Elizabeth Holmes: How Theranos founder went from billionaire darling of Silicon Valley to the brink of prison
“Don’t worry about the future, we’re in good hands.”
So said former US president Bill Clinton in 2015, as he introduced Elizabeth Holmes to an adoring New York crowd.
It seemed an uncontroversial statement at the time, as he hailed the achievements of a woman who had become America’s youngest self-made female billionaire after taking Silicon Valley by storm.
A hub for the world’s biggest tech companies, the only thing more synonymous with this infamous stretch of northern California than scientific breakthroughs and innovative gadgets were the rich white men who were invariably behind them – turtleneck jumpers and smart trouser-sneaker combos in tow.
Bill Clinton and Elizabeth Holmes at the Clinton Global Initiative’s 2015 meeting in New York
Holmes – a high school computer whizz turned Harvard dropout – was a bona fide gatecrasher, her stunning rise to the cover of Forbes magazine powered by her founding health technology firm Theranos and its rapid ascent to a peak valuation of $9bn. Look back on what it was promising to deliver, and it’s easy to see why.
Revolutionary blood tests were at the heart of its pitch, ones which could be performed at phenomenal speed with merely a small drop required – and no needles.
Holmes’s catchphrase became “change the world”, such were her assertions that the equipment her company had developed could test for dozens of diseases in one fell swoop.
She insisted it would change healthcare in the US, not just by speeding up and streamlining trips to the doctor, but by eventually rendering such visits obsolete by selling the gizmos in stores.
It took more than a decade for such claims to be exposed as the stuff of science-fiction, but Holmes’s shameless willingness to talk the talk regardless helped her become one of the darlings of Silicon Valley, raising hundreds of millions from investors and venture capitalists.
As Theranos grew, her public image was crafted to perfection to make her the perfect face of one of America’s most exciting companies, famously adopting the aforementioned turtlenecks from her idol Steve Jobs, the late Apple founder, and speaking in a strikingly deep voice which added extra gravitas to her every word.
Fame isn’t for everyone, but for Holmes it seemed elementary.
Nothing, it seemed, could go wrong. Until it did. Big time.
Theranos reached a value of $9bn
How the lie was exposed
Holmes’s empire began to unravel upon the publication of a bombshell expose by The Wall Street Journal, which reported that Theranos’s technology was profoundly flawed.
The devices used to collect people’s blood, which the firm dubbed “nanotainers”, were said to be so far off the mark that Theranos had in fact been using other companies’ equipment to carry out blood tests in its laboratories.
The most distressing piece of the Journal’s report was that the company’s ex-chief scientist, Briton Ian Gibbons, had tried to take his own life after telling his wife the tech did not work. He died shortly after from liver failure.
The stories emerged just a month after Holmes had shared the stage with Bill Clinton.
Silicon Valley is home to some of the biggest names in tech
As described by Sky’s Ian King when Theranos went bust in 2018, three years after the Journal’s report, key to the company keeping the wool fixed firmly over the public’s eyes until then had been an almost cult-like culture among its executives and staff, and one of extreme secrecy.
Neither are unique to Silicon Valley – some of the big tech personalties who have emerged over the years remain an odd focus of worship in some corners of the internet – but rarely have they combined to such destructive effect.
The journalist who broke the story, John Carreyrou, has since written a book on the scandal called Bad Blood, which stands to be turned into a feature film. There’s perhaps a cruel irony that it’s being produced by Apple, the company whose late co-founder was a source of such inspiration for Holmes.
Her rise and fall also inspired a hit podcast series called The Dropout, and a subsequent Hulu series of the same name starring Amanda Seyfried.
The show presents Holmes as a brave, smart, single-minded young woman determined to succeed, and she is initially easy to root for. As Apple designer Ana Arriola tells Holmes in a scene when she attempts to recruit her following the launch of the first iPhone: “Honestly, it’s just really exciting to me that you’re a young female CEO, instead of a cocky little boy in a sweatshirt.”
But Holmes’s goal of becoming a wealthy star of the biotech scene quickly overcomes all other instincts – including a willingness to tell the truth.
It’s a trait that left some staff feeling deeply uneasy, not just Gibbons and Arriola, who describes her time at Theranos on her LinkedIn page as “altruism through corrupt unethical science-fiction”.
Amanda Seyfried as Holmes in The Dropout: Pic Disney+
How a life unravelled
Carreyrou’s revelations, which Holmes has admitted trying to silence, sparked investigations by medical and financial regulators in the US. In a development which would once have been unthinkable, the now 34-year-old was facing criminal charges in 2018.
She and the president of Theranos, ex-lover Romesh Balwani (who she has since accused of sexual assault), were accused of engaging “in a multi-million-dollar scheme to defraud investors, a separate scheme to defraud doctors and patients”, and each faced two counts of conspiracy to commit wire fraud and nine counts of wire fraud.
Former Theranos president Ramesh Balwani
Among those defrauded investors were the likes of Rupert Murdoch and the American pharmacy giant Walgreens, while similarly big names had been attracted to Theranos’s board of directors.
Among them were former secretaries of state Henry Kissinger and George Shultz, and an ex-director of the US Centers for Disease Control.
All of them had been hoodwinked by Holmes, who had founded Theranos aged just 18 and quickly learned how to tell her backers exactly what they wanted – and she needed them – to hear.
As Eric Jackson, a startup founder and author of The PayPal Wars, put it to Sky News: “There is almost endemic to the system a need to, I don’t want to say exaggerate, but to tell a narrative that’s compelling to investors. At a certain point hype does have to be in line with credibility, if not you’re in an instance of good old-fashioned fraud.”
Whether it was a matter of delusion, falling victim to the treacherous “fake it ’til you make it” culture that permeates American startups, or something more sinister, Holmes maintained during her trial that she initially believed her company’s purportedly revolutionary blood tests were real.
“I wanted to convey the impact the company could make for people and for health care,” she told the court of her meetings with investors.
To prosecutors, such assertions were the consequence of a woman who was “out of time and out of money”.
Having launched her company by repurposing family funds meant for her Harvard degree, taking it mainstream meant doing whatever it took to attract her big time investors and venture capitalists.
The once-enamoured former US secretary of defence Jim Mattis, who joined the company board, told the trial: “There just came a point when I didn’t know what to believe about Theranos any more.”
Holmes arrives for a hearing in San Jose in 2019
‘She chose lies when we needed truth’
Holmes’s sentencing on Friday comes after she was convicted of fraud earlier this year, her years-long scam having failed to move the jury as it had done her backers.
After a case which gripped the world, just as her rise to fame had done, US federal prosecutors want the judge to jail her for 15 years, a term considered appropriate for “one of the most substantial white collar offences Silicon Valley or any other district has seen”.
Balwani has been left waiting until next month for his sentencing, having also been convicted of multiple fraud counts during a separate trial.
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In a 46-page brief last week, assistant US attorney Robert S Leach wrote of Holmes: “She repeatedly chose lies, hype, and the prospect of billions of dollars over patient safety and fair dealing with investors.
“Elizabeth Holmes’ crimes were not failing, they were lying – lying in the most serious context, where everyone needed her to tell the truth.”
A counter document from Holmes’s attorneys, totalling 82 pages, insisted her reputation had been permanently and unfairly destroyed, given it had turned her into a “caricature to be mocked and vilified”.
They are appealing for a sentence of no more than 18 months.
More than 130 friends, family, former investors and employees have also submitted letters to the judge, Edward Davila of San Jose, California, to appeal for leniency.
Senator Cory Booker used his to hail Holmes, still only 38, as someone who “can, despite mistakes, make the world a better place”.
Whether that’s true or not, she won’t be able to from behind bars.
Almost 7,000 Afghan nationals are being relocated to the UK following a massive data breach by the British military that successive governments tried to keep secret with a superinjunction.
The blunder exposed the personal information of close to 20,000 individuals, endangering them and their families – with as many as 100,000 people impacted in total.
The UK only informed everyone on Tuesday – three-and-a-half years after their data was compromised.
Politics latest: Minister sorry after ‘extraordinary secrecy’ concealed data leak
The Ministry of Defence (MoD) said the relocation costs alone directly linked to the data breach will be around £850m. An internal government document from February this year said the cost could rise to £7bn, but an MoD spokesperson said that this was an outdated figure.
However, the total cost to the taxpayer of existing schemes to assist Afghans who are deemed eligible for British support, as well as the additional cost from the breach, will come to at least £6bn.
In addition, litigation against the UK arising from the mistake could add additional cost, as well as whatever the government has already spent on the superinjunction.
Details about the blunder can finally be made public after a judge lifted the injunction that had been sought by the government.
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Defence secretary on Afghan leak
Barings Law, a law firm that is representing around 1,000 of the victims, accused the government of trying to hide the truth from the public following a lengthy legal battle.
Defence Secretary John Healey offered a “sincere apology” for the data breach in a statement to MPs in the House of Commons on Tuesday afternoon.
He said he had felt “deeply concerned about the lack of transparency” around the data breach, adding: “No government wishes to withhold information from the British public, from parliamentarians or the press in this manner.”
The previous Conservative government set up a secret scheme in 2023 – which can only now be revealed – to relocate Afghan nationals impacted by the data breach but who were not eligible for an existing programme to relocate and assist individuals who had worked for the British government in Afghanistan.
Some 6,900 Afghans – comprising 1,500 people named on the list as well as their dependents – are being relocated to the UK as part of this programme.
Afghan co-workers and their families board a plane during the Kabul airlift in August 2021. Pic: South Korean Defense Ministry/ZUMA Press Wire/Shutterstock
This comes on top of the many thousands more who are being moved until the Afghan Relocation and Assistance Policy (ARAP). A lot of these individuals are also caught up in the data breach.
The Times, which has been battling the injunction, said a total of 18,500 people have so far been relocated to the UK, including those directly impacted plus their dependents.
Read more:
‘My family is finished’: Afghan man in UK military data breach says he feels betrayed
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Some 5,400 more Afghans who have already received invitation letters will be flown to the UK in the coming weeks, bringing the total number of Afghans affected by the breach being brought to the UK to 23,900. The rest of the affected Afghans will be left behind, the newspaper reported.
How did the data breach happen?
The disaster is thought to have been triggered by the careless handling of an email that contained a list of the names and other details of 18,714 Afghan nationals. They had been trying to apply to a British government scheme to support those who helped or worked with UK forces in Afghanistan that were fighting the Taliban between 2001 and 2021.
People gathered desperately near evacuation control checkpoints during the crisis. Pic: AP
The evacuation at Kabul airport was chaotic. Pic: AP
The collapse of the western-backed Afghan government that year saw the Taliban return to power. The new government regards anyone who worked with British or other foreign forces during the previous two decades as a traitor.
A source said a small number of people named on the list are known to have subsequently been killed, though it is not clear if this was a direct result of the data breach.
It is also not clear whether the Taliban has the list – only that the MoD lost control of the information.
Taliban members on the second anniversary of the fall of Kabul. Pic: Reuters
Adnan Malik, head of data protection at Barings Law, said: “This is an incredibly serious data breach, which the Ministry of Defence has repeatedly tried to hide from the British public.
“It involved the loss of personal and identifying information about Afghan nationals who have helped British forces to defeat terrorism and support security and stability in the region.
“A total of around 20,000 individuals have been affected, putting them and their loved ones at serious risk of violence from opponents and armed groups.”
The law firm is working with around 1,000 of those impacted “to pursue potential legal action”.
Read more:
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It is thought that only a minority of the names on the list – about 10 to 15% – would have been eligible for help under the Afghan Relocation and Assistance Policy (ARAP).
The breach occurred in February 2022, when Boris Johnson was prime minister, but was only discovered by the British military in August 2023.
A superinjunction – preventing the reporting of the mistake – was imposed in September of that year.
It meant the extraordinary – and costly – plan to transport thousands of Afghans to the UK took place in secret until now.
Sir Keir Starmer’s government inherited the scandal.
Why was superinjunction lifted?
An internal review into the affair was launched at the start of this year by Paul Rimmer, a retired civil servant.
It played down the risk to those whose data is included in the breached dataset should it fall into the hands of the Taliban.
The review said it was “unlikely to substantially change an individual’s existing exposure given the volume of data already available”.
It also concluded that “it appears unlikely that merely being on the dataset would be grounds for targeting” and it is “therefore also unlikely that family members… will be targeted simply because the ‘principal’ appears… in the dataset”.
This is why a High Court judge ruled that the superinjunction could be lifted.
Mr Malik, however, said that he believes there is still a risk to those named in the breach.
He added: “Our claimants continue to live with the fear of reprisal against them and their families, when they should have been met with gratitude and discretion for their service.
“We would expect substantial financial payments for each claimant in any future legal action. While this will not fully undo the harm they have been exposed to, it will enable them to move forward and rebuild their lives.”
Latest MoD data breach
While the MoD’s data breach is by far the largest involving Afghan nationals, it is not the first.
Earlier this month, the MoD said Afghans impacted by a separate mistake could claim up to £4,000 in compensation four years after the incident happened.
Human error resulted in the personal information of 265 Afghans who had worked alongside British troops being shared with hundreds of others who were on the same email distribution list in September 2021.
In December 2023, the UK Information Commissioner fined the MoD £350,000 and said the “egregious” breach could have been life-threatening.
An Afghan man who worked for the British military has told Sky News he feels betrayed and “completely lost (his) mind” after his identity formed part of a massive data breach.
He told The World with Yalda Hakim about the moment he discovered he was among thousands of Afghans whose personal details were revealed, putting him at risk of reprisals from the Taliban.
The man, who spoke anonymously to Sky News from Afghanistan, says that for more than 10 years he worked for British forces
But now he says he regrets working alongside troops, who were first deployed to Afghanistan in 2001.
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Afghans being relocated after data breach
“I have done everything for the British forces… I regret that – why (did) I put my family in danger because of that? Is this is justice?
“We work for them, for [the] British, we help them. So now we are left behind, right now. And from today, I don’t know about my future.”
He described receiving an email warning him that his details had been revealed.
He said: “When I saw this one story… I completely lost my mind. I just thought… about my future… my family’s.
“I’ve got two kids. All my family are… in danger. Right now… I’m just completely lost.”
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The mistake by the Ministry of Defence in early 2022 ranks among the worst security breaches in modern British history because of the cost and risk posed to the lives of thousands of Afghans.
On Tuesday, a court order – preventing the media reporting details of a secret relocation programme – was lifted.
Read more from Sky News:
Minister defends handling of breach
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Defence Secretary John Healey said about 6,900 Afghans and their family members have been relocated or were on their way to the UK under the previously secret scheme.
He said no one else from Afghanistan would be offered asylum, after a government review found little evidence of intent from the Taliban to seek retribution.
But the anonymous Afghan man who spoke to Sky News disputed this. He claimed the Taliban, who returned to power in 2021, were actively seeking people who worked with British forces.
“My family is finished,” he said. “I request… kindly request from the British government… the King… please evacuate us.
“Maybe tomorrow we will not be anymore. Please, please help us.”
The retreat from Afghanistan during the Taliban takeover in 2021 began as a farce, then it was a scandal and now it’s a shoddy cover-up.
The farce was when the then foreign secretary Dominic Raab remained on his holiday sunbed in Crete rather than return to work during the height of the evacuation crisis.
Politics latest: Minister sorry after ‘extraordinary secrecy’ concealed data leak
It was a scandal because around 200 people were killed in the chaos, with distressing pictures of terrified Afghans clinging to the wings of moving aeroplanes at Kabul airport.
And now we learn that in a massive cover-up, the Tory government of Rishi Sunak took out a superinjunction to gag the media from reporting a data breach that put 20,000 Afghans in danger.
Over the years, superinjunctions granted by UK courts have been condemned for enabling celebrities and sports stars to cover-up extra-marital affairs, drug-taking and other secrets.
The superinjunction granted to the government in 2023 to conceal a secret scheme to relocate Afghan nationals was obviously entirely different and no doubt sought for honourable motives.
But it was a cover-up nonetheless and not so honourable because it hid a data blunder exposing names and contact details of 18,000 people who had applied for asylum in the UK under a resettlement scheme.
The scheme had been set up by the government in 2021 to provide asylum for people who had worked with the UK armed forces and could be at risk of Taliban reprisals for working with western forces.
In the Commons, the current defence secretary, John Healey, said it was “deeply uncomfortable” to be prevented from reporting the data breach blunder to MPs until now.
Read More:
‘My family is finished’: Afghan man in UK military data breach says he feels betrayed
Almost 7,000 Afghans being relocated to UK in secret scheme after MoD data breach
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Afghans being relocated after data breach
The ministers involved in seeking the gagging order were the former defence secretary Ben Wallace and the then armed forces minister James Heappey, he said.
But while most MPs welcomed Mr Healey’s apology, it’s probably fair to say that if it hadn’t been for tenacious campaigning by media organisations the superinjunction might not have been lifted by the High Court.
One Tory MP, Mark Pritchard, accused the defence secretary of “wriggling” and said: “The fact is that he is justifying this superinjunction and not telling parliament, the press, the public and, unbelievably, the Afghans who were potentially in harm’s way.”
And, among a number of individual cases highlighted by MPs, Liberal Democrat Calum Miller told MPs that “in the chaos of withdrawal” a constituent who left Afghanistan was promised by British officials that his pregnant wife could follow him.
“Two years later, we have still not kept that promise,” said Mr Miller. “My constituent’s wife and child continue to move around in Afghanistan to evade the Taliban and my constituent is so desperate that he is talking about returning to Afghanistan – despite the risk to him – to be reunited with them.”
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Reform UK’s Zia Yusuf hit out at the Tory government’s asylum policy, writing on X: “24k Afghans secretly granted asylum, costing British taxpayers up to £7bn.
“The government covered it up. Who was in government? Home secretary: Suella Braverman. Immigration minister: Robert Jenrick.”
Later, Mr Healey was asked on LBC’s News Agents podcast if the official responsible for the data breach is still employed by the government. “They are no longer doing the same job on the Afghan brief,” he replied.
Hmm. That suggests the person hasn’t been fired, which will alarm those MPs who remain extremely concerned about this whole fiasco.
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Asked whether he would have taken out the superinjunction if he had been defence secretary in 2023, he replied: “Very, very unlikely.”
But when he was asked if he could rule out the use of superinjunctions by the Ministry of Defence in the future, Mr Healey said: “Well, you can never say never.”
So while Mr Healey will obviously be determined to avoid a farce in future, it appears that the threat of another Ministry of Defence cover-up in future hasn’t gone away.
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