The gender factor also played a role, as Carreyrou highlighted in his book: “There was a yearning to see a female entrepreneur break out and succeed on the scale that all these men have: Mark Zuckerberg, Larry Page and Sergey Brin, Steve Jobs, and Bill Gates before them.” As a young, conventionally attractive woman, he adds, Holmes was also able to charm many of the older men who eventually backed her.Ĭarreyrou’s outside perspective helped him break the story. The technology simply couldn’t deliver as promised.
#Theranos reveal venture capitalism driver
“The culture of Silicon Valley created the conditions for someone like Holmes to come along, to thrive,” Carreyrou said.įor example, the valley is replete with mantras like “fake it until you make it” and “fail fast.” As Carreyrou noted, “Holmes’ grave error was to channel this culture, especially the fake-it-until-you-make-it part.” Applying such maxims to a medical product with life-and-death implications was a key driver of the Theranos downfall. Here are the main takeaways from Carreyrou’s discussion of the scandal. Professor Anat Admati, faculty director of the Corporations and Society Initiative, noted in her introduction for the event that “Theranos raises many questions,” and that Carreyrou could help the Stanford community by shedding light on what happened and what the audience can learn from this story. Holmes’s passion for the venture and Steve Jobs-like image (black turtlenecks and all) gained her the support of luminaries like Oracle founder Larry Ellison and former Secretary of State Henry Kissinger.īut the suspect science behind Theranos and its paranoid, secretive culture of leadership eventually caught up to the business, leading to criminal charges. In 2003, 19-year-old Elizabeth Holmes dropped out of Stanford University to start the company, which promised something revolutionary: accurate diagnoses of health conditions using a single drop of blood. The Theranos story was supposed to have a very different ending. He spoke before an audience in conversation with Michael Callahan, executive director of the Rock Center for Corporate Governance, which cosponsored the event. Carreyrou, a Pulitzer Prize-winning Wall Street Journal reporter, chronicled the downfall of Theranos in his book Bad Blood.Ĭarreyrou recently visited Stanford Graduate School of Business as part of a program organized by the school’s Corporations and Society Initiative. That’s how John Carreyrou described the high-profile plummet of health technology business Theranos from heralded Silicon Valley unicorn to disgraced cautionary tale, with founder Elizabeth Holmes and President and COO Ramesh “Sunny” Balwani facing multiple current fraud charges. One of the most epic failures in corporate governance in the annals of American capitalism. Theranos founder Elizabeth Holmes epitomized Steve Jobs, which attracted Silicon Valley investors who didn’t look too closely at the health company’s claims, says John Carreyrou, the Wall Street Journal reporter who investigated Theranos.
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