Elizabeth Holmes and the unread memo

There’s a fascinating trial taking place now the Silicon Valley town of San Jose involving a super-star tech entrepreneur named Elizabeth Holmes. If you are familiar with the case, it could well be because of her looks, personality, background and reflectiveness of…well…the way we view women in this society.

The story’s pretty simple. Holmes was a young tech businesswoman who founded a company, call Theranos, after dropping out of Stanford University’s School of Business. Holmes was, by all accounts, a driven person and, by her account, trypanophobic which means she was afraid of needles.

Now, take it from an old guy who gets needled pricked every day of his life (I’m diabetic so I need to monitor my blood sugar levels) and has blood drawn at least once a month, a fear of needles can make life a nightmare. The older you get the more blood they need to routinely take because contemporary medicine is based on blood analysis. It’s how they do all the normal body monitoring…pretty amazing how much information you can get from a vial of blood.

But wouldn’t it be better to be able to get that same amount of info from one prick of the finger? More efficient, cheaper, less pain, less blood, less time, etc. Holmes spent her post-school year trying to convince everybody she could talk to that this could fly and produce a super-successful company. There’s no question that she was right — the idea was a winner if the science worked (which she was convinced would be the case).

In fact, she raised about $400 million dollars for her company which valuated on the stock market at about $9 billion. The thing was a winner and, she reported to all her investors and the world, that the science did work; her product was effective. She could replace a tube of blood with a drop from a prick.

She showed reports. She gave interviews. She made public appearances and crowd-pleasing speeches at conferences. She was blond, stereo-typically white, dressed (like her idol Steve Jobs) in black turtlenecks and she delivered her spiel in a deep, authority reflecting voice about which there’s a debate since some say she used to have this “girly” voice while family members say she always sounded like a baritone.

Well, the punch line is that she was a liar and a fraud and her reports were all crap and the science, in fact, didn’t work. They were essentially using normal blood draws (full tubes) for her samples and she allegedly knew that. The government says she hustled lots of people out of lots of money and so she’s now facing a trial in which, if convicted, she could get lots of time.

Which is all good but not my point.

Have you noticed something from reading all this? Read it again and think about this: would I have written about this case in this way if it involved a man? Would I have described him or his actions that way? Not to say Holmes isn’t a criminal who should be held accountable for hustling. But think about how many hustlers have cheated their way to wealth in Silicon Valley.

The epidemic start-up fever that swept the tech industry for two decades created more millionaires than the Kentucky Derby creates bets. Most of them got their money trying to start companies, most of which failed (some before getting to market).

Silicon Valley was never really a “center for technology”; that happened in smaller companies all over the country or in the homes of probing, experimenting technologists. The Valley, as it were, was really a home for hustling, frenetically seeking the gold-mine of investor money that was blindly seeking tech innovation. There is nothing as attractive to a hustler than a blind investor.

I would venture to say, without statistics but with some confidence, that at least 75 percent of the start-ups that were financed in tech almost immediately failed. Now…understand something…when a company fails that doesn’t mean its owners go broke. Those people have drawn salaries and options and benefits during the initial investment and start-up periods. They put that money in the bank and it stays there. They are, effectively, rich from an idea that didn’t work, didn’t yield this economy any money, didn’t benefit any consumer…didn’t do a damned thing.

How did they convince people to give all that money to a failed idea? Did they really believe their idea would work? All of them? Really?

How did they get away with that? Why aren’t they on trial? What is different about them?

Well…they’re men. So I don’t describe their hair or their voices or their personalities when I describe what they did and didn’t do. In fact, I don’t describe anything about them because their cases are unknown…because no law enforcement people went after them.

Yeah, sure, men get arrested and go to jail and sometimes women get away with horrible things. But in this case, the men and the woman didn’t.

To be clear. She should face those accusations but so should all those men. That’s not happening because this spasm of tech investment is absolutely essential for capitalism’s survival. After all, this is the system that commodifies everything it can see and so why not commodify science and technology and, if you have to look the other way while a gang of brats become multi-millionaires, why upset the apple cart so to speak.

Elizabeth Holmes’ problem is that this largesse has been extended only to men — this is boys club stuff. The memo that explains that to women apparently wasn’t included in those lab reports.

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