Review: Bad Blood: Secrets and Lies in a Silicon Valley Startup

Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou
My rating: 5 of 5 stars

John Carreyrou does an amazing job of reconstructing the story of Theranos. The book is engrossing and keeps your attention right till the end. This is a story I had not known about till this book was recommended to me.

Elizabeth Holmes drops out of Stanford and starts Theranos. The aim of the company is do a range of blood tests with very small amounts of blood – most with a finger prick. The underlying premise is an exciting one, and as with most people I would certainly hope this can happen where drawing large quantities of blood from the veins for tests ends someday. The company claims success and finds interest from many investors, pharmacies and even the US armed forces. The truth though was that the company could never get its devices and technology to work reliably. Elizabeth, however decided to plunge ahead with going to market nevertheless, hiding the issues from investors, regulatory authorities, partners and customers. Theranos finds some hacks by using modified commercial instruments with diluted blood samples for testing when its own devices fail. Safeway invested a considerable amount of money in designing wellness centers at its stores. Walgreens enters into a partnership as well.

The culture at Theranos was another problem – a demanding and authoritarian leadership team of Elizabeth & Sunny Balwani, who also had an undisclosed romantic relationship. There was an air of extreme secrecy and teams were encouraged to work in silos. Elizabeth saw Steve Jobs as her role model and adopts a similar dressing style as also a suspected put-on deep voice. Balwani was feared and often fired people who felt were too independent and not falling in line. Elizabeth also later starts moving around with a lot of security.

At one point the company was valued at $9 billion, with Elizabeth’s worth being about half of that. An aggressive legal team headed by David Boies coupled with the intimidation tactics of Elizabeth & Sunny keeps the wraps on the issues for a fairly long time. The board of Theranos & investors had many well know and powerful names, and relationship building was Elizabeth’s unique strength. All this falls apart once John Carreyrou starts an investigation based on a tipoff and speaks to a number of ex-employees and does his own tests on Theranos technology. Theranos tries its best to intimidate the people he speaks to you and him as well. A series of articles in the Wall Street Journal brings widespread attention to the practices of Theranos, which the company vigorously denies for some time. Theranos is shutdown and Elizabeth and Balwani will face a trial soon.

I later read a number of more articles on the net and saw some videos on youtube. Elizabeth’s voice does come across artificial, but maybe because it was unexpected. Startups do not always succeed and that by itself is obviously not the issue. I do hope some startup does succeed in the area Theranos failed. There is the serious issue of lack of mature leadership in many startups (Disrupted: My Misadventure in the Start-Up Bubble by Dan Lyons is another interesting read as well though the issues are entirely different).

This was a fascinating read and one which I strongly recommend.

My rating: 4.5 / 5.

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