“Don’t worry about tomorrow, we’re in great hands.”
In 2015, Bill Clinton, the former US president, said so as he introduced Elizabeth Holmes before an adoring crowd in New York.
He made it seem uncontroversial at the time. After taking Silicon Valley by storm, he celebrated the accomplishments of a woman who was America’s youngest female billionaire.
The hub of the largest tech companies in the world, this famous stretch of northern California is also synonymous with the rich white men behind them. They wore turtleneck jumpers and clever trouser-sneaker combinations.
Holmes, a Harvard dropout and high school computer genius turned Harvard dropout, was a true gatecrasher. Her astonishing rise to Forbes cover was powered by Theranos’s rapid ascent to a $9bn peak valuation and her founding of health technology company Theranos. It’s clear why when you look back at what it promised to deliver, it’s clear.
It was revolutionary blood tests that were the core of its pitch. They could be done at incredible speed with just a drop of blood – and without needles.
Holmes’s catchphrase was “change the world” because the equipment she had created could detect dozens of diseases in one go.
She argued that it would transform healthcare in America, not only by streamlining and speeding up visits to the doctor but also by making such visits unnecessary by selling the gizmos at stores.
Although it took over a decade for such claims of science-fiction to be exposed, Holmes’s shambolic willingness to talk the talk helped her become one the most beloved Silicon Valley figures, raising hundreds upon millions of dollars from venture capitalists and investors.
Theranos’ public image grew as she grew. She was the perfect face for one of America’s most exciting companies. Theranos famously adopted the turtlenecks of her idol Steve Jobs and spoke in a deep voice that added gravitas to every word.
While fame is not for everyone, Holmes found it to be easy.
It seemed like nothing could go wrong. It did, however. Big time.
The truth about the lies
Holmes’s empire collapsed after The Wall Street Journal published a bombshell expose revealing that Theranos’s technology had serious flaws.
The “nanotainers” were the devices that collected blood from people. Theranos claimed that they had used equipment from other companies to perform blood tests in their laboratories.
The Journal’s most disturbing report revealed that Briton Ian Gibbons (ex-chief scientist of the company) had attempted suicide after telling his wife that the technology did not work. Shortly after, he died from liver failure.
Just a month after Holmes and Bill Clinton shared the stage, the stories were born.
Sky’s Ian King described how Theranos was able to keep the wool firmly on the public’s eye three years after its report. It had a cult-like culture with its employees and executives, as well as extreme secrecy.
Both are not unique to Silicon Valley. Some of Silicon Valley’s most prominent tech personalities remain a focus of worship in certain corners of the internet. However, they rarely combine to cause such a destructive effect.
John Carreyrou (the journalist who broke the story), has written a book called Bad Blood about the scandal, which is now being made into a feature movie. It’s a bit of a cruel irony, that the film is being produced by Apple. Apple’s late co-founder was an inspiration to Holmes.
Her rise and fall inspired The Dropout podcast, as well as a Hulu series with Amanda Seyfried.
Holmes is portrayed as a determined, brave, intelligent, single-minded young lady who wants to succeed. It’s easy to root for her at first. Ana Arriola, Apple’s designer, tells Holmes, in a scene where she tries to recruit Holmes after the launch of the iPhone 1: “Honestly it’s just really exciting for me that you are a young female CEO instead of a cocky little guy in a sweatshirt.”
Holmes’s desire to become a star biotech industry figure quickly overrides all other instincts, including the willingness to tell the truth.
This is a trait that made some staff feel deeply uneasy. Not just Gibbons or Arriola. She describes her time at Theranos as “altruism through corrupt, unethical science fiction”.
A life untold
Holmes admitted to trying to keep Carreyrou’s disclosures under wraps. This prompted investigations by financial and medical regulators in the US. The 34-year old was indicted on criminal charges in 2018, a move that would have been impossible.
Ex-lover Romesh Balwani, president of Theranos ( ) was also accused. She was later accused of sexual assault. Each of them were charged with participating in a multimillion-dollar scheme defrauding investors and a separate scheme defrauding doctors and patients .
Rupert Murdoch, the American pharmacy giant Walgreens were just two of the investors who were defrauded. Similar big names were attracted to Theranos’s board of directors.
They included Henry Kissinger, George Shultz, former secretaries of state, and an exdirector of the US Centers for Disease Control.
Holmes had hoodwinked them all. Holmes had started Theranos at just 18 years old and quickly learned how she could tell her backers what they wanted.
Eric Jackson, a founder of a startup and author of The PayPal Wars stated that “there is almost endemic in the system a necessity to, I don’t want to exaggerate but to tell an investor-compelling narrative. If you don’t have credibility, hype is a sign of fraud.
Holmes claimed that she believed the company’s purportedly groundbreaking blood tests were real.
She told the court about her meetings with investors that she wanted to “transmit the company’s impact on people and health care”.
Prosecutors said such statements were due to a woman “out of money and time”.
After launching her company with family funds she received for her Harvard degree, it was time to make it mainstream and attract big-time investors and venture capitalists.
Jim Mattis, a former US secretary to defense, was once in love with Theranos and joined the company’s board.
“She chose lies when truth was needed”
Holmes was convicted earlier this year of fraud. Her years-long scheme to deceive the jury has failed to make an impact on her backers.
The case, which was as famous as her rise to fame, has captivated the entire world. US federal prosecutors are asking for the judge to sentence her for 15 years. This is a term that’s appropriate for “one the most significant white collar offenses Silicon Valley or any other District has ever seen”.
Balwani, who was also convicted in a separate case of fraud, will be sentencing next month.
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Robert S Leach, an assistant US attorney, wrote about Holmes in a 46-page report last week: “She repeatedly chose lies and hype over patient safety or fair dealings with investors.
“Elizabeth Holmes’ crimes weren’t failing; they were lying – lying in the most serious context where everyone needed them to tell the truth.”
Holmes’s attorneys counter-document, which totalled 82 pages, claimed that her reputation was permanently and unfairly damaged, as it had made her a “caricature” to be ridiculed and denigrated.
They ask for a sentence not exceeding 18 months.
Edward Davila, San Jose, California has received letters from more than 130 family members, former investors, and employees to request leniency.
Senator Cory Booker used his to hail Holmes (still only 38) as someone who “can make the world a better, despite making mistakes”.
She won’t be allowed to leave behind bars, regardless of whether that’s true.
