One of my recent favourite reads was Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou. Certainly a page turner, the book details the rise and fall of Theranos and its founder Elizabeth Holmes. Theranos, the unicorn biotech startup that promised to test for hundreds of fatal diseases and give you a full picture of your health - with just a few drops of blood - captured everyone’s imagination and was valued at nearly $10 billion in 2014. Its charismatic founder, Elizabeth Holmes, was the wunderkind Stanford drop-out who founded it when she was just 19. Both Holmes and Theranos swiftly became the darlings of Silicon Valley, giving TED talks and being featured on the covers of Forbes and Fortune, in WIRED and in the Wall Street Journal. Holmes also had the support from the likes of Henry Kissinger, George Schulz, Rupert Murdoch, Betsy DeVos and scores more of very famous, purportedly very smart people.

Anyway, the only thing was that Theranos’ much-heralded technology never actually worked. The company had been faking proficiency testing and using other commercial machines to complete the tests it claimed were being done on its machines, which were slap-dashed together from parts of other commercial kits. Elizabeth Holmes and Theranos’ former president Sunny Balwani (who Holmes were romantically involved with, on the sly, btw) were indicted on charges of criminal fraud, and the company itself was ordered to dissolve.

Now that the curtains have closed on this cautionary tale, pundits are coming out of the woodwork to crow that they had seen it coming all along, and people who bought into Holmes / Theranos’ story were idiots.

Oh, really? I don’t think so, man.

To be sure, yes, as I was ripping through the book, there were so many moments when I wanted to yell, what the hell are you doing? Why are you buying into her story? Why are all you smart people believing in this bullshit? Why? 

(Oh, the magic of hindsight. The luxury of being a bystander.)

*Former president Bill Clinton and Elizabeth Holmes, the CEO of Theranos, in 2015.*

How did Elizabeth Holmes fool so many people, for so long?

It seems like such an unbelievable story.

But you know what, we’ve all seen this before.

If you’ve ever interviewed for a job, you’ve seen this before. A woefully underqualified candidate is asked whether she could do XYZ or use the ABC platform. She says yes, absolutely, everyday. And prays that by the time she’s in the job, she’d figure out how to do that darn thing.

If you’ve ever worked in a business, you’ve seen this before. An ambitious, overeager, I-have-quotas-to-meet salesman (or a well-intentioned but not exactly realistic executive) is determined to do whatever it takes to close the deal. Whatever it takes to make the sales, to win a new customer, to get that contract signed and delivered. So they overpromise, yes of course we can do that, yes no problems at all, absolutely. They promise the world, and then leave the delivery for someone else in the back office - who, right now, is not thrilled because she knows she will either have to disappoint the customer or make miracles happen, again.

So in that respect Holmes is not the first, or the last, person who’s ever lied. She probably truly believed that her lies were, or were close to, the truth - by the time that it needed to be delivered, in any case.

Perhaps the only thing that’s different is that Holmes was just a lot more successful when she lies.

As someone who relies on the fake it until you make it ethos on occasions, I have to admit, I’m a bit envious. Maybe that’s why we are all in an uproar about Theranos’ house of cards: we wonder why we aren’t as good as Holmes when we lie.

I think Holmes managed to convince so many people to believe in her because of a few things,

Holmes lived her story. Want to be a great salesman? Dress the part, and talk the part. Holmes idolised Steve Jobs and emulated after him to dress the part of a preppy, precocious genius. She spoke in an unexpected (and allegedly fabricated) deep baritone voice, dyed her hair blond, and if you talked to her she would stare at you intensely with her large, unblinking blue eyes. She was so good at selling the vision.
People wanted to believe in her story. Here’s a young, beautiful, charismatic Stanford dropout who’s incredibly smart, with an idea that promises to change the world. For the male-dominated Silicon Valley, here’s this wunderkind female tech founder who talks disruption and innovation in the multi-billion dollar healthcare industry (and she looks great on a magazine cover, too). Her company’s technology was claimed to help countless people monitor their health and diagnose fatal diseases early, ‘so no one has to say goodbye too early’. It’s story perfect. Holmes was everything Silicon Valley wanted in a founder.
(and wouldn’t all of us? I also want to believe in a story of a young, powerful female tech founder who changes everything. )
Nobody wanted to miss out on a good deal. Well, if she’s backed by all these celebrities and congressmen.. there must be something in it, right? Nobody wants to be the first to commit money, but once you’ve got a few scores on the board, the rest comes easily. Nobody wants to lose out to their competitor.

People are rather easy to fool, when they want to be fooled.

Theranos, Or How to Tell Better Lies