
Theranos: How to destroy $9B in valuation in 6 Months - Geekette
http://finance.yahoo.com/news/theranos-blow-9-billion-6-123500740.html
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dharmon
I feel like the Theranos fiasco has been discussed on HN ad nauseam, so I'll
comment on an interesting quote by Holmes:

> “The minute you have a back-up plan, you've admitted you’re not going to
> succeed.”

I've seen this as a common refrain in SV. In my experience, though, what
actually happens if you insist on no backup plan, and you've been fortunate
enough to have smart people around you, is _they_ secretly make backup plans.
Then, when things inevitably don't go exactly according to plan, they step up
ready to keep moving without missing a beat.

What this means as a founder is that the plan you end up implementing had
nothing to do with you. It doesn't stop them from taking all the credit,
though. If you are unlucky in terms of your top team then well, you just die.

Flipping it around, the smartest (and usually most successful) founders' plan
is that things will not go according to plan, and to a) hire smart people who
can handle that and plan for it, and b) maintain maximum flexibility as long
as you can (e.g., don't sign a massive corporate giant as your first
customer).

Maybe if Holmes had some experienced, skin-in-the-game investors on the board
she would know this?

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jonnathanson
Sounds as though Holmes really did put all her eggs in one basket: government
relations. Score government contracts; use regulatory capture to create moats
against competition; profit.

If that was indeed her calculus, then in retrospect, the Walgreens partnership
was strategically off target -- at least for Phase 1 of the company's plans.
So was that part of Plan A, or was it someone's Plan B, or was it simply a biz
dev opportunity that came their way and which they decided to pounce on?
Interesting to consider.

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samfisher83
It might have been smoke and mirrors that got you to that 9 billion dollar
valuation so did you really destroy that valuation or was it ever there?

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chadlavi
possibly ironic that the link is to yahoo

