Startup funding:NEA ExploraMed Acclarent Johnson& Johnson/JJDC Ethicon

Startup funding:NEA ExploraMed Acclarent Johnson& Johnson/JJDC Ethicon

June 9, 2014

If you’ve ever worked for a startup you’ve heard words like venture capitalist, incubator and growth hack (it’s the new and already retired paradigm shift); and you’ve heard these words ad nauseam.   And those of us who have worked in the industry we take for granted the messy little tangled often fraudulent web that’s known as an incubator (idea) that gives birth to the startup (through the help of venture capitalist) to bring someone’s idea to life and is either sold to a larger company or is taken public (IPO.)

If I had a dollar for every time someone said they were a venture capitalist (usually meant to impress); again, fellas iron on your W-2 on the front and your net worth on the back of your cheap suits.  (Do it backwards though) because you’re the only one who cares (and when you’re staring at yourself in the mirror) it will enhance your image (if only in your own mind).  Harsh? Yep.  Accurate?  You bet.

It was every insecure man’s dream (in my experience) to want to one day put VC on their CV.  I guess you can only impress people with so many gold Rolexes, cheating on your golf game (which consequently came across as less important than cheating on the spouse); and, this picture isn’t Rockwellian but is it accurate.

People could not take credit for other’s ideas fast enough* or place blame quickly enough.  Thankfully distance (and therapy) brought clarity to what I once saw as accepted and “normal,” or just part of doing business-to where I now see it as The Sociopathic Business Model™.  It’s not ok to steal someone’s idea, pathologically lie to everyone while engaging in illegal activity, sell to a larger company (who was investing all along in the startup) for hundreds of millions and turn around and do it all over again.  But that’s what’s happening all the time. * well that link is down so here’s another, this isn’t EU “the right to be forgotten” doesn’t apply here but it’s a good indication we’re on to something.

So Josh Makower (Acclarent) thinks patents are important but wait is that inconsistent & contradictory language to action if he was sued over patent infringement?

Or did Josh Makower and the others named in the suit exploit weak patent law for personal financial gain?

 

“After all of the work we had put into this, the last thing we wanted was for someone to see the product, copy the idea and take it to market before we could,” Makower says. “It’s one thing to tell people you’re doing something special; it’s another thing to protect your IP.” Entrepreneur October 17, 2013

Makower again in 2013 when discussing his Boston-based wine accessory company Coravin, talks of protecting IP but what about Quest Medical Inc.’s IP?  Perhaps future investors would like to learn more about this case before funding Makower, Chang & Facteau as tactics from The Sociopathic Business Model™ state that all accomplices eventually become victims.  Dr. Bruce B. Becker & Quest Medical Inc. first likely saw them as accomplices but judging from the lawsuit (which settled out of court for an undisclosed amount) it’s clear they became victims of Makower, Chang & Facteau.  This is a pattern that’s usually encouraged, replicated & rewarded in startups or companies acting unethically or illegally.

And now to give more context:

NEA is one of the world’s largest and most active venture capital firms according to their website.

 

ExploraMed (ExploraMed II/ExploraMed III) is an incubator founded by Josh Makower in 2004 and also a partner with NEA since 2004 where ExploraMed II was in their portfolio with among others Acclarent which sold to Johnson & Johnson’s Ethicon Divison for $785 million in January 2010.  

 

ExploraMed is a venture-backed medical technology incubation company dedicated to the identification, creation and development of new medical device solutions. ExploraMed creates new ideas which match certain key fundamental criteria and add capital, intellectual property, and expertise in the fields of clinical, engineering, legal, strategic marketing, and financing, while focusing on efficient and timely development.

There are a few things missing from that bio and the bio on NEA site as well.  Like former CEO of Acclarent, Bill Facteau, who was recently part of  NEA but is no longer?  It’s not necessarily an indictment of any wrongdoing but at least he got a nice black and white out of the deal.

 

Josh Makower co-founded Acclarent in 2004 along with  John Chang and brought in Bill Facteau to be CEO.  Acclarent was able to raise over $104 million in VC money.   And Bill Facteau is now part of ExploraMed as part of the management team along with Josh Makower (also a Board Memeber and founder), while John Chang is project architect.  Johnson & Johnson has a subsidiary known as Johnson & Johnson Development Corporation (JJDC) and operates as venture capital division for healthcare.

 

Johnson & Johnson Development Corporation (JJDC)  funded $26 million to Acclarent and joined existing prominent investors New Enterprise Associates (NEA) Inc., Delphi Ventures, Versant Ventures, and Meritech Capital Partners.

 

Great to have Josh Makower of @NEAVC with us @JanssenLabs for the Meet with and J – mix #jlabsbaypic.twitter.com/QiM13KrT3D

— James Viola (@Violajj) September 17, 2014

 

 

So to recap:

Josh Makower Founder of Incubator ExploraMed is also

Josh Makower Partner in Venture Capitalist firm NEA that invested along with

Johnson & Johnson Development Corporation (JJDC) a Venture Capital Division of Johnson & Johnson (invested $26 million into Acclarent in January 2009)

All funded Acclarent which was co- founded by John Chang and Josh Makower (yep the same Josh Makower) where William M. (Bill) Facteau was named CEO

And almost a year to the date of Johnson & Johnson’s Development Corporation (JJDC) making the $26 million investment into Acclarent

January 2010 Johnson & Johnson’s Ethicon (yep the same Johnson & Johnson’s Ethicon) purchased Acclarent for $785 million.

Wow!  What could possibly go wrong with this scenario?  Certainly not any conflicts of financial interest or SEC violations ? It sure looks like Johnson & Johnson Development Corporation (JJDC) are thick as thieves with Josh Makower (as he’s educating the public on behave of NEA/JNJ’s JJDC and Janssen), John Chang and Bill Facteau via ExploraMed as they continue to support their efforts financially with Neotract, MoxiMed, and Nevro.  And now you’ve just met the flying monkeys  as we ease on down, ease on down The Yellow Brick Road.  And some are going to be easing on down a little more painfully since Johnson & Johnson sold KY-Jelly because they didn’t want to fill out paperwork on the 510 (k).