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The Rise and Fall of Theranos and Elizabeth Holmes

Elizabeth Holmes’ biotech startup, Theranos, was valued to be worth $10 billion. However, in 2015, Wall Street Journal’s reporter revealed that its technology didn’t work. This discovery was followed by a variety of lawsuits and layoffs; finally, Holmes reported to prison to begin serving her sentence of 11 years and 3 months following her indictment for wire fraud.

The Story of Theranos

Theranos was a biotech startup that aimed to revolutionize the healthcare industry with cutting-edge blood testing technology. Holmes managed to secure high-profile investors and fawning press coverage, but it all came crashing down in 2015 when the Wall Street Journal revealed that Theranos’ technology didn’t actually work. To make matters worse, unsuspecting patients were getting blood tests on Theranos machines, endangering their health with false positives for conditions like cancer, HIV, and even miscarriage.

The Painful and Lengthy Fall of Millennial Steve Jobs

The fall of the woman formerly hailed as the next Steve Jobs has been a painfully drawn-out process, with Holmes’ legal team playing every card in the deck to delay this inevitable day. It usually doesn’t take so long after an indictment for a defendant to be found guilty and sent to prison. Nevertheless, Holmes’ case dragged on for years. Her legal team fought back at every turn, initially pleading not guilty and eventually changing it to guilty. Finally, today, she will begin serving her sentence of 11 years and 3 months in prison.

Timeline of Events

Here’s a brief timeline which highlights various events happened in the Theranos scam:

2016-2017: Lawsuits, Layoffs Abound

Once investors realized that Theranos was all smoke and mirrors, things got real litigious real quick. The US government began its investigation of Theranos in 2016.

2018: The Dissolution of Theranos

The company dissolved, and Holmes and Balwani were officially charged with fraud by the US government.

2021-2023: Elizabeth Holmes and Sunny Balwani go to Trial

Holmes and Balwani were supposed to be tried for fraud in June 2020. Holmes became pregnant with her first child, further delaying the trial. Though the two executives were supposed to be tried together, Holmes’ legal team successfully moved for separate trials. Holmes was found guilty on 4 out of 11 counts, and Balwani was found guilty on all counts.

Lessons Learned from Theranos

What can we still learn from one of the most infamous startup implosions of all time? Here are our takes on what Theranos says about the tech industry at large, and how it figures into the history of Silicon Valley.

Conclusion

Looking back, the story of Theranos is all too familiar now. Nevertheless, it shows how the tech ecosystem and the startup world can go wrong when we get too carried away with the promise of something we want to believe in.

Frequently Asked Questions (FAQ)

What was Theranos, and what did they do?

Theranos was a biotech startup that aimed to revolutionize the healthcare industry with cutting-edge blood testing technology.

What happened to Elizabeth Holmes and Sunny Balwani?

Holmes was found guilty on four out of 11 counts of defrauding and conspiring to defraud investors, and Balwani was found guilty on all counts.

What can we learn from Theranos?

Don’t do fraud.

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