FORTUNE — Draper Fisher Jurvetson has quietly exited its investment in Polaris Wireless, a Mountain View, Calif.-based company that uses RF pattern-matching technology to determine the location of any wireless device (primary application is for E-911 compliance). But this wasn’t a sale to a strategic. Or an IPO. Or, most importantly, a loss.

Instead, DFJ generated around an 11x cash-on-cash return through a redemption. For those not familiar with the VC world, that’s pretty unusual. Not the redemption, per se, but a redemption that has double digits attached.

Here’s what happened: DFJ invested around $4 million into the company in 2001, but Polaris Wireless was never quite ready for a traditional exit. Probably too small for an IPO, plus all sorts of customer concentration and potential sensitivities related to its E-911 business. And management didn’t think it was ready yet to be sold. So DFJ and management spent the past year working on this redemption plan, which came to fruition last week.

It basically results in DFJ taking a bit less than what the company thinks it will be worth in a future sale for the sake of liquidating an old fund, but more than what the company is probably worth today. Plus, management now holds around 60% of the company’s common shares.

Fortune has learned the payout was $40 million, partially funded by a new $10 million equity infusion from Industry Ventures and a $15 million debt issuance (plus company cash). DFJ previously had gotten its initial $4 million back. Fellow investors Draper Richards and Palisades Ventures also had a redemption option, but chose to stay in.

CEO Manlio Allegra tells me that he is open to a sale, just not yet. “This is a company, not your wife or your kids where you’re with them for the rest of your life,” he says. “But we’re only in four countries so far, so there is plenty of growth potential left.”

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