This week IPwe, the company headed by former patent litigation king Erich Spangenberg, acquired ClearAccess IP, a venture-backed, Palo Alto-based IP analytics company associated through marriage with Google founder Sergey Brin.
The transaction comes on the heels of Ocean Tomo selling a majority stake last week to Denver-based private equity firm, Bow River Capital Partners. Consolidation in the IP services space has been well underway (and observed by IP CloseUp) and it is unclear if these particular transactions were facilitated by seller strength or weakness in this uncertainty-ravaged and Covid-slowed patent market.
In the case of the ClearAccess deal, the background of the principals adds to the mystery.
As reported this week by IAM’s Richard Lloyd, ‘Spangenberg expands services business with new AI acquisition,’ the veteran patent monetizer had been an early investor in ClearAccess IP. As recently as five years ago, Spangenberg had been described by many as one of the most egregious patent “trolls.” His firm, Dallas-based IPNav, filed and settled scores of allegedly dubious patent suits between about 2000 and 2014.
Nicole Shanahan’s history has a decidedly different arc. She began her career as a paralegal and went on to enroll as a student at Santa Clara Law School, where she was research assistant to NPE-baiter Colleen Chien. Shanahan is a fellow at CodeX, the prestigious Stanford Center of Legal Informatics, a joint initiative between Stanford Law School and Computer Science.
According to her LinkedIn profile she served at RPX, the defensive patent aggregator, for 10 months as a Patent Specialist.
As recently as September ClearAccess IP had added seed capital totaling $3.7 million from a group comprised of six investors, including Alpana Ventures, Plug and Play Ventures, Founder’s X and Bill Tai, among others. It may have been seeking cash to fund operations prior to an exit.
For IPwe’s part, it had been involved in bitcoin and blockchain IP, and has an established presence in China and France. Now, it may have opened a door to whole new world.
$100 Million Gift
Shanahan has been associated with Sergey Brin, founder and now Chairman of Alphabet, Google’s parent, which has been known to oppose strong patents. Business Insider wrote in October 2019 that the couple had secretly wed in 2018 and Shanahan and had given birth to the couple’s child. They had been dating since 2015.
Brin was previously married to 23andMe founder Anne Wojcicki. In 2013 Shanahan was married to a Bay Area investor Jeremy Asher Kranz. The Chronicle of Philanthopy reported in 2019 that Shanahan gave $100 million to reproductive research and other causes. Shanahan launched the Bia-Echo Foundation, which focuses on equality-based investment in areas such as Reproductive Longevity & Equality, Criminal Justice Reform and Healthy and Livable Ecosystems, naming herself to the board. A press release states that she had named several prominent professionals to the board alongside her.
What Shanhan was thinking taking capital from former IPNav CEO Spangenberg is not clear. IAM’s Lloyd believes that ClearAccess and IPwe likely share a common focus on greater transparency in the transactions space.
Where Two Heads Lie
Given the parties involved, and that where two heads lie their are no secrets, the IPwe acquisition could mean that Google is toying with a more aggressive patent strategy, or that Spangenberg is considering a more defensive, operating company-centric approach in the ever-evolving world of patent monetization. For him, ClearAccess may be just that.
On the other hand, the IPwe – ClearAccess combination could mean that with increasing family and philanthropic commitments, Shanahan may simply have too much on her plate right now to focus on patent-deconstructing algorithms. Terms of the transaction were not announced.
Image source: zimbio.com; medium.com