Episode description
If you listened to the press this past year you must have heard snippets about Elizabeth Holmes, the young, attractive and charismatic CEO of Theranos, and how she fleeced rich and savvy people out of almost a billion dollars. It's a topic that Rob and Toby have been mulling over recently and particularly wondering just where in the journey did Elizabeth turn to fraudulent claims and did she do so knowingly?
From what we know, she started out with a genuine vision/dream to disrupt the blood-testing industry with a machine that could provide blood analysis from a single pinprick and in the early years, there seems to have been a lot of effort into achieving that dream. But somewhere along that journey it would have become obvious that the technology wasn't going to work and that's when Elizabeth's pathological desire to succeed turned to fraud.
The bottom line seems to be that she had a sociopathic disorder that allowed her to believe in her fraudulent claims, but it doesn't explain why such savvy people parted with their money so easily. Was it because they thought they were being invited into a secret and highly exclusive club? Did the fact that well-known people had already invested cloud their judgment? Who knows?
What we do know if that even basic due diligence would have set alarm bells ringing so I guess that leaves us with two take aways from the Theranos story:
- If it looks and sounds too good to be true it probably is.
- Simple due diligence should be a prerequisite before you hand over your well-earned cash.