Bad Blood: Secrets and Lies in a Silicon Valley Startup

by John Carreyrou

The message Elizabeth took away from them is that if she wanted to truly leave her mark on the world, she would need to accomplish something that furthered the greater good, not just become rich.

Elizabeth incorporated the company as Real-Time Cures, which an unfortunate typo turned into “Real-Time Curses” on early employees’ paychecks.

fitting

The chemistry work was handled by a separate group made up of biochemists. The collaboration between that group and Ed’s group was far from optimal. Both reported up to Elizabeth but weren’t encouraged to communicate with each other. Elizabeth liked to keep information compartmentalized so that only she had the full picture of the system’s development.

this never ends well

“I don’t care. We can change people in and out,” she responded. “The company is all that matters.”

no empathy

Ellison might be one of the richest people in the world, with a net worth of some $25 billion, but he wasn’t necessarily the ideal role model. In Oracle’s early years, he had famously exaggerated his database software’s capabilities and shipped versions of it crawling with bugs. That’s not something you could do with a medical device.

Every time Elizabeth fired someone, Matt had to assist with terminating the employee. Sometimes, that meant more than just revoking the departing employee’s access to the corporate network and escorting him or her out of the building. In some instances, she asked him to build a dossier on the person that she could use for leverage.

Brodeen wasn’t exactly dying to come out of retirement to run a startup in a field in which he had no expertise, so he took a neutral stance and watched as Elizabeth used just the right mix of contrition and charm to gradually win back his three board colleagues. It was an impressive performance, he thought. A much older and more experienced CEO skilled in the art of corporate infighting would have been hard-pressed to turn the situation around like she had. He was reminded of an old saying: “When you strike at the king, you must kill him.” Todd Surdey and Michael Esquivel had struck at the king, or rather the queen. But she’d survived.

Justin tried to remind himself that Elizabeth was very young and still had a lot to learn about running a company. In one of their last email exchanges, he recommended two management self-help books to her, The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t and Beyond Bullsh*t: Straight-Talk at Work, and included their links on Amazon.com.

The company was lurching from one ill-conceived initiative to another like a child with attention deficit disorder.

Theranos had cleverly played on this insecurity. As a result, Walgreens suffered from a severe case of FoMO—the fear of missing out.

Like most people, Greg had been taken aback by Elizabeth’s deep voice when he’d first met her. He soon began to suspect it was affected. One evening, as they wrapped up a meeting in her office shortly after he joined the company, she lapsed into a more natural-sounding young woman’s voice. “I’m really glad you’re here,” she told him as she got up from her chair, her pitch several octaves higher than usual. In her excitement, she seemed to have momentarily forgotten to turn on the baritone. When Greg thought about it, there was a certain logic to her act: Silicon Valley was overwhelmingly a man’s world. The VCs were all male and he couldn’t think of any prominent female startup founder. At some point, she must have decided the deep voice was necessary to get people’s attention and be taken seriously.

only mention of this

As he watched the standoff unfold, Greg became convinced that it wasn’t so much about the patent as it was about punishing Kent for his perceived disloyalty. Elizabeth expected her employees to give their all to Theranos, especially ones like Kent whom she entrusted with big responsibilities. Not only had Kent not given his all, he’d devoted part of his time and energy to another engineering project. It explained why he hadn’t been coming in on weekends like she wanted him to. As she saw it, Kent had betrayed her. In the end, a fragile compromise was reached: Kent would go on a leave of absence to give his bicycle-light venture a shot. When he was done indulging his pet project, they’d have a conversation about whether, and under what conditions, he could return.

hope the bicycle-lights project took off

Trey, the friend Greg had met while living in Pasadena and recruited to Theranos, tapped Greg’s foot. They glanced at each other knowingly. What Elizabeth had just said confirmed their armchair psychoanalysis of their boss: she saw herself as a world historical figure.

Part of the problem was that Elizabeth and Sunny seemed unable, or unwilling, to distinguish between a prototype and a finished product.

Ian nodded. “It’s a folie à deux,” he said. Tony didn’t know any French, so he left to go look up the expression in the dictionary. The definition he found struck him as apt: “The presence of the same or similar delusional ideas in two persons closely associated with one another.”

madness of two

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,” the retired general gushed.

that's hilarious

I’d also been struck by a brief description Holmes had given of the way her secret blood-testing devices worked: “A chemistry is performed so that a chemical reaction occurs and generates a signal from the chemical interaction with the sample, which is translated into a result, which is then reviewed by certified laboratory personnel.”

unbelievable

HOLMES HAD TOLD Maria Shriver on the Today show that she took responsibility for the Newark lab’s failings, but it was Balwani who suffered the consequences. Rather than take the fall herself, she sacrificed her boyfriend. She broke up with him and fired him. In a press release, Theranos dressed up his departure as a voluntary retirement.

“Sympathy for the Devil” by the Rolling Stones was playing on the public announcement system, a choice of music that didn’t seem like a coincidence.

hahaha

A sociopath is often described as someone with little or no conscience. I’ll leave it to the psychologists to decide whether Holmes fits the clinical profile, but there’s no question that her moral compass was badly askew. I’m fairly certain she didn’t initially set out to defraud investors and put patients in harm’s way when she dropped out of Stanford fifteen years ago. By all accounts, she had a vision that she genuinely believed in and threw herself into realizing. But in her all-consuming quest to be the second coming of Steve Jobs amid the gold rush of the “unicorn” boom, there came a point when she stopped listening to sound advice and began to cut corners. Her ambition was voracious and it brooked no interference. If there was collateral damage on her way to riches and fame, so be it.