rossotti served as Commissioner of Internal Revenue from 1997 to 2002. In 1970, Mr. Rossotti co-founded American Management Systems, Inc. (AMS), and for 27 years served in a variety of capacities, including President, Chief Executive Officer, and Chairman of the Board. AMS grew through his tenure, becoming a major international business systems consulting and systems integration firm with revenues of more than $1 billion. Mr. Rossotti’s expertise complements Liquid Engine’s existing roster of industry experts, including Nobel Economist Mike Spence, who serve on the company’s board.

Liquid Engines co-founder and chairman Edward Lazear, a Stanford University economist, said, “I am pleased to welcome Charles and Gwen to the Liquid Engine’s team. Their industry knowledge and leadership will help take us to the next level of success. He added, “There are some problems that CFOs and tax executives face that could not even be conceptualized until Liquid Engines came along. The complexity of the modern corporation implies that restructuring can be done in so many ways that only a few possibilities can be considered and those designs may be far from optimal. Our technology allows firms to find the structures that best align tax policy with business goals from among millions of possible alternatives. The high-powered proprietary algorithms available to all Liquid Engines customers monitor and report key cash and tax metrics as they perform the complex analyses.”

Mr. Rossotti said, “The Carlyle Group made this investment and I joined Liquid Engines’s board because the company delivers the most powerful technology for managing the tax affairs of complex corporations. As the number of legal entities and taxing jurisdictions involved in a company’s business increases, the difficulties of complying with the law while minimizing taxes becomes extremely difficult and often inefficient. Liquid Engines has the tools for managing this important business problem. I look forward to supporting the executive team to make Liquid Engines the technology company of choice for corporations seeking to improve the management of their tax activities.”

Included in today’s announcement, Liquid Engines has appointed accomplished enterprise software veteran Gwen Spertell president and CEO. Ms. Spertell will provide corporate, strategic, and operational leadership to the organization. Prior to joining Liquid Engines, Ms. Spertell was president and CEO of Intelligent Results, Inc. and COO of BackWeb Technologies, Inc. Additionally, Ms. Spertell spent eight years at Oracle Corporation where she served in senior management positions in sales, consulting, and alliance development, with her most recent position as vice president of global ISV alliances. She was previously president and CEO of Pacific Western Information Systems, where she served as the key architect for its flagship product, CompuTrust, a trust accounting application. Ms. Spertell succeeds Liquid Engines’ co-founder Ms. Arti Arora, who will continue as the company’s Chief Technology Officer.

“Liquid Engines possesses breakthrough technology and a dynamic team of experts propelling it forward,” said Ms. Spertell. “We are supported by the right individuals and funded by the right investors, giving us the muscle and insight necessary to provide solutions for key corporate customers. The team’s deep technology and tax experience enables us to aggressively pursue our next stage of growth.”

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