Holmes’ New Home – Elizabeth’s Sentencing 🔐

Holmes’ New Home – Elizabeth’s Sentencing 

If you’re not familiar with the infamous story of Elizabeth Holmes and Theranos, let’s recap it. Theranos was founded by then-19-year-old Elizabeth Holmes, who dropped out of Stanford in March 2004 to pursue the company full-time. Theranos promised to deliver a small blood-testing device capable of running hundreds of tests from a tiny pinprick. Investors loved the idea. They loved it so much that they sent the company flying to the moon at a massive $9 billion valuation. Everyone wanted to invest in Theranos. 

The company raised more than $700 million from billionaire investors like Carlos Slim and Rupert Murdoch. Additionally, Safeway and Walgreens partnered with the company, and CEO Holmes regularly appeared on major business magazine covers. All of this success was built on lies and deception with the underlying “one drop blood test” technology. Indeed, a series of investigations revealed that Theranos’ technology didn’t perform as claimed, that it covertly used commercially available blood analyzers, and that it lied to regulators. In 2014, the firm reportedly promised potential investors that it was on pace to break even and generate $100 million in revenue. Instead, for that period, it raked in just over $100,000. Theranos is one of Silicon Valley’s largest scams. Not only did Theranos defraud investors out of hundreds of millions of dollars, but it also put thousands of people’s health at risk.

As of today, Elizabeth Holmes has been sentenced to 11 years and 3 months in prison. What do you think about this sentencing? And should it be more or less severe? 

Want to learn how to invest? Download the Invstr app, where you can play Fantasy Finance and manage a virtual investment portfolio, or open a brokerage account and invest for real. Take our interactive investing course on Invstr Academy and become a better investor today!

I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

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