Elizabeth Holmes, Convicted of Fraud, is More Fascinating Than Ever

Perhaps it’s only right for a story about a convicted criminal to start with a confession.

The following is a partial list of the media I have consumed on the topic of Elizabeth Holmes (no relation), recently convicted of four fraud-related charges for lying to investors in her company, Theranos.

• The John Carreyrou book Bad Blood: Secrets and Lies in a Silicon Valley Startup
• The John Carreyrou podcast Bad Blood: The Final Chapter
• The ABC podcast The Dropout
• The Alex Gibney documentary The Inventor: Out for Blood in Silicon Valley

I have listened to the Carreyrou book on audio — twice. I have watched the Gibney documentary, I believe, three times. If Theranos Fever is a disease, I am the patient who kept going back and putting my mouth directly on the water fountain, no matter how many times they tell me to stop, making myself sick all over again.

The draw of the scam

Part of this, I admit, is rooted in a more general weakness for stories about brazen grabs for other people’s money, particularly people who have a lot of it. People who have enough money that they buy Magic Beans: The Painting, Magic Beans: The Stock, Magic Beans: The Experience. There were two documentaries in 2019 about the ill-fated Fyre Festival, and I watched both. I would have watched three. (Who am I kidding? I would have watched ten. That iconic and possibly apocryphal cheese sandwich!) I love Sour Grapes, about rich types who paid small fortunes for counterfeit wine, and Made You Look: A True Story About Fake Art, about a massive bamboozle involving paintings.

As it related to investors, Theranos has always been, for me, a bit like Magic Beans: The Startup: something rich people invested in because other rich people were doing it and said they should do it too. And when the magic evaporated, well, all those rich people were furious. If you take this comparison to its logical conclusion, here’s the question: Was Elizabeth Holmes the seller, or was she, in fact, the beans? Did she make the shiny object, or was she herself the shiny object?

If you have thus far avoided Theranos Fever, some basics: Holmes was a young Stanford dropout who wanted to be the Steve Jobs of biotech. (When she was still in college, she had this idea that you could put a patch on your arm that would detect your medical problem and administer your medications through your skin. When I try to envision this, it’s always on George Jetson.) She carried her Jobs-iness through her adoption of a black-turtleneck uniform, her hiring of people who came from Apple, and her apparent conviction that a slick-looking interface was the lever you pulled to make money come out.

Later, she began to follow her dream of making a machine that could run hundreds of medical tests on a couple of drops of blood from pricking your finger. She raised a fortune from investors, got on the cover of Fortune, hobnobbed with political and financial mucky-mucks of many stripes, was hailed as the rare woman to break through the very male world of Silicon Valley startup founders, and then saw it all go to pieces when it turned out that the machines didn’t work the way she hoped and she, according to the charges on which she was just convicted, didn’t tell her investors the truth.

Elizabeth Holmes belongs to a robust cohort of startup founders who have seen their reputations tank. (WeWork’s ousted Adam Neumann saying a $47 billion valuation might just have warped his perspective is amazing.) But there’s something about the brazenness with which she operated that makes her mesmerizing to me. You can keep your high-level financial maneuvers and your sophisticated document manipulations: according to Carreyrou’s reporting and some of the trial testimony, Theranos got around demands for demonstrations of its machines with painfully obvious dodges—moves about as complicated as making beeping noises with your mouth to make a toddler think you’re a robot.

Self-made, indeed

I keep asking myself: How did any of this work? On anybody? How did she have two former Secretaries of State on her board (Henry Kissinger and George Schultz), both over 90 years old, and wiggle around the doubts about her motives that one would think decades of experience in diplomacy would instill? How did a company like Walgreens, which undoubtedly wouldn’t change the length of the tail on the “W” logo without being certain that they understood every last possible consequence, spend $140 million on a doomed deal with Theranos?

Maybe it was her capacity for invention after all—not invention of the machine, but invention of herself.

Consider this: Elizabeth Holmes was touted at one point as the youngest-ever woman self-made billionaire, but Forbes revised her net worth from billions to zero in a single year. And it wasn’t because she gave all that money away or spent it on candy and magazines. It just no longer existed.

It’s almost charming, the verve of this particular kind of operator, right? Imagine I walked up to you with my hand held behind my back, and I told you I had a unicorn horn of potentially unlimited value. Imagine I offered you a one percent interest in my unicorn horn, which you have not seen yet, for $10,000. And imagine you believed me. You paid me the money.

On the one hand, I only have $10,000. But on the other, I own a unicorn horn that has been valued by the market at one million dollars. I am a self-made millionaire. You may have never even seen the unicorn horn, but I have the proof of its worth. Your belief in me has defined me! How impressive, someone might say when walking past me, that yesterday she was broke, and today, she is a self-made millionaire!

In this example, I do not actually have a unicorn horn, of course. And I don’t have a million dollars. But I have a story. And Elizabeth Holmes did not have operational technology that could do hundreds of tests on a finger prick’s worth of blood, and she did not have billions of dollars. But she had a story.

Underestimate her at your peril

We come, inevitably, to this: Most of the purveyors of magic beans who have become cultural (and sometimes criminal) legends have been men. Plenty of people before me have spent considerable time since Holmes came to power analyzing the complicated gender dynamics around her rise and fall. We know sexism is rampant in tech, in Silicon Valley, in press coverage, in everything. No one gets the chance to opt out of all relevant context. She’s sometimes argued that the treatment of her has been sexist compared to the treatment of other similarly sketchy startup founders, and it probably has been at times. Why wouldn’t it be? How couldn’t it be?

But the gender dynamics in the Theranos story pull in multiple directions. Skepticism—lack of faith in one’s work and ability—can be the result of bias. But maybe in this case, the many powerful men pulled into her orbit as investors or board members or public allies—or, in some cases, credulous journalists—were less skeptical of her than they might have been if she weren’t a young woman. Maybe they just didn’t have their antennae up. When you see the way men like George Schultz acted around her, it doesn’t seem patronizing as much as just paternal. Introducing her in 2015, Schultz said his first thought when he met her was that she seemed like a friend of his granddaughter’s. He claimed that he quickly realized he’d underestimated her, and he began to rave about her accomplishments. But did he really understand the ways he’d underestimated her?

What if the most important sexist misapprehension of Elizabeth Holmes was that some of her backers believed young women to be less driven, less capable, and therefore less dangerous to take at their word than young men? What if they underestimated not just her abilities, but also her ruthlessness? What if she keenly understood sexism and used it to her advantage? And what if, given the way Silicon Valley works, the way tech works, the way big money works, a woman less willing to exploit sexism would not have stood a chance?

Vanessa Friedman wrote in the New York Times recently about Holmes’ image makeover before and at her trial. She described it as a transformation “from black-clad genius to besuited milquetoast.” Whatever the purpose of that change was, it’s hard to deny that the Elizabeth Holmes of her trial was a very different one from the Elizabeth you will see in any footage that was taken during the highest highs of her publicity swings. As the aforementioned Theranos enthusiast I am, I almost didn’t recognize her the first time I saw her during her trial. Different hair, different makeup, different clothes, different bearing, the abandonment of every element of her Theranos-era style. (Except, of course, her deep voice, which I have considered mostly a distraction—if she artificially started speaking in a lower voice at some point because people didn’t take her seriously, that’s a modest and understandable manipulation.)

This question also got a lot more prickly when Holmes testified about sexual and emotional abuse she said she suffered at the hands of Sunny Balwani, her significantly older former boyfriend and her number-two at Theranos. Raising the issue of intimate partner abuse in the context of this trial, to suggest Balwani was really the driver of the bad acts at Theranos, was really complicated to navigate, only partly because so much of what had been reported about Elizabeth Holmes had focused on how forceful she was, how in charge.

More to come

Pop culture is not through with Elizabeth Holmes. Apple has a movie coming (perhaps not the connection to Apple that Holmes dreamed of) in which Jennifer Lawrence will play her. Adam McKay (The Big Short) is directing, so it’s probably not going to be a particularly flattering portrait. Hulu has a limited series coming much sooner, in March, in which Holmes is played by Amanda Seyfried. There were two podcasts, at least one big book, a big documentary … it only makes sense that there will be two high-profile fictional Elizabeths as well.

I know myself. I will watch both.