S3 Investment Company Comments on TSPartner Financials and Gives Revenue Guidance for Calendar-Year 2005 and Announces January 12 Conference Call with CEO Chris Bickel.

TEMECULA, Calif. -- Company Notes TSPartner's Cash Flow Positive Status as a Factor in Acquisition

S3 Investment Company (OTCBB:SEIH) today issued comments regarding its rationale for the acquisition of TSPartner announced earlier this week and released revenue projections for calendar year 2005. In addition, the company announced that it has scheduled a market conference call for shareholders featuring Chief Executive Officer Chris Bickel on Wednesday, January 12, 2004 at 12:00 P.M. (Noon) Eastern Standard Time. Individuals interested in participating should call 1-800-406-5356 at that time and reference S3 Investment Company.

In Wednesday's conference call, Mr. Bickel is expected to discuss the initial milestones that were reached before the end of 2004, the TSPartner acquisition and expectations for this new portfolio investment, further progress in the marketing of the COMPLY product, and the revenue projections for 2005. Mr. Bickel will also address questions from shareholders during the call.

Four major drivers were cited in the decision to acquire TSPartner:

1. Combining TSPartner and Securesoft into one subsidiary forms a complete, robust entity that is expected to take the COMPLY product and obtain a market leader position within the Enterprise software solutions for compliance application market. This combination will provide the new company with the personnel, operations, products & services and experience to bring this goal to reality within this calendar year.

2. Bringing the distribution of the COMPLY product in-house gives S3 Investment more comprehensive control and participation in the development of this critical market for the company.

3. TSPartner has a management team that is a perfect fit to round out the current S3 Investment Company management. With the addition of the TSPartner executives, the Board of Directors of S3 Investment Company is confident we have critical, final pieces of the company's management in place.

4. TSPartner is cash flow positive and has additional revenue sources other than the COMPLY product that exist currently.

S3 Investments also announced that TSPartner was cash flow positive every month in calendar-year 2004. TSPartner generates revenue from assessment and implementation work with healthcare facilities, migration work with former Data General customers in healthcare and other industries, technical services, and consulting services. The soon-to-be-named company, which will be the combination of Securesoft and TSPartner, has launched an aggressive expansion plan that requires additional capital. The acquisition by S3 Investment will provide this growth capital to allow the new subsidiary to implement this expansion immediately, which is expected to result in the goal of the COMPLY product being the market leader in the healthcare compliance market prior to the end of 2005. We are forecasting over $3,000,000 of revenue over the next twelve months for the new subsidiary company, we expect it to be cash flow positive in Q2 calendar year 2005 and to post a net profit of more than $250,000 during this same quarter.

S3 Investment Company as a whole is forecasting total revenues from subsidiary companies to total over $6,000,000 over the next twelve months. Earnings before interest, taxes and any amortization will be over $1,000,000 or over 16% of total sales. These forecasted numbers are conservative in nature and there are several areas of the company's business that could exceed the projected forecasts and thus improve the overall performance of the company.

Chris Bickel, CEO of S3 Investment Company, stated, "There has been significant interest expressed by our shareholder base in a statement of both the financial status of our recent acquisition and the revenue outlook for S3 Investments, and we felt strongly that making such a statement at this time would be appropriate. As we continue to do the work necessary to meet and exceed these forecasted financials, we are confident that the value of our investment portfolio will increase significantly as will the company's per share Net Asset Value (NAV). We will continue to work on a daily basis to build portfolio value through greater revenue in our subsidiaries and in turn provide value for our shareholders."

Company Profile

S3 Investment Co. Inc. (http://www.s3investments.com) is a Business Development Company regulated by the Investment Company Act of 1940. Its first operating subsidiary, Securesoft Systems Inc. (http://www.securesoftsystems.com), was acquired in April 2003 and is a leader in compliance and risk management software, services and Internet technologies for regulated industries. S3 Investments has also acquired 100 percent of Redwood Capital to participate in the fast-growing investment banking market in China. S3 is currently seeking to acquire additional synergistic companies and is focused on assembling a portfolio of investments that will provide value to its shareholders.

Any statements contained herein related to future events are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on forward-looking statements. S3 Investment Company, Inc. undertakes no obligation to update any such statements to reflect actual events.