5 Mind-Blowing Stories About Elizabeth Holmes & Theranos From John Carreyrou's 'Bad Blood'
On Monday, March 18, the Theranos documentary The Inventor: Out for Blood in Silicon Valley premieres on HBO. It promises to explore the rise and fall of Theranos, a biotech startup that promised to revolutionize the healthcare industry with a new kind of blood testing machine. Instead, the company defrauded investors of hundreds of millions of dollars, and put many other people's health at risk. Pulitzer Prize-winning journalist John Carreyrou followed the story of corporate fraud for years, and chronicled each mind-blowing moment in Bad Blood: Secrets and Lies in a Silicon Valley Startup, his bestselling book about Theranos company and its enigmatic founder and CEO, Elizabeth Holmes.
The Elizabeth Holmes story sounds like something out of a Silicon Valley fairy tale: At 19 years old, she dropped out of Stanford University and began raising money for a device that would make blood testing faster, easier, and more accessible. With the help of big-name investors, including venture capitalist Tim Draper, entrepreneur and Oracle co-founder Larry Ellison, media mogul Rupert Murdoch, Mexican business magnate Carlos Slim, and members of the WalMart's Walton family, she was able to raise the value of Theranos to over $9 billion, and increase her own worth to an estimated $4.7 billion. But there was one catch: the technology she promised her investors — the machine she put out into the world with the promise it could improve lives and innovate healthcare — did not work, and Holmes knew it.
"A sociopath is often described as someone with little or no conscience," writes Carreyrou in Bad Blood. "I’ll leave it to the psychologists to decide whether Holmes fits the clinical profile, but there’s no question that her moral compass was badly askew. I’m fairly certain she didn’t initially set out to defraud investors and put patients in harm’s way when she dropped out of Stanford fifteen years ago [...] But in her all-consuming quest to be the second coming of Steve Jobs amid the gold rush of the “unicorn” boom, there came a point when she stopped listening to sound advice and began to cut corners.”
Carreyrou followed the story of Theranos from the very beginning, chronicling its almost mythological rise to its calamitous fall, and all the chaos and confusion in between. In writing Bad Blood, Carreyrou interviewed over 150 people, more than 60 of them former employees of the company. The stories Carreyrou he recounts in his book may sound outrageous or even impossible, but you know what they say: The truth is stranger than fiction.
Here are 5 of the most bonkers moments from the very true, very bizarre Bad Blood.
Elizabeth Holmes was obsessed with Steve Jobs — and I mean obsessed.
It isn't unusual to look up to or idolize another successful person in your field, but Elizabeth Holmes took hero worship to the next level. According to Bad Blood, the Theranos founder went out of her way to emulate her idol, Steve Jobs. Not only did she wear black turtlenecks, like the Apple founder, but she also hired a security detail to drive her around without plates. Jobs was known to lease a new car every six months so he could avoid having plates, too.
Holmes referred to the Theranos blood-testing system as "the iPod of healthcare," and even nicknamed it "the 4s." When it came time to design a company website, Holmes chose the same ad agency Apple used for its most iconic campaigns.
Even stranger, Holmes mimicked Jobs's behavior at work. "Elizabeth was borrowing behaviors and management techniques described in Walter Isaacson's biography of the late Apple founder," writes Carreyrou. Apparently, Theranos employees "were all reading the book too and could pinpoint which chapter she was on based on which period of Jobs's career she was impersonating."
The nepotism ran deep at Theranos.
The former president and COO of Theranos, Sunny Balwani was Holmes's right hand man and her biggest ally at the company. He was also her boyfriend. Although they tried to keep their relationship a secret at first, Holmes and Balwani's romance became a well-known fact at Theranos. But the nepotism didn't stop there.
In Bad Blood, Carreyrou reveals Holmes hired her brother, Christian Holmes, as the associate director of product management. He, in turn, hired four of his fraternity brothers from Duke to come work at Theranos. Wildly unqualified for the job, Holmes was known to read ESPN articles he copied and pasted into empty emails, to appear as though he was working.
Loyalty wasn't an option at Theranos. It was a requirement.
According to Bad Blood, many former employees say the same thing about Theranos: It was a workplace full of paranoia, mistrust, and suspicion, and it started at the top. Holmes and Balwani demanded loyalty from their employees, and when they didn't feel they were getting it, their reactions could be alarming.
Carreyrou writes that Holmes would compile "a dossier on the person she could use for leverage" before terminating an employee. When former engineer Kent Frankovich informed Holmes and Balwani that his side project, a bike-light, had taken off on Kickstarter, and that he would be leaving Theranos as a result, the company's CEO and COO attempted to force him to turn over the patent for it. They even got company lawyers involved. A friend of Frankovich and fellow Theranos employee saw it as "punishing Kent for his perceived disloyalty."
During one particularly intense speech to the Theranos employees, Balwani explained that “anyone not prepared to show complete devotion and unmitigated loyalty to the company should 'get the f--- out.'"
Theranos COO Sunny Balwani treated employees like servants, according to the book.
Holmes was far from the only problem at Theranos. According to Bad Blood, her then-boyfriend and the company's COO Sunny Balwani made the office a hostile one, to say the least. “Sunny, in fact, had the master-servant mentality common among an older generation of Indian businessmen," Carreyrou writes in Bad Blood. "Employees were his minions. He expected them to be at his disposal at all hours of the day or night and on weekends.”
In one instance, Balwani felt an employee known as "Big Del" wasn't working long enough hours. "He'd gone as far as to review security footage to track Big Del's comings and goings," writes Carreyrou. After a confrontation, Big Del gave his two weeks notice. As he was leaving on his last day, the former employee was chased by Holmes and Balwani who insisted he needed to sign a nondisclosure agreement. When he refused, Balwani sent security after him. They failed to catch up to him.
"Sunny called the cops," Carreyrou writes. "Twenty minutes later, a police cruiser quietly pulled up to the building with its lights off. A highly agitated Sunny told the officer that an employee had quit and departed with company property. When the officer asked what he'd taken, Sunny blurted out in his accented English, 'He stole property in his mind.'"
Holmes reportedly spoke in a false baritone.
Holmes's reported decision to use a lower voice than her natural one is perhaps one of her most bizarre decisions. According to several former Theranos employees, Holmes spoke in a false baritone, apparently "to get people's attention and be taken seriously" in the male-dominated world of Silicon Valley.
As former Theranos engineer Greg Baney explained to Carreyrou: "One evening, as they wrapped up a meeting in her office shortly after he joined the company, she lapsed into a more natural-sounding young woman's voice. 'I'm really glad you're here,' she told him as she got up from her chair, her pitch several octaves higher than usual. In her excitement, she seemed to have momentarily forgotten to turn on the baritone."