blood-testing device called Edison was so  revolutionary that it was about to turn the entire  

healthcare industry upside down. This technology  wasn't just another breakthrough in healthcare  

but had the potential to reshape the entire world.  Vice President Joe Biden came to visit her Labs,  

Henry Kissinger, James Mattis former defense  se cretary joined the board of the company,  

and America's richest family (Walton) was  ready to give her as much money as she wants  

just to make sure that this technology  wouldn't fall into the wrong hands. 

Little did all of these people  know that this little girl  

is just fooling the American government  and the country's wealthiest people.

In 2003 , a 19-year-old teenager from Stanford  decided to start her own company. Elizabeth Holmes  

wasn't an ordinary student. She used to wear  a black turtleneck and was deeply inspired by  

Steve Jobs. Getting into Stanford is a challenge  by itself but Her ambitions were much bigger than  

just Stanford. She wanted to change the world with  her inventions and leave her mark in the history  

books like Thomas Edison, Bill Gates, and Steve  Jobs. The only problem was, she didn't know what  

exactly she should invent to make a difference. But that quickly changed when she stumbled  

across an idea of a wearable patch that  could adjust the dosage of drug delivery  

and notify doctors of variables in patients'  blood. However, that seemed impossible because  

blood tests, first of all, take at least a few  days and secondly are expensive. Most people  

can't afford to do blood tests on a regular basis.  So she started developing lab-on-a-chip technology  

for blood tests, with the idea to start a  company that would make blood tests cheaper,  

more convenient, and accessible to consumers. Finally, she has an idea that could change  

the world forever. She dropped out of Standford  

while she was a teenager and started a company  called "Real-Time Cures”. She quickly realized  

the power of marketing and if she wants to be like  Steve Jobs, she needs to market like steve jobs.  

So she changed the name of the  company to Theranos, a combination  

of the words "therapy" and "diagnosis". Just a year after finding the company,  

Holmes raised 6.9 million dollars valuing  the company at 30 million dollars. She was  

the new cool kid in the town. She was so  good at convincing people that by 2007,  

she raised another 43.2 million dollars at a 197  million dollar valuation. Theranos was booming,  

investors were lining up to give Holmes the  money she wants to develop her technology. 

But what exactly Theranos was developing? 

Blood testing has changed the world  since blood types were discovered  

in 1930. Since then we have learned to discover  STDs, cancer, and a lot of other problems  

through blood testing and prevent them before they  get serious. But it's not easy or cheap. While a  

blood test is simple for you—with the exception  of feeling "a little pinch"—the actual diagnostic  

process behind the scenes is quite complex,  requiring specialized equipment and technicians.  

And if something slightly goes wrong, the blood  results are going to be wrong. So the industry  

has been mostly controlled by a few giants. But that was about to change because what  

Theranos was promising wouldn't just  change the industry but the entire world! 

Holmes named her invention Edison. This machine  required very little blood, a few drops from your  

fingerpick, and could run hundreds of tests within  a few hours. So instead of taking a lot of blood  

from your veins with big needles that will be sent  to the lab for a few days for testing. You could  

place this machine in the store and people  can blood tests much more frequently and stop  

diseases like cancer when they are just starting. It was easy to imagine how such a machine wouldn't  

just be placed in every store across  the country (USA) but in every store in  

every part of the world. Investors were lining up  

to buy a piece of her company, especially  those who missed the opportunity to invest  

in Facebook a few years ago. After a few rounds of  funding, Theranos was valued at 1 billion dollars. 

After 10 years of working, she claimed that her  technology, validated by FDA and was used by the  

military on the battlefield. Investors were sold.  The Walton family invested 150 million dollars.  

Robert Murdock invested 125 million dollars. In 2014, With over $400 million in funding,  

Theranos was valued at nearly $9 billion.  Holmes effectively became a multi-millionaire  

thanks to her 50% stake. She appeared  on the Forbes magazine cover page,  

times' most influential people, the NYT, fortune,  and so on. She was seen as the next Steve Jobs,  

especially when jobs recently passed away. Overall, she raised 900 million dollars to  

fund Theranos, and Thanks to her 50  percent ownership of the company,  

her net worth exceeded 5 billion dollars once  Theranos crossed the 10 billion dollar mark. 

But not everything was sunshine and rainbows, what  she didn't know is that wall street journalists  

were secretly investigating her technology  and were about to bring her company to knees! 

Just days before Theranos's Series C-3  funding where the company had sought to  

raise an additional $200 million. Wall  Street Journal released their article  

criticizing Theranos's blood-testing device. That infuriated the investors, Homles did  

everything she could but the damage has already  been made. When the world knew that Theranos was  

actually rigging their test results, that  was a death sentence. Her partners one by  

one began detaching themselves  from her and closing the labs. 

But that was just the beginning because little  did she know that she might end up spending  

the rest of her life in prison! Holmes denied all the claims,  

calling the Journal a "tabloid" and promising the  company would publish data on the accuracy of its  

tests. She appeared on CNBC claiming "This is what  happens when you work to change things, first they  

think you're crazy, then they fight you, and  then all of a sudden you change the world.” 

But that didn't work. Lawsuits after lawsuits  drained the company's resources. In March 2018,  

the SEC charged Holmes with fraud by taking  more than $700 million from investors  

while advertising a false product. Homles is found guilty and faces a  

maximum sentence of 20 years in prison. But here  investors never really criticized her? But why? 

While it's easy to hate Homles for her fraud,  you have to understand the culture of silicon  

valley. 9 out of 10 startups fail and  those who succeed become really huge.

When you get to investors with your idea, what  most investors care about is if you are going  

to make it to your next round of funding so that  they can sell their shares to the next investors  

for a higher price. And the next investors  only care if you can make it to round C,  

D, and so on until the company goes public and  the last investor will be able to cash out. 

The rest doesn't matter. 

That's why a lot of startups that come  up from silicon valley are usually  

overpriced and keep investors' attention  by overpromising and underdelivering. 

Take the example of WeWork, Nikola Motors,  and even Tesla. Tesla is a great company,  

but if you look at it, Elon Musk has always  been overpromising until he makes it. 

In January 2016, he promised that in 2 years,  we will have fully self-driving cars. In 2017,  

he said that in 3 to 6 months, Tesla cars will  be fully self-driving. But here we are in 2022,  

5 years later, and we don't even know when is that  going to happen. The new Roadster was first teased  

in 2014. In 2017 a prototype was shown with insane  claims that it could accelerate from 0 to 60  

in under 1.9 seconds, with a range of 620 miles.  Production should have started in 2020. But now  

in 2022, Tesla postponed it to 2023 or 2024 and  we have no idea when is that really coming. Tesla  

SemiTrack should have been delivered by 2019,  but now it's 2022, it's on hold UNTIL TESLA CAN  

FIGURE OUT THE WHOLE BATTERY THING. The same story  is with cyberattacks. All of these promises have  

kept pushing the stock price higher and higher Instead of Tesla delivering on its promises,  

Elon Musk is claiming that Tesla is a robotic  company and it's going to focus on robots.  

These are just a few examples. I am not trashing Elon musk or  

defending Theranos. Tesla might deliver on all of  its promises, maybe 5, 10, or 20 years from now.  

But the strategy is simple - fake it till  you make it. That's how silicon valley works. 

Once you make it, everyone is going to  clap and talk about what a genius are you,  

but if you don't make it, or get caught in  the middle before delivering on your promises,  

then you are going to be seen like the villain who  defrauded everyone. Whether that's right or wrong,  

I will leave that for you to answer.