11 ms·

According to Forbes, Theranos CEO Elizabeth Holmes now has a Net Worth of Zero

35 points by elsewhen 10y ago

a_small_island 10y ago
"FORBES spoke to a dozen venture capitalists, analysts and industry experts and concluded that a more realistic value for Theranos is $800 million, rather than $9 billion. That gives the company credit for its intellectual property and the $724 million that it has raised, according to VC Experts, a venture capital research firm. It also represents a generous multiple of the company’s sales, which FORBES learned about from a person familiar with Theranos’ finances." Wonder how much weight this holds
- jerryhuang100 10y ago
  i would say that valuing Theranos' IP at $76M is very generous as their portfolio of non-core patents has nothing to cover their proprietary Edison or whatsoever. Given such generous valuation and multiple does that means Theranos' revenue is just somewhere between $8M (100x as Uber) or $800K (less fund ever raised)? That would be pathetic.
xyzzy4 10y ago
Classic example of what happens when you don't diversify your investments. High volatility will sometimes drop your net worth to 0.
- rexreed 10y ago
  It's hard to diversity when your entire "wealth" is determined by a fictional valuation on non-liquid stock. I can offer to buy .0001% of your company that you own 100% for $20. That doesn't make you worth $20 Million.
  - ryan606 10y ago
    Exactly. See this: https://m.signalvnoise.com/press-release-basecamp-valuation-tops-100-billion-after-bold-vc-investment-c221d8f86ad7#.lxtccp5vx https://m.signalvnoise.com/press-release-basecamp-valuation-... "CHICAGO — December 1, 2015–Basecamp is now a $100 billion dollar company, according to a group of investors who have agreed to purchase 0.000000001% of the company in exchange for $1."
yial 10y ago
Here is a link :http://www.vanityfair.com/news/2016/06/elizabeth-holmes-net-worth http://www.vanityfair.com/news/2016/06/elizabeth-holmes-net-... That won't make you turn off your adblocker.
- waterphone 10y ago
  https://github.com/reek/anti-adblock-killer https://github.com/reek/anti-adblock-killer
  - yial 10y ago
    Thank you! That's pretty cool.
ealexhudson 10y ago
What interested me specifically about this: they call out the preferred participating stock. Is it rare? In my experience, not really - not common per se, but not necessarily rare. And being frank, most common stock holders are at a fair disadvantage through growth phases. I wonder if they apply this type of thinking for other potential-high-net-worth founders, who are likely to have most of their potential-worth tied up in a single organization. Surely this rule about treating the net value of such stock as being very low unless/until there was some kind of public sale or it had otherwise been crystallized somehow means that this type of founder will never feature in the rich list going forwards?
graffitici 10y ago
I'd imagine she probably took some money off the table in some of those investment rounds. Though no way of being sure, of course..
mmastrac 10y ago
This is a huge leap to peg her at zero. She might have taken some money off the table in a round. She might have used her stock as leverage with a bank to invest elsewhere, making a decent return on it (though potentially leaving her over-leveraged if the banks call those loans). If you've got a billion dollars in paper money, I don't see it as far-fetched that you could turn that into a few hundred million of cold, hard cash with some basic financial advice.
- dragonwriter 10y ago
  > This is a huge leap to peg her at zero. Its no more of a leap than the earlier peg at $4.5B
aficiomaquinas 10y ago
"From 4.5 B to Zero" a new book by Elizabeth Holmes. https://twitter.com/aficiomaquinas/status/738079483081547777 https://twitter.com/aficiomaquinas/status/738079483081547777

35 points by elsewhen 10y ago

"FORBES spoke to a dozen venture capitalists, analysts and industry experts and concluded that a more realistic value for Theranos is $800 million, rather than $9 billion. That gives the company credit for its intellectual property and the $724 million that it has raised, according to VC Experts, a venture capital research firm. It also represents a generous multiple of the company’s sales, which FORBES learned about from a person familiar with Theranos’ finances." Wonder how much weight this holds

jerryhuang100 10y ago
i would say that valuing Theranos' IP at $76M is very generous as their portfolio of non-core patents has nothing to cover their proprietary Edison or whatsoever. Given such generous valuation and multiple does that means Theranos' revenue is just somewhere between $8M (100x as Uber) or $800K (less fund ever raised)? That would be pathetic.

xyzzy4 10y ago

Classic example of what happens when you don't diversify your investments. High volatility will sometimes drop your net worth to 0.

rexreed 10y ago
It's hard to diversity when your entire "wealth" is determined by a fictional valuation on non-liquid stock. I can offer to buy .0001% of your company that you own 100% for $20. That doesn't make you worth $20 Million.
- ryan606 10y ago
  Exactly. See this: https://m.signalvnoise.com/press-release-basecamp-valuation-tops-100-billion-after-bold-vc-investment-c221d8f86ad7#.lxtccp5vx https://m.signalvnoise.com/press-release-basecamp-valuation-... "CHICAGO — December 1, 2015–Basecamp is now a $100 billion dollar company, according to a group of investors who have agreed to purchase 0.000000001% of the company in exchange for $1."

yial 10y ago

Here is a link :http://www.vanityfair.com/news/2016/06/elizabeth-holmes-net-worth http://www.vanityfair.com/news/2016/06/elizabeth-holmes-net-... That won't make you turn off your adblocker.

waterphone 10y ago
https://github.com/reek/anti-adblock-killer https://github.com/reek/anti-adblock-killer
- yial 10y ago
  Thank you! That's pretty cool.

ealexhudson 10y ago

What interested me specifically about this: they call out the preferred participating stock. Is it rare? In my experience, not really - not common per se, but not necessarily rare. And being frank, most common stock holders are at a fair disadvantage through growth phases. I wonder if they apply this type of thinking for other potential-high-net-worth founders, who are likely to have most of their potential-worth tied up in a single organization. Surely this rule about treating the net value of such stock as being very low unless/until there was some kind of public sale or it had otherwise been crystallized somehow means that this type of founder will never feature in the rich list going forwards?

graffitici 10y ago

I'd imagine she probably took some money off the table in some of those investment rounds. Though no way of being sure, of course..

mmastrac 10y ago

This is a huge leap to peg her at zero. She might have taken some money off the table in a round. She might have used her stock as leverage with a bank to invest elsewhere, making a decent return on it (though potentially leaving her over-leveraged if the banks call those loans). If you've got a billion dollars in paper money, I don't see it as far-fetched that you could turn that into a few hundred million of cold, hard cash with some basic financial advice.

dragonwriter 10y ago
> This is a huge leap to peg her at zero. Its no more of a leap than the earlier peg at $4.5B

aficiomaquinas 10y ago

"From 4.5 B to Zero" a new book by Elizabeth Holmes. https://twitter.com/aficiomaquinas/status/738079483081547777 https://twitter.com/aficiomaquinas/status/738079483081547777