The Theranos Con

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The Theranos Con‘Forbes

The Theranos Con

SAN FRANCISCO, CA – OCTOBER 06: NBC News Special Anchor Maria Shriver (L) and Theranos Founder and C.E.O. Elizabeth Holmes speak onstage during ‘True Blood’Diagnostics in the New Age’ at the Vanity Fair New Establishment Summit at Yerba Buena Center for the Arts on October 6, 2015 in San Francisco, California. (Photo by Mike Windle/Getty Images for Vanity Fair)

Theranos’s layoffs occurred in the wake of last month’s charge by the SEC that the firm’s CEO Elizabeth Holmes had committed fraud. The SEC contends that Holmes misled investors about the efficacy of the firm’s technology, in the course of raising $700 million of financing. For this, Holmes agreed to a settlement in which she would pay a $500,000 penalty.

Here are two behavioral questions to ponder, given the fraud. Were all these prominent board members and venture capitalists conned; or did they instead allow themselves to be conned? To answer these questions, we need to understand the essence of the fraud.

The fraud entailed the firm falsely claiming that its purported revolutionary technology was successfully producing accurate lab results from small drops of blood. Instead, the firm cheated and used conventional technology to produce accurate results, as its own technology was inaccurate.

The second phenomenon is ‘unrealistic optimism,’ stemming from wishful thinking. Technically, wishful thinking is described by the psychological term ‘desirability.’  A lot of people rooted for Theranos to be successful, including its customer, investors, and board members, because the technology it promised was so desirable.

  • Publisher: Forbes
  • Date: 2018-04-14
  • Author: Hersh Shefrin
  • Twitter: @forbes
  • Citation: Web link

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Not to change the topic here:

Theranos employees made a game where you shoot the investigative journalist who exposed the startup’s major problems

Elizabeth Holmes, the founder and CEO of Theranos, at the 2015 Wall Street Journal Digital Live conference in California. REUTERS/Mike Blake

There’s a lot of blame to go around — whether it’s aimed at CEO Elizabeth Holmes, the former chief operating officer Sunny Balwani, or the investors who enabled the startup to raise $1.4 billion in venture funding.

But some within the company blame John Carreyrou, the Wall Street Journal ace who revealed that the company, once valued at $9 billion and backed by big names like the former Secretary of State George Shultz, was misleading people about its technology.

Not only did Theranos employees once chant “f— you, Carreyrou” at an all-hands meeting, but employees even built a “Space Invaders”-style game in which players were to shoot little pictures of Carreyrou’s head, as well as the Zika virus, he tweeted on Thursday.

Carreyrou wrote that the game’s creator got in touch with him and would eventually send him the full game so he could play it.

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  • Publisher: Business Insider
  • Author: Kif Leswing
  • Twitter: @sai
  • Citation: Web link

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Watching: Theranos Founder, C.E.O. Elizabeth Holmes, New Age

The Theranos Con
on 14th of Apr 2018 This past week Theranos laid off all but a sliver of its workforce. This marks a sad event for a medical technology firm whose board once included prominent people such as Henry Kissinger, George Schultz, Larry Ellison, and the country’s current

Theranos employees made a game where you shoot the investigative journalist who exposed the startup’s major problems
(Apr 2018) Theranos may be liquidated as soon as this summer, according to an investor email. The company was once valued at $9 billion and backed by big names like the former Secretary of State George Shultz. Some people inside the company blame John Carreyrou, the

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