Bad Blood: Secrets and Lies in a Silicon Valley Startup – John Carreyrou
Theranos was supposed to the company that changed health care forever. The Silicon Valley startup had issued a bold proclamation that it had developed technology that could analyze a person’s blood and screen it against a multitude of known conditions, thereby providing early detection of sometimes fatal conditions. The startup attracted attention and investments from big name players, all highly interested in the potential of what promised to be a revolutionary product. Today, Theranos is gone, having officially become defunct in September, 2018. Its proposed device nicknamed “Edison”, never materialized into the product it was designed to be and the fall of Theranos left many with shock, frustration and anger. But why did a small company with such a game-changing idea, fail to live up to its potential? John Carreyrou is a journalist with the Wall Street Journal who received a tip about an obscure Silicon Valley startup plagued by internal problems and using deception as a tactic to accumulate investors. His investigation has resulted in this best-selling account of the rise and fall of Theranos.
The central figure in the story is Elizabeth Holmes, the wide-eyed young lady with bright blonde hair who envisioned a product that would project her to stardom in the male dominated world of information technology. Although she only completed two years at Stanford, she was able to launch the startup with the help of very wealthy investors. Interest into the product accumulated and in a short amount of time, the money rolled in. But as time went on, investors began to realize that little return was being shown. And as the facade slowly crumbled, the truth was revealed for the world to see. And even then, many on the outside of Theranos had no idea about what really transpired behind the scenes.
Former employees agreed to talk to Carreyrou, even in the face of legal threats from Theranos’s counsel. A widow also talked, even as she mourned the suicide of her husband, once one of the company’s best technicians. The picture that has come together is a web of secrets and lies that doomed the company from the start. This inside story is nothing short of mind-boggling and it is surreal that the startup existed for as long as it did. During its prime, it claimed as members of its Board of Directors, Henry Kissinger and Gen. James “Mad Dog” Mattis. Investors such as the savvy Rupert Murdoch also put their money into the startup, believing it truly did have an innovative concept that would change the world. The ability of Holmes to sway investors towards Theranos and finalize deals with major carriers such as Walgreens, highlighted the ambition behind her vision that carried a win at all costs mindset. But that same mindset would later prove to be her downfall and that of Theranos.
Interesting, Carreyrou does not enter the story until about midway. Prior to that, we learn about Holmes’s life and the foundation of Theranos. Contacts are reached and employees soon fill the roster of a promising young company. But as they would soon learn, there was far more than meets the eye and no one would come away unscathed. Leadership that evolved into tyranny cast a dark cloud over the startup and a revolving door of employees ensues. Carreyrou tells each of their unbelievable stories while covering the progress of Theranos step by step. But over time, optimism faded and former employees could no longer ignore the many illegalities and outright lies purported by the company. And as Carreyrou is beginning to learn about the startup, he finds assistance and guidance in the voices of those who were once on the inside. At this point in the book, the story picks up the pace and the battle between Theranos and the media, in particular the Wall Street Journal, is nothing short of a slug-fest.
The investigation by the Wall Street Journal, in addition with anonymous tips to the Center for Medicaid and Medicare services, combined to seal the fate of Theranos. And despite threats of litigation to the paper from Theranos’s legal counsel, the Wall Street Journal moved forward publishing a series of articles that opened the eyes of many to a deception that had gone unnoticed by even the sharpest of eyes. By the time the end came and the company was a shell of its former self, nearly all of the major players and investors were gone but the memory of Theranos remains firmly implanted in their minds.
Silicon Valley is full of startups, bristling with activity in the belief that it might by the next big thing in technology. But sometimes, a company can move too fast too soon, never stopping to evaluate itself and its motives. Haste of that nature combined with ego and vindictiveness, can combine to form a nexus of nefarious behavior that can only lead to defeat and in some cases, total destruction. This is the unbelievable story of the mysterious and ultimately disappointing, Theranos.