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State budget to fund more UC campus startup incubators

By   /   Friday, July 1st, 2016  /   Comments Off on State budget to fund more UC campus startup incubators

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Phillip Joens

Phillip Joens

Startups around the state got a boost with the stroke of Gov. Jerry Brown’s pen June 27 when he signed the state’s $171 billion budget. Included was $22 million earmarked for startup incubators at all 10 UC campuses.

Assemblywoman Jacqui Irwin, D-Thousand Oaks, proposed the initiative, which will give $2 million every year for three years to each UC campus and the Lawrence Berkeley National Laboratory to start or expand business incubators. The funding will be used to improve equipment and industry mentorship services and offset legal fees on UC campuses.

In a news release, Irwin’s office said UC startups employed 19,000 people and brought in $14 billion in revenue in 2014. Since 1980, 843 companies have started using UC technology. As the Diablo Canyon Power Plant near Avila Beach prepares to close over the next nine years and new support for new tech industries in the region will become more critical.

Impact hub opens

Speaking of incubators, the Impact Hub finally opened at its downtown Santa Barbara location during a reception June 28. Only a few months ago, sawdust covered bare concrete floors of the incubator and handfuls of two-by-fours sat silently after construction stalled.

A large investment by Kinko’s founder Paul Orfalea kickstarted the project in February. At the reception, bright blue, red and green LED lights in a main foyer glowed and new co-working offices sat freshly painted waiting to be moved into.

After the reception, Invoca founder Jason Spievak spoke words of wisdom to a large group of entrepreneurs gathered for the event.

Sientra stays mum

Sientra, the embattled Goleta-breast implant manufacturer, held its annual shareholder meeting June 23 at the Marriott Courtyard in Goleta. Just eight people, including two shareholders, attended the meeting, which officially lasted only about eight minutes.

The company stuck to its script and got the annual meeting, required by the Securities and Exchange Commission, over as quickly as possible. Shareholders in person and online re-elected five members of the board of directors. They also re-approved KPMG as the company’s independent financial auditor.

In case you’re new to the Sientra saga, Sientra shares plummeted Sept. 24 from $20.58 to $9.70 when the British Medicines and Healthcare Products Regulatory Agency suspended sales of implants made by Sientra’s Brazilian manufacturer Silimed on Sept. 23. Nearly simultaneously to the suspension Sept. 23, Sientra held a second public offering where it sold 3 million new shares for $22 each.

Regulators said during previous inspections by the agency, they found implants contaminated by microscopic particles of silica and cotton at Silimed’s factory. After repeated warnings, Silimed sales were suspended. The suspension did not affect Sientra products, but the company voluntarily removed them from the market later. The offering raised questions about how much Sientra knew about the looming actions by British regulators.

New investors are bullish on the stock, but the company is still facing two lawsuits regarding the scandal. Several court dates will be coming up later this year as those cases enter trial phases.

Since the scandal broke in September, shareholders have repeatedly asked me how much I know about what the company’s executives knew and when. Unable to get a comment from the company about the disclosures, I decided to buy one share and represent those litigious former shareholders at the meeting, which is supposed to serve as public forums for shareholders.
Jeffrey Nugent, who took over as CEO after founder and former CEO Hani Zeini resigned at the scandal’s height in November, rebuffed questions about the issue.

“That is a situation that is currently being reviewed and that’s something that we’re not able to comment on at this time,” Nugent said.

Asked what “reviewed” meant, Nugent said, “it’s something that the board has taken under consideration and that at this point our position is that there was no indication of any information, material information, prior to the secondary offering.”

When Nugent was asked about a Sept. 15 email Zeini sent to the SEC abruptly moving up the offering, Chief Financial Officer Matthew Pigeon jumped in.

“It’s our prerogative that we don’t comment on anything that’s tied to any litigation,” Pigeon said. “So any of these questions we’re not going to respond to.”

After attending the shareholder meeting, I walked out of the hotel thinking one thing: “They still have more questions to answer.”

• Contact Philip Joens at [email protected]

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