Theranos’s time in the public spotlight has been a wild one, but as is ever the case, the full story is somehow even more elaborate and absurd.
When Theranos burst into the public consciousness on a colossal PR push in 2014, it seemed like the next big thing in Silicon Valley. Promising to revolutionize blood tests by performing full lab work off a portable device using only finger-pricked samples, Theranos claimed it could push preventative healthcare into the 21st century. Those with any remote familiarity with tech news know what happened next: a 2015 exposé by Wall Street Journal reporter John Carreyrou broke that the company’s vaunted machine was, indeed, too good to be true, that Theranos had misled and outright falsified test results to cover up for a machine that not only didn’t work but, according to doctors and medical experts, literally could never work under the boasted parameters. More and more reportage broke news of even more disasters for the company, culminating in founder and CEO, the Steve Jobs-aping Elizabeth Holmes, finally being indicted for fraud and conspiracy in June of this year. Theranos’s time in the public spotlight has been a wild one, but as is ever the case, the full story, documented in Bad Blood: Secrets and Lies in a Silicon Valley Startup, is somehow even more elaborate and absurd.
Carreyrou expands upon his reporting to cover the entire saga of the company, starting with a condensed biography of Holmes that makes her appropriation of Jobs’s black turtleneck look merely the culmination of a life that reads like a parody of startup founders. A precocious, tenacious child of upper middle-class parents, Holmes got into Stanford, only to drop out when she conceived of the idea behind Theranos and secured enough support from professors and a few investors to convince her that university would only delay a life of fortune and fame. Carreyrou lays out this background, along with the earliest days of Theranos, with the rigid precision and lean prose of an investigative reporter, leaving just enough fat to enhance the meat of his reportage. For example, he includes an anecdote of a seven-year-old Holmes drawing a rudimentary schematic of a time machine to emphasize both her innate intellectual curiosity and her mirthless belief in her own fantasies.
When Theranos’s practices were exposed in 2015, it sent shock waves through the tech industry, yet as Carreyrou writes, it’s almost unfathomable that Theranos managed to last more than a decade from its 2003 founding before things fell apart. From the outset, Holmes is depicted as someone who realized early on that her dream of a portable blood-testing device able to run full diagnostics off a single blood drop was impossible, and responded by simply masking that fact from employees and investors. The book opens out of chronological order with an account of a Theranos presentation to Big Pharma company Novartis at a conference in Switzerland, where then-CFO Henry Mosley gave a rousing demonstration of the company’s miniature testing device, only to learn later that the results he’d proudly displayed were fakes, transmitted remotely from the company’s home base in San Francisco to cover for the device not working. The story equally lays out Holmes’s ruthless side, as she promptly dismisses Mosley the second he brings up his discomfort with such falsehoods.
The book’s pace and tension escalate alongside Theranos’s growth, its funding and connections inoculating it from increasing pressures from internal and external probes. Holmes and her second-in-command/boyfriend Ramesh “Sunny” Balwani subject employees to draconian security measures to prevent them from discovering, much less leaking, revelations of the technology’s failures, and Holmes uses her influence with backers to shut down outside snooping. The most striking of these examples is that of an Army regulator reviewing Theranos devices for possible military application and finding so many issues he recommends an FDA investigation, only to be virulently dressed down by Central Command head General Jim “Mad Dog” Mattis, who just so happens to be a sitting board member of Theranos.
Ducking editorial input, Carreyrou does not directly comment on that brazen conflict of interest, though he carefully threads an overall portrait of incestuousness in Silicon Valley that enabled Theranos’s fraud. This ranges from the willful denial of wrongdoing by board members like former secretaries of state George Shultz and Henry Kissinger to the hilarious soap opera that is the family feud between the Holmes family and former friends the Ruiszes, whose patriarch, Richard, gums up Theranos with patent trolling over the perceived slight of Elizabeth not consulting the medical businessman for advice when starting her company. Carreyrou expertly lays out the spiraling madness of Theranos’s crimes and intimidating litigiousness, but it is in this overarching view of Silicon Valley as one giant, emotionally stunted grift, a vapor economy in which the only true product is the charisma of the frontpeople angling for venture capital, that Bad Blood is most caustic. The author devotes the final pages of his epilogue to contemplating the bizarre set of circumstances that allowed Theranos to thrive even with the added scrutiny that should have accompanied operation within the more legally regulated realm of healthcare, and the tacit suggestion hidden behind those words is the unsettling feeling that the now-notorious disaster of the company is likely occurring all over the tech industry every day, with billions of dollars circulating around an elaborate fantasy.