InnerWireless Secures $7 Million in New Private Equity Funding

Rho Ventures Becomes Newest Investor

Richardson, Texas – July 29, 2002 – InnerWireless Inc., an in-building wireless systems and services company, has accepted $7 million in new equity capital from Rho Ventures targeted to expand the company's sales efforts and accelerate the deployment of the company's in-building wireless systems. To date, InnerWireless has raised a total of $25 million in equity capital.

Rho Ventures, a New York-based venture capital firm, focuses on technology and healthcare investments and joins InnerWireless' list of high-profile venture capitalists including Sevin Rosen Funds, Technology Associates Management Company (TAMC), Massey Burch Capital Corp. and HO2 Partners.

"We believe that reliable coverage inside buildings is the next frontier in the wireless industry and that InnerWireless has developed the broadband technology, strategy and business model to dominate this market," said Yag Patel, principal of Rho Ventures, who will be joining the InnerWireless board of directors as part of the financing. "Our substantial investment in InnerWireless illustrates the tremendous potential we believe enabling a broad spectrum of wireless voice and data services inside of buildings offers to this industry."

"This investment allows us to accelerate our aggressive pursuit and to expand our reach in the enterprise, real estate and wireless carrier markets," said Ed Cantwell, president and CEO of InnerWireless. "The confidence shown by the investment community, especially now, speaks volumes about the in-building wireless industry and our model for providing multiple wireless voice and data services and protocols – including 2G, 2.5G, and 3G cellular/PCS, wireless LAN, paging, and two-way radio, with our InnerWireless system."

About InnerWireless
InnerWireless Inc. is an in-building wireless technology, systems and services company that brings the promise of anywhere, anytime wireless communications to high traffic public spaces, commercial office buildings and enterprise campuses. The company's InnerWireless system employs patented technology to converge wireless voice and data onto a single in-building infrastructure that is reliable, efficient and versatile. One InnerWireless system can simultaneously provide coverage for multiple services from 400 MHz to 2.5 GHz using any current or future wireless protocols, including GSM, TDMA, CDMA, 2.5G, 3G, iDEN®, LMR, paging and 802.11 b/g.

About Rho Ventures
Rho Ventures is a New York-based venture capital firm with extensive investments in the technology, healthcare and electronic information sectors. Since it was founded in 1981, the firm has invested in numerous companies including Active Power, Capstone Turbine, Ciena, Commerce One, Compaq Computer, Copper Mountain, Diversa, Human Genome Sciences and MedImmune. Aggregate venture capital under management exceeds $1 billion. Additional information can be found at www.rho.com.

InnerWireless is based in Richardson, Texas in the heart of Telecom Corridor® and can be found on the Web at www.innerwireless.net.