Rise and fall of Theranos CEO Elizabeth Holmes
The CEO and founder of the failed Silicon Valley start-up Theranos, Elizabeth Holmes, has been given a sentence of over 11 years in jail for duping investors. Forbes named her the youngest self-made woman billionaire in 2014 with a net worth of around $4.5 billion when she was only 30 years old. However, where did things go wrong for the Theranos CEO?
Why does this story matter?
- Theranos had pledged to change the blood testing game; instead, it turned Holmes into a Silicon Valley character whose ambition turned into deceit quickly.
- In January, the start-up founder was convicted on four separate felony fraud counts for swaying investors into believing that she had invented a groundbreaking medical device before Theranos plummeted after a probe by The Wall Street Journal.
Holmes was once touted as the next Steve Jobs
Holmes rose to prominence at age 19 in 2003 after founding Theranos and became well-known for dressing up in black turtlenecks, exactly like her idol and late Apple co-founder Steve Jobs. Holmes quickly turned into a Silicon Valley star with her start-up, which claimed to have developed a testing kit that could identify various disorders and diseases from only a few drops of blood.
Know about Holmes's meteoric rise
With the meteoric rise of Holmes, numerous media outlets projected her as the next Steve Jobs and featured her as the cover star. Several knowledgeable investors, such as media moguls Larry Ellison and Rupert Murdoch and the Walton family, the founders of Walmart, were pulled in by her act. Theranos raised $1 billion from investors, but Holmes's big promises turned out to be bogus.
Movies, TV shows, and books on Holmes
The interesting tale of Elizabeth Holmes has been featured in movies, TV shows, and books that used her to spread awareness about the tech industry's blind faith in charismatic Silicon Valley personalities. In September this year, American actress Amanda Seyfried also received an Emmy for her portrayal of Holmes in the television movie "The Dropout."
Investors at Theranos
Holmes's claims of inventing a technology to revolutionize the blood testing game attracted the likes of former US secretary of state Henry Kissinger, former US defense secretary James Mattis, etc., as board members of Theranos at one point.
Homes to spend time behind bars!
The 38-year-old could have spent 20 years in jail, but her defense team requested an 18-month maximum sentence from the judge, ideally to be served under home confinement. Homes's attorney asked US District Judge Edward Davila to consider the apparent emotional and sexual abuse Holmes suffered while intimately connected with Ramesh Balwani, who turned from a Theranos executive into a co-conspirator in her crimes.
Holmes, a 'massive fraud'!
According to her prosecutors, Holmes knew her device was not yielding reliable results, yet induced investors to contribute almost one billion dollars without gaining any meaningful gain. US attorney Stephanie Hinds stated that the sentence "reflects the audacity of her massive fraud and the staggering damage she caused." Pregnant Holmes will not need to surrender until April 2023, Davila ordered in California's San Jose.
Prosecutors want Holmes to pay $800 million
Prosecutors demanded that Holmes pay $800 million in restitution to her investors, including the Walgreens chain of pharmacies and media mogul Rupert Murdoch, Walmart's Walton family, etc. Although Holmes has claimed she has no money to pay, a restitution hearing is set to be scheduled.