Not long ago, Elizabeth Holmes was a tech industry “it girl”. She was the youngest self-made female billionaire, and she had a company that was absolutely exploding with growth, potential and fulfilled promise.
You may know the rest of the story… After an investigative reporter did a little digging, he found a thread and began to tug. Soon, Theranos and Holmes came crashing down. Now, Wall Street Journal reporter John Carreyrou has a new book out that sheds yet more light on what really happened to transform Theranos from the “greatest new thing” to a disgraced company almost overnight, while devastating Holmes’ reputation along the way.
Earlier this year, the SEC charged Theranos with fraud to the tune of $700 million, and the company is still under a criminal investigation headed by the Department of Justice.
The book is, reportedly, pretty tough on Holmes, who set out to develop a cheaper, more efficient competitor to traditional blood tests using “proprietary technology” that turned out to be a bit of a smokescreen. After Carreyrou’s expose in the Journal, Theranos was forced to void nearly two years of blood tests. And that was just the beginning.
In the book, Holmes is characterized as a hard-driving boss with “unrealistic expectations” about the speed of development. Promises about development and production were made that her R&D team could not hope to meet. Speaking to CNN, Carreyrou described Holmes in this way: “This was an incredibly ambitious woman. She wanted to be the second coming of Steve Jobs. It was an ‘ends justify the means’ situation. Perhaps she thought [Bill] Gates and Jobs faked it until they made it so why not her too?”
Some people have said Holmes was a victim of her youth and inexperience — she founded Theranos at 19, and was quickly able to connect with serious money people and industry power brokers. But Carreyrou’s narrative doesn’t let Holmes off with the “young idealist” excuse. His book, based on interviews with scores of former Theranos employees, claims Holmes “ignored warnings” from several different company workers who called her attention to issues with the company’s proprietary technology long before it became a, literal, federal case.
Holmes didn’t listen, at least according to the book, continuing to make promises and push forward, forcing some employees to take part in “explicit lies,” even going so far as to set up fake labs in order to impress high level people, including Vice President Joe Biden. Carreyrou told the media: “There’s no question in mind that she knew there was a risk that she was putting patients in harm’s way…”
And that takeaway, as much as anything, is what sent Holmes and Theranos crashing down. People perceived her as only caring about her own success, at their expense… and that’s a tough perception to change.