ESCALATE ATTRACTS TOP PARTNER FROM McKINSEY TO LEAD ONLINE MERCHANDISING AND E-COMMERCE PRACTICE

Escalate to augment world class merchandising solutions for online selling

Redwood Shores, California — February 29, 2000 — Escalate, Inc., the first E-commerce Service Provider (ESP), today announced that Michael Farello has joined its executive management team as Vice President, Merchandising and E-Commerce Practice. Mr. Farello recently held the position of Partner at McKinsey & Company, where he focused on retailers and large consumer goods clients facing growth or customer service challenges. He also led McKinsey's North American e-tailing initiative and hospitality, foodservice, and leisure sector. Mr. Farello joins Escalate to manage a broad vendor network offering sophisticated and cost-effective solutions for high volume e-tail sites.

"I have seen first-hand the difficulties traditional retailers, pure play e-tailers, and media companies have had both launching e-commerce businesses and charting a path to profitability. Escalate can fundamentally redefine the economics of e-commerce," said Farello. "I look forward to building the most complete online merchandising capabilities in the marketplace, and more importantly, offer distinctive insights into online merchandising based on our unique purview into multiple categories being sold in multiple selling environments."

"Merchandising is key to selling online, and is a profound differentiator for Escalate as a company. Michael is an extraordinary addition to the executive team," said Bruce Golden, partner, Accel Partners. "Companies who are making an e-commerce play know that the economics of e- business will continue to be tough under the current business model unless they are over $500 million in sales. Today companies are seeing how outsourcing is a model that works for them, and Escalate is the leader that will help them win."

"Michael brings superior e-commerce leadership to Escalate and our customers. He brings distinctive domain expertise in merchandising, retailing, online selling, customer service and supply chain, and he will play a seminal role in Escalate's business," said Keng Lim, President and CEO of Escalate. "In a very short time he has already recruited top talent from traditional retailers like The Gap, Banana Republic, and Williams-Sonoma to support our customers as they reach their full potential in this new Internet sales channel."

Mr. Farello earned a Masters of Business Administration with distinction from Harvard Business School, and received a Bachelor of Science with distinction in industrial engineering from Stanford University.

About Escalate
Escalate radically changes the economics of e-commerce. By outsourcing e-commerce to Escalate, customers reduce their time to market from nine months to six weeks and can focus financial resources on building their business, not infrastructure. As the first E-commerce Service Provider (ESP), Escalate takes a unique approach to deliver a complete outsourced e-commerce and online selling solution through its flagship e-commerce network. The Escalate Commerce Network provides the most comprehensive and integrated online selling solution, comprised of an end-to-end e-commerce management system with a vast product catalog, integrated supplier network, robust supply chain, and high-quality service provider network. Access to the Escalate Commerce Network is available to e-business customers, including large websites, retailers, e-retailers, e-marketplaces and emerging e-businesses.

Representative Escalate customers include such high profile e-businesses as Egreetings and Quokka Sports. A privately held company with over 100 employees, Escalate has raised more than $30 million in working capital from leading venture capital firms including Accel Partners, Norwest Venture Partners, and the Barksdale Group. Headquartered in Redwood Shores, California, Escalate serves Europe and Asia via offices in Paris and Tokyo. For more information visit Escalate's website at http://www.escalate.com.

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Escalate™ and Escalate to Market™ are trademarks of Escalate, Inc. Other names may be trademarks of their respective owners.

Lance Mercereau
Burson-Marsteller
415.591.4124
lance_mercereau@sfo.bm.com

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