“There are no shortcuts to any place worth going.” – Helen Keller
I’ve been listening to the Dropout podcast about the Elizabeth Holmes trial this fall. She is charged with 12 counts of felony fraud in regards to how she handled investor money and advertised to patients. As I said in a previous post, High-Tech Drama I’m fascinated because in my career, I’ve been privy to all the money in high-tech, mostly at Microsoft and how it influences innovation and character.
Elizabeth Holmes was 19-years-old when she dropped out of Stanford and started Theranos in 2003. She positioned the company as a start-up that would revolutionize the blood testing industry by being able to test for a wide array of factors on a portable testing device that only required a small volume of blood.
It never worked – or at least not reliably. For the short time that the devices were rolled out at Walgreens, they provided bad test results like telling a man he had indications of a prostate problem when he didn’t, another that he was HIV+ when he wasn’t, and an excited mother-to-be that she’d miscarried when in fact she hadn’t. Clearly, there were major problems with big consequences for people that received inaccurate results.
I think this trial could be titled “What happens when you give a 19-year-old college dropout 750 million dollars.” (To be fair, Elizabeth Holmes raised most of the 750 million dollars when she was in her 20’s.) I don’t assume that you have to go to college to be a success but I would think that some training or apprenticeship on how to be a leader, manage finances and run a company, whether it be institutional learning or otherwise would be helpful.
It’s left me wondering if it’s possible to develop character when you are 19 years old and people are throwing money at you. It’s been intimated that she shows narcistic tendencies but I would think it would be more surprising if she didn’t, given that trajectory.
Elizabeth Holmes, who is now 37 years old, testified at the trial. I cannot begin to do justice to all of her testimony but she seem to do a beautiful job of representing herself. She said there’s many things she wished she did differently – like when she put logos from other companies on documents to make it seem like a 3rd party endorsement. But there’s a lot that she can’t remember, even when emails and texts are read to refresh her memory. Her defense has pointed the finger at a lot of other people: the investors should have done better due diligence, the lab director should have spoken up more loudly, her boyfriend and COO was controlling her and so on.
The thing that I heard Elizabeth say that resonated a great deal with me was something like “The investors weren’t interested in the details of what we could do today, they wanted the big vision of what we could do in five years.” Whatever her intent was in making false statements, that matches much of what I’ve seen in high-tech. People want the hear the magic of what might work one day and are willing to entertain a lot of smoke and mirrors in the process of trying to make something real.
If Elizabeth is found guilty (the jury is currently deliberating), there must be hundreds of CEO’s currently doing exactly the same thing. In no way am I justifying lying and deceitful practices but I’m affirming that venture capitalists of Silicon Valley aren’t usually trying to create truth-tellers and reinforce good values.
All I can say is that I’m really glad that no one handed me three-quarters of a billion dollars at age 19, or at any age. I’ve gained so much character by having to earn one dollar at a time.
(featured photo by Pexels)
Surprised By Joy 
The whole high-tech world is very foreign to me, and it seems so bizarre that people with no life experience are being given massive amounts of money by investors.
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Yes! – bizarre is exactly the right word! And truly bizarre that they (anyone involved in the enterprise) expect it to work out well for anyone!
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Character building rarely occurs on the mountain tops in life or when we’re given everything on a silver platter. It’s through the valleys with one step in front of the other trying to scale the next mountains that our character is developed.
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Perfectly said, Nancy! Yes!
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I haven’t been following this case, Wynne. Thanks for sharing your insights. I agree with your concluding remarks. Lots of money does, indeed, corrupt character building.
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It’s an interesting case for sure. Thanks for listening to my moment on the soap box. 🙂
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It’s very interesting you blogged about Elizabeth Holmes because prior to a week ago I’d never heard about it but read this past week that a biopic is being made about her life.
19 seems like such a baby at this age I’m in now but I can only imagine how grand and big she must’ve felt at that age, especially with all that money being thrown at her.
I agree that the owners and investors must also be held accountable for what came from her actions. It’s not all on her.
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That’s so interesting that you just read about her. She’s an interesting character for sure – I bet it’ll be good.
Yes, regardless of the outcome of her trial, I wonder if anything will change with the investors. Food for thought at least!
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Charismatic people tend to over inflate their abilities, both in their own minds and outwardly to others. Who would be able to float out such grandiose ideas unless they utterly believed them? My second husband was in the film industry and was very charismatic. He got a lot of people excited about long shots, myself included. People see the successes that billionaires have and they desperately want that for themselves so they deliberately turn a blind eye to anything which could potentially derail their dreams. Reality is for us day to day Joe and Joannes, the stratosphere is where they wish to live, so the two don’t ever coexist! I was the moral compass of our company, so I was perceived as the negative one! Being a moral compass is difficult and unsavory, most people don’t want that job!
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You describe the problem, cycle and believability so well, Tamara. I had a similar role with a former business partner so I can relate to how hard the job is that you had. But I can’t imagine how magnified it was to be married to the charismatic. Whew – hats off to you for holding the line and making it through with your psyche and spirit intact!!
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Thanks! It certainly took a lot out of me! At the time we had a couple as our business partners and a few years afterwards I spoke with the wife, who said she was happy I had validated her memories, because once she was out of the situation she had questioned if it was real or if she had made it all up, since it was so unbelievable! I had been journalling through it with the task of writing a making of the movie book, and rereading some of it, I can guarantee that if I ever did write a book about it that people would never believe it to be true! 😬
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Oh my goodness – I can totally relate to this comment. I have stories from running that business that are completely unbelievable. Truth is the strangest fiction for sure. I bet it was nice to commiserate with the business partner’s wife. The hardest part is when you feel like you are the crazy one.
But I would think writing a book about that time, would be hard. At least for me, I’m so grateful that I’m through that phase so even though I think the stories are pretty funny now, I don’t spend a lot of time hanging out with them!
What do you think? Will you ever write that book?
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