Henry Kissinger, a famous American diplomat, found "a lot of charm" in Elizabeth Holmes. He was left with $ 3 million, evaporated after investing in the start-up Theranos. Press magnate Rupert Murdoch, for his part, lost 125 million. In total, more than $ 700 million in fundraising has vanished into the hands of the “Girl Boss” of Silicon Valley. In other words, it's the story of a business owner who has long been described as a visionary, even as a new Steve Jobs, and who was really just a huckster. The comparison with the late boss-founder of Apple, therefore stopped at the black turtleneck that this blonde with blue eyes almost invariably wore during her public outings.
This Monday in the United States, Elizabeth Holmes was indeed found guilty of knowingly defrauding investors who entrusted their money to her. A rare sanction, in the world of start-ups valued at several billion. The young woman who owned more than 50% of the shares of the company has - in the eyes of justice - in particular embellished the prospectuses intended for the potential customers, the pharmacy chains Walgreens and Safeway, in its strategy of conquering the market. She also had to admit that it was she who added the logo of companies like the Pfizer laboratory without asking their permission in its commercial offers. This conviction exposes the 37-year-old woman to several decades in prison, but the sentence will be pronounced at a later date by the federal court.
The "beautiful" story of the one who hated injections
Elizabeth Holmes, heir to a large American family, had everything going for her.
His father was the vice president of Enron, the American energy giant.
A business with disastrous fate, which will end up stuck in a scandal of financial embezzlement in 2001. The young woman was only 19 years old when she founded Theranos, in 2003. She finances the start-up of her start-up, based in Palo Alto in Silicon Valley, with the money her parents had set aside to pay for her studies at Stanford, whose benches she deserted at the same time.
To explain the genesis of her project, Elizabeth Holmes evokes a sick uncle and an anecdote: as a child, she hated injections during blood tests. So what could be better than a simple, fast and efficient machine that would allow anyone to perform hundreds of blood diagnoses from a single drop of blood taken from the fingertip? It was Elizabeth Holmes' “golden ticket” to make investors dream. "From the moment you have crazy promises, you can have incredible valuations", decrypts a French specialist in the financing of start-ups. "We will always find a banker to say that it will be a success," quips this connoisseur of fundraising mechanisms.
Vegetarian, single, childless, the young American seemed at the time entirely devoted to her business. Theranos and his boss seduce many people, thus promising to make medical diagnoses faster and less expensive than those of traditional laboratories in the United States. At the height of the “Holmesmania” on the other side of the Atlantic, the company was then valued at nearly 10 billion dollars (approximately 8.5 billion euros), and Elizabeth Holmes, majority shareholder, was at the head of a virtual fortune of 3.6 billion (about 3.1 billion euros), according to Forbes magazine.
The problem is that the house of cards collapsed from 2016, following revelations in the Wall Street Journal, which questioned the reliability of its tests and led to a judicial inquiry. His business has never made any money, or hardly any. As an example, Elizabeth Holmes had claimed that her products were used by the US Department of Defense on the ground in Afghanistan and that the company would have a turnover of $ 100 million in 2014: in fact, the government has never used these products and Theranos generated in 2014 an income of ... 100,000 dollars!
Yet, still confident of her success in 2021, Elizabeth Holmes continued to plead good faith: "We were on the right track to achieve our goals" she said at the bar during her trial, while her " machine ”has never actually worked, as the investigation by the American authorities has shown.
A defense strategy that did not convince
Even more surprisingly, Elizabeth Holmes opted for a strategy deemed daring across the Atlantic, during her trial, by presenting herself as the victim of her ex-partner and director of operations, Ramesh "Sunny" Balwani - who will be tried separately. The latter was also his companion for nearly ten years. The
fallen
golden girl
said at the bar that her romantic relationship with her "lover" had been peppered with forced sex and that he was responsible "for the technical problems of his business". A testimony certainly disturbing but which does not seem to have convinced the Californian court.
"She is doomed but will eventually become a sort of star like Jérôme Kerviel, that's the irony of the story", comments yet another specialist in start-ups.
Will this scandal change anything in the culture of Silicon Valley?
Not really, judge Pierre-Yves Dargaud, director of APM, a company specializing in mergers and acquisitions: “I'm not sure that it serves as a lesson in the community.
It would surprise me that such a particular condemnation would be a warning signal for entrepreneurs who dream of making a fortune.
Justice has passed.
Not all young Elon Musks in the making are necessarily worried.
"
