Learning for investors from Elizabeth Holmes’ conviction
The fraud conviction of former Theranos, US Biotech Startup, CEO Elizabeth Holmes could offer Silicon Valley's culture of hubris and hype some valuable lessons. Holmes was found guilty of duping investors into believing that Theranos had developed a revolutionary medical device that could detect a multitude of diseases and conditions from a few drops of blood – a claim that despite having little scientific proof raised hundreds of millions of dollars and attracted big-name investors.
However, The Wall street Journal revealed that Theranos technology was not working upto claimed level and these revelations led to collapse of Ms. Holmes’fraud empire. It also marks a milestone for Silicon Valley – an industry that has for years evaded accountability in its pervasive culture of “fake it till you make it” that encourages founders to make big promises, often with little proof.
