Tag: Elizabeth Holmes

Lessons Of Theranos: Sex, Lies, And PR

Posted on by Dorothy Crenshaw

Like many in tech PR, I’m fascinated by the Theranos story because of what it says about Silicon Valley, public relations, and the press. Now that the trial of its disgraced founder Elizabeth Holmes has started, media and pundits have updated their hot takes on her spectacular rise and fall. Theranos claimed to have devised a technology that offered ultra-sophisticated diagnostic testing based on a single pinprick of blood. The implications – and potential PR angles – were irresistible. It would revolutionize diagnostic testing, making it easier, cheaper, and more accessible. It would disrupt the legacy companies in the field. It would be a boon for needle-phobics. Most appealing to the media, it was started and run by a woman. And Holmes wasn’t just any woman; she was young and blond, a Stanford dropout with a fascinating backstory who channeled Steve Jobs. Is it any wonder that Theranos was valued at $10 billion at its pinnacle?

Fake it ’til you break it?

Its breathtaking success and subsequent crash tells us a lot about the sexism that persists in startup circles, how investors see women in tech, and how females try to cope with the perception.

Still, I was surprised to read that in the years following the collapse of Theranos, female entrepreneurs in life sciences and biotech say they’re constantly compared to Holmes. The Theranos case, according to a piece in The New York Times, has left female founders facing “the additional hurdle of fighting assumptions that they were like Ms. Holmes… something their male counterparts have generally not had to contend with.” One female founder of a health testing company said that she was linked to Holmes so frequently that her advisors suggested she dye her naturally blond hair a darker color, presumably to stop the damaging comparison.

Wow. Even more remarkably, some women founders have weighed in with a degree of sympathy toward Holmes. Entrepreneur Beth Esponnette posted on Medium that, while she fully recognized that Holmes was wrong, “I still believe that she thought she was doing the right thing taking the universal advice of Silicon Valley: ‘Fake it till you make it.'” Esponnette claims that in her own struggle to get funding, she was encouraged by investors to overpromise and exaggerate even to the point of lying.

Can confidence turn to criminality?

I take Esponette’s point that female founders are seen and treated differently than male counterparts. I doubt the next brash young male techpreneur has to worry he’ll be compared to Adam Neumann, the WeWork founder who dazzled investors and media, only to leave in disgrace (albeit with a $1.7 billion parachute.)

Yet her view that women in Silicon Valley are held to unique and inappropriate standards is a double-edged one. It’s clear that Holmes was lionized in part because she was female. Anyone who works in PR with high-growth technology businesses knows that the media are eager to cover women founders. There are so few of them, and what’s different naturally makes news. Holmes would have been the first self-made woman billionaire in tech, and everyone was rooting for her. Of course her sex was a factor. For me, “fake it til you make it” is about projecting confidence, not an excuse to engage in criminal fraud.

Journalists missed red flags

Of course, the Theranos debacle also tells us something about journalism. As someone who has spent a career in tech PR, where we try to build up business leaders and tech entrepreneurs in the media, it feels weird to criticize press who took a good pitch and ran with it. But there’s no denying the Theranos story is about the credulity of tech journalists. They were thirsty for a female Steve Jobs, so most didn’t sufficiently question Holmes’s claims. What’s more, reporters often work in packs, especially in sector bubbles like Silicon Valley. Media coverage begets more media coverage. Even as reporters compete fiercely for the story, they’re influenced by what colleagues and competitors write. As soon as Holmes’s PR team cracked one top-tier business publication, the rest clamored to cover her with fresh angles and updated quotes. Few questioned the culture of secrecy or the absence of peer-reviewed research on the Theranos technology. No one asked why there wasn’t a single physician (except Senator Bill Frist) on its board. It took a couple of sharp professors and John Carreyrou, with his investigative background and outside-the-bubble pedigree, to bring down the house.

A PR-first culture can’t work in healthcare

Finally, even if you attribute Holmes’s dishonesty to the self-aggrandizing ethos of Silicon Valley, that ethos doesn’t translate outside the tech industry. It’s one thing to promote “vaporware” by exaggerating a product’s readiness or overpromising on features. But in medical diagnostics, the stakes are too high. The consequences for mistakes can be fatal. It’s the main reason why I can’t ultimately swallow the “fake it til you make it” mantra as an excuse here.

The tragedy of Elizabeth Holmes is that we’re still clamoring to make her a symbol – of sexism, of journalistic laziness, investor gullibility, or even imposter syndrome and the pressure to succeed. She may be all those things, but in the end, a lie is a lie and a fraud is a fraud. Even in tech, a great PR campaign will only take you so far.

Theranos: Triumph Of PR Over Science?

Posted on by Dorothy Crenshaw

The suddenly sober mood of 2016 is extending to Silicon Valley. The tech sector’s experiencing a sense of caution and maybe a renewed commitment to diligence after much exuberance. Part of that is something Fast Company calls the “Theranos effect.”

The rise and fall of the once-promising health technology startup is a warning for investors chasing the next unicorn. But it’s also a lesson for PR practitioners and journalists. The Theranos narrative is about the triumph of PR and optics over substance and maybe even science.
Through its telegenic founder Elizabeth Holmes, Theranos articulated a bold vision: it would completely upend the traditional diagnostic laboratory industry by offering over 200 medical tests at a fraction of the price of established labs, and with far less discomfort and blood – just a fingerprick’s worth, in fact. In 2014 Fortune put Holmes on its cover. She was featured in a lengthy profile in The New Yorker, interviewed by dozens of women’s and lifestyle publications and lionized on the women-in-technology circuit. Time magazine named her one of the 100 Most Influential People of 2015.  Theranos was valued at an impressive $9 billion.

But the story started to fray after the Wall Street Journal reported that, in contrast to the innovative promise of the fingerprick, Theranos was using the same technology as conventional labs for all but one of its blood tests. Other doubts came to light, and the media, smelling – well, blood, began to pile on. Holmes responded to the challenges, but skepticism persists, and the company still hadn’t opened its scientific methodology to outside scrutiny.

Things may yet turn, but it’s safe to say that the Theranos story grew out of proportion to the reality. One factor is the recent frothy environment for technology startups. Many think there’s simply been too much money chasing deals.

But there are other reasons – a lack of media diligence, a PR strategy that ignored science in favor of personality, and our desperate need to believe in the next technology hero – or heroine.

Holmes was great PR because she seemed right out of central casting. Her emergence as a 30-year-old, newly minted billionaire (on paper); her story (well-connected Stanford student drops out of school to pursue her word-changing idea); and her role as disruptor of the healthcare status quo and champion of personal healthcare empowerment was irresistible to media. She was the Silicon Valley version of a triple threat.

Connections led to more connections. Holmes happened to be a friend of the daughter of Tim Draper of legendary VC Draper Fisher Jurvetson, who kicked in the first $1 million of financing. And with the cash came credibility, and more contacts. Holmes ultimately assembled a Board of Directors with boldfaced names like ex-Secretaries of State Henry Kissinger and George Shultz, among others. With such heavyweights, no one seemed to notice the relative absence of scientific experts or practicing medical professionals. 

Media follow media. It’s a dirty secret in PR. When it comes to a hot story, sometimes all you need to do is crack that first feature. Journalists can have a herd mentality even as they scramble for a fresh take, coverage begets more coverage, and the hits just keep rolling in. Although some details seem odd in hindsight, there were few tough questions. The story was just too good, and there was something for everyone, from Holmes’ lofty idealism to her closet full of black turtlenecks.

Finally, there’s gender. You can’t underestimate the influence of Holmes status as a young, blonde woman at the helm of a technology company with a sexy story. 
She was the sole female chemical engineering student in her class at Stanford University. She took risks that led her to the rarefied air of so-called unicorn founders, where women are more than scarce. As Fortune – which has done plenty of post-mortem coverage as Theranos has fallen – points out, “the media is desperate for a woman to hold up as a model of success at this level.”

And it’s true. Anyone with a female tech-company founder as a client knows how hot the demand is for speaking opportunities, profiles, and board memberships for women in tech. Silicon Valley has been justly criticized for female-unfriendly policies, and the Theranos story was an inspiring change to the drumbeat of recrimination.

For its part, the women’s media are equally hungry for stories about brilliant, ambitious young females who are breaking barriers. As Elle magazine’s Mattie Kahn says, “feminists need CEO Elizabeth Holmes.” Everyone needed her, because everyone benefited from the Elizabeth Holmes that the PR machine created. So much that they were willing to ignore the science (or lack of it), defer the hard questions, and overlook the unusual degree of secrecy around Theranos. As annoying questions about the “stealth research” and lack of peer-reviewed literature arose, the company doubled down on the personal narrative and the challenge to the status quo. That’s a defense that works only if the scientific underpinning is in place.

Now the backlash has begun, and the press will scrutinize every move at Theranos from here on. That’s okay. But there’s a danger that they’ll overreact and demonize Holmes, not because of her gender, as some suggest, but in their embarrassment and haste to do what they should have done in the first place. In cases like these there’s always the risk of a media pile-up because they feel they’ve been duped.

A better approach by the company would have involved a positioning informed by science, a communications approach more in line with reality, and a narrative reflecting the inspiring potential of the technology instead of one dominated by a cult of personality. The right role for journalists is to hold Theranos to its commitment to disclose its data as promised, not to crucify it.
It will be unfortunate if Theranos crashes and burns, because it could still be a great narrative and a successful business. And I’d like to think that there are many future Elizabeth Holmeses in waiting, and that, one day soon, one of them will go all the way.