- Elizabeth demanded absolute loyalty from her employees and if she sensed that she no longer had it from someone, she could turn on them in a flash.
- The staff turnover was like nothing ever experienced and the employees were troubled by what they saw as a culture of dishonesty at the company.
- Lying is a disgusting habit, and it flows through the conversations here (Theranos) like it’s our own currency.
I just finished reading “Bad Blood: Secret and Lies in a Silicon Valley Startup” and was shocked, angry and amazed at the failure on so many levels of so many people and organizations. Interesting enough pharma companies saw through the problems and ditched Theranos like a bad habit. Here are some tidbits from the book..
-Walgreen’s rush to get into bed with Theranos was a case of FOMO: fear of missing out to a competitor like CVS.
-Documents Theranos gave Walgreens stated that the Theranos system had been “comprehensively validated over the last seven years by ten of the largest fifteen pharma companies.” The second was a review of its technology Dr. J had supposedly commissioned from Johns Hopkins University’s medical school. This was a blatant lie.
-Elizabeth saw herself as a world historical figure. A modern-day Marie Curie.
-Some of the differences between the Theranos values and the values from the other labs were disturbingly large.
–The biggest problem of all was the dysfunctional corporate culture in which it was being developed . Elizabeth and Sunny regarded anyone who raised a concern or an objection as a cynic and a naysayer. Employees who persisted in doing so were usually marginalized or fired, while sycophants were promoted.
-To still be working out the kinks in the product was one thing when you were in R&D mode and testing blood volunteered by employees and their family members, but going live in Walgreens stores meant exposing the general population to what was essentially a big unauthorized research experiment.
-How to make money at Theranos: 1. Lie to venture capitalists 2. Lie to doctors, patients, FDA, CDC, government. While also committing highly unethical and immoral (and possibly illegal) acts.
-What we (Wall Steet Journal) hadn’t fully anticipated was her willingness to tell bald-face lies in a public forum. Not just once, but again and again during the half-hour interview. In addition to continuing to insist that the nanotainer withdrawal had been voluntary, she said the Edison devices referred to in my stories were an old technology that Theranos hadn’t used in years.
-An inspection report running 121 pages long, the document was as damning as one could expect. For one thing, it proved that Holmes had lied at the Journal’s tech conference the previous fall: the proprietary devices Theranos had used in the lab were indeed called “Edison,” and the report showed it had used them for only twelve of the 250 tests on its menu. Every other test had been run on commercial analyzers.
It may be that Ms Homes wanted to “change the world of medicine” but the author of the book makes clear that she both wanted to be a billionaire and idolized Steve Jobs. The intimidation of employees and the press had been unprecedented, according to the book’s author often requiring employees to give HR their personal eMail account passwords to ensure that company eMails were deleted.
While an investigative reporter from the Wall Street Journal broke the story, stories in Fortune, Inc and other business magazines place Ms Holmes on a pedestal because she was one of the few female, self made, executives. These publications failed to due their due diligence along with board members who drank too much Kool-Aid.
The author paints a picture of a very dysfunctional company with dysfunctional managers who demanded absolute loyalty without questioning anything. Of course what is so troubling was that Theranos machines put lives at risk.
Mr Carreyrou does a great job keeping the reader engaged and will have you scratching your head and ask “how could they have gotten away with this?” I highly recommend it, but there is a lesson here about the hype around startups and potential future technology (mHealth?).