Who is Elizabeth Holmes, the woman who created a billionaire fraud in Silicon Valley

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11/25/2022 – 9:30 am

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SMALL AND INSUFFICIENT
The microtube with blood: Elizabeth Holmes and the fake attraction in lectures
to potential investors (Credit: Disclosure)

Elizabeth Holmes lived a big lie for 15 years. It wasn’t a harmless lie. It was something that moved billions of dollars and damaged the lives of many, many people. This 38-year-old American founded a company in 2003, yet another start-up in Silicon Valley. It didn’t take long to present his proposal to create a new method for blood tests. that would allow the performance of several hemograms with a minimal amount of the patient’s blood. She could do up to 200 different blood counts with one sample. The proposal was revolutionary, it would change the clinical analysis market a lot and help people who don’t like to give up several vials of blood when they need to perform a lot of tests. It didn’t work out. Last Friday, the 18th, she was sentenced to 11 years in prison, which must be increased by another three years of house arrest. The former businesswoman was found guilty on four of the 11 charges brought against her for fraud and conspiracy.

In 2003, aged 19, Holmes left the biochemistry course at Stanford University to create Theranos, a clinical exam laboratory company, associated with Ramesh Sunny Balwani, who would be his partner for the next two decades. Soon, she presented her revolutionary proposal to the public: the creation of a process and the devices necessary for it so that, with a small blood sample, it would be possible to perform many tests. She knew how to sell her fish. Young, blonde and beautiful, she adopted strategies from her idol, Steve Jobs. Even in clothes. She appeared in public wearing the same look as the owner of Apple, with jeans and a black long-sleeved blouse with a neck-length collar. Like Jobs, she turned her presentations into media events, with a lot of sympathy and a sense of what show business is.

His start-up began to be talked about and the pace of investor adhesion was very fast. She got some of the most important people to embark on this story, including very important names in American politics, such as former Secretary of State Henry Kissinger and former Secretary of Defense James Mattis. One of her biggest investors was media billionaire Rupert Murdoch. But while Apple introduced one new product after another, Jobs’ disciple couldn’t get her revolutionary method off the ground. Meanwhile, the co-option of investors continued. She began to forge reports on the development of equipment and in 2014 her company reached an absurd market value of US$ 10 billion. Holmes then became the first woman to become a billionaire without having received an inheritance. Interestingly, she is the daughter of Christian Rasmus Holmes IV, a powerful executive at energy giant Enron who lost everything when he was convicted of fraud when his daughter was a teenager.

“The worst thing in the world is someone not believing what you say!” Elizabeth Holmes, during a talk in 2009

The farce gained cinematographic contours. In addition to forging documents about the company’s progress, she began to carry out tests by sending the material to conventional laboratories, hired with prices above the market to keep everything confidential. He employed employees for high salaries, who soon realized all the fraud, but, satisfied with the remuneration, they continued in the company. The house of cards began to crumble in 2015, when reporter John Carreyrou published the first article in the Wall Street Journal questioning the existence of the new method of testing. He pointed out that patients were receiving skewed test results related to HIV and cancer. For more than two years, the businesswoman refuted the accusations. The house went down in late 2017 and all has been revealed. Elizabeth Holmes’ trial began in July 2021, and she was found guilty in January of this year. Last Friday, the 18th, she appeared in court and heard the sentence which her lawyers are appealing. The chances of any change are minimal. Her defense team set up several strategies that did not work out. During the trial, they tried to bring a gender discrimination narrative to the case, claiming that her client was suffering that process because she was a woman. In another frustrated strategy, they wanted to point out that Holmes had no intention of making money, but helping people, that her concern with the invention of a new method for blood tests was a legitimate concern for humanity. Last Monday, she announced that she is pregnant with her second child.

PARTNERS IN CRIME Amanda Seyfried and Naveen Andrews: they play Elizabeth Holmes and Sunny Balwani in The Dropout series (Credit: Disclosure)

Such a story is irresistible material to be turned into a film or series. In the case of Elizabeth Holmes, both. The documentary The Inventor: Out for Blood in Silicon Valley (2019), by Alex Gibney, and the dramatized series The Dropout, available today on Disney+, which manages to provide entertainment based on the saga of Holmes, played by Amanda Seyfried, have already been produced and shown. , from Les Miserables and Mamma Mia!. Reports of the trial and these two on-screen productions will preserve this case, which was a milestone for start-ups in the United States. After the great Elizabeth Holmes hoax, investments in companies that cannot justify their development practically disappeared. It took a while, but Silicon Valley is ceasing to believe in nice people with visionary speeches that don’t hold up.

The article is in Portuguese

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