inewsamerica: As Theranos Burned, Elizabeth Holmes Was Partying

Elizabeth Holmes in New York City in 2015.

By Taylor Hill/Getty Images.

By the end of last August, the general counsel and acting chief executive officer of Theranos had some more bad news. David Taylor had succeeded troubled co-founder Elizabeth Holmes a few months earlier, when she stepped down after the Department of Justice indicted her on charges of wire fraud. (She pleaded not guilty.) Holmes’s free fall had been dramatic and unprecedented, both precipitated and documented by The Wall Street journal’s Pulitzer Prize–winning reporter, John Carreyrou. Now, it was time for the final death blow. Theranos, the former unicorn, which had raised some $900 million at a staggering $9 billion valuation, was kaput. Taylor told the company’s remaining employees that Theranos was being dissolved and everyone was being laid off. Naturally, Carreyrou memorialized the moment in the Journal. “Most of Theranos’s two-dozen remaining employees worked their last day on Friday, August 31,” he wrote. “Only Mr. Taylor and a handful of support staff remain on the payroll for a few more days.” By September, the doors had shut for good.

Given her personal attachment to Theranos, a company she started as a Stanford undergraduate, it would have been fair to assume that Holmes would have been distraught—perhaps holed up somewhere, like the mansion in the Los Altos hills that, according to former executives, the company had been renting for her, even as it was cratering amid endless legal bills. Or perhaps she would have headed east to spend some quality time with her parents, who had furnished that mansion with their own decor after they found out she was living in Grey Gardens–like desolation, alone in a bare-naked empty mega-house. Perhaps she would have been seeking the counsel of her father, a former Enron executive, who had similarly viewed the unpleasantness of corporate upheaval.

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Or perhaps still, she would be fighting to revive Theranos. Before the company’s collapse, Holmes gave speeches at universities detailing how, back when she started Theranos in 2003, she had resolved to never, ever give up on the company, no matter what happened. She famously said that “the minute you have a backup plan, you’ve admitted you’re not going to succeed.” And she said that she would stay with Theranos even if it failed, determined to see her life’s work through to the end.

Holmes had always done things her way—she hewed herself to a diet of disconcerting green juices, wore a Jobsian turtleneck, and as I recently reported, walked around the office with a dog whom she repeatedly told people was a wolf, and whom she doted on even when he shat all over the company boardroom. Indeed, Holmes spent Theranos’s final days not in mourning, but at the biggest party on earth. As Taylor locked the door at the company’s lab in Newark, California, Holmes was roughly 375 miles away, dressing in white fur, with pink bug-eyed sunglasses, prancing around the playa at Burning Man with her boyfriend.

I learned this detail, along with plenty of others, after the publication of my recent article on the final months of the company’s life. The article struck a nerve with former Theranos employees, many of whom say they hate Holmes like a cartoon villain. One former Theranos employee reached out to me to recount how small and petty her lies could be. This person suggested that Holmes’s comment about being able to quote Jane Austen in a New Yorker profile was nonsense. In public, Holmes often attempted to appear well-read and scholarly, in a dreary New England sort of way, despite her single year of college. She touted the titles of works of philosophy that she had absorbed. According to this former employee, however, it was all fiction. Colleagues who questioned her about the canon found that Holmes’s intellect was mostly superficial. For this person, it was a harbinger of what was to come. “How is it that you can remember every word of Jane Austen but you say ‘I don’t remember’ 600 times during a deposition,” the employee asked me rhetorically, referring to Holmes’s now infamous pattern of response during a series of depositions with 12 attorneys from the Securities and Exchange Commission.

The list of deceits is long. Holmes also told The New Yorker that she “doesn’t date,” even though she was dating Sunny Balwani, the Theranos C.O.O., at the time. As Carreyrou wrote in his book, Bad Blood, and as he described during his press tour, even Holmes’s baritone voice was fake. He relays the story of a new employee who held a meeting with Holmes late in the day, and in a moment of excitement, “She forgot to put on the baritone voice, and went back into a more natural-sounding young woman’s voice.” There’s also a moment in ABC News’s fantastic new podcast, The Dropout, where Holmes’s voice becomes briefly falsetto. (Holmes’s counsel did not respond to a request for comment.)

But the falsehood that has struck me the most, possibly just due to sheer laziness, regards Holmes’s dog. As I noted in my piece, during Theranos’s final months, Holmes flew across the country to get a little Siberian husky she named Balto. Holmes told colleagues at the time that the pup was named after the world-famous sled dog who, as legend has it, led a team of huskies on a 600-mile trek from Nenana, Alaska, to remote Nome, Alaska, in 1925, bearing an antitoxin that was used to fight a diphtheria outbreak. The problem is, as I’ve since learned, the original Balto was more than likely a fraudster, too. According to Time, one of the other dogs, Togo, ran 261 miles of the journey, which “included a traverse across perilous Norton Sound—where he saved his team and driver in a courageous swim through ice floes.” The original Balto finished the last leg (around 55 miles) of the trip. But, given that it was Balto who rode into town with the antitoxin, it was also Balto who took all the credit and got all the media attention.

Holmes had used Balto as a metaphor for her vision for Theranos. In reality, it was almost too apt. Balto represented Holmes’s own shallow desire to be famous and take credit for something that wasn’t true. Holmes was on the cover of Forbes, Inc., Fortune, and T magazine, and praised to high heaven as the woman who was going to save the world. Balto was similarly plastered across newspaper covers and magazines in the early 1900s, and praised to high heaven as the dog who saved Alaska. But in both cases, it turns out it was all bullshit. As The Saturday Evening Post wrote in 1954, the main reason Balto got all the credit was because “newsagents of the time thought that Balto was a more newsworthy name.”

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As Theranos Burned, Elizabeth Holmes Was Partying—At Burning Man

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