Occasionally, though, there’s a dramatic failure, one so big that it leaves insiders and outsiders asking how outsized risks went overlooked and why no one saw the disaster coming. That kind of inquest began after California-based medical-diagnostics startup Theranos—which raised more than $1 billion in funding against a peak valuation of $10 billion—was brought down by allegations of systematic fraud. For more than a decade, founder and CEO Elizabeth Holmes was able to mislead her customers, investors, and board members about the company’s progress in developing a tabletop machine intended to run hundreds of standard lab tests on a single drop of blood. The scheme came undone in 2015 thanks to a few brave whistleblowers and the work of Wall Street Journal investigative reporter John Carreyrou. In 2018 Carreyrou, a two-time Pulitzer Prize winner, published Bad Blood: Secrets and Lies in a Silicon Valley Startup, which began to unpack the misjudgments and systemic failures that had enabled Holmes to continue the charade for so long.
Then came the real media feeding frenzy. In early 2019 ABC News and Nightline published a six-part podcast about Holmes, The Dropout, and documentarian Alex Gibney released The Inventor: Out for Blood in Silicon Valley, which premiered at the Sundance Film Festival with backing from HBO. Even before Carreyrou’s book appeared, Legendary Entertainment had snapped up the movie rights, with Adam McKay (The Big Short, Vice) attached as director and Jennifer Lawrence set to play Holmes. Not to be outdone, streaming provider Hulu has now ordered a limited series about Theranos starring Saturday Night Live’s Kate McKinnon. Surely, at this point, someone is recruiting Lady Gaga for the Holmes role in Theranos! The Broadway Musical.
With each retelling, it seems, the story focuses less on the lapses that allowed the Theranos hoax to go unchallenged and more on Holmes, her Steve Jobs complex, and her impulsive chief operating officer and co-conspirator Sunny Balwani. In the glare, the opportunity for a thorough examination of both culpability and gullibility—both the pathologies inside Theranos and the naïveté that left its investors, partners, and customers so vulnerable to glamorous shysters—may be slipping away.
Before our eyes, the media industry is hijacking the Theranos story and turning it into a Silicon Valley-style true-crime spectacle, complete with beguiling villains and blood. Lots and lots of blood.