It’s 2008, and Elizabeth Holmes is about to be removed as CEO of Theranos, the blood-testing startup she founded. Don Lucas, chairman of Theranos’ board, has convened an emergency meeting with the other directors to discuss concerns about Holmes’ revenue projections, which seem highly unrealistic. Holmes is waiting outside Lucas’s office. When the four men call her in, it’s to tell her that she has proven too young and inexperienced for her title.
“But then something extraordinary happens,” John Carreyrou writes in Bad Blood: Secrets and Lies in a Silicon Valley Startup. “Over the course of the next two hours, Elizabeth convinced them to change their minds. She told them she recognized that there were issues with her management and promised to change. She would be more transparent and responsive going forward. It wouldn’t happen again.”
You might think Holmes the sympathetic character in this tableaux: a 20-something female entrepreneur surrounded by middle-aged men telling her she’s not qualified to run her own company. After all, Steve Jobs, Holmes’ idol, started Apple Computer when he was 21. Mark Zuckerberg launched Facebook in his dorm room. Holmes, who wrote her first patent application as a freshman at Stanford University, was the reason Theranos even existed. Surely, if given a second chance, she would run with it.
And run with it she did: Under Holmes’ leadership, Theranos would go on to become one of the most spectacular startup implosions in Silicon Valley history. As Carreyrou first outlined in a 2015 exposé (paywall) in the Wall Street Journal, Holmes presided over a company defined by mismanagement, secrecy, deception, and paranoia. By the time she found herself charming the board to let her stay on as CEO, Theranos was already a bomb waiting to go off.
Holmes’ connections in Silicon Valley, where she grew up, helped Theranos find its early footing—wealthy family friends were some of its first investors. But Holmes was also very convincing, and captivated many an executive and venture capitalist with her laudable ambitions, unshakeable confidence, and unnaturally deep voice. She modeled herself after Silicon Valley legends like Jobs and Oracle founder Larry Ellison, whose ranks she hoped to join one day. Many people Holmes met seemed to agree this was possible. “She had the presence of someone much older than she was,” Carreyrou writes. “The way she trained her big blue eyes on you without blinking made you feel like you were the center of the world. It was almost hypnotic.”
Behind the scenes, Holmes was exacting and mercenary. She frequently purged employees who questioned her, and kept information compartmentalized across teams so only she had a complete picture of Theranos’ inner workings. (If this sounds benign enough, remember that the company was building a blood-testing device requiring input from from chemists, engineers, and designers, none of whom could even instant-message each other.) She had assistants track when employees came and left, and even become friends with employees on Facebook to tell Holmes what they were posting.
Holmes was also vengeful. After firing her first chief financial officer, Henry Mosley, for questioning the accuracy of information she was presenting to potential investors, Holmes found out via the IT department that he had once used his work computer to browse pornography. She said that discovery was the reason for Mosley’s termination, even though it took place after he was let go. Holmes used the claim to deny Mosley his stock options.
Mosley was one in a long line of people—due to the makeup of Silicon Valley, most of them men—to question the feasibility of Theranos’ technology, timeline, and financial footing. When the skepticism came from within, Holmes would shoot it down and ultimately fire whoever expressed it. When it came from investors or executives at any of Theranos’ real or potential partners, she would focus on anyone in the room that seemed to have her back, and could often convince them that the skeptics were the problem.
And if that didn’t work, she lied—about how many and which types of tests Theranos devices could perform, about how fast they could perform them, about where the devices had been deployed, about when they’d be ready for a wider rollout, about the accuracy of their test results, about their regulatory approval, and about the company’s revenue prospects. By the time Carreyrou’s WSJ bombshell exposed that Theranos had been outsourcing many of its tests instead of running them on its devices, Holmes had run roughshod over almost every part of the research, development, design, and implementation of her vision—all in the interest of getting to market quickly and raising a ton of money in the process.
One other man looms large in the Theranos story: Ramesh “Sunny” Balwani, a Lotus Software and Microsoft alumnus who had sold his company for a cool $4.5 million during the dot-com bubble. In 2009, Balwani became president and chief operating officer of Theranos, a position from which he made impossible demands and fired anyone who pushed back on them. Portrayed by Carreyrou as a garrulous bullshitter who had none of Holmes’ knack for attracting acolytes, Sunny was disliked within the company and distrusted by investors. Also, he and Holmes were a couple.
In her freshman year at Stanford, Holmes showed up at her boyfriend’s dorm to break things off. It wasn’t personal, she told him: She was starting a business, and needed to put all of her attention on that. Though a minor aside in Bad Blood, this feels like an inflection point in Holmes’ story, the moment when she decides to pursue Theranos with a singular, aggressive focus. It’s also a moment at which, if you didn’t know anything about Theranos, you might still be rooting for Holmes. After all, if a woman at Stanford, a school that touts itself as an incubator of future CEOs, can’t dump her boyfriend to launch a startup without him replying, “This keeps happening to me!” then our feminist future has not yet been fully realized.
As time goes on, rooting for Holmes becomes impossible, until she is eventually felled by the same hubris that has brought down many a male executive—leaders too caught up in potential victory to acknowledge critical setbacks, and too arrogant to learn from feedback and disagreement. In March of this year, Holmes settled with the US Securities and Exchange Commission over charges that she defrauded investors; the settlement required her to pay $500,000 and forfeit 19 million Theranos shares. She is also prohibited from holding a leadership role at a public company for 10 years. It’s a dramatic fall from grace for a woman once compared to Steve Jobs.
Yet Holmes never stopped being captivating, first as a visionary, and later as a rare public example of a female leader brought low by her ego. There is something spectacular about watching her ignore, override, or shout down dozens of male voices (offering measured, valuable advice) in favor of steamrolling ahead. There is something fascinating about seeing her break through the glass ceiling by using others as battering rams. To be sure, Holmes is no role model—she’s more like the Cruella de Vil of Silicon Valley—but her chutzpah does command a certain dumbfounded respect. Even Sunny, arguably the brash, older man steering an impressionable young CEO down the wrong path, can also be viewed as the gender-swapped counterweight to every male executive who has handed a job to his unqualified girlfriend.
Modern society rightly lauds the idea of a female Jobs, or Warren Buffett, or better yet a veritable army of female captains of industry. Still, there is something intriguing about aspiring to have our own villains, too—the female Jeffrey Skilling, the female Bernie Madoff, the female Martin Shkreli. Holmes may be a disgraced former startup CEO who cost her investors some $600 million (paywall). But her settlement with the SEC required no admission of wrongdoing. Ten years from now, she’ll only be 44. And next year, she’ll be played by Jennifer Lawrence in a Bad Blood movie adaptation directed by Adam McKay. The Theranos saga may be a loss for the future of blood testing. For the future of female super-villains, it’s a damn good start.