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Vanity Fair Blames The Failure of Theranos On Silicon Valley (vanityfair.com)
"I was only a day or two behind FBI agents who were trying to put together a time line of what Elizabeh Holmes knew and when she knew it," writes Vanity Fair, in what Slashdot reader PvtVoid describes as "a compelling story of hubris, glamour and secrecy about the unicorn Silicon Valley company that turned out to be founded on bullshit." Another anonymous Slashdot reader writes:
Holmes raised $700 million "on the condition that she would not divulge to investors how her technology actually worked," according to an article detailing how Silicon Valley can "replicate one big confidence game in which entrepreneurs, venture capitalists, and the tech media pretend to vet one another while, in reality, functioning as cogs in a machine that is designed to not question anything -- and buoy one another all along the way... In the end, it isn't in anyone's interest to call bullshit."
Theranos employed "hundreds of marketers, salespeople, communications specialists, and even the Oscar-winning filmmaker Errol Morris," as well as a chief scientist who eventually became suicidal. But then the Centers for Medicare and Medicaid Services "discovered that some of the tests Theranos was performing were so inaccurate that they could leave patients at risk of internal bleeding, or of stroke among those prone to blood clots." A reporter at the Wall Street Journal says "It's O.K. if you've got a smartphone app or a social network, and you go live with it before it's ready; people aren't going to die. But with medicine, it's different."
He became suspicious after reading the answer that the company's CEO, a Stanford dropout, supplied for a question about their technology. "A chemistry is performed so that a chemical reaction occurs and generates a signal from the chemical interaction with the sample, which is translated into a result, which is then reviewed by certified laboratory personnel."
Theranos employed "hundreds of marketers, salespeople, communications specialists, and even the Oscar-winning filmmaker Errol Morris," as well as a chief scientist who eventually became suicidal. But then the Centers for Medicare and Medicaid Services "discovered that some of the tests Theranos was performing were so inaccurate that they could leave patients at risk of internal bleeding, or of stroke among those prone to blood clots." A reporter at the Wall Street Journal says "It's O.K. if you've got a smartphone app or a social network, and you go live with it before it's ready; people aren't going to die. But with medicine, it's different."
He became suspicious after reading the answer that the company's CEO, a Stanford dropout, supplied for a question about their technology. "A chemistry is performed so that a chemical reaction occurs and generates a signal from the chemical interaction with the sample, which is translated into a result, which is then reviewed by certified laboratory personnel."
Scott Adams (of Dilbert) sent two samples for testing and they came back with different results. It seems the scam was very very easy to detect.
Venture capitalists are mostly scammers. They buy into a *plausible* startup, regardless of the reality. One of the other sister companies they invested in, then buys a stake in this new one. Usually a tiny stake at a hugely inflated price. This gives the new startup a super ridiculous valuation based on that tiny sliver of stock. They head for an IPO based on this fake valuation and the crap stock is dumped on the stock markets and sold to unsuspecting investors. VC exit at a big profit.
The company isn't the thing they're investing in, it's the scam IPO, and that has more to do with the designer clothes the CEO wears than technology it makes.
Do you remember Groupon? Or Zygna?
The title of this post has nothing to do with the article or even the summary. From the Slashdot summary She built a corporation based on secrecy in the hope that she could still pull it off. Then, it all fell apart. The company did not fail because of Silicon valley secrecy, it succeeded because of it. I'm used to Slashdot summaries not matching the article but the title not matching the summary? That's an amazing new low.
Yeah. This isn't a gender specific thing. If anything, it's reassuring to see a woman getting the opportunity to commit such a large financial deception.
What I wonder after reading this sorry story is: was Holmes aware that she was selling snake oil all along, or did she start out with the genuinely belief that her company could make the technology work? I'm willing to believe the latter: they did try, but the longer their breakthrough failed to materialize, the more they had to shift their efforts towards keeping up appearances, or "controlling the narrative" as it's called.
Good question. She probably did believe either it worked or that they would make it work. The article suggests an echo chamber, which is mind-bending in how it can reinforce what should be obviously bad beliefs. In all things, it pays to surround yourself with people willing to disagree and present good arguments.
For a good analogue, just look at the financial traders/gamblers who lose big by continuing to bet in the hopes of making up for their losses, where cutting their losses earlier would have made the situation far less severe.
-- Using the preview button since 2005
Talking of Vanity Fair am I alone in finding it significant that it is a publication that largely concentrates on entertaining copy on celebrities and lifestyle issues which has recently repeatedly published fairly hard core investigative journalism. How come the so called heavyweight "broadsheet" publications sound like echo chambers for various vested business interests these days and could not publish a challenging piece of investigative journalism to save their lives?
Great job Vanity Fair! you are now on my must read list.
Facts are history now plebs have politics for religion on social media.