The rise and fall of Theranos CEO Elizabeth Holmes, who went from youngest female billionaire to being charged with massive fraud
Kate McKinnon has been roped in to play Elizabeth Holmes, in a new Hulu 'limited drama series' based on Rebecca Jarvis and ABC News' podcast 'The Dropout'
Back in 2014, Elizabeth Holmes was definitely on top of the world, all thanks to her blood-testing startup Theranos. At the time, the company was a revolutionary idea thought up by a woman who was hailed as a genius, someone who styled herself as a female Steve Jobs. Her success was a huge deal at the time because Theranos pushed Holmes into becoming the world's youngest female self-made billionaire, with the blood-testing company making a name for itself as one of Silicon Valley's unicorn startups, valued at an estimated $9 billion.
However, it all came crashing down when the shortcomings and imprecision of Theranos's technology were exposed, along with the role Holmes played in covering it all up. In utter disgrace, Holmes was ousted as CEO and charged with massive fraud, while Theranos was forced to close its labs and testing centers, eventually shutting operations altogether.
Now, according to a new Deadline report, actress Kate McKinnon has been roped in to play Elizabeth Holmes, in a new Hulu "limited drama series", since the streaming service is closing a deal for an adaptation of Rebecca Jarvis and ABC News’s podcast 'The Dropout'.
The aforementioned podcast focused on Holmes’ rise to celebrity as the "next Steve Jobs" after dropping out of Stanford to focus on her blood-testing company Theranos, and how she and her technology were later revealed to be frauds. Even in the past, Holmes was the subject of another HBO documentary called 'The Inventor: Out for Blood in Silicon Valley' that combed through the story of Theranos and how its founder was able to defraud investors and potential customers.
Born on February 3, 1984, in Washington, D.C., Holmes' mother was a Congressional committee staffer while her father worked for Enron before moving to government agencies like USAID. The family moved to Houston from D.C., where a seven-year-old Holmes tried to invent her own time machine, filling up an entire notebook with detailed engineering drawings.
By the age of nine, the little girl told relatives she wanted to be a billionaire when she grew up, and her relatives swear to this day that Holmes' declaration came with the "utmost seriousness and determination". A child who was insanely competitive from quite a young age, Holmes would often storm off if she saw herself losing out on board games as a child, and more than once, she ran directly through a screen on the door.
Multiple reports suggest that Holmes' impeccable work ethic began when she started high school, and in no time she became a straight-A student of her class. She even started her own business, where she sold C++ compilers, a type of software that translates computer code, to Chinese schools. This paved the way for Mandarin lessons, and part-way through her high-school, Holmes got accepted by Stanford University’s summer program, which culminated in a trip to Beijing.
Holmes was so impressed by the works of her great-great-grandfather Christian Holmes, a surgeon, that she decided she wanted to get into medicine. Ironically, the young girl's fear of needles was what led her into starting Theranos, she later revealed. Holmes started studying chemical engineering at Stanford, and soon enough, became a "president's scholar", an honor which came with a $3,000 stipend to go for a research project.
As a sophomore, Holmes went to one of her professors, Channing Robertson, and said: "Let's start a company." With his blessing, she founded Real-Time Cures and later changed its name to Theranos. Soon after, she filed a patent application for "Medical device for analyte monitoring and drug delivery," a wearable device that would pass on medication, monitor patients' blood, and adjust the dosage as required.
In a few months, Holmes made the decision to drop out of college and started working on Theranos in the basement of a college house. The company's business model was majorly based around the idea that it could run blood tests, using proprietary technology that required only a finger pinprick and a small amount of blood. Holmes claimed that the tests would be able to detect medical conditions like cancer and high cholesterol.
As a result of the boom in research, Holmes began raising money for Theranos from prominent investors like Oracle founder Larry Ellison and Tim Draper, the father of a childhood friend and the founder of prominent VC firm Draper Fisher Jurvetson. She managed to raise more than $700 million for the company, and it was revealed that she only took the money on the condition that she wouldn't have to reveal how Theranos' technology worked, in addition to having the final say over everything having to do with the company.
Holmes was a demanding boss and wanted her employees to work as hard as she did. She had her assistants track when employees arrived and left each day. To encourage people to work longer hours, she started having dinner catered to the office around 8 pm each night. In 2008, the Theranos board decided to remove Holmes as CEO in favor of someone more experienced, but she convinced them to let her stay in charge of her company in the span of a two-hour meeting.
As Theranos started to rake in millions of funding, Holmes became the subject of media attention and acclaim in the tech world. She graced the covers of Fortune and Forbes, gave a TED Talk, and spoke on panels with Bill Clinton and Alibaba's Jack Ma. At one point, Holmes was the world's youngest self-made female billionaire with a net worth of around $4.5 billion.
Around the same time, questions were being raised about Theranos' technology. Ian Gibbons, who was chief scientist at Theranos and one of the company's first hires, warned Holmes that the tests weren't ready for the public to take and that there were inaccuracies in the technology. But due to Holmes' ambitiousness, all these possible red flags were set aside.
By August 2015, the FDA began investigating Theranos, and regulators from the government body that oversees laboratories found "major inaccuracies" in the testing Theranos was doing on patients. And in October that same year, Wall Street Journal reporter John Carreyrou published his investigation into Theranos's struggles with its technology, which was what sparked the beginning of the company's downward spiral.
Carreyrou found that Theranos' blood-testing machine, named Edison, couldn't give accurate results, so Theranos was running its samples through the same machines used by traditional blood-testing companies. "This is what happens when you work to change things, and first they think you're crazy, then they fight you, and then all of a sudden you change the world," Holmes said on CNBC's 'Mad Money', shortly after the WSJ published its story.
By 2016, the FDA, Centers for Medicare & Medicaid Services, and SEC were all looking into Theranos, and in July that year, Holmes was banned from the lab-testing industry for two years. By October, Theranos had shut down its lab operations and wellness centers. In March 2018, Theranos and Holmes were charged with "massive fraud" by the SEC, and she agreed to give up financial and voting control of the company, pay a $500,000 fine, and return 18.9 million shares of Theranos stock. Apart from all that, Holmes was also not allowed to be the director or officer of a publicly traded company for 10 years.
In June 2018, Theranos announced that Holmes was stepping down as CEO. On the same day, the Department of Justice announced that a federal grand jury had charged Holmes with nine counts of wire fraud and two counts of conspiracy to commit wire fraud. In September, Theranos sent an email to shareholders announcing that the company was shutting down, claiming that it planned to spend the next few months repaying creditors with its remaining resources.
As for Holmes, she is now reportedly engaged to Billy Evans, the heir to hospitality company Evans Hotel Group, and wears his MIT "signet ring" on a chain around her neck. They reportedly live together in San Francisco in a luxury apartment.