My Kindle notes and highlights for this book were more profane than usual. At times the spleen got so out of hand that I found myself cooling it down a little in view of whatever use might be made of my annotations. That’s not to say I didn’t enjoy it. I did, in much the same way as I enjoy the rare plane crash or industrial accident story where the people who suffer are the same ones who override safety measures out of pure, arrogant self indulgence.
Bad Blood: Secrets and Lies in a Silicon Valley Startup tells the story of the now defunct medical technology startup Theranos. Three years ago Theranos was hailed as a wondrous unicorn, a once in a generation venture promising life changing innovation and staggering profitability. Estimates for the value of the company (it was never taken public) hit $10 billion dollars. Then the author of this book, John Carreyrou of the Wall Street Journal (they’re good for something I guess), started questioning some of Theranos’ claims. Now they’ve ceased to exist; their technology never existed at all.
That purported technology was going to allow any of hundreds of blood tests to be run on a single drop of blood pricked from a fingertip. The tests would run on tabletop sized, wirelessly networked machines located in drugstores and homes. Mainly, I think, because tiny blood samples are so hard to handle without corrupting, Theranos was never able to perform more than a few tests, and those with dubious accuracy. This did not stop them from forming partnerships, notably with Walgreens, which they touted as groundbreaking successes with just a few kinks to be worked out. Meanwhile they were mailing blood samples to be tested on conventional machines. It seems that Theranos was able to get away with their fraud as long as they did because they were selling a plan of decentralized, personal, on demand medical care as much as they were selling any particular new technology. In business parlance, they were being disruptive.
Does it still seem to you that something like this should never have been allowed to happen? How could people put money like this into an untested concept? That’s what makes this story so delightful. Theranos gave the business world exactly what it wanted, and it was complete bullshit. Carreyrou gives most of the credit to Elizabeth Holmes, the company’s founder. She dropped out of Stanford after her freshman year and started the company, largely, it seems, on the strength of recommendations from a reputable professor. She was charming, but also monomaniacal, a fanatic, a tyrant. Former employees reported on harangues where she talked in religious tones of making the most important thing the world had ever seen. Ubiquitous security cameras, fingerprint readers, surveillance of email, and even bulletproof glass were deployed, allegedly to protect Theranos’ intellectual property. She aped Steve Jobs’ turtleneck.
Among the people who fell for this act were two former secretaries of state and the current secretary of defense: Henry Kissinger, George Schultz, and General James Mattis. I don’t know if I’ve gotten over this yet. These supposed elder statesmen, people who held life and death over this planet, agreed to sit on the board and preside over a lie. George Schultz took the company’s side against his own grandson when the younger man tried to blow the whistle. What was it for? I didn’t get the sense that those men in particular stood to make a whole lot of money. That was for Rupert Murdoch, who put in $100 million of his own fortune and took a tax write off when it tanked. They were essentially selling their names to the company, I guess to be involved with the next big thing, and to exercise their undeserved, abstract authority. Per Wikipedia, Betsy DeVos also invested, and Holmes got involved with fundraising for Hillary Clinton.
I’ve seen some articles about Theranos and about the book that would downplay the significance of the whole thing. A few millionaire investors lost money. A few people got scary blood test results. Some employees got hurt (and that’s actually the saddest story in the book) but what did that ever count for? We should all have known from the get go that Silicon Valley is prone to a little hype. And of course many people don’t need the help making up their minds about Republican cabinet members. I think there are aggravating factors. The involvement such establishment giants as Kissinger is one. The fact that it was medicine that was being attempted, and not social media or rocket planes is another. The failure of ego and greed is so sparklingly clear. The book is a license for cynicism and even hostility towards bosses, money and fame. It could drive you to read someone like Howard Zinn or Thomas Piketty. And I do like a good disaster story.