She lied and the lies got bigger and bigger and eventually the lies got so big relative to reality that it became a pretty massive fraud.
The hyperbolic Jim Cramer of CNBC’s ‘Mad Money’ settled down for a chat with John Carreyrou, the author of ‘Bad Blood’, to dissect what Mr. Cramer touted as ‘the best business book since Phil Knight’s book about starting Nike, ‘Shoe Dog”. Mr. Carreyrou outlines Elizabeth Holmes and Sunny Balwani went ‘live’ with fingerstick tests far too prematurely, burned through money, lied to the board, and (schadenfreude alert!) lied to attack dog David Boies, her attorney. There was also a real lack of ‘due diligence’–real diligence–on the part of companies like Safeway and Walgreens. A reveal coming out of this interview is that Walgreens hired a lab consultant, Kevin Hunter, as early as 2010, who ‘smelled a rat’ even then–and Walgreens executives ignored him, frightened that Ms. Holmes would go to CVS. Wrapping Ms. Inexplicable Me up, Mr. Carreyrou attributes her mindset to ‘noble cause corruption’; she really did believe that her blood testing machine would do good because the outcome would be good for society. Thus every corner cut was justified….which explains a lot, but really excuses nothing. The ten-minute video is over at ValueWalk (the transcript is only partial).
LinkedIn’s hyperbolic co-founder Reid Hoffman, like him or not, does have a way with words, and this article in Fast Company is a decent discussion of a new term that he actually coined, ‘blitzscaling’ which is pursuing rapid growth by prioritizing speed over efficiency in the face of uncertainty. It’s quite a lure he sets out to his classes at Stanford, that the only way to have a successful business in winner-take-all (or most) markets is to do this, and if you do it right you’ll have the next Google, completely ignoring the fact that 99.99 percent of businesses don’t need to change the world, just to get to breakeven, get to profitability, and endure (or get bought out). He springboards off this to where Ms. Holmes and Mr. Balwani Went All Wrong. The answer? Product failure=Mortal Risk–to the patient. They needed to meet a Walgreens deadline thus went out prematurely with their nanotainer testing knowing it did not work. The best quote in the article?
There’s a big difference between being embarrassed and being indicted.