We interrupt the cloddish accumulation of campaign effluvia to bring you Nick Bilton’s epic anatomy of the downfall of Theranos, the smoke-and-mirrors Silicon Valley startup that was allegedly poised to revolutionize the diagnosis and treatment of disease. Its very name said as much, a portmanteau that combined “therapy” and “diagnosis.”
Unfortunately, as Bilton documents in painstaking detail, the science behind the Theranos business model—which promised to deliver detailed breakdowns of disease susceptibility and long-term health prospects based on analysis of a simple blood sample—was distinctly fanciful. Even though founder and CEO Elizabeth Holmes racked up hundreds of millions in investor capital, with her company valued at more than $9 billion at its peak, there was never a there there. The company’s “core technology was actually faulty and . . . Theranos administered almost all of its blood tests using competitors’ equipment,” Bilton writes.
How Holmes was able to confect a multibillion-dollar startup out of such thin material is a stark cautionary tale, both for the self-regarding masters of Silicon Valley and for their many enablers in the tech press. For Holmes, none too subtly, ensured that the main commodity that Theranos produced, in the absence of reliable lab results, was her own tirelessly flogged narrative as world-class innovator and industry disruptor. She conspicuously donned the restless-genius wardrobe of Steve Jobs, caroming around her company in a black turtleneck and puffy vest—while keeping interior temperatures artificially low so as to minimize the discomfort of her contrived “think different” uniform. And like Jobs, she obsessively micromanaged all details of working life and corporate décor on the Theranos campus—taking particular pains to ensure that the various senior engineers at the company never communicated directly among one another about the substance of their research, lest the whole scam be exposed from within.
Most of all, though, Holmes, like Jobs, was a premier corporate storyteller. Investors, consumers, and the media bought her bullshit because she crafted it to be precisely the sort of bullshit she knew they would want to hear:
Like Jobs, crucially, Holmes also paid indefatigable attention to her company’s story, its “narrative.” Theranos was not simply endeavoring to make a product that sold off the shelves and lined investors’ pockets; rather, it was attempting something far more poignant. In interviews, Holmes reiterated that Theranos’s proprietary technology could take a pinprick’s worth of blood, extracted from the tip of a finger, instead of intravenously, and test for hundreds of diseases—a remarkable innovation that was going to save millions of lives and, in a phrase she often repeated, “change the world.” In a technology sector populated by innumerable food-delivery apps, her quixotic ambition was applauded. Holmes adorned the covers of Fortune, Forbes, and Inc., among other publications. She was profiled in The New Yorker and featured on a segment of Charlie Rose. In the process, she amassed a net worth of around $4 billion.
All interested parties lapped up what Bilton calls the Theranos “origin story”—a standard accessory among striving Valley visionary CEO’s—largely because it hit every sweet spot in the tech sector’s expansive, world-conquering, and undeviatingly messianic self-image. Armed with the fable of brilliantly creative innovation, Bilton writes, the Valley’s “business dealings can . . . replicate one big confidence game in which entrepreneurs, venture capitalists, and the tech media pretend to vet one another while, in reality, functioning as cogs in a machine that is designed to not question anything—and to buoy one another all along the way.”
The Theranos origin story hit every sweet spot in the tech sector’s expansive, world-conquering, and undeviatingly messianic self-image.
Within the confines of said machine, not surprisingly, the great sin is to begin questioning things. When Wall Street Journal health care reporter John Carreyrou saw a completely nonsignifying strand of buzzwords in a quote regarding the inner workings of Theranos’s proprietary technology—a quote Holmes furnished to her admiring Boswell at the New Yorker, Ken Auletta—he decided to find out for himself whether Theranos could actually deliver on its promises of radically disrupted medical diagnoses. In October 2015, he published a copiously reported piece titled “Hot Startup Theranos Has Struggled With Its Blood-Testing Technology.” Holmes and her board of directors mounted successive, failed efforts to rescue their cherished narrative via threatened lawsuits and renewed media charm offensives, but the end was clearly nigh. Today, Theranos is a grim punchline, signifying the disastrous results of untrammeled tech-industry hubris, with pending SEC and FBI investigations engulfing Holmes’s bogus origin story.
But as Bilton has noted elsewhere, the Theranos saga is much more than that. It’s also an indictment of the brain-dead state of tech journalism. The journalistic ecosystem surrounding the Valley genius class
has been molded to effectively prevent reporters from asking tough questions. It’s a game of access, and if you don’t play it carefully, you may pay sorely. Outlets that write negatively about gadgets often don’t get pre-release versions of the next gadget. Writers who ask probing questions may not get to interview the C.E.O. next time he or she is doing the rounds. If you comply with these rules, you’re rewarded with page views and praise in the tech blogosphere. And then there’s the fact that many of these tech outlets rely so heavily on tech conferences. “If you look at most tech publications, they have major conferences as their revenue,” Jason Calacanis, the blogger and founder of Weblogs, told me. “If you hit too hard, you lose keynotes, ticket buyers, and support in the tech space.”
Small wonder, then, that when Holmes first briefed her loyal corps of technicians and programmers on how petty and wrongheaded Carreyrou’s exposé was, the crowd moved as one to re-assert their tarnished sense of cosmic specialness:
A chant erupted. “Fuck you . . .,” employees began yelling in unison, “Carreyrou.” It began to grow louder still. “Fuck you, Carreyrou!” Soon men and women in lab coats, and programmers in T-shirts and jeans, joined in. They were chanting with fervor: “Fuck you, Carreyrou!,” they cried out. “Fuck you, Carreyrou! Fuck. You. Carrey-rou!”
And here, alas, we must repair once more to Campaign 2016’s accumulations of vile effluvia. For one can’t read over the details of Elizabeth Holmes’s arrogant ascension into the Silicon Valley pantheon without thinking of that other great corporate huckster-turned-master-fabulist, Donald Trump. Sub in “Lock Her Up!” for “Fuck you, Carreyrou!” and you have the same sense of permanently aggrieved entitlement summoned out of thin air. Throw in the coy protocols of political access journalism, which barter critical messaging and narrative-framing powers away to highly placed campaign sources in exchange for meaningless scooplets designed to “win the morning” and you have the same systemic corruption that has defanged the Silicon Valley tech press. Take some sober measure of candidate Trump’s many forays into media demonology (amplified, of course, by a hardy cast of media enablers, from Sean Hannity to Mark Halperin) and you will soon descry the same impulse that sent the unbowed Holmes straight from her legal team’s showdown with the editors of the Journal to the obliging set of Jim Cramer’s asinine CNBC franchise “Mad Money” to plead her heroic case thusly: “This is what happens when you work to change things. First they think you’re crazy and then they fight you, and then, all of a sudden, you change the world.”
Or make America great again, as the case may be. Indeed, thanks to Bilton’s incisive post-mortem on the collective delusion that was Theranos, you can understand how a coddled career mountebank like Trump could envision the American presidency as the next logical stop on his colorful, mediagenic CV. Why, it’s almost as if the American republic was in thrall to bottomless vanity, and reckless impunity, of a terminally unaccountable ruling class. But really, who’s going to buy that origin story?