Share with your friends!

Elizabeth Holmes was the youngest person to ever be featured on the cover of the business week. She was also the subject of a two-part article in vanity fair and an episode of 60 minutes. In fact, she was on so many magazine covers that it would be hard to list them all.

By age 30, Holmes had amassed over $4 billion from investors and companies interested in partnering with her company, Theranos. But it turned out that she was faking results from her blood test machines, and that it wasn’t reliable at all!

A real-life Frankenstein story

rise and fall of theranos - frankenstein

Elizabeth Holmes is a real-life Frankenstein. She’s the kind of monster that makes you wonder what kind of person would do such a thing, and why?


Then again, she’s also a fraud and liar who conned investors out of more than $1 billion dollars while lying to them about her company’s technology.

So why did I say “real-life Frankenstein”?

Well, because it turns out that Elizabeth Holmes’ story was basically ripped straight from the pages of Mary Shelley’s classic novel about an inventor who creates life in his laboratory only for it to turn against him — or at least that’s how I interpreted it when I saw The Prestige (which by the way is one of my favorite movies).

In any case: if you haven’t heard about this yet then let me fill you in…

How Elizabeth Holmes started

Elizabeth Holmes was born in 1984 (same year as Mark Zuckerberg) and grew up in San Diego. Reportedly, when asked what she wanted to be when she grew up, she replied cooly ‘A billionaire’.

She was a straight-A student who graduated high school at 16 and went on to attend Stanford University.

While there, she studied chemical engineering – but dropped out before graduating so that she could start her own company.

The original idea was a patch that would diagnose you, and cure you at the same time but that was more science fiction than reality so they pivoted to another idea that made use of micro-fluidics.

Finally, she worked with a professor named Channing Robertson (who is now one of her investors) on developing medical devices that would use micro-fluidics technology to detect diseases like cancer or tuberculosis by analyzing small amounts of blood or other bodily fluids through a simple pinprick test rather than taking samples from veins or arteries like traditional methods do today.

The whole thing was just a miniaturized glue dispensing robot which was the tech behind the device they called ‘the Edison’.

Rising slowly but surely

The story of Elizabeth Holmes and Theranos is a classic tale of Silicon Valley.

A young woman with a brilliant idea, who becomes an overnight success. She had already raised $1 million from venture capitalists by the time she was 21 years old!

And then things really took off: over the next few years Elizabeth became one of the most famous people in America–and not just because she was beautiful (although that certainly didn’t hurt).

It also didn’t hurt that she was a white suburban woman who came from a privileged background. She managed to assemble an all-star cast of investors and board members including former secretary of state, Henry Kissinger.

Making it big in silicon valley

She was a college dropout and a high school dropout, both at the same time!

And now she’s back in school again. Some people have credited Theranos’ success to the rapidly growing ‘#girlboss’ trend that occurred at the same time.

People genuinely wanted there to be a female Steve Jobs (who wasn’t perfect either as we’ve come to know).

People were quick to award her prizes and honors for her groundbreaking work such as the Breakthrough Prize in Science which is partly funded by Mark Zuckerberg.

And business publications were quick to hop on the hype train, the culmination of which was Forbes naming her the world’s youngest billionaire.

The technology world was also convinced. The impressive roster of board members lent an important air of credibility to the company, which made other investors want to join in.

Theranos even struck up a partnership with Walgreens to put their blood testing machines in their drug stores all over the country.

It really seemed like Elizabeth and Theranos were on top of the world.

The downfall, and now?

Then the house of cards started falling.

Whistleblowers started to come forward. John Carreyrou, a reporter from the Wall Street Journal probed deeper and deeper into the silicon valley darling. The company never really delivered on its lofty promises and vaporware accusations started surfacing.

They tried to keep it under wraps by threatening whistleblowers with lawsuits and the company counsel David Boies made this a very convincing threat.

They even went so far as to ask Rupert Murdoch, the owner of the wall street journal to ask his journalists to stop investigating Theranos.

In 2018, Elizabeth Holmes was sentenced to federal prison for two years. She may face additional charges as well, but for now, she has been sentenced and is serving her time.

Now her ex-boyfriend and COO of Theranos Sunny Balwani is also on trial.

The company itself has been devastated by these events and has not yet recovered from them. They have been sued by the SEC for fraud, which means that if you invested money in Theranos back when it was at its height of popularity (which was around 2015), then your investment may not have paid off–and could even be worthless now that the company is no longer operational or profitable.

Theranos’ story is a cautionary tale for investors. It shows that even if you think you are investing in a good company, it could still be hiding fraud from the public.

This means that your investment could be worthless now or in the future. The best way to protect yourself against this kind of thing is to diversify your portfolio, which means investing in more than one company at any given time.

The nasty side of silicon valley

Theranos was a fraud. Elizabeth Holmes, who founded the company, is in jail but she’s hardly the only one, she’s just the one who got caught.

Silicon Valley is full of frauds. It’s not just Theranos–there are many other startups that have been accused of similar things, including Zenefits (which sold insurance without being licensed) and Lending Club (which had its own financial scandal).

You can’t fool all the people all the time

As the great Abraham Lincoln once said, ‘You can fool some people all the time and all people some of the time but you can’t fool all people all the time’ and that’s exactly what happened.

Theranos is not a real company, and Elizabeth Holmes is not a real person. Theranos was a scam.

The rise of Theranos was built on lies and deception that fooled people into believing that they could be rich by investing in this fake company with its fake CEO who had no idea what she was doing or how anything worked.


We hope that you’ve enjoyed learning about Elizabeth Holmes and Theranos. It was an incredible story, but one that can teach us a lot about how not to run a business.

We may never know what really happened at Theranos, but we do know that this is one of the biggest falls from grace in Silicon Valley history. I think the biggest downside of this whole fiasco is not the loss of the investors’ money (they’ll be okay😇) but how much she has set women and the whole feminism movement back.

It should also serve as a warning that young entrepreneurship is mostly a myth and that there are no shortcuts to success.

I honestly believe, Theranos could have been successful if they had just worked on it a few more years. Of course not as successful as they would have hoped but certainly not the defunct company it is now.

Because now when people hear of a female entrepreneur, Elizabeth Holmes will come to mind. For more on this, you can read Bad Blood by John Carreyrou.

You might Also like: The Biggest Marketing Fails of All time

Share with your friends!

Don't miss out!
Subscribe To Newsletter

Receive top startup and online business news, marketing ideas, software tools to use, tips and more!

Invalid email address
Give it a try. You can unsubscribe at any time.

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.