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> But the most conspicuous feature of Theranos's cap table is the absence of Silicon Valley firms. Journalists were fooled by Theranos, but Silicon Valley inves

by defen 6y ago

> But the most conspicuous feature of Theranos's cap table is the absence of Silicon Valley firms. Journalists were fooled by Theranos, but Silicon Valley investors weren't. Not really a good defense of Silicon Valley, considering that Tim Draper was Theranos's first investor and a pretty big proponent of them https://twitter.com/RebeccaJarvis/status/974435962930548736 https://twitter.com/RebeccaJarvis/status/974435962930548736

pchristensen 6y ago
Tim Draper was friends with Holmes's family and his kids grew up with hers. He invested personally, but I don't think his firm Draper Fisher Jurvetson did. Theranos' fundraising was primarily from outside of SV: "Documents unsealed in a lawsuit brought against Theranos reveal a number of the high profile investors who had a stake in the nearly worthless start-up: The Waltons, founders of Walmart, with $150 million; Rupert Murdoch, with $125 million; and the DeVos family, including Education Secretary Betsy DeVos, with $100 million. The investments were made between 2013 and 2015, according to the Journal." - https://www.cnbc.com/2018/05/04/theranos-devos-other-investors-reportedly-lost-over-600-million.html https://www.cnbc.com/2018/05/04/theranos-devos-other-investo...
- deleted 6y ago
  [deleted]
- hugs 6y ago
  You can go directly to the SEC's website for the information. In Theranos' earliest SEC filing, "Draper Fisher Jurvetson Fund VII, L.P." is listed as a Beneficial Owner. Filing Date 2005-01-03 File/File Number 021-72626 05000011
ameliaquining 6y ago
DFJ put in $500,000. At their scale, that's chump change. They can safely invest that much money even in companies that are unlikely to succeed. And IIUC, Theranos wasn't a fraud at that point—there was still genuine hope that their product would work. pg, and others pushing back against the Theranos-as-an-indictment-of-Silicon-Valley-venture-capital narrative, are talking about the firms that invested much larger sums after Elizabeth Holmes had gotten a lot of good press and become a hot commodity (and, in most cases, after she'd started engaging in fraud, unbeknownst to most). Those firms lost their shirts in a way that DFJ didn't.
- hugs 6y ago
  Pushing back on Theranos-as-an-indictment-of-Silicon-Valley-venture-capital is a fine point to make, but that's not the point he made. He said Theranos' cap table had an "absence of Silicon Valley firms", which is false. Also DFJ is not the only SV firm that invested. So did Larry Ellison in the $28.5M Series C. This is all very easy to find information. It seems like a weird point to nit-pick, but in most of PG's essays, there are so few demonstrably easy-to-disprove facts. This one is easy. And the misplaced hubris in thinking zero SV firms were foolish enough to invest in a fraud makes you question all his other assertions.
sek 6y ago
The early stage of Theranos wasn't really a scam, they tried to build the actual product. The scam started when they failed to do so and then lied about it.

by defen 6y ago

pchristensen 6y ago

Tim Draper was friends with Holmes's family and his kids grew up with hers. He invested personally, but I don't think his firm Draper Fisher Jurvetson did. Theranos' fundraising was primarily from outside of SV: "Documents unsealed in a lawsuit brought against Theranos reveal a number of the high profile investors who had a stake in the nearly worthless start-up: The Waltons, founders of Walmart, with $150 million; Rupert Murdoch, with $125 million; and the DeVos family, including Education Secretary Betsy DeVos, with $100 million. The investments were made between 2013 and 2015, according to the Journal." - https://www.cnbc.com/2018/05/04/theranos-devos-other-investors-reportedly-lost-over-600-million.html https://www.cnbc.com/2018/05/04/theranos-devos-other-investo...

deleted 6y ago
[deleted]
hugs 6y ago
You can go directly to the SEC's website for the information. In Theranos' earliest SEC filing, "Draper Fisher Jurvetson Fund VII, L.P." is listed as a Beneficial Owner. Filing Date 2005-01-03 File/File Number 021-72626 05000011

ameliaquining 6y ago

DFJ put in $500,000. At their scale, that's chump change. They can safely invest that much money even in companies that are unlikely to succeed. And IIUC, Theranos wasn't a fraud at that point—there was still genuine hope that their product would work. pg, and others pushing back against the Theranos-as-an-indictment-of-Silicon-Valley-venture-capital narrative, are talking about the firms that invested much larger sums after Elizabeth Holmes had gotten a lot of good press and become a hot commodity (and, in most cases, after she'd started engaging in fraud, unbeknownst to most). Those firms lost their shirts in a way that DFJ didn't.

hugs 6y ago
Pushing back on Theranos-as-an-indictment-of-Silicon-Valley-venture-capital is a fine point to make, but that's not the point he made. He said Theranos' cap table had an "absence of Silicon Valley firms", which is false. Also DFJ is not the only SV firm that invested. So did Larry Ellison in the $28.5M Series C. This is all very easy to find information. It seems like a weird point to nit-pick, but in most of PG's essays, there are so few demonstrably easy-to-disprove facts. This one is easy. And the misplaced hubris in thinking zero SV firms were foolish enough to invest in a fraud makes you question all his other assertions.

sek 6y ago

The early stage of Theranos wasn't really a scam, they tried to build the actual product. The scam started when they failed to do so and then lied about it.