Journalist Ken Auletta joins Tim to talk about the story of Elizabeth Holmes and Theranos from the perspective as the reporter who helped introduce the woman and the company to the world. In December 2014, Ken was one of the first to conduct in-depth interviews with all of the major players at Theranos and their booming start-up company. Little did he or anyone know at the time how the Theranos story would unfold. Ken talks about his coverage of Elizabeth Holmes in The New Yorker and the story that unfolded.
If you were to conduct an Internet search of Elizabeth Holmes today, you’d learn that one of the terms that often accompanies the 39-year-old’s name is “disgraced Theranos CEO.” This is the result of the story we are about to tell.
At the moment, she is appealing her federal conviction for fraud that was committed while she led Theranos, that had promised a revolutionary new way to conduct the full range of blood tests.
Her story gave us a glimpse as to some of the inner workings of Silicon Valley.
Homes now has to serve an 11-year prison sentence because a jury found her guilty of four counts of fraud and conspiracy against company investors.
They believed in her promise to change the way blood could be collected and tested, and in turn, transform healthcare.
That’s where we are now. But the story started almost 20 years ago when Holmes dropped out of Stanford University. She was only 19 years old then.
She left Stanford to start Theranos. Almost from the start, the company had attracted lots of money from some extremely influential investors.
Holmes herself had the kind of magnetism the media likes. She was young and smart. She was a really effective speaker and salesperson. And she seemed to have a sense of personal branding long before that became a thing.
She patterned herself after Apple founder and tech pioneer Steve Jobs. She wore black turtlenecks, almost exclusively. She adopted a slow, deliberate and deep speaking style that at times was almost hypnotic.
She created a media persona that had others characterizing her as the female Steve Jobs. This was no coincidence, of course. It was all calculated.
She was rewarded with an avalanche of positive media coverage. Elizabeth Holmes graced just about every major business magazine cover. She was billed as “the world’s youngest self-made woman billionaire.”
She was said to be worth $4.5 billion. Her company – Theranos – at its peak, was valued at $10 billion.
Some of its well-known investors were Larry Ellison, who founded Oracle Corporation, and media titan Rupert Murdoch. Her advisors and board of directors were the stuff of envy for any company. Names like Henry Kissinger, the former U.S. Secretary of State. John Mattis, the decorated and now retired U.S. Marine general. George Schultz, another revered former U.S. Secretary of State. William Perry, a former U.S. Secretary of Defense, and others.
So, how could a company so well positioned for success fail? And not only fail, but for the reasons it did?
One person who’s given these questions more thought than most is journalist Ken Auletta. He wrote one of the most comprehensive stories about Homes for The New Yorker in December 2014.
- Blood, Simpler, By Ken Auletta, The New Yorker
- Hot Startup Theranos Has Struggled With Its Blood-Test Technology, by John Carreryrou, Wall Street Journal
- Elizabeth Holmes: The hyptnoic tale of the rise and fall of Theranos, New Scientist
- How Theranos Misled Me, Fortune
- Elizabeth Holmes sentenced: how politics, celebrity and big pharma collided in trial of the century, Yahoo! News
- The Inventor: Out for Blood in Silicon Valley, HBO
About this Episode’s Guest Ken Auletta
Ken Auletta launched the Annals of Communications column for The New Yorker magazine in 1992. He is the author of twelve books, including five national bestsellers—Three blind Mice: How the TV Networks Lost Their Way; Greed and Glory On Wall Street: The Fall of the House of Lehman; The Highwaymen: Warriors of the Information Super Highway; World War 3.0: Microsoft and Its Enemies; and Googled: The End Of The World As We Know It. His twelfth book, Frenemies: The Epic Disruption of the Ad Business (And Everything Else), was published in June 2018. His thirteenth book, Hollywood Ending: Harvey Weinstein and the Culture of Silence, was published in July 2022.