Theranos: The $10 Billion Blood Test Scam

trolls please raise your right hand do you swear to tell the truth the whole truth I do this woman Elizabeth Holmes taking her last steps of Freedom defrauding investors out of hundreds of millions of dollars I don't know I can't remember before all that she started theranos a miracle blood testing and diagnostic startup with hundreds of millions of dollars of Investments she's got Heavy Hitters on her board huge Partnerships with drugstores theranos was worth nine billion dollars Elizabeth was worth 5 billion the youngest female billionaire in the world youngest billionaire in the world is that heady when you hear that but it was all a champ thereinos was nothing no no product no results no Miracle tests and cures she fought lied and cheated her way to the top of Silicon Valley at times even using a brick voice thinking it would get people to take her more seriously early diagnosis and early detection men asking if they could do a finger stick this story is so nuts hang on [Music] thank you [Music] started with this bombshell Bad Blood the book written after Wall Street journalist John Kerry will meet the theranos broad story with the help of some whistleblowers from inside the company shown to light that there were huge deficiencies directly to their face as convincing the story got tons of media coverage that only escalated this year after Elizabeth's criminal trial took place but it's hard to piece this whole crazy therano story together so what actually happened here and how every time you create something new there should be questions let's dig into this because I actually have one of theranos's blood testing machines well a tiny fake collectible version of a theranos blood testing machine perfectly suited actually to hang out with my new pad Rock the boy okay there are no so it's 1994. and we've got this chick Elizabeth Holmes now like most kids Elizabeth has One Singular dream for when she grows up yeah I must have been a billionaire oh good girl she crushes in school then ends up at Stanford and while she's on a trip to Singapore in 2002 there was basically an outbreak of covid 1. 0 the SARS virus oh oh okay billionaire I want to be a billionaire I'll create a patch a patient puts on their arm it'll constantly monitor their vitals and when something goes wrong in their body it will dispense the perfect amount of medication they need super easy so she drops out of Stanford to pursue this medical device pipe tree at 19 years old she secures 7 million dollars in seed funding from wealthy neighbors and friends and she's off to the races with her new startup baronos their goal was to prick patients fingers store a drop of their blood in a tiny cartridge click that cartridge into their machine and in seconds display a readout for like 200 diseases and illnesses that a patient may or may not have the machine was thermos 1.

0 and this made total sense it was a big ambitious thing to tackle yes but there wasn't really any reason it was technically impossible plus the old way the still currently of doing blood tests was big expensive machines and many days to get your test results Elizabeth's Vision was this machine would be like the personal computer and everybody would have one in their house we'd like to see a world in which every person gets access to this type of basic testing you'd get Diagnostics and lab results instant continuously before something bad happened if you understand that early that you're at risk there's a lot more that you can do about it okay but there's a huge glaring problem that we need to understand thank you hello hello huh [Music] did somebody just no you're like Scurry am I hearing things okay um huge glaring problem s Jesus Christ sorry okay so the uh the the huge glaring problem for theranos foreign drop of blood and let's say you want to run a complete blood count test on this drop of blood okay you take a teeny bit of Bud add some water so you have enough to test and run your test great but while you've got this sample we also need to run a lipid profile basically looking for fats in your blood okay so you take a little more of the first drop dilute it with water so you have enough to test and run your test great except every time you want to run another test you have to dilute this sample and when you keep diluting the drop of blood your results get sketchier and sketchier and remember theranos wanted to test like 200 different things on a single drop of blood drone maybe there is a reason that when you get your blood tested at the doctor they need several vials of this stuff to get accurate results this is the huge veteranos problem that while technically not impossible it'd be super hard to crack the technology and computing power just might not have been available at the time to run such crazy tests on such small samples but in Silicon Valley The Show Must Go On grow at all costs raise more money at higher valuations prove to your shareholders that you're developing something big that will have huge returns keep the mission and vision bold so Engineers will work for less money and more Equity so things start to heat up for theranos and now it's 2007 and Elizabeth's minions I mean team has iterated from the theranos 1. 0 machine to the Edison but things are getting weird internally engineering team you're falling behind I want you on the clock 24 7. oh you're a little baby good I hired competing engineering team fastest designer wins other team gets fire if you're not with our mission you're out Elizabeth you can't lie in our forecast as CFO of this company it's my duty to help fire whatever our internal Financial projections are they should be multiplied 10 times to investors speaking of investors right this way let's show you the magic of Medicine yeah all right all right on with your tour we'll show you the results at the end Elizabeth the due to the inaccuracy of Edison blood tests and you're lying to patients and investors about their efficacy the theranos board hereby fires you a CEO okay you don't understand the mission this is important work we're doing this is going to be huge Elizabeth you're persuasive as hell damn it we're reinstating you as CEO Elizabeth I uh hereby award you the uh title of U.