She was “the world’s youngest self-made female billionaire,” proclaimed TBEN magazine. The “next Steve Jobs,” said Inc, another business magazine that put her on the cover.
In 2014, Elizabeth Holmes, then 30 years old, was on top of the world. A dropout from Stanford University, she had founded a company worth $9bn (£6.5bn) for supposedly revolutionizing disease diagnosis.
With a few drops of blood, Theranos promised that his Edison test could quickly detect conditions such as cancer and diabetes without the hassle of needles. Leaders from Henry Kissinger to General James Mattis sat on the board.
But by 2015, the seams came apart, and within a year, Holmes was exposed as a fake. The technology she touted didn’t work at all, and by 2018 the company she founded had collapsed.
In January, she was convicted by a California jury of four counts of fraud, each carrying a maximum sentence of 20 years in prison.
The jury found her not guilty on four other charges and failed to reach a verdict on three others. Holmes, who had pleaded not guilty to all charges, sought a new trial, but those requests were denied.
She will be sentenced on Friday, but is expected to appeal.
During the trial, Holmes accused her ex-boyfriend and business partner, Ramesh “Sunny” Balwani, of emotional and sexual abuse at the time of the alleged crimes, affecting her mental state.
Balwani, 56, who faced the same fraud charges, was convicted in July and will be sentenced next month. He had called the allegations “outrageous”.
Start under high pressure
Despite being the subject of a book, an HBO documentary, and an upcoming TV series and movie, it’s still unclear why Holmes took such a gamble on technology she knew didn’t work.
She grew up in a comfortably well-to-do family in Washington DC and, according to people who knew her, was a polite but withdrawn child.
Inventor and businessman Richard Fuisz, 81, speculated that there must have been tremendous pressure on Holmes to succeed. His family lived next door to the Holmes family for many years, but they fell out when Theranos sued him in 2011 over a patent dispute (it was later settled).
Holmes’s parents spent much of their careers as bureaucrats on Capitol Hill, but “they were very interested in status” and “lived for connections,” he told the TBEN. Her father’s great-great-grandfather founded Fleischmann’s Yeast, which changed the American bread industry, and the family was very aware of its lineage, he said.
At the age of nine, young Elizabeth wrote a letter to her father stating that she “really wanted”[ed] out of life is to discover something new, something humanity didn’t know was possible”.
While attending Stanford University in 2002 to study chemical engineering, she came up with the idea of a patch that could scan the wearer for infection and deliver antibiotics if needed.
At the age of 18, she already showed an intransigence that would apparently continue and propel the company she would found the following year.
Phyllis Gardner, an expert in clinical pharmacology at Stanford, recalled discussing Holmes’s idea for a skin patch and telling her it “wouldn’t work.”
“She just stared right through me,” Dr Gardner told the TBEN.
“And she seemed absolutely sure of her own genius. She wasn’t interested in my expertise and that was disturbing.”
Months later, Holmes dropped out of Stanford at age 19 and launched Theranos, this time with a seemingly revolutionary way to test blood with a simple finger prick.
Powerful people were captivated and invested without seeing audited financial accounts.
U.S. Treasury Secretary George Schultz, media mogul Rupert Murdoch, and America’s wealthiest family, the Waltons, were among her backers.
The support lent credibility to her, as did her attitude.
“I knew she had this brilliant idea and she had convinced all these investors and scientists,” said Dr. Jeffrey Flier, the former dean of Harvard Medical School, who met her for lunch in 2015.
“She was confident, but when I asked her several questions about her technology, she didn’t look like she understood,” added Dr Flier, who never formally reviewed her technology. “It seemed a little odd, but I couldn’t get away with thinking it was fraud.”
Dr. Flier eventually invited her to join the medical school’s Board of Fellows, which he regrets, though she was removed when the scandal broke.
Things began to unravel in 2015 when a whistleblower raised concerns about Theranos’ flagship product, the Edison. The Wall Street Journal wrote a series of damning revelations claiming that the results were unreliable and that the company had used commercially available machines from other manufacturers for most of its testing.
Lawsuits piled up, partners cut ties, and in 2016, the US regulator banned Holmes from conducting a blood testing service for two years.
In 2018, Theranos disbanded.
In March of that year, Holmes settled civil charges from financial regulators that she had fraudulently raised $700 million from investors.
But three months later, she was arrested along with Mr. Balwani on criminal charges of wire fraud and conspiracy to commit wire fraud.
Prosecutors alleged that she knowingly misled patients about the tests and vastly exaggerated the company’s performance to backers.
When the Theranos scandal went to trial, commentators said it was remarkable how tightly Holmes clung to her origin story and people who knew her said they doubt she’s changed.
Since the trial, Holmes lives in California with partner William “Billy” Evans, 27, heir to the Evans Hotel Group. They had a son in July 2021 and she is pregnant with their second child.
Emily Baker, a former deputy district attorney for Los Angeles, told the TBEN before the verdict that the sentencing judge could take into account Holmes’s status as a young mother if found guilty, and opt for a lighter sentence.
Holmes’ lawyers had said she would not be jailed because she posed no danger to society. They offered testimony from more than 130 people on her behalf, including Senator Cory Booker.
But prosecutors demanded she receive 15 years in prison and an $800 million payment, arguing she was “blinded” by ambition, which “put and will continue to put people at risk.”
“She assumes no responsibility,” they wrote in court documents. “On the contrary, she insists she is the victim.”