Elizabeth Holmes: How Theranos founder went from billionaire darling of Silicon Valley to behind bars
“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 Stanford 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 to more than 11 years in prison 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 had asked 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 appealed 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.
At least 40 people have been killed across four states after Hurricane Helene barrelled its way across southeastern US.
Emergency crews are racing to rescue people trapped in flooded homes after Helene struck the coast of Florida as a highly destructive Category 4 storm.
It generated a massive storm surge, wreaking a trail of destruction extending hundreds of miles north.
Millions are without power in Florida and neighbouring states.
Meanwhile, dozens of people are trapped on the roof of a flooded Tennessee hospital, with a “dangerous rescue operation” under way.
The Unicoi County Hospital is engulfed in “extremely dangerous and rapidly moving water”, according to Tennessee’s Ballad Health.
Patients and staff are trapped on the roof of Unicoi County Hospital. (Pic: Erwin Police Chief Regan Tilson)
It said 54 people were relocated to the roof of the Unicoi County Hospital, while seven were in rescue boats.
“The situation at the hospital is very dangerous and TEMA [The Tennessee Emergency Management Agency] and National Guard resources are engaged in what can only be described as a dangerous rescue operation,” Ballad Health added.
Local official Michael Baker told Sky News people are being moved from the roof “little by little”, describing the flooding as “unprecedented”.
“We’ve never seen anything like this,” he said.
Steinhatchee in the Big Bend area of Florida. Pic: Reuters
Flooding has severely damaged property in Atlanta. Pic: AP
As of early afternoon, Helene, which has been downgraded to a tropical depression, was packing maximum sustained winds of 35 mph (55 kph) as it slowed over Tennessee and Kentucky, the National Hurricane Center said.
It struck overnight with maximum sustained winds of 140 mph (225 kph) in the rural Big Bend area, the northwestern part of Florida.
The National Hurricane Center said preliminary information shows water levels reached more than 15ft above ground in that region.
US President Joe Biden has approved emergency declaration requests from the governors of several southern states affected by Helene.
Georgia, Florida, Alabama, North Carolina and South Carolina are being supported by emergency response personnel including search and rescue teams, medical support staff and engineering experts.
Georgia Governor Brian Kemp has said dozens of people are trapped in buildings damaged by the storm, with multiple hospitals in southern Georgia without power.
In western North Carolina, Rutherford County emergency officials have told residents near the Lake Lure Dam to immediately evacuate to higher ground, warning “Dam failure imminent”.
Meanwhile, Florida Governor Ron DeSantis said the damage from Helene in the area appears to be greater than the combined damage of Idalia and Hurricane Debby in August. “It’s demoralizing,” he said.
Getting around by kayak is easier than car in St Petersburg, Florida. Pic: AP
Rescue teams in Venice, Florida. Pic: Venice Police Department
Many stranded in places like Tampa could only be reached by boat, with officials warning the water could contain live wires, sewage, sharp objects and other debris.
More than four million properties are without power across Florida, Georgia, the Carolinas, Virginia, Kentucky, Tennessee and Ohio, according to the logging website, PowerOutage.
Why this hurricane season is defying forecasts
Despite Helene’s power, this hurricane season has been more remarkable for its lack of activity.
At the start of the hurricane season, which runs from 1 June to 30 November, sea surface temperatures were (and remain) off-the-charts warm.
It’s this ocean heat that fuels tropical storms.
This combined with a developing La Nina phenomenon led the US forecasters to predict 2024 would be a major hurricane season. Between 17 and 24 storms were expected, with eight to 13 developing into hurricanes.
Hurricane Beryl grazed the coast of Jamaica in July as a Category 5 hurricane. It was the earliest storm of that size ever recorded and was seen as a harbinger of the prediction. But, so far at least, it’s failed to materialise.
There have been just six hurricanes so far this year – slightly below average. But why?
It seems to be due to what’s happening on the other side of the Atlantic where ocean warming forced the African monsoon further north than usual.
This led to catastrophic flooding in central and west Africa displacing millions, but it also shifted the weather system that usually spawns hurricanes and spins them across the Atlantic.
There’s already abundant evidence our warming oceans and atmosphere are making storms more intense – but predicting where they will occur and how often is never simple – and perhaps getting even harder as our planet gets hotter.
Prior to the hurricane making landfall, officials in Florida begged residents to evacuate. The sheriff’s office in rural Taylor County issued a chilling warning to those who refused to leave.
“Please write your name, birthday, and important information on your arm or leg in a permanent marker so that you can be identified and family notified,” the post on Facebook said.
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Child and dog rescued from floods
Forecasters now expect the storm to continue weakening across Tennessee and Kentucky.
It is feared heavy rain over the Appalachian Mountains could cause mudslides and flash flooding.
Helene has made landfall in northwestern Florida as a Category 4 hurricane, with forecasters warning of a “catastrophic” storm surge.
The National Hurricane Centre in Miami said Helene struck near the mouth of the Aucilla River in the Big Bend area of Florida’s Gulf Coast at around 11.10pm local time.
High winds, possibly in excess of 140mph (225kph), and flash floods are possible, the weather service said.
Florida Governor Ron DeSantis told reporters one person had died while driving on a motorway when a sign fell on to their car.
“When Floridians wake up tomorrow morning, we’re going to be waking up to a state where, very likely, there’s been additional loss of life. And certainly, there’s going to be loss of property,” Mr DeSantis said.
Florida’s Big Bend, where Helene has made landfall. Pic: Reuters
“You’re going to have people that are going to lose their homes because of this storm. So please keep those folks in mind, keep them in your prayers.”
Two other people are reported to have been killed in a possible tornado in neighbouring south Georgia as the storm approached, the Associated Press reported.
‘Unsurvivable scenario’ to play out
More than one million homes and businesses were already without power shortly after the hurricane made landfall, according to tracking website poweroutage.
States of emergency have been declared in Florida, Georgia, and the Carolinas, with hurricane and flash flood warnings in place as far away as south-central Georgia.
Officials pleaded with residents in the path of the storm to heed mandatory evacuation orders or face life-threatening conditions.
Traffic cameras showed waves overtopping roads in St Pete Beach, Florida. Pic: Florida Department of Transportation
The surge caused by the hurricane – the wall of seawater pushed on land by hurricane-force winds – could rise as high as 20ft (6.1m) in some spots, as tall as a two-storey house, Michael Brennan, director of the hurricane centre, said in a video briefing.
“A really unsurvivable scenario is going to play out” in the coastal area, Mr Brennan said, with water capable of destroying buildings and carrying cars pushing inland. Millions of people are under the current flood watch.
Forecasters warned the storm surge could be particularly “catastrophic and unsurvivable” in Apalachee Bay.
Hurricane Helene in the Gulf of Mexico moving towards Florida. Pic: NOAA/AP
‘It’s going to cause a lot of damage’
Residents in the city of Tallahassee told Sky’s US partner NBC News that they stocked up on sandbags, food and supplies, before leaving their homes.
The city’s mayor John Dailey urged people to take the evacuation warnings “extremely seriously”, calling Helene “the biggest storm in the history of the city to hit us head-on”.
Speaking to NBC News on Wednesday, Mr Dailey said though they are “very prepared”, he was also “very nervous, and I hope everyone is nervous”.
He added: “This is a big storm. It is going to cause a lot of damage.”
Surfers taking advantage of heavy winds in Key West. Pic: Rob O’Neal/The Key West Citizen/AP
Flooding has already hit Madeira Beach, Florida. Pic: Max Chesnes/Tampa Bay Times/AP
Jared Miller, sheriff of Wakulla County, went further – calling the storm “not a survivable event for those in coastal or low-lying areas”.
The county has issued a mandatory evacuation order, but one resident, Christine Nazworth from Crawfordville, which is located about 25 miles (40km) from Apalachee Bay, said her family would be sheltering in place.
She said: “I’m prayed up. Lord have mercy on us. And everybody else that might be in its path.”
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Damage caused by Tropical Storm Helene in Puerto Juarez, Cancun, Mexico. Pic: Reuters/Paola Chiomante
Helene caused streets to flood in Guanimar, Cuba. Pic: AP/Ramon Espinosa
Leslie Powell, from Quincy, a city a similar distance from Tallahassee, told NBC she was leaving her mobile home to go to a shelter with her eight-month-old baby and six-year-old daughter.
She said simply: “I’m scared. I’ve got a lot of trees around my home, so it’s not safe for me and my kids.”
Helene is expected to remain a full-fledged hurricane as it rolls through the Macon, Georgia, area on Friday, forecasters said.
Sir Keir Starmer is to meet with Donald Trump later tonight.
It is believed to be the first meeting between the current UK prime minister and former – and potentially future – US president.
The pair are set to meet overnight UK time, which is the evening in New York, where Sir Keir is currently located while on a visit to the UN.
David Lammy, the Labour foreign secretary, has met Mr Trump‘s vice presidential candidate, JD Vance.
Speaking to journalists, Sir Keir reiterated he wanted to meet both Mr Trump and Kamala Harris ahead of the November vote.
However, meeting the Democrat is hard due to the “usual diary challenges”.
Sir Keir said: “It’ll be really to establish a relationship between the two of us.
“I’m a great believer in personal relations on the international stage.
“I think it really matters that you know who your counterpart is in any given country, and know them personally, get to know them face to face.
“So it’s really along those lines. I won’t go into what we’ll actually discuss, obviously, but that’s the purpose of it, as you’d expect, ahead of the election.”
Sir Keir is in New York at the United Nations. Pic: Reuters
Asked if a Trump presidency would leave Ukraine exposed, Sir Keir said the nature of the “special relationship” between the UK and US “always sits above whoever holds the particular office”.
“The US people will decide who they want as their president, and we will work with whoever is president,” he added.
“I’m not going to speculate on what any particular issues may be on the other side of the election.”
Speaking ahead of the meeting, Mr Trump said he thought Sir Keir was “very nice”.
He said: “I actually think he’s very nice. He ran a great race, he did very well, it’s very early, he’s very popular.”
Keep up with all the latest news from the UK and around the world by following Sky News
Mr Trump went on to praise Reform UK leader Nigel Farage as well, saying: “I think Nigel is great, I’ve known him for a long time.”
“He had a great election too, picked up a lot of seats, more seats than he was allowed to have actually.
“They acknowledged that he won but for some reason you have a strange system over there, you might win them but you don’t get them.”
This appears to be a misunderstanding of how the UK’s first past the post system for elections chooses MPs – Reform won fewer seats compared to its vote share because it came second in many seats.
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