Once celebrated in Silicon Valley, Theranos CEO Elizabeth Holmes surrenders and starts 11 years jail sentence

By Sneha SahaElizabeth Holmes, who was once hailed as the next Steve Jobs, begins her decade-long prison sentence today. The infamous story of Holmes and her health startup Theranos is known to the world, especially in Silicon Valley. Theranos’ downfall is surely a cautionary tale about the dangers of startup culture and the importance of due diligence.

Well, the world knows how Holmes’ biotech startup, which was valued at $10 billion at its peak, was found guilty on four counts of defrauding investors in earlier 2022. After years of delay in starting the prison sentence, Holmes’ 11 years and 3 months begin today.

It surely doesn’t take so long for someone to be found guilty and sent to prison. However, in Holmes’ case, the lawyers tried all the possible ways to delay this inevitable day.

So what exactly happened? For the unaware, Theranos was a biotech startup that claimed to have developed a revolutionary blood testing technology, but it was later revealed that the technology was not as accurate as it claimed to be.

Later in 2016, the US government began the investigation of Theranos, and that continued for nearly two long years. It was in 2022 November that the Theranos CEO was sentenced to more than 11 years in prison for fraud after deceiving investors about the efficacy of the company’s blood-testing technology.

Theranos raised more than $700 million from venture capitalists and private investors, which resulted in a $10 billion valuation at its peak in 2013 and 2014. But all of this came down crashing in 2015 when Wall Street Journal reporter John Carreyrou revealed that the company’s blood testing technology didn’t actually work.

Back then, some unsuspecting patients were getting blood tests on Theranos machines and they showed false positives for health conditions like cancer, HIV, and even a miscarriage.

Carreyrou exposed Theranos’ false claims in a series of investigative reports in which he exposed the company’s false claims. The Wall Street Journal reporter also revealed that Theranos’ Edison device was unable to run a wide range of tests on a tiny blood sample as the company claimed.

Holmes was found guilty on 4 out of 11 counts of defrauding investors, but not guilty of any charges related to defrauding patients. Ramesh Balwani, former COO of Theranos, was found guilty on all counts.