Elizabeth Holmes was supposed to be the grrl powered answer to Steve Jobs, black turtleneck and all. At the encouragement of a professor, she dropped out of Stanford University at 19 years old to continue the startup that she (wait for it…) founded in her dorm room. She opened offices in Palo Alto, garnered high profile board members, heavy hitting financial backers, Ted conference appearances and eager media cheer leading as the dollars rolled in and she became America’s youngest female billionaire.
Her stratospheric rise was a shot across the bow to the male dominated tech industry (the medical tech industry, at least) demonstrating that yes, women can do it too and you’d better be ready for us.
Disruptive technology, they say
The revolutionary product at the core of Theranos (a company name beget from “therapy” and “diagnosis”) was a proprietary blood test method that only required drops of blood through a pin prick at the pharmacy versus big needles and vials full of blood, a doctors visit and a lab order. Results would be delivered within a few hours, versus days, be more affordable, less intimidating and accessible to the masses.
This was the disruptive answer to the $75 billion dollar a year market dominated by lab testing giants Quest Diagnostics and Laboratory Corporation of America (LabCorp.) A deal was struck with Walgreens to offer Theranos tests in select locations, with more on the way.
Then, right before the IPO, the balloon popped. In October, a series of reports emerged ranging from FDA allegations of uncleared medical devices to employee allegations that Theranos isn’t using the technology they claim to have. What happened?
The list of board members at Theranos is impressive, albeit one comprised mostly of DC insiders and people completely disconnected with the medical technology industry. What interested them? A strong likelihood is the desire to corner the market on less expensive lab tests, especially since both LabCorp and Quest have both been prosecuted for diagnostic testing fraud before.
Moreover, Theranos technology ostensibly replaces visits to primary care doctors, a welcome relief to existing federal programs as well as the imminent costs of Obamacare. Hence, the ability to get on board was probably too big a temptation for the early adopters to ignore. Throw in a blond female Stanford dropout in silicon valley as the face of the company, and it looks like nobody even bothered with basic due diligence – it was just too good to be true.
What about Elizabeth Holmes, the illustrious founder? Yes, she’s a billionaire—but only if you take in the exuberant valuations of Theranos, of which she is 51% owner. The “self made billionaire” line is watered down a bit more considering it was all men who gave her the 400 million in actual cash raised. Her mother was a congressional staffer while dad held several executive positions at USAID, undoubtedly facilitating access to connected men like Henry Kissenger, an early Theranos board member.
Holmes is a child prodigy who, while living abroad at age 9, claims to have sold C++ compilers to Chinese customers (citation needed), and also got the privilege of working at the Genome Institute in Singapore the summer after her freshman year at Stanford, since she speaks Mandarin, they say.
Whether or not she speaks any Mandarin (props to anyone who can find a clip of her doing so), the gleeful writers trumpeting this grrl power accomplishment neglected to realize that Singapore’s native language is English, not Chinese. Even the Genome Institute web site is English-only, and none of the student programs require Chinese language. Because Holmes is a Silicon Valley fixture with a Chinese connection, she’s recently been paraded around as America’s answer to Jack Ma.
Reality check: she quits school at 19 years old to run a medical technology startup in several areas where PhDs spend decades researching just one aspect of each, and we are supposed to accept the fact that she’s got it all figured out, just like that? Got it.
This ain’t the taxi business, honey
Fast forward past the Tech Crunch presentations, the black turtlenecks and mystery shrouded secret-sauce technology at Theranos and exaggerated business relationships, and people are finally starting to wonder. Walgreens recently halted the addition of any more Theranos machines at their pharmacies until questions about their accuracy are answered.
The scientific community is finally questioning the science behind the tests, and while Thernanos talks transparency they have yet to deliver the goods. Hopefully by now they at least have a lawyer good enough to identify when they might actually be selling medical devices, but who knows.
In the end, the Silicon Valley community and the media in general fell in love with the story. After the firing of Ellen Pao from her short stint at Reddit, the likely canning of Marissa Mayer from Yahoo in the not-too-distant future, it hasn’t been looking too good for females in senior tech roles lately.
If Theranos fails, given all of the smoke and mirrors and the backing from several rich powerful men on both coasts, it would be ridiculous for Holmes to blame the patriarchy – and truthfully, she doesn’t seem the SJW type. But that doesn’t mean someone else won’t do it for her. Stay tuned.
Read More: The Truth About Women In STEM