Julie Omohundro I don't see many lessons to be learned from Theranos that couldn't have been learned from Enron, the sub-prime mortgage investors, Bernie Madoff, or even the collapse of British South Sea Company in the 1700s. If lessons so repetitively presented haven't been learned by now, I think it's safe to say they never will be.

If Theranos had actually been real, than one man would not be able to take her down like that. Elizabeth Holmes is a shame to our medical industry. She should be behind bars for fraud. She is a pathological liar. To date she has still no proof that her product ever really existed. As a healthcare worker I would have been thrilled if this product really worked.

This story yet again demonstrates the power of personality. Charisma will usually beat logic!

Hopefully stories like this don’t slow medical and scientific progress. The bleeding edge is a real, and real dangerous place to be, but without the private sector moving the needle, progress may never be made.

“Fake it til you make it” is a very dangerous idea, especially in this field. You either know it and own it, or stay quiet until you do. Like many people with inflated, egocentric views, she was a pretender. Probably driven by greed but who knows?

We need to strive to make advancements verifiable and ALWAYS be weary of who people in power surround themselves with.

Great book with a lot of insight on the process these companies do (and don’t) go through on the bleeding edge. The drama also makes it difficult to put down.

Ginger Cantor Venture capital greed, and the willingness to be turned by a short skirt

Wow, Ginger Cantor. You're saying she got this far because of her gender and blonde hair?

Glenn- what is your take on the rise of early stage and very early stage biotech IPOs. Is that not risk shift to less sophisticated investors or are the buyers savvy? Will the inevitable failures of lead assets cast a pall over biotech in general the way Theranos did over diagnostics? How long will the window stay open?

I just finished this as well, loved it! She mimicked someone else's style of dress identically, what else do you need to know? Childish!

Completely fantastic that she conned a bunch of 80 year old investors and board members that had no knowledge of the industry and technology just like she did. 100% leadership failure, don't confuse management and leadership; Theranos did...

James Bell, MBA I'm a little surprised we l think there are lessons to be learned. I thought honesty, integrity and trust but verify were minimum requirements to living.

Bleeding edge science has a paper trail. Theranos is largely a case of not following publications. The goal of the company was the real appeal. The idea is sound. It’s just about a decade before realization. For all who don’t know, you can find rare events in a drop of blood. There are statistics.

Paul Teitelbaum Just read it.  Aside from the outright fraud, definitely a Harvard case study on how not to run a business - insulated silos, etc.

Ginger, except she didn't wear short skirts. Her "signature" style was an imitation of Steve Jobs, turtlenecks and black slacks. She was a great bullshit artist. It has less to do with her gender than her overall ability to find stupid money.

While I only read the first few chapters, my admittedly biased take is that the author completely missed the underlying truth. To get funding, investors press for almost immediate revenue, which Theranos promised. Investors press for having big customers already lined up before they’ll invest, which Theranos also promised. Investors also typically don’t want to fund multi year development projects, and want a working prototype before they’ll invest. Again, Theranos promised that they had a working prototype. Theranos appeared to simply tell investors what they wanted to hear. Otherwise, Theranos would likely never gotten any funding. The underlying truth might simply be that biotech specifically investors just don’t want to recognize that solving difficult problems takes lots of time and money.

While the pathology industry is ripe for disruption, people in the industry knew theranos was full of excrement. Fools and their money.

Joe Hage Thanks a lot for sharing!

Julie Omohundro I don't think attributing these kinds of fiascos to individuals, whether it's Ken Lay or Bernie Maddox or Elizabeth Holmes, serves as either corrective or preventive action. Nor do I think reading articles written by third parties remotely approximates actual investigation.

I do think this approach is an easy one to spin for a number of reasons, and probably quite effective at directing attention away from what really needs correction and prevention.

Perhaps that's why no useful lessons get learned, no matter how many of these fiascos occur.

Group member Linda Bunschoten Çağlayan shares, "Another trend is investors rewarding clinical validation, especially in the face of massive collapse of biotech company Theranos. In turn, companies are making a validation strategy a core part of their business model by investing in clinical trials and regulatory approvals.” The investors duped by the Theranos fraud never asked for one important thing…..reliable clinical evidence.

See ow.ly/Jzfo30kSSaE, "With $3.4 billion already pledged, digital health investment in 2018 could break records."

Julie Omohundro Peggy, to clarify, Theranos was a corporation, not a product. The primary purposes of a corporation are to 1) attract investments and 2) protect management from personal liability for the consequences of their management. Theranos "worked" big time in serving purpose #1. For purpose #2, we'll see.

As for a technology that will allow multiple tests from a single fingerprick sample, Theranos filed a number of patents in its quest to develop this type of test. At the time the WSJ article was published, effectively putting an end to the company, it had apparently not succeeded in developing its patented technology into this type of test. Whether it might have succeeded in the future, it seems that we'll never know.

Others have said it - more are thinking it as they read the book and the ensuing commentary. Diligence is critical and cannot be substituted. If you don't know what questions to ask, find someone who does. The expertise is out there if you're willing to look. An investor group brought me in to evaluate a capital raise and I used this story as a relevant point of reference as I worked to alert the group to the potential risks of the deal.
Just because the lesson is taught doesn't mean the lesson is learned.

John Jones I have to agree with Julie O. Nothing really to learn. Soundness and the characteristics that go with that would simply never let this happen in the first place. I saw this coming long before the WSJ expose. I called Holmes a charlatan then but now I feel very sorry for her and if she is wise (which she is not) she will keep a low profile and roll with the punches that come.

With a budget of $950 million I could have put a team of engineers together that could have made her idea work. She built her empire prematurely.