
An Open Letter From Elizabeth Holmes - alva
https://news.theranos.com/2016/10/05/an-open-letter-elizabeth-holmes/
======
objclxt
> "We have decided to close our clinical labs"

...or, perhaps more accurately, the Center for Medicare and Medicaid Services
has banned Elizabeth Holmes from running any kind of blood testing
laboratory[1]. It seems a little odd to write a letter making it sound like
you're just pivoting when in fact your chief executive is not permitted to
carry out the kind of business they were previously carrying out.

[1]:[http://www.wsj.com/articles/u-s-regulator-bans-theranos-
ceo-...](http://www.wsj.com/articles/u-s-regulator-bans-theranos-ceo-
elizabeth-holmes-from-operating-labs-for-two-years-1467956064)

~~~
dimino
Sometimes you guys are after blood, what do you want them to say?

"We're the worst, we'll never try at anything anymore, sorry for existing."

Would that make you happy?

~~~
Dylan16807
"We are closing our clinical labs."

or to mirror the original statement "We have been forced to close our clinical
labs."

It's not that they need to grovel, it's that the phrase "we decided" is not an
accurate representation of the situation.

~~~
erikpukinskis
Sure they decided. They could fight back with legal challenges. They could
spin off the labs into an independently run entity. There are lots of choices
besides shutting them down.

~~~
pyre
"Due to regulatory pressure, we have decided to..."

"We decided to" devoid of any qualifiers makes it sound like it was a decision
made with full autonomy, and not a decision made because you were backed into
a corner.

~~~
oldmanjay
Are your inferences really the important thing? Does it ultimately matter to
anyone on any timeframe beyond a two minute hate?

~~~
Dylan16807
The typical press release doesn't matter at all to most people at a timeframe
beyond two minutes.

But to the extent that it does, it should be based on an accurate
representation of reality and not misdirection.

------
kldaace
I feel bad for those 340 employees. I can't imagine what it would feel like to
have years of your work be exposed as (basically) a farce. I can barely stand
working a week without getting results much less x years of my professional
life.

~~~
aswanson
Yeah. Having the big "T" on the resume might be one of the few red flags
signalling fraud and corruption worse than a few years at SAC capital after a
internship at Enron and Lehman Bros. Maybe the employees themselves will sue
the company for fraud and damage to their careers. Crazy situation.

~~~
nikcub
Working at SAC Capital is only a black mark on your name to those outside of
finance. Within the world of hedge funds SAC alumni are doing extremely well:

[http://www.bloomberg.com/news/articles/2016-02-23/sac-
alumni...](http://www.bloomberg.com/news/articles/2016-02-23/sac-alumni-make-
cohen-proud-as-plotkin-s-fund-shines-in-ranking)

~~~
srtjstjsj
Those outside of finance don't know what SAC is.

------
walrus01
Worth reading: [http://www.vanityfair.com/news/2016/09/elizabeth-holmes-
ther...](http://www.vanityfair.com/news/2016/09/elizabeth-holmes-theranos-
exclusive)

~~~
paulvs
Good old common sense is lacking all throughout this farce. It's one thing to
build a company on an existing technology, like Jobs did, but promise to
implement it better. It's another to come up with a _wouldn 't it be nice
if..._ scenario, and raise capital on it.

Are Silicon Valley investors stupid enough to throw their money at any bright
young dropout with a change-the-world idea? The fact that some Ivy League
dropouts found billion dollar companies does not mean a particular Ivy League
dropout chosen at random (or one of the many who express a desire to change
the world) has a non-zero chance of returning $$$ on investments.

Demonstrating that inteligence and common sense are seperate traits, the
latter not always accompanying the former.

~~~
lordnacho
If you wait for all the pieces of a proposed business to be functioning
properly, you will have missed the boat as an investor. It's perfectly
reasonable to take a bet on someone who appears intelligent and well
connected, with a "maybe" idea.

There's all sorts of hurdles that a company might not get over:

\- Tech turns out to be a red herring \- Tech works, but competitors also get
it to work \- You can't scale the team \- People buy the product, but you need
critical mass to make it worthwhile \- etc

~~~
TillE
I don't think it's too much to demand a scientifically verified "proof of
concept" before investing. There's still a very long road from that to a real
functioning business.

What Theranos had was merely the hope of developing such a process, with many
reasons to believe that it's simply impossible. That's insanely risky.

~~~
Tloewald
She is also thin, good looking, eventually blond, charismatic, and connected.

What I see is a cult leader who happens to be recruiting in Silicon Valley
rather than (say) Hollywood.

~~~
walrus01
Be right back, buying turtlenecks and blonde hair dye. We're gonna be a
unicorn!

------
JumpCrisscross
“We will return our undivided attention to our miniLab platform. Our ultimate
goal is to commercialize miniaturized, automated laboratories capable of
small-volume sample testing, with an emphasis on vulnerable patient
populations, including oncology, pediatrics, and intensive care.”

People who are expected to die before they can sue. Also kids. Am I reading
this correctly?

[http://www.wsj.com/articles/theranos-retreats-from-blood-
tes...](http://www.wsj.com/articles/theranos-retreats-from-blood-
tests-1475713848)

~~~
daveguy
Also known as vulnerable patient populations -- a critical group for
healthcare needs. That part is definitely not a conspiracy. From Theranos'
perspective they have families that are quite capable of litigation.

That angle is a bit of a stretch to put it mildly.

------
arkitaip
How long are they going to continue this farce? When will the investors step
in and try to save what's left of the business?

~~~
adrenalinelol
What would they do? If they can maintain say 5% of its hype valuation that's
worth more than the market/product they have (nothing).

~~~
blhack
Maybe I'm missing something, but...nothing? Just looking at google maps there
are like 10 theranos labs just in Phoenix (my hometown).

Recently, I was talking to a doctor-friend, and they recommended that if I was
curious about something like my blood sugar, but didn't want to go for a whole
doctor visit, to just go over to a theranos lab and have them do it.

~~~
car
Actually, it's pretty cool you can do this in Arizona. Wish this was possible
in California.

I've installed the Theranos app on my iPhone, and was pleasantly surprised at
their very affordable a la carte clinical lab testing.

It feels pretty empowering for a consumer to order whatever clinical test they
want without having to consult a doctor first (at least in Arizona).

------
readhn
The whole company is full of delusional characters it seems... Read recent
article, apparently during recent company meeting the entire auditorium of
Theranos employees chanted "F... Y.. Carreyrou! F... Y.. Carreyrou! " What
kind of mentality people need to have to behave like that? Professional
Scientists? Come on. I will not be sorry to see this dirty company go down the
drain.

~~~
readhn
Does anyone else think this is the type of behavior expected of supposedly
world class, cutting edge researchers? Cussing at the person who is
challenging them? With the approval of the management?

Theranos, MAY have a chance to build a successful product if they replace ALL
of their decision makers who got them here in the first place and then clean
up the ranks and build appropriate science team. Only then they have a SHOT at
making a good product.

If this does not happen then it is RIP for Theranos 2016..

------
Fricken
She's a mighty good leader. It takes a rare and special talent to build a 9
billion dollar company using only smoke and mirrors. Even after all that has
transpired she hasn't given up, she's still trucking.

She doesn't see herself as a fraud at all, her faith in her mission, however
delusional, is ironclad. She inspired her investors to take insane financial
risks without so much as a whiff of due diligence. Elizabeth Holmes is a
modern day Joan of Arc.

~~~
Shivetya
You need to read up on Joan of Arc, unless I am missing the idea your entire
post is in jest.

She sounds like a modern day politician caught with their hands in the cookie
jar whose response is to change the issue to fit their own narrative.

My only shock is they haven't trotted it out as if her company was treated
differently because of the sex of the leadership.

~~~
Grishnakh
>She sounds like a modern day politician caught with their hands in the cookie
jar whose response is to change the issue to fit their own narrative.

Yeah, but isn't that exactly what true leadership is? After all, people are
perfectly happy, by the millions, to follow such people, and they've been
doing it throughout history.

------
Tycho
_In July 2011, Holmes was introduced to former Secretary of State George
Shultz, who joined the Theranos board of directors that same month.[48] Over
the next three years, Shultz helped to introduce almost all the outside
directors on the "all-star board," which included William Perry (former
Secretary of Defense), Henry Kissinger (former Secretary of State), Sam Nunn
(former U.S. Senator), Bill Frist (former U.S. Senator and heart-transplant
surgeon), Gary Roughead (Admiral, USN, retired), James Mattis (General, USMC)_

There's some crony capitalism for you.

~~~
ekianjo
You know who Dropbox has on their board right?

~~~
Mango_Diesel
Clearly you are implying exactly Condoleezza Rice, but if you look at the
other companies she is a board member/advisor for you find a diverse groups of
companies. It makes sense for someone who wants to stay current with the
latest in business to seek a diverse portfolio of companies to be a part of.

One board member being formerly involved in politics doesn't strike me as
valid the way you are comparing it to Theranos.

[https://www.crunchbase.com/person/condoleezza-
rice/advisory-...](https://www.crunchbase.com/person/condoleezza-
rice/advisory-roles/edit)

~~~
honkhonkpants
"Formerly involved in politics" hardly scratches the surface of what Rice is.
Rice got on national television and told America that Iraq had nuclear
weapons. Rice was also instrumental in leading the CIA to torture of certain
detainees. Rice should be on trial at the Hague, not collecting honoraria for
sitting on corporate boards.

~~~
hueving
When did Rice claim that? Please choose a different forum the spout political
lies.

~~~
hyperbovine
[http://www.nytimes.com/2003/01/23/opinion/why-we-know-
iraq-i...](http://www.nytimes.com/2003/01/23/opinion/why-we-know-iraq-is-
lying.html)

~~~
hueving
Nuclear program != nuclear weapons. See Iran

~~~
ryanlol
Seems intellectually dishonest to accuse honkhonkpants of lying when Rice was
claiming they could produce a nuke at any time.

~~~
chirau
'Can produce' and 'has produced' are two very different things.

Just because you can punch me, have already rolled up your sleeve and clenched
a fist does not mean you have punched me, does it now?

------
cjslep
"An Open Letter From Elizabeth Holmes" posted by Staff Writer

It wouldn't surprise me if a shadow writer indeed wrote this letter "from"
Elizabeth Holmes. That's how the world of open letters from CEOs works, right?
But usually they wouldn't expose the farce this way?

~~~
kldaace
I doubt she actually wrote this but to be fair all of their posts are written
by "Staff Writer" except an op-ed linked by "Theranos Staff."

------
seesomesense
From John Carreyrou,the Wall Street Journal writer who wrote the investigatory
series on Therano: "Patients are finally safe tonight. I did my job.
#theranos""

Carreyrou will probably get a Pulitzer for his work on this story.

------
hans
i'll say it again, there's a really cool Don DeLillo book in this Theranos
burn out ..

"Through it, we see a world in which no one ever has to say ‘goodbye’ too
soon, and people are able to leverage engagement with their health to live
their best lives." \-- bunch of BS :]

~~~
jaredhansen
You might enjoy _Zero K_ , a Don DeLillo book that is more or less about
cryogenic suspension.

------
sopooneo
From an outside perspective, the "mini-lab" sounds like a slightly different
name for the same thing they already promising five years ago. What am I
missing? Anything?

~~~
daveguy
I think they are trying to pivot from a dumpster fire. The original "product"
was blood tests with microliter volumes. That is essentially a farce. Now they
are trying to sell lab automation in a box.

~~~
sopooneo
Right. But as they are describing the "lab", it seems to be for doing blood
tests with microliter volumes. No?

~~~
daveguy
Yes, so the "pivot" is more from a service to an instrument -- with a
different set of regulations that they haven't yet burned to the ground. It's
more of a 90 degree pivot than a 180 degree pivot.

------
beachstartup
> _We have a new executive team leading our work toward obtaining FDA
> clearances, building commercial partnerships, and pursuing publications in
> scientific journals._

hm, that's funny, no mention of products or services...

------
swingbridge
I think it's more like she's been banned by regulators from running a lab and
given their history no sane person would purchase such services from them
anyway... but you know, details.

------
seesomesense
"She also controls a majority voting stake in the company and can’t be easily
removed from her position, according to people familiar with the matter." From
the Wall Street Journal.

------
josh_carterPDX
The most frustrating part of this whole situation is that this is going to
cause VC deal flow to be impacted for those entrepreneurs who actually know
what they're doing.

~~~
gumby
Unlikely -- this deal didn't really get any VC deal flow. DFJ invested because
Draper's kids were childhood friends of Holmes'. Ellison (not a VC) invested
because his investment manager was a college friend of her father's. ATV
invested because, well who knows -- perhaps because DFJ invested. Those are
the three investors.

No life science VCs invested.

~~~
ben_jones
I'm a really uninformed opinion but doesn't public perception impact VC at
some level, even subliminally? If public perception goes to shit, might the
market (and VC) follow?

~~~
gumby
Life science investors need to invest in life science deals -- it's the
promise they made to their customers (err...LPs) and what the need to do to
make any more than the management fee.

If anything, they can tout their prowess in passing on the Theranos shitshow.

As far as I can tell right now life science investing is doing fine. I am
advising one company (and in the device diagnostic space, same space, if
different application than Theranos) which is deciding over multiple offers.

------
Overtonwindow
The last dying gasps of a Silicon Valley fraud..

------
baoha
It's strange that there are so many people at the company. If I were one of
them, I would jump ship long time ago.

------
FussyZeus
> "An Open Letter From Elizabeth Holmes"

> "By Staff Writer"

I think this encapsulates this phony in two lines perfectly.

------
readhn
This is after several papers were published on inherent inaccuracy of small
blood volume based tests..

------
brooklyndude
In the future you will be able to run a multitude of blood tests on a single
drop of blood. Just the future is not here just yet. Just like DNA. You
amplify. And amplify. And a very cool guy got a Nobel prize for that.

~~~
anbende
It's not at all clear that that is the case. On of the problems, as I
understand it, is that there's just not enough material in a drop of blood to
run many tests.

I'm not an expert, but while improvement may be possible, miraculous
improvement may not be.

------
seesomesense
The initial plan was to sell the technology to the Defence Department for use
in battlefields. Theranos might still be able get a few billion out of them.

------
M_Grey
Preparing for charges to be levied, you have to hope.

------
fsloth
I'm not sure what people are so pissed about (unless they are investors). A
little help here?

Did they cause actual medical harm to someone?

 _Had_ the minilab worked they would have had a functioning commercial service
available to test and finetune the process immediately. Isn't field testing
and shipping products what's important when developing new products and
services?

Sure, there is the chance it's a psychopath bullshit scenario from start to
the end but do we have any actual proofs that this is the case?

~~~
new299
Actually, you know what people are pissed about? Poor investments like this
create a business environment where it's harder to get really useful things
done.

It becomes impossible to bootstrap, and then get funded because VCs a) are
looking at all the wrong metrics b) make development more expensive because
the money they've thrown into the sector has pushed up costs.

Poor investments as an employee, that when you're looking for an interesting,
innovative hard science company to work for, you're comforted by a stream of
companies that have been evaluated, not on their scientific merit but on their
ability to sell an image of themselves. As an employee who doesn't just want
to take a pay check, but would like to actually do something useful this is
frustrating.

You might say "it's their money, they can spend it how they want". As far as
I'm aware that's not really true. The majority of the money invested in these
kinds of companies ultimately comes from Banks. It's either money created out
of thin-air (and doubly diluting every dollar you own) or it's a debt owned to
the banks customers.

~~~
fsloth
I understand all but the last of your arguments:

"the majority of the money invested in these kinds of companies ultimately
comes from Banks. "

I suppose from the point of view of economy this is a problem if the funds
exit circulation. If, on the other hand, the funds are mostly used for payroll
and purchasing goods and services to maintain the business this means the
whole economy benefits. Or am I totally clueless of fundamental economics
(which might be the case, computer science and physics are more familiar to
me)?

~~~
new299
It's a problem with how society allocates it resources to make technological
progress.

Payroll goes to pay people to do something non-optimal. As for equipment, well
it's great for me because I can pick up used lab equipment cheaply on eBay.
But when a startup buys, say low-yield back-thinned CCD cameras and then never
uses them human effort is wasted.

As an aside, the startups themselves rarely purchase used equipment (how do
you present it in your budget, how do you explain the increased risk that
comes with buying a used piece of equipment to your investors?).

So, the economy keeps functioning... but the economy is just money moving
around, not necessarily people doing actually useful things.

Edit: Not sure I really understand the downvote. It would be great if you'd
comment directly. Particularly given I was attempting to clarify my previous
comment as requested.

------
lohankin
She was _used_ by greedy VCs. She's a victim. Take pity folks. (No sarcasm)

------
hprotagonist
Death by a thousand cuts.

~~~
kejaed
More precisely, 340.

------
lekeve
"Stop breaking the law, asshole!"

[https://www.youtube.com/watch?v=Zx40udwQvZI](https://www.youtube.com/watch?v=Zx40udwQvZI)

------
zerooneinfinity
I went to the technology page which was a whoops 404 error.

~~~
kctess5
Ha they fixed it. Someone at theranos reads hn.

~~~
Mango_Diesel
Either broken again or maybe you hit a cache.

~~~
kctess5
When I click the link in the footer now, it directs to the homepage. The
/technology page is still 404.

------
lint_roller
Yes. That would be a start.

The downvotes are comical. Never seen so much sympathy for people who defraud
investors and put healthcare at risk.

~~~
dang
One needn't sympathize with those things to downvote unsubstantive snark on
HN.

We detached this comment from
[https://news.ycombinator.com/item?id=12649468](https://news.ycombinator.com/item?id=12649468)
and marked it off-topic.

~~~
lint_roller
Snark begets snark, dang. I didn't perceive the parent comment to be
particularly substantive either.

We'll agree to disagree. Voters seemed to agree with my sentiment after all.

~~~
dang
Voters upvote snark routinely. That's a weakness of the voting system, not a
sign of quality. HN can't live by upvotes alone.

------
transfire
How does this become top post with only 79 points and 21 comments posted 1
hour ago?

~~~
kens
To simplify, lots of votes in a short time gets the article to the top, unless
penalties kick in. If you're interested in the HN scoring algorithm, I wrote
about it in 2013: [http://www.righto.com/2013/11/how-hacker-news-ranking-
really...](http://www.righto.com/2013/11/how-hacker-news-ranking-really-
works.html)

Some changes have been made to the algorithm since then, but it's still
roughly accurate.

------
readhn
RIP THERANOS.2016.

