Bad Blood: Secrets and Lies in a Silicon Valley Startup
4.7 4.7 out of 5 stars | 40,161 ratings
Price: 17.72
Last update: 05-27-2024
About this item
NATIONAL BESTSELLER The gripping story of Elizabeth Holmes and Theranos—one of the biggest corporate frauds in history—a tale of ambition and hubris set amid the bold promises of Silicon Valley, rigorously reported by the prize-winning journalist. With a new Afterword.
“Chilling ... Reads like a thriller ... Carreyrou tells [the Theranos story] virtually to perfection.” —The New York Times Book Review
In 2014, Theranos founder and CEO Elizabeth Holmes was widely seen as the next Steve Jobs: a brilliant Stanford dropout whose startup “unicorn” promised to revolutionize the medical industry with its breakthrough device, which performed the whole range of laboratory tests from a single drop of blood. Backed by investors such as Larry Ellison and Tim Draper, Theranos sold shares in a fundraising round that valued the company at more than $9 billion, putting Holmes’s worth at an estimated $4.5 billion. There was just one problem: The technology didn’t work. Erroneous results put patients in danger, leading to misdiagnoses and unnecessary treatments. All the while, Holmes and her partner, Sunny Balwani, worked to silence anyone who voiced misgivings—from journalists to their own employees.
Top reviews from the United States
TONY SMITH5.0 out of 5 stars
very informative book--easy read
Reviewed in the United States on April 26, 2024
Very interesting book (saw the story on American Greed on CNBC) and had to get the book so I would no the whole story... Its amazing what this young girl could accomplish
Kai Lee5.0 out of 5 stars
A leader without integrity will ultimately fail
Reviewed in the United States on October 11, 2021
This book presents a fascinating account of a real-life story that is still unfolding. It involves a cast of characters so unique and events so beyond the norm that it is not an exaggeration to say that they are probably beyond the imagination of even the best fiction writers.
The story is about the rise and fall of the company Theranos, founded in 2003 by the 19 years old Stanford Dropout Elizabeth Holmes. The company’s objective, which it later falsely claimed to have achieved, was to revolutionize blood tests by only requiring very small amounts of blood taken by finger stick; and the tests could be performed and the results obtained very rapidly using small automated devices developed by the company. Holmes was CEO and she ran the company with her boyfriend Sunny Balwani, who had the title President. Although not learning much about science, engineering or medicine during her two years at Stanford, her charm, ambition, and deceit were able to raise hundreds of millions from venture capitalists and private investors. She was also able to persuade experienced executives of established businesses to partner with her company, including the CEO of Safeway and the Board of Directors of Walgreens. She convinced famous political and military names to serve on Theranos’ Board of Directors, including former Secretaries of State George Schulz and Henry Kissinger, Four Star General James Mattis, former Senator Sam Nunn, to name but a few. Although dropping out in her second year, her former Stanford Chemical Engineering Professor Channing Robertson stated in an article about Theranos and its CEO: “You start to realize you are looking in the eyes of another Bill Gates or Steve Jobs.” When Fortune Magazine’s legal correspondent Roger Parloff talked to Shultz and Mattis about Elizabeth, Shultz said: “Everywhere you look with this young lady, there’s a purity of motivation. I mean she really is trying to make the world better, and this is her way of doing it.” Mattis went out of his way to praise her integrity: “She has probably one of the most mature and well-honed sense of ethics – personal ethics, managerial ethics, business ethics, medical ethics that I’ve ever heard articulated,” Kissinger told New Yorker journalist Ken Auletta that Holmes had an "ethereal quality." "She is like a member of a monastic order,"
It is perhaps fortunate for America that the Soviet Union/Russia did not have a charming person of similar caliber when the above three gentlemen were serving their country in their respective high positions in the U.S. Government.
While Elizabeth was perhaps the ultimate person of authority in the company, Sunny was mostly in charge of running its everyday operation. Their leadership style included: demanding complete loyalty, complete secrecy, intimidation, and deceit. According to the book, earning projections were not based on realistic estimates, inaccurate blood test results were not made known, machines designed in-house failed to work most of the time. Folks who raised doubts about the company’s operation were fired. Employees who could not live with the thought that patients may be harmed chose to resign.
For more than a decade, the company was riding high. By 2015, Forbes had named Holmes the youngest and wealthiest self-made female billionaire in America on the basis of a $9-billion valuation of her company. The downfall began in October 2015, when the author of this book published a "bombshell article", detailing how the company’s Edison device gave inaccurate results, and revealing that the company had been using commercially available machines made by other manufacturers for most of its testing. Sanctions and other adverse actions by the Centers for Medicare & Medicaid Services soon followed, as well as a lawsuit filed by Arizona for violation of the Arizona Consumer Fraud Act. In 2016, Walgreens and Capital BlueCross announced a suspension of Theranos blood tests from the Newark lab. On June 15, 2018, Holmes and Balwani were indicted on multiple counts of wire fraud and conspiracy to commit wire fraud. Due to Covid-19, the trial of Elizabeth was delayed for a year. It began on August 31, 2021. Looks like the trial for Sunny would not take place until 2022. The ending of this saga is nowhere in sight.
On September 4, 2018, Theranos announced in an email to investors that it would cease operations and release its assets and remaining cash to creditors after all efforts to find a buyer came to nothing. Most of the company's remaining employees had been laid off on the previous Friday, August 31.
Perhaps all of this could have been avoided if Elizabeth had taken a course on Leadership before she dropped out of Stanford. The first thing one learns in Leadership 101 is: A leader without integrity will ultimately fail.
The story is about the rise and fall of the company Theranos, founded in 2003 by the 19 years old Stanford Dropout Elizabeth Holmes. The company’s objective, which it later falsely claimed to have achieved, was to revolutionize blood tests by only requiring very small amounts of blood taken by finger stick; and the tests could be performed and the results obtained very rapidly using small automated devices developed by the company. Holmes was CEO and she ran the company with her boyfriend Sunny Balwani, who had the title President. Although not learning much about science, engineering or medicine during her two years at Stanford, her charm, ambition, and deceit were able to raise hundreds of millions from venture capitalists and private investors. She was also able to persuade experienced executives of established businesses to partner with her company, including the CEO of Safeway and the Board of Directors of Walgreens. She convinced famous political and military names to serve on Theranos’ Board of Directors, including former Secretaries of State George Schulz and Henry Kissinger, Four Star General James Mattis, former Senator Sam Nunn, to name but a few. Although dropping out in her second year, her former Stanford Chemical Engineering Professor Channing Robertson stated in an article about Theranos and its CEO: “You start to realize you are looking in the eyes of another Bill Gates or Steve Jobs.” When Fortune Magazine’s legal correspondent Roger Parloff talked to Shultz and Mattis about Elizabeth, Shultz said: “Everywhere you look with this young lady, there’s a purity of motivation. I mean she really is trying to make the world better, and this is her way of doing it.” Mattis went out of his way to praise her integrity: “She has probably one of the most mature and well-honed sense of ethics – personal ethics, managerial ethics, business ethics, medical ethics that I’ve ever heard articulated,” Kissinger told New Yorker journalist Ken Auletta that Holmes had an "ethereal quality." "She is like a member of a monastic order,"
It is perhaps fortunate for America that the Soviet Union/Russia did not have a charming person of similar caliber when the above three gentlemen were serving their country in their respective high positions in the U.S. Government.
While Elizabeth was perhaps the ultimate person of authority in the company, Sunny was mostly in charge of running its everyday operation. Their leadership style included: demanding complete loyalty, complete secrecy, intimidation, and deceit. According to the book, earning projections were not based on realistic estimates, inaccurate blood test results were not made known, machines designed in-house failed to work most of the time. Folks who raised doubts about the company’s operation were fired. Employees who could not live with the thought that patients may be harmed chose to resign.
For more than a decade, the company was riding high. By 2015, Forbes had named Holmes the youngest and wealthiest self-made female billionaire in America on the basis of a $9-billion valuation of her company. The downfall began in October 2015, when the author of this book published a "bombshell article", detailing how the company’s Edison device gave inaccurate results, and revealing that the company had been using commercially available machines made by other manufacturers for most of its testing. Sanctions and other adverse actions by the Centers for Medicare & Medicaid Services soon followed, as well as a lawsuit filed by Arizona for violation of the Arizona Consumer Fraud Act. In 2016, Walgreens and Capital BlueCross announced a suspension of Theranos blood tests from the Newark lab. On June 15, 2018, Holmes and Balwani were indicted on multiple counts of wire fraud and conspiracy to commit wire fraud. Due to Covid-19, the trial of Elizabeth was delayed for a year. It began on August 31, 2021. Looks like the trial for Sunny would not take place until 2022. The ending of this saga is nowhere in sight.
On September 4, 2018, Theranos announced in an email to investors that it would cease operations and release its assets and remaining cash to creditors after all efforts to find a buyer came to nothing. Most of the company's remaining employees had been laid off on the previous Friday, August 31.
Perhaps all of this could have been avoided if Elizabeth had taken a course on Leadership before she dropped out of Stanford. The first thing one learns in Leadership 101 is: A leader without integrity will ultimately fail.
bigheadted4.0 out of 5 stars
Excellent Read, but It Ain't Over Yet
Reviewed in the United States on June 28, 2018
A unicorn in the investment world is a startup with a massive valuation, which always felt like an insult to entrepreneurs building very real products and services. A unicorn, in the rest of the world, is a mythical creature that doesn't existed so I guess they finally got it right when Theranos was called a unicorn. Like Ringling Brothers, they strapped a horn on a goat and marketed it as a real thing. And everyone bought it.
Bad Blood was a fast and exciting read, and relatively easy, worth mentioning because there's a reasonable amount of science in there. As everyone surely knows, this is the story of a company that lied and the idiots who believed them to the tune of billions of dollars. But ultimately, it's a book about incompetence, and just how many people in this world are completely incompetent and unqualified to do their jobs. At least we can take comfort that investigative journalists are fairly competent and can reveal the incompetence of others. Theranos should never have gotten as far as they did and was only able to do so because of negligence all around.
And while I appreciate that I got to read the details of this insane story at this point in time, we'll need a sequel in a few years once the dust settles. This case is still ongoing and therefore the ending is still open, which made the end of this book feel somewhat unsatisfactory. I am especially interested to learn how the good people in this story, the ones with sense and ethics, ended up. I want to know if Rochelle sued Holmes' turtleneck off. I want to know who was behind the surveillance. I want to know what excuses the failed Board members have come up with. I want to know what excuses the VCs came up with. And I want Holmes and Sunny to get what's coming to them.
Commentary:
Most non-fiction books are actually about incompetence. True crime, history, war, these books are filled with people who should never have been given the jobs they have, and Bad Blood is no exception. Obviously the leadership of Theranos were abject failures. Their Board of Directors were a bunch of doddering, dotty seniors who led a company that has a technology they never understood, and who completely failed in their duty to manage and monitor their CEO on behalf of their shareholders. The Venture Capitalists did not perform sufficient due diligence nor did they properly monitor their portfolio. We know they were too busy drooling over the valuation and pre-counting their investment carry to bother to look into the lies. Have you ever met a finance guy who is a blood science expert? In 20 years in finance, I have never met one, and yet investors believed them when they say a blood testing technology works without a shred of evidence. So the investors failed as well, and continue to fail by giving them a pass on their negligence. The regulators were also a bit incompetent, though I suspect their SOPs prevent them from being as effective as they can be. Nor should regulators be susceptible to pressure from politically connected investors and Board Members, but they are. US military leadership, including Sensible Dog Mattis formerly known as Mad Dog Mattis, also proved themselves to be incompetent and biased to the extent that they're willing to put our soldiers' health at risk. Theranos's corporate partners, who stuck with Theranos after years of continuous failure to deliver on their promises, were hilariously incompetent. I am very grateful that the states, and not the idiot pharmacies, set the standards for patient care in their stores. Anyone still in favor of deregulating the medical field and taking power away from the FDA should exclusively use Theranos testing devices for their family's health decisions.
The most inspiring characters in this book were the youngsters like Erika and Tyler, who came out of college with a strong sense of personal ethics that they refused to give up, regardless of what the "grownups" told them to do. Tyler stood strong even as his own grandfather, Secretary of State George Schultz, tried to muscle him with lawyers, but Tyler showed grandpa what honor looks like. I'd hire those kids in a NY minute just based on their conviction, and I hope neither this experience nor any other breaks down their will and sense of right and wrong.
Will Silicon Valley and venture capital learn from this mistake? Nope! The fact is that they're still showing returns to their investors who do not care how the money is earned, as long as there are no legal or tax ramifications. But I am especially interested to how pensioners feel about VCs using CalPERS funds to invest in scams like Theranos, since the risk is much greater for them than your average venture investor. Remember Moral Hazard? Silicon Valley doesn't.
Bad Blood was a fast and exciting read, and relatively easy, worth mentioning because there's a reasonable amount of science in there. As everyone surely knows, this is the story of a company that lied and the idiots who believed them to the tune of billions of dollars. But ultimately, it's a book about incompetence, and just how many people in this world are completely incompetent and unqualified to do their jobs. At least we can take comfort that investigative journalists are fairly competent and can reveal the incompetence of others. Theranos should never have gotten as far as they did and was only able to do so because of negligence all around.
And while I appreciate that I got to read the details of this insane story at this point in time, we'll need a sequel in a few years once the dust settles. This case is still ongoing and therefore the ending is still open, which made the end of this book feel somewhat unsatisfactory. I am especially interested to learn how the good people in this story, the ones with sense and ethics, ended up. I want to know if Rochelle sued Holmes' turtleneck off. I want to know who was behind the surveillance. I want to know what excuses the failed Board members have come up with. I want to know what excuses the VCs came up with. And I want Holmes and Sunny to get what's coming to them.
Commentary:
Most non-fiction books are actually about incompetence. True crime, history, war, these books are filled with people who should never have been given the jobs they have, and Bad Blood is no exception. Obviously the leadership of Theranos were abject failures. Their Board of Directors were a bunch of doddering, dotty seniors who led a company that has a technology they never understood, and who completely failed in their duty to manage and monitor their CEO on behalf of their shareholders. The Venture Capitalists did not perform sufficient due diligence nor did they properly monitor their portfolio. We know they were too busy drooling over the valuation and pre-counting their investment carry to bother to look into the lies. Have you ever met a finance guy who is a blood science expert? In 20 years in finance, I have never met one, and yet investors believed them when they say a blood testing technology works without a shred of evidence. So the investors failed as well, and continue to fail by giving them a pass on their negligence. The regulators were also a bit incompetent, though I suspect their SOPs prevent them from being as effective as they can be. Nor should regulators be susceptible to pressure from politically connected investors and Board Members, but they are. US military leadership, including Sensible Dog Mattis formerly known as Mad Dog Mattis, also proved themselves to be incompetent and biased to the extent that they're willing to put our soldiers' health at risk. Theranos's corporate partners, who stuck with Theranos after years of continuous failure to deliver on their promises, were hilariously incompetent. I am very grateful that the states, and not the idiot pharmacies, set the standards for patient care in their stores. Anyone still in favor of deregulating the medical field and taking power away from the FDA should exclusively use Theranos testing devices for their family's health decisions.
The most inspiring characters in this book were the youngsters like Erika and Tyler, who came out of college with a strong sense of personal ethics that they refused to give up, regardless of what the "grownups" told them to do. Tyler stood strong even as his own grandfather, Secretary of State George Schultz, tried to muscle him with lawyers, but Tyler showed grandpa what honor looks like. I'd hire those kids in a NY minute just based on their conviction, and I hope neither this experience nor any other breaks down their will and sense of right and wrong.
Will Silicon Valley and venture capital learn from this mistake? Nope! The fact is that they're still showing returns to their investors who do not care how the money is earned, as long as there are no legal or tax ramifications. But I am especially interested to how pensioners feel about VCs using CalPERS funds to invest in scams like Theranos, since the risk is much greater for them than your average venture investor. Remember Moral Hazard? Silicon Valley doesn't.