Elizabeth Holmes, the Story of a Fallen Quester
At the age of nine, Elizabeth Holmes, an innovator and entrepreneur, wrote to her father saying: “What I really want out of life is to discover something new, something that mankind didn’t know was possible.” It was clear from the onset that she was always going to be a quester leader. Inspired by stories of her great-great-grandfather, Christian Holmes, a surgeon, Holmes enrolled at Stanford University to study medicine, but at the age of 19 she dropped out to work on Real-Time Cures, later rebranded, Theranos − the word comes from a combination of therapy and diagnose – in the basement of a college house. “When I realised this is what I wanted to do with my life, things got easy,” Holmes told USA Today, “because when you reach that moment when you’ve found what you’re born to do, well then you just got do it.”
Over the next ten years Elizabeth Holmes worked feverously below the radar developing 84 patents and launching an innovative minimal invasive blood test that required only a pinprick on the finger but was claimed to be capable of testing for medical conditions like cancer and high cholesterol. “Theranos is enabling everyone” she said. “No matter how much money they have, or where they live, or what kind of insurance they have, to be able to have access to the kind of testing information that could change their lives.” Actionable health for Holmes, “is a basic human right.”
Providing near real-time blood test results at very affordable prices has the potential to change the world and deliver real benefits to many people. Imagine popping into a supermarket or drug store getting a quick pin prick and knowing almost immediately if you have cancer or diabetes. “Between forty and sixty per cent of people who are ordered by their doctor to get a blood test do not. Diabetes, sexually transmitted diseases, and other common medical conditions could be diagnosed and treated earlier if the tests were less onerous and more accessible,” Elizabeth Holmes told an audience at a conference. “We see a world in which no one ever has to say, ‘If only I’d known sooner.’ A world in which no one ever has to say goodbye too soon,” she enthused.
Swiftly Elizabeth Holmes became the toast of Silicon Valley and in 2014 she topped the Forbes list as America’s Richest Self-Made Women with a net worth of $4.5 billion. But then as quickly as Holmes rose to fame she fell from grace. On the 20th December 2015 an article in the Wall Street Journal, alleged that Theranos products don’t work as advertised. The Centre for Medicare and Medicaid Services (CMS) and FDA promptly launched investigations and Forbes subsequently downgraded her personal worth to zero. Oh how the mighty fall cried her critics.
Parallels between Elizabeth Holmes and Steve Jobs have been made with Inc magazine claiming she would be the next Jobs. But there remains a key and important distinction. Getting blood testing wrong can be life-threatening, getting computing wrong isn’t.
There are two main issues here. Firstly, blood testing is big business with laboratories charging hundreds even thousands of dollars for individual tests. Theranos claimed it could do 200 tests with just a pinprick of blood and at a cost of just a few dollars turning the blood testing industry on its head. I’m sure this made Elizabeth Holmes a lot of enemies. It is interesting that the investigations focused on the Theranos laboratory that only did 10% of Theranos tests. If I were cynical I’d question if any large drug or blood test company was covertly encouraging the regulatory investigations and media articles calling for her blood. Regardless of the motives it appears the required levels of compliance and due-diligence at Theranos’s Californian Lab was not being followed. As CEO this makes Elizabeth Homes responsible. Secondly, blood testing is a serious business. It’s about people’s health so getting test results right is massively important. Elizabeth Holmes and Theranos got this wrong even though what she wants to achieve is admirable. This left her vulnerable to the media and those from the establishment who view her as a threat and swoop they did. On Friday 8th of July, federal regulators delivered their verdict and banned Elizabeth Holmes from the laboratory testing industry for at least two years.
Here’s the thing each and every leader who wants to make a difference can learn from this story. Every quester comes up against dead-ends or obstacles that halt progress. They make decisions that result in wrong turns and questers push up against established paradigms and people with vested interests who want them to fail. The difficulty questers face is that by going against the grain to prove the impossible possible, they threaten to upset the applecart of accepted wisdom. This places in question the validity of the paradigms that have given power and prominence to established players. Hence, leaders on quests get a lot of pushback. In the past six months Elizabeth Holmes has received pushback in spades, but she’s not alone in being singled out by the establishment. Established players and media pundits often cry fowl to regulators when questing disruptors threaten to upend their party. Uber and Airbnb can testify to this. 23&Me, a genomics and biotechnology company founded by Anne Wojcicki in 2006 – when she was married to Sergey Brin the co-founder of Google – most closely mirrors Theranos. 23&Me was banned from conducting personal genetic tests by the FDA in 2013 because of alleged inaccuracies of tests but bounced back and by the end of 2015 the company resumed personal health tests. Elizabeth Holmes may follow a similar path, the ban she has received does not mean it is the end of her quest.
It is said that Elizabeth Holmes deeply admired her icon Steve Jobs and even kept a picture of him on her desk. The similarities between these two Silicon Valley disruptors is striking. Not least because both dropped out of College aged 19 and both favour black turtleneck tops, but now because with her fall from grace there is a growing voice for the board of Theranos to have her fired.
In Steve Job’s 2005 Stanford University commencement speech, he described the very public humiliation of being ousted from Apple. “It was awful tasting medicine but I guess the patient needed it” he said. Elizabeth Holmes began her quest “thinking about what is the greatest change (she) could make in the world.” Seeking a solution to provide patients with affordable blood test is noble and worthy quest. She can take strength that Theranos and her best days may lie ahead of them and that taking “awful tasting medicine” is just one part of her adventure. Elizabeth Holmes should take further inspiration from her icon who said “Sometimes, life hits you in the head with a brick. Don’t lose faith.” As the great computer pioneer concluded: “I didn’t realize it at the time, but [it] was the best thing that could have happened to me.”
Elizabeth Holmes, made mistakes but she is only human and asking for forgiveness is part of reflecting and growing as any great leader can testify. I hope she continues to battle on her quest, the two-year ban is only a hurdle that can be overcome; there will be other hurdles and obstacles too that will test her, that is the nature of a quest. No quest is ever an easy strategy to follow but the benefits are huge for those who stick to their beliefs when the naysayers call. I hope she continues to encourage and inspire others to pick up her batton and venture into the great unknown. Operationally she may have got it wrong but her quest is sound and noble. Elizabeth Holmes has opened the door to another world and there is no going back, even if she never completes her quest the path is now open to other intrepid entrepreneurs. Verily Life Sciences, an Alphabet owned company is already expanding into this space and the time for entrenched competitors who do not shift and change is numbered. I hope Elizabeth Holmes continues to strive towards conquering the impossible and like Steve Jobs she can return with greater knowledge, riches and rewards, for she has the qualities of a quester extraordinaire.
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