Theranos Blood Testing Fraud
The Story
Elizabeth Holmes founded Theranos at 19, claiming revolutionary blood testing technology requiring only a finger prick. She became Silicon Valley's darling, attracting nearly $1 billion in funding from prominent figures.
At its peak, Theranos was valued at $9 billion. Walgreens partnered to offer testing in stores. Behind closed doors, the technology never worked. The company secretly used traditional machines while claiming to use their proprietary technology.
Wall Street Journal reporter John Carreyrou uncovered the fraud. Patients received incorrect results that led to wrong medical decisions.
🚩 Red Flags
- Extreme secrecy about how technology worked
- No peer-reviewed publications
- High employee turnover
- Aggressive legal action against whistleblowers
- Board stacked with politicians, not medical experts
⚖️ The Fallout
Holmes was convicted in 2022 of fraud and conspiracy, sentenced to 11+ years in prison. Her ex-boyfriend Sunny Balwani received 13 years. Theranos dissolved in 2018. Case became cautionary tale about Silicon Valley's 'fake it till you make it' culture.
📚 Lessons Learned
Revealed how charisma and connections can overshadow due diligence. Major investors failed to verify the technology actually worked. Media created hero narrative without critical examination.
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