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Does anybody know if Theranos got started with at least an idea how to accomplish what they wanted to do? From what I have heard in interviews they started with

Does anybody know if Theranos got started with at least an idea how to accomplish what they wanted to do? From what I have heard in interviews they started with the thought "Doing xxx would be super useful" but didn't have an approach for accomplishing this but instead took in money and tried to figure it out. It's like me saying "An antimatter drive would revolutionize space exploration" and starting to collect money but without even the faintest idea how to produce one. Does anyone know? Did Holmes have any insight that caused her and the investors to believe she could do the blood tests?

zitterbewegung 8y ago
After the company launched professionals in the medical testing said it was impossible. I believe it was even posted to HN. They stated it was impossible to get the results they would get from the amount of blood given.
- maxxxxx 8y ago
  That can be OK if the company was started knowing that they had invented something new.
  - FireBeyond 8y ago
    Sure. And while certainly "possible", how likely is it that a 19yo college dropout (who wasn't studying medical sciences) was able to discover a technique that did so, after forty years of multiple multi-billion dollar companies researching the same (after all, the brave new world offered by her dream was hardly new or unpalatable to other players in her field). And her actions demonstrated she had done no such thing. Buying, hiding, deceiving around traditional venipuncture machines, etc. This is someone who "had a dream", had connections, and was determined and stubborn, in a bad way. Even now she, and one or two of investors, still believe she has been robbed and wronged, and that the world is worse off without Theranos.
  - vkou 8y ago
    The bar for inventing something new in medicine is not "Eh, if you squint, it sorta looks like it works, ship that shit."
- minimaxir 8y ago
  For reference, here's the very first HN submission about Theranos in 2013: https://news.ycombinator.com/item?id=6349349 https://news.ycombinator.com/item?id=6349349
  - portman 8y ago
    Fascinating to read, thank you. “There are more soldiers in that board there than doctors” is one of the original comments!
  - sveme 8y ago
    Interesting. Skinming through the comments, very little criticism, everyone in awe. Only way down there is someone stating how hard it is to get regulatory approval. I guess that‘s HN still in full fanboy mode, before all those startups started to display their dark sides.
    - icebraining 8y ago
      I don't see any fanboyism; I see interest, and surprise at the composition of the board. A bit down, I see strong criticism by medman77, who hasn't been downvoted.
      - KSS42 8y ago
        medman77 created his/her account that day and only ever posted that one comment. I wonder if he/she was from Nanomix (nano.com, another company working on similar technology since 2000)
        notlob 8y ago
        An interesting observation is that medman77 would seem to be particular about FDA clearance vs approval, which is one sign of someone who does know what they’re talking about.
      - rgbrenner 8y ago
        medman77, who hasn't been downvoted. We don't know that. You can only downvote comments for a day(?).. but you can upvote forever. Considering it's been 5 years, and people keep linking to his comment... it's hard to say if he gained those points that day or years later after theranos was found to be a fraud.
- maxander 8y ago
  Any citations on that? In all the hullabaloo about Theranos I haven't heard that there were serious theoretical difficulties with what they were trying to do. It would make me feel somewhat better about the whole mess to know this was the case. A successful Theranos would have been the best thing to come out of SV since the Apple II. It was sad to see it fail because of executives' delusions.
  - 21 8y ago
    I am no expert, but it's my understanding that blood in the capillaries (fingertip) is not exactly the same as blood in the veins. > In addition, the small volumes involved and the variability in sample quality based on puncture site and technique make capillary sampling particularly susceptible to errors during the pre-preanalytical phase, which are beyond the control of clinical laboratory personnel https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4622200/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4622200/
    - oldgradstudent 8y ago
      It's not the same as the veins, and varies a lot between fingers and location. It is well known to any diabetic, or to anyone who played for a few minutes with a blood glucose monitor.
  - joezydeco 8y ago
    The major medical diagnostic companies had been working on microfluidic assays for a couple of decades before Holmes came along. It's a very difficult subject especially when it comes to immunoassays. This wasn't a blue sky field by any means. There were numerous research papers on the topic, and some time spent with experts in the field would have also pointed her in the direction of the current research. Almost too late she hired an expert from Abbott Diagnostics (who headed up a number of successful system projects for them), and he walked away after 6 months.
- MBCook 8y ago
  Well, to be fair, experts in the field called the original iPhone impossible. Turns out in this case they were right.
  - epistasis 8y ago
    I'm not sure if there were "experts" of the same caliber calling the iPhone impossible. In fact, I don't recall anybody saying it was impossible, but would like to find out more. I remember a ton of doubt, after launch, that it would be successful, but those people weren't really experts.
    - comex 8y ago
      Here’s one example. Apparently RIM’s employees collectively thought it was impossible (to achieve the stated battery life); I think they count as experts: > RIM had a complete internal panic when Apple unveiled the iPhone in 2007, a former employee revealed this weekend. The BlackBerry maker is now known to have held multiple all-hands meetings on January 10 that year, a day after the iPhone was on stage, and to have made outlandish claims about its features. Apple was effectively accused of lying as it was supposedly impossible that a device could have such a large touchscreen but still get a usable lifespan away from a power outlet. http://www.macnn.com/articles/10/12/27/rim.thought.apple.was.lying.on.iphone.in.2007/ http://www.macnn.com/articles/10/12/27/rim.thought.apple.was...
      - oldgradstudent 8y ago
        I had the first iPhone. Let me just say that the official battery life was somewhat aspirational.
      - teraflop 8y ago
        The comments summarized in that article seem to no longer be available, but I have a hard time believing the summary is accurate. When the iPhone was released, there were already PDAs on the market with screens the same size or bigger.
gamblor956 8y ago
They had a good idea of what they wanted to do (blood tests using very thin needles) but never successfully figured out how to accomplish that with the level of accuracy required. Most Medical professionals believe that what they wanted to do was simply impossible from a biological perspective due to the natural variations of blood content. It would have been like trying to determine traffic on a freeway by taking a brief glance through a tiny slit in a piece of paper.(This is why they draw so much blood for testing, to try and get a fairly representative sample.)
- trhway 8y ago
  >determine traffic on a freeway by taking a brief glance through a tiny slit in a piece of paper. taking 10 such brief glances may allow for some good enough probabilistic estimate though. Upon hearing first time about Theranos in 2013 i thought that they would do something like it, i.e. statistical approach based on some data mining as they would collect large number of samples, etc. - a typical SV tech based approach. One look at Holmes' black turtleneck photo and Glassdoors reviews mostly talking about Ballwani, and i remember immediately thinking - any even minimally advanced R&D is just not possible there.
  - majos 8y ago
    What's so bad about the black turtleneck?
    - adventured 8y ago
      In the tech industry, if it's worn as a uniform, it's probably a dead give-away that the person should be avoided (especially if there's any other supporting evidence related to negative behavior). It's a Jobsian mimic. There was one Steve Jobs, he was extraordinary in some ways, and he wasn't very nice. There isn't going to be another, he was the product of a unique circumstance. The next great person/s will be their own composition made up of the time and place. Her fake voice is a lot more indicative than the black turtleneck though.
      - deleted 8y ago
JumpCrisscross 8y ago
> It's like me saying "An antimatter drive would revolutionize space exploration" and starting to collect money but without even the faintest idea how to produce one In America, it's perfectly legal to say "I'm going to make an antimatter drive; give me a million dollars." It's illegal to say "I have a working antimatter drive prototype; give me a million dollars." Holmes and Balwani did the latter.
- partycoder 8y ago
  That is a good way to describe it. They also made the technology very secretive. Not even their investors could have access to implementation details.
  - dboreham 8y ago
    Very similar to my secret perpetual motion machine.
    - IncRnd 8y ago
      Based upon what you said, there is just one flaw in your pmm. I know how to fix it. Unfortunately, I can't tell you. The secret is proprietary, and I need to make sure that it doesn't get corrupted, so everyone can use it for free.
- maxxxxx 8y ago
  My question is: Did they have a prototype or at least a concept?
  - JumpCrisscross 8y ago
    > Did they have a prototype or at least a concept? Not one that could do what they promised. "The indictment alleges that the defendants used a combination of direct communications, marketing materials, statements to the media, financial statements, models, and other information to defraud potential investors. Specifically, the defendants claimed that Theranos developed a revolutionary and proprietary analyzer that the defendants referred to by various names, including as the TSPU, Edison, or minilab. The defendants claimed the analyzer was able to perform a full range of clinical tests using small blood samples drawn from a finger stick. The defendants also represented that the analyzer could produce results that were more accurate and reliable than those yielded by conventional methods—all at a faster speed than previously possible. The indictment further alleges that Holmes and Balwani knew that many of their representations about the analyzer were false. For example, allegedly, Holmes and Balwani knew that the analyzer, in truth, had accuracy and reliability problems, performed a limited number of tests, was slower than some competing devices, and, in some respects, could not compete with existing, more conventional machines." https://www.justice.gov/usao-ndca/pr/theranos-founder-and-former-chief-operating-officer-charged-alleged-wire-fraud-schemes https://www.justice.gov/usao-ndca/pr/theranos-founder-and-fo...
coldtea 8y ago
>From what I have heard in interviews they started with the thought "Doing xxx would be super useful" but didn't have an approach for accomplishing this but instead took in money and tried to figure it out. So, just like most VC favorite startups?
- dboreham 8y ago
  I've been involved with many vc funded startups and have never encountered a situation where nobody knows how to achieve the core product vision. Nobody knows how to achieve profitability...sure.
  - maxxxxx 8y ago
    The only one that comes to mind is Magic Leap. They could blow up like Theranos.
    - puzzle 8y ago
      As a data point, GV decided twice not to invest in Theranos, due to lack of transparency, a peculiar board mix and a sketchy experience in the field. They actually sent someone to a Walgreens. Later they happily poured lots of millions into Magic Leap.
      - joejerryronnie 8y ago
        See, even GV can be duped into idiotic investments. Theranos couldn't trick them but Magic Leap sure did!
  - nikanj 8y ago
    UBeam springs to mind.
    - madengr 8y ago
      Yes, that’s some bullshit there. Though they are small compared to Theranos, so uBeam will just fizzle out quietly.
SilasX 8y ago
I'm guessing they struggled over those questions but were reassured by the chorus of "fake it till you make it".
jjoonathan 8y ago
My suspicion: Holmes heard about microfluidics at school, misjudged its position in the hype cycle (it's a red ocean, not a blue ocean), sold herself as an expert, raised money from people who didn't know better, and let the success get to her head because at some point she would have hired actual experts and they would probably have tried to steer her away from the known-hard problem she was trying to tackle and towards prospects that weren't as high-tech-disruptive but at least had a fighting chance of actually working.
- meowface 8y ago
  It seems like a typical SV case of "fake it til you make it", except instead of risking a down website or burned investor, they risked harm and death of patients. She clearly had some knowledge and strategy about the technology and likely fully intended for it to be successful, but responded to delays and difficulties with deception rather than just admitting it was harder than they expected. "If we just get over this hurdle, we'll revolutionize medical testing and become legends." Not unlike Ponzi schemes which start out as legitimate investment ventures, do very poorly, and then just make up the return numbers. Martin Shkreli arguably pulled that fraud off "successfully" and actually got over the hurdle, but of course it came back to bite him.
  - atombender 8y ago
    They did start with legitimate attempts at implementing th technology needed to microfluidics (though apparently Holmes knew nothing about the field and didn't even know anything about existing players such as Abaxis, who actually had working machines). However, they could not get the technology to work and abandoned several development paths in favour of a less ambitious approach that, among other things, involved doing blood analysis the old-fashioned way (manually in the lab), and only pretending to be using new tech they'd invented. They knew it didn't work, but kept selling it anyway, which is where it went from just faking it to outright fraud. Most of their money was raised after they failed to develop their blood analysis technology, but to the investors, to the press and to their clients (such as Walgreens), they were still claiming to be using their proprietary technology [1]. [1] http://m.nautil.us/issue/60/searches/does-theranos-mark-the-peak-of-the-silicon-valley-bubble http://m.nautil.us/issue/60/searches/does-theranos-mark-the-...
jcranmer 8y ago
Holmes and Balwani had some experience with microfluidics (IIRC), which is certainly sufficient chemical background to give them a credible belief that they could do what they wanted to do (run blood tests on smaller sample sizes). The ultimate problem with their goal is that when you do a finger prick, a large fraction of the sample is not blood but interstitial fluid and skin layers, which makes the results noisy at best and irrelevant at worst. So the original genesis of Theranos probably wasn't fraudulent, but when things didn't work out and they started faking it instead, that was outright fraud.
- learc83 8y ago
  Holmes dropped out after 3 semesters. As far as I can tell she took one intro chemical engineering class. Not what I would call experience with microfluidics.
  - jcranmer 8y ago
    My recollection was that there was someone involved early on who had substantial experience with microfluidics, but I'm having trouble pinning down who exactly it was.
    - jamestimmins 8y ago
      Potentially Ian Gibbons? He was the original Chief Scientist who died by suicide after legal issues arose within Theranos over a patent dispute. https://en.wikipedia.org/wiki/Ian_Gibbons_(biochemist) https://en.wikipedia.org/wiki/Ian_Gibbons_(biochemist)
      - lenocinor 8y ago
        Wow, I hadn't read his story before. I really feel for his position. What an awful way to go. :(
    - learc83 8y ago
      She convinced her chemical engineering professor to be an advisor early on. But the project she sold him on was based on her idea for some kind of wearable. From reading interviews I got the idea that he was more impressed with the wireless, wearable aspect (technologies he didn't have experience with presumably).
atombender 8y ago
This interview with John Carreyrou [1], the Wall Street Journal journalist who is largely responsible for exposing Theranos, goes into a lot of detail. It's long, so if you want a shorter answer, jump to the question "What technology did Theranos actually develop?": Basically there were three iterations of the technology. The first one used microfluidics, which are basically the repurposing of the micro-fabrication techniques that the computer chip industry pioneered to move tiny volumes of liquid. Theranos tried to work on that for several years before Holmes lost patience in late fall 2007 and abandoned it. At that point she pivoted to what was essentially a converted glue-dispensing robot. One of the engineers ordered a glue-dispensing robot from a company called Fisnar in New Jersey, studied its components and rebuilt a smaller version of it. It was a robotic arm on a gantry with three degrees of motion and a pipette stuck to its end, and it replicated what the scientist does at the bench. That ended up being called the Edison and it could do only one class of test, known as immunoassays. It was also error-prone. The third iteration of the technology was the miniLab, which Holmes wanted to be able to do more than just immunoassays. The miniLab didn’t invent any new techniques to test blood with. It miniaturized existing laboratory instruments and packed them into one box. By the time Theranos went live with its tests, the miniLab was a malfunctioning prototype. The interview also explains how Holmes was able to attract so many influential people on her board. The short answer is her Jobs-like "reality distortion field" -- she was exceedingly good at convincing non-scientists that their science worked. [1] http://m.nautil.us/issue/60/searches/does-theranos-mark-the-peak-of-the-silicon-valley-bubble http://m.nautil.us/issue/60/searches/does-theranos-mark-the-...
- api 8y ago
  > The short answer is her Jobs-like "reality distortion field" -- she was exceedingly good at convincing ... Considering this and the lack of substance behind her claims, I would personally bet money that she is a clinical psychopath. The most disturbing thing I have ever observed about human beings is our tendency to follow psychopaths. Psychopaths seem to have this gravity around them and people just fall into line. I've observed some spectacular examples. A psychopath can say the most questionable or even absurd things and people will just believe, whereas people will be skeptical of even very sane things that come out of the mouths of non-psychopaths. It's as if clinical psychopaths have some special instinctive ability to generate body language, vocal cues, and linguistic patterns that manipulate others very effectively. I am not claiming that everyone with a "reality distortion field" must be a psychopath, but I've definitely observed a positive correlation.
learc83 8y ago
Her original idea was for a wearable diagnostic device that transmitted information directly to doctors.
mozumder 8y ago
My understanding is that they could measure ~95% of what they wanted, but the remaining 5% needed for full accuracy certification was out of reach with the limited tests they were performing. And that this was the difference between their tests and more expensive tests.
- madengr 8y ago
  Read the book. ALL of their tests were flawed.
pmattos 8y ago
For anyone wanting to dig deeper into this the recently released Bad Blood book is pretty awesome. The author, the WSJ jornalist above who early on raised serious doubts about Theranos, reconstructs the startup history in a thriller-ish style, but fully based on actual facts/research. Highly recommended.
- bookofjoe 8y ago
  The upcoming movie starring Jennifer Lawrence as Holmes should be a blockbuster.
marme 8y ago
It was all ideas and plans. They built machines that performed significantly worse than standard tests. Their idea was one machine to run virtually all blood tests with a few drops of blood, their final machine only ran a handful of tests and was so inaccurate that only reason the FDA did not shut them down instantly is they used a loophole to claim it was not a testing machine but just in house lab equipment to assist with testing or some nonsense that meant they did not need FDA to sign off on the machine. Holmes was just a smooth talker and convinced everyone, it also helped that she had major players on her board and even Bill Clinton was supporting her. The one really weird thing i noticed about her is she never blinks. Watch her give talks and it is like a robot never blinking
- vlozko 8y ago
  I’ve heard about her not blinking. Also, she forces her voice to be at a lower octave than what her speaking voice normally is.
  - joncrane 8y ago
    She had some strange mannerisms, right? And she had very wide eyes.
everdev 8y ago
I have a book called "The Creator's Code" [2015] that praises Elizabeth Holmes right along side other successful SV entrepreneurs like Musk, Hoffman, Thiel and others, diving deep into their story of how they became successful. Back in 2015, it was the same story they told investors: We can do an expensive blood test for a fraction of the cost in a fraction of the time with better accuracy. Unfortunately, it sounds like they defrauded investors with false claims, which is why they were able to get so much funding without a real, viable product.
verulito 8y ago
Those kinds of business plans were typical of that era and venture capitalists were accustomed to investing in lofty dreams. Naturally, it didn't pan out most of the time and they've gotten smarter. Theranos managed to outlive most of their peers, it seems by turning to deception instead. From my reading, it seems that the failures are old but the crimes are recent.
Animats 8y ago
Abbott sells microfluidic hand-held blood test machines right now.[1] "Just two drops of blood". These have been around since 2006. So it's possible to do this. [1] https://www.pointofcare.abbott/us/en/offerings/istat/istat-handheld https://www.pointofcare.abbott/us/en/offerings/istat/istat-h...
- BenjiWiebe 8y ago
  I clicked that linked just to see if .abbott was a valid TLD. Apparently it is!
ryan-allen 8y ago
I'm reading the book Bad Blood at the moment. It's a cracker. Assuming it's true, the level of wilful negligence and fraud is astounding. What is unbelievable is how they got away with it for so long. I can hardly put it down, I highly recommend it.

zitterbewegung 8y ago

After the company launched professionals in the medical testing said it was impossible. I believe it was even posted to HN. They stated it was impossible to get the results they would get from the amount of blood given.

maxxxxx 8y ago
That can be OK if the company was started knowing that they had invented something new.
- FireBeyond 8y ago
  Sure. And while certainly "possible", how likely is it that a 19yo college dropout (who wasn't studying medical sciences) was able to discover a technique that did so, after forty years of multiple multi-billion dollar companies researching the same (after all, the brave new world offered by her dream was hardly new or unpalatable to other players in her field). And her actions demonstrated she had done no such thing. Buying, hiding, deceiving around traditional venipuncture machines, etc. This is someone who "had a dream", had connections, and was determined and stubborn, in a bad way. Even now she, and one or two of investors, still believe she has been robbed and wronged, and that the world is worse off without Theranos.
- vkou 8y ago
  The bar for inventing something new in medicine is not "Eh, if you squint, it sorta looks like it works, ship that shit."
minimaxir 8y ago
For reference, here's the very first HN submission about Theranos in 2013: https://news.ycombinator.com/item?id=6349349 https://news.ycombinator.com/item?id=6349349
- portman 8y ago
  Fascinating to read, thank you. “There are more soldiers in that board there than doctors” is one of the original comments!
- sveme 8y ago
  Interesting. Skinming through the comments, very little criticism, everyone in awe. Only way down there is someone stating how hard it is to get regulatory approval. I guess that‘s HN still in full fanboy mode, before all those startups started to display their dark sides.
  - icebraining 8y ago
    I don't see any fanboyism; I see interest, and surprise at the composition of the board. A bit down, I see strong criticism by medman77, who hasn't been downvoted.
    - KSS42 8y ago
      medman77 created his/her account that day and only ever posted that one comment. I wonder if he/she was from Nanomix (nano.com, another company working on similar technology since 2000)
      - notlob 8y ago
        An interesting observation is that medman77 would seem to be particular about FDA clearance vs approval, which is one sign of someone who does know what they’re talking about.
    - rgbrenner 8y ago
      medman77, who hasn't been downvoted. We don't know that. You can only downvote comments for a day(?).. but you can upvote forever. Considering it's been 5 years, and people keep linking to his comment... it's hard to say if he gained those points that day or years later after theranos was found to be a fraud.
maxander 8y ago
Any citations on that? In all the hullabaloo about Theranos I haven't heard that there were serious theoretical difficulties with what they were trying to do. It would make me feel somewhat better about the whole mess to know this was the case. A successful Theranos would have been the best thing to come out of SV since the Apple II. It was sad to see it fail because of executives' delusions.
- 21 8y ago
  I am no expert, but it's my understanding that blood in the capillaries (fingertip) is not exactly the same as blood in the veins. > In addition, the small volumes involved and the variability in sample quality based on puncture site and technique make capillary sampling particularly susceptible to errors during the pre-preanalytical phase, which are beyond the control of clinical laboratory personnel https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4622200/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4622200/
  - oldgradstudent 8y ago
    It's not the same as the veins, and varies a lot between fingers and location. It is well known to any diabetic, or to anyone who played for a few minutes with a blood glucose monitor.
- joezydeco 8y ago
  The major medical diagnostic companies had been working on microfluidic assays for a couple of decades before Holmes came along. It's a very difficult subject especially when it comes to immunoassays. This wasn't a blue sky field by any means. There were numerous research papers on the topic, and some time spent with experts in the field would have also pointed her in the direction of the current research. Almost too late she hired an expert from Abbott Diagnostics (who headed up a number of successful system projects for them), and he walked away after 6 months.
MBCook 8y ago
Well, to be fair, experts in the field called the original iPhone impossible. Turns out in this case they were right.
- epistasis 8y ago
  I'm not sure if there were "experts" of the same caliber calling the iPhone impossible. In fact, I don't recall anybody saying it was impossible, but would like to find out more. I remember a ton of doubt, after launch, that it would be successful, but those people weren't really experts.
  - comex 8y ago
    Here’s one example. Apparently RIM’s employees collectively thought it was impossible (to achieve the stated battery life); I think they count as experts: > RIM had a complete internal panic when Apple unveiled the iPhone in 2007, a former employee revealed this weekend. The BlackBerry maker is now known to have held multiple all-hands meetings on January 10 that year, a day after the iPhone was on stage, and to have made outlandish claims about its features. Apple was effectively accused of lying as it was supposedly impossible that a device could have such a large touchscreen but still get a usable lifespan away from a power outlet. http://www.macnn.com/articles/10/12/27/rim.thought.apple.was.lying.on.iphone.in.2007/ http://www.macnn.com/articles/10/12/27/rim.thought.apple.was...
    - oldgradstudent 8y ago
      I had the first iPhone. Let me just say that the official battery life was somewhat aspirational.
    - teraflop 8y ago
      The comments summarized in that article seem to no longer be available, but I have a hard time believing the summary is accurate. When the iPhone was released, there were already PDAs on the market with screens the same size or bigger.

gamblor956 8y ago

They had a good idea of what they wanted to do (blood tests using very thin needles) but never successfully figured out how to accomplish that with the level of accuracy required. Most Medical professionals believe that what they wanted to do was simply impossible from a biological perspective due to the natural variations of blood content. It would have been like trying to determine traffic on a freeway by taking a brief glance through a tiny slit in a piece of paper.(This is why they draw so much blood for testing, to try and get a fairly representative sample.)

trhway 8y ago
>determine traffic on a freeway by taking a brief glance through a tiny slit in a piece of paper. taking 10 such brief glances may allow for some good enough probabilistic estimate though. Upon hearing first time about Theranos in 2013 i thought that they would do something like it, i.e. statistical approach based on some data mining as they would collect large number of samples, etc. - a typical SV tech based approach. One look at Holmes' black turtleneck photo and Glassdoors reviews mostly talking about Ballwani, and i remember immediately thinking - any even minimally advanced R&D is just not possible there.
- majos 8y ago
  What's so bad about the black turtleneck?
  - adventured 8y ago
    In the tech industry, if it's worn as a uniform, it's probably a dead give-away that the person should be avoided (especially if there's any other supporting evidence related to negative behavior). It's a Jobsian mimic. There was one Steve Jobs, he was extraordinary in some ways, and he wasn't very nice. There isn't going to be another, he was the product of a unique circumstance. The next great person/s will be their own composition made up of the time and place. Her fake voice is a lot more indicative than the black turtleneck though.
    - deleted 8y ago

JumpCrisscross 8y ago

> It's like me saying "An antimatter drive would revolutionize space exploration" and starting to collect money but without even the faintest idea how to produce one In America, it's perfectly legal to say "I'm going to make an antimatter drive; give me a million dollars." It's illegal to say "I have a working antimatter drive prototype; give me a million dollars." Holmes and Balwani did the latter.

partycoder 8y ago
That is a good way to describe it. They also made the technology very secretive. Not even their investors could have access to implementation details.
- dboreham 8y ago
  Very similar to my secret perpetual motion machine.
  - IncRnd 8y ago
    Based upon what you said, there is just one flaw in your pmm. I know how to fix it. Unfortunately, I can't tell you. The secret is proprietary, and I need to make sure that it doesn't get corrupted, so everyone can use it for free.
maxxxxx 8y ago
My question is: Did they have a prototype or at least a concept?
- JumpCrisscross 8y ago
  > Did they have a prototype or at least a concept? Not one that could do what they promised. "The indictment alleges that the defendants used a combination of direct communications, marketing materials, statements to the media, financial statements, models, and other information to defraud potential investors. Specifically, the defendants claimed that Theranos developed a revolutionary and proprietary analyzer that the defendants referred to by various names, including as the TSPU, Edison, or minilab. The defendants claimed the analyzer was able to perform a full range of clinical tests using small blood samples drawn from a finger stick. The defendants also represented that the analyzer could produce results that were more accurate and reliable than those yielded by conventional methods—all at a faster speed than previously possible. The indictment further alleges that Holmes and Balwani knew that many of their representations about the analyzer were false. For example, allegedly, Holmes and Balwani knew that the analyzer, in truth, had accuracy and reliability problems, performed a limited number of tests, was slower than some competing devices, and, in some respects, could not compete with existing, more conventional machines." https://www.justice.gov/usao-ndca/pr/theranos-founder-and-former-chief-operating-officer-charged-alleged-wire-fraud-schemes https://www.justice.gov/usao-ndca/pr/theranos-founder-and-fo...

coldtea 8y ago

>From what I have heard in interviews they started with the thought "Doing xxx would be super useful" but didn't have an approach for accomplishing this but instead took in money and tried to figure it out. So, just like most VC favorite startups?

dboreham 8y ago
I've been involved with many vc funded startups and have never encountered a situation where nobody knows how to achieve the core product vision. Nobody knows how to achieve profitability...sure.
- maxxxxx 8y ago
  The only one that comes to mind is Magic Leap. They could blow up like Theranos.
  - puzzle 8y ago
    As a data point, GV decided twice not to invest in Theranos, due to lack of transparency, a peculiar board mix and a sketchy experience in the field. They actually sent someone to a Walgreens. Later they happily poured lots of millions into Magic Leap.
    - joejerryronnie 8y ago
      See, even GV can be duped into idiotic investments. Theranos couldn't trick them but Magic Leap sure did!
- nikanj 8y ago
  UBeam springs to mind.
  - madengr 8y ago
    Yes, that’s some bullshit there. Though they are small compared to Theranos, so uBeam will just fizzle out quietly.

SilasX 8y ago

I'm guessing they struggled over those questions but were reassured by the chorus of "fake it till you make it".

jjoonathan 8y ago

My suspicion: Holmes heard about microfluidics at school, misjudged its position in the hype cycle (it's a red ocean, not a blue ocean), sold herself as an expert, raised money from people who didn't know better, and let the success get to her head because at some point she would have hired actual experts and they would probably have tried to steer her away from the known-hard problem she was trying to tackle and towards prospects that weren't as high-tech-disruptive but at least had a fighting chance of actually working.

meowface 8y ago
It seems like a typical SV case of "fake it til you make it", except instead of risking a down website or burned investor, they risked harm and death of patients. She clearly had some knowledge and strategy about the technology and likely fully intended for it to be successful, but responded to delays and difficulties with deception rather than just admitting it was harder than they expected. "If we just get over this hurdle, we'll revolutionize medical testing and become legends." Not unlike Ponzi schemes which start out as legitimate investment ventures, do very poorly, and then just make up the return numbers. Martin Shkreli arguably pulled that fraud off "successfully" and actually got over the hurdle, but of course it came back to bite him.
- atombender 8y ago
  They did start with legitimate attempts at implementing th technology needed to microfluidics (though apparently Holmes knew nothing about the field and didn't even know anything about existing players such as Abaxis, who actually had working machines). However, they could not get the technology to work and abandoned several development paths in favour of a less ambitious approach that, among other things, involved doing blood analysis the old-fashioned way (manually in the lab), and only pretending to be using new tech they'd invented. They knew it didn't work, but kept selling it anyway, which is where it went from just faking it to outright fraud. Most of their money was raised after they failed to develop their blood analysis technology, but to the investors, to the press and to their clients (such as Walgreens), they were still claiming to be using their proprietary technology [1]. [1] http://m.nautil.us/issue/60/searches/does-theranos-mark-the-peak-of-the-silicon-valley-bubble http://m.nautil.us/issue/60/searches/does-theranos-mark-the-...

jcranmer 8y ago

Holmes and Balwani had some experience with microfluidics (IIRC), which is certainly sufficient chemical background to give them a credible belief that they could do what they wanted to do (run blood tests on smaller sample sizes). The ultimate problem with their goal is that when you do a finger prick, a large fraction of the sample is not blood but interstitial fluid and skin layers, which makes the results noisy at best and irrelevant at worst. So the original genesis of Theranos probably wasn't fraudulent, but when things didn't work out and they started faking it instead, that was outright fraud.

learc83 8y ago
Holmes dropped out after 3 semesters. As far as I can tell she took one intro chemical engineering class. Not what I would call experience with microfluidics.
- jcranmer 8y ago
  My recollection was that there was someone involved early on who had substantial experience with microfluidics, but I'm having trouble pinning down who exactly it was.
  - jamestimmins 8y ago
    Potentially Ian Gibbons? He was the original Chief Scientist who died by suicide after legal issues arose within Theranos over a patent dispute. https://en.wikipedia.org/wiki/Ian_Gibbons_(biochemist) https://en.wikipedia.org/wiki/Ian_Gibbons_(biochemist)
    - lenocinor 8y ago
      Wow, I hadn't read his story before. I really feel for his position. What an awful way to go. :(
  - learc83 8y ago
    She convinced her chemical engineering professor to be an advisor early on. But the project she sold him on was based on her idea for some kind of wearable. From reading interviews I got the idea that he was more impressed with the wireless, wearable aspect (technologies he didn't have experience with presumably).

atombender 8y ago

This interview with John Carreyrou [1], the Wall Street Journal journalist who is largely responsible for exposing Theranos, goes into a lot of detail. It's long, so if you want a shorter answer, jump to the question "What technology did Theranos actually develop?": Basically there were three iterations of the technology. The first one used microfluidics, which are basically the repurposing of the micro-fabrication techniques that the computer chip industry pioneered to move tiny volumes of liquid. Theranos tried to work on that for several years before Holmes lost patience in late fall 2007 and abandoned it. At that point she pivoted to what was essentially a converted glue-dispensing robot. One of the engineers ordered a glue-dispensing robot from a company called Fisnar in New Jersey, studied its components and rebuilt a smaller version of it. It was a robotic arm on a gantry with three degrees of motion and a pipette stuck to its end, and it replicated what the scientist does at the bench. That ended up being called the Edison and it could do only one class of test, known as immunoassays. It was also error-prone. The third iteration of the technology was the miniLab, which Holmes wanted to be able to do more than just immunoassays. The miniLab didn’t invent any new techniques to test blood with. It miniaturized existing laboratory instruments and packed them into one box. By the time Theranos went live with its tests, the miniLab was a malfunctioning prototype. The interview also explains how Holmes was able to attract so many influential people on her board. The short answer is her Jobs-like "reality distortion field" -- she was exceedingly good at convincing non-scientists that their science worked. [1] http://m.nautil.us/issue/60/searches/does-theranos-mark-the-peak-of-the-silicon-valley-bubble http://m.nautil.us/issue/60/searches/does-theranos-mark-the-...

api 8y ago
> The short answer is her Jobs-like "reality distortion field" -- she was exceedingly good at convincing ... Considering this and the lack of substance behind her claims, I would personally bet money that she is a clinical psychopath. The most disturbing thing I have ever observed about human beings is our tendency to follow psychopaths. Psychopaths seem to have this gravity around them and people just fall into line. I've observed some spectacular examples. A psychopath can say the most questionable or even absurd things and people will just believe, whereas people will be skeptical of even very sane things that come out of the mouths of non-psychopaths. It's as if clinical psychopaths have some special instinctive ability to generate body language, vocal cues, and linguistic patterns that manipulate others very effectively. I am not claiming that everyone with a "reality distortion field" must be a psychopath, but I've definitely observed a positive correlation.

learc83 8y ago

Her original idea was for a wearable diagnostic device that transmitted information directly to doctors.

mozumder 8y ago

My understanding is that they could measure ~95% of what they wanted, but the remaining 5% needed for full accuracy certification was out of reach with the limited tests they were performing. And that this was the difference between their tests and more expensive tests.

madengr 8y ago
Read the book. ALL of their tests were flawed.

pmattos 8y ago

For anyone wanting to dig deeper into this the recently released Bad Blood book is pretty awesome. The author, the WSJ jornalist above who early on raised serious doubts about Theranos, reconstructs the startup history in a thriller-ish style, but fully based on actual facts/research. Highly recommended.

bookofjoe 8y ago
The upcoming movie starring Jennifer Lawrence as Holmes should be a blockbuster.

marme 8y ago

It was all ideas and plans. They built machines that performed significantly worse than standard tests. Their idea was one machine to run virtually all blood tests with a few drops of blood, their final machine only ran a handful of tests and was so inaccurate that only reason the FDA did not shut them down instantly is they used a loophole to claim it was not a testing machine but just in house lab equipment to assist with testing or some nonsense that meant they did not need FDA to sign off on the machine. Holmes was just a smooth talker and convinced everyone, it also helped that she had major players on her board and even Bill Clinton was supporting her. The one really weird thing i noticed about her is she never blinks. Watch her give talks and it is like a robot never blinking

vlozko 8y ago
I’ve heard about her not blinking. Also, she forces her voice to be at a lower octave than what her speaking voice normally is.
- joncrane 8y ago
  She had some strange mannerisms, right? And she had very wide eyes.

everdev 8y ago

I have a book called "The Creator's Code" [2015] that praises Elizabeth Holmes right along side other successful SV entrepreneurs like Musk, Hoffman, Thiel and others, diving deep into their story of how they became successful. Back in 2015, it was the same story they told investors: We can do an expensive blood test for a fraction of the cost in a fraction of the time with better accuracy. Unfortunately, it sounds like they defrauded investors with false claims, which is why they were able to get so much funding without a real, viable product.

verulito 8y ago

Those kinds of business plans were typical of that era and venture capitalists were accustomed to investing in lofty dreams. Naturally, it didn't pan out most of the time and they've gotten smarter. Theranos managed to outlive most of their peers, it seems by turning to deception instead. From my reading, it seems that the failures are old but the crimes are recent.

Animats 8y ago

Abbott sells microfluidic hand-held blood test machines right now.[1] "Just two drops of blood". These have been around since 2006. So it's possible to do this. [1] https://www.pointofcare.abbott/us/en/offerings/istat/istat-handheld https://www.pointofcare.abbott/us/en/offerings/istat/istat-h...

BenjiWiebe 8y ago
I clicked that linked just to see if .abbott was a valid TLD. Apparently it is!

ryan-allen 8y ago

I'm reading the book Bad Blood at the moment. It's a cracker. Assuming it's true, the level of wilful negligence and fraud is astounding. What is unbelievable is how they got away with it for so long. I can hardly put it down, I highly recommend it.