FAKE IT TILL YOU MAKE IT

HolmesAnyone who can recall my satirical series, ‘Exposure’, back when YT allowed such filth – or indeed has viewed it recently since its resurrection on my Patreon site – might remember I once referred to California’s Silicon Valley in it as Sillycunt Valley; an obvious gag, perhaps, but one that retains its unhealthy relevance as big tech’s epicentre continues to dictate public discourse via its stranglehold on internet content and its permanent sleepovers at the homes of world leaders. Indeed, just this week, the overconfident conviction that the wool can be pulled over the eyes of investors and consumers alike – an attitude that has fuelled the rise of self-made billionaires whose belief that the charisma of its sales-person is enough to secure success – has had its flaws exposed in a Court of Law, highlighting how the arrogant Silicon Valley approach to business isn’t that dissimilar to the gambles taken by 19th century industrialists who could talk the talk and risk other people’s fortunes in the pursuit of financial gain.

As has often been suggested, 37-year-old Elizabeth Holmes sold herself as a female Steve Jobs, even going so far as to adopt the famous black turtleneck sweaters her inspiration had trademarked. On the ‘TED Talk’ circuit, Holmes was a star of the early 2010s, a photogenic and charismatic communicator who convinced the powerful and the wealthy – including the likes of Rupert Murdoch and Henry Kissinger – that her company Theranos was the quick and easy way forward in the testing of health conditions, one that crucially didn’t require injections. Holmes claimed she had developed a means of testing that involved a simple pinprick; a mere drop of blood would be sufficient when it came to such a process. It sounded radical and revolutionary, and one would perhaps have expected its inventor to have at least a degree of medical training to have come up with this groundbreaking innovation.

In actual fact, the nearest Elizabeth Holmes had come to any kind of medical training was her separate stints working as a lab assistant at Stanford University’s School of Engineering and then at the Genome Institute of Singapore; she even dropped out of university in order to pursue her lifelong goal of emulating her great-great-great grandfather Charles Louis Fleischmann, co-founder of Fleischmann’s Yeast, a product that proved to be a great leap forward in the bread-making process during the late 19th century. As early as the age of nine, she professed to her father – perhaps tellingly, vice-president of doomed energy giant Enron – that what she really wanted from life was ‘to discover something new, something that mankind didn’t know was possible to do’. An admirable ambition in one so young, true; but many of us harbour such ambitions at so young an age; I know I myself as a nine-year-old would also read about great inventors whilst racking my brains trying to think of something nobody had ever thought of before – even though it often seemed to me that everything had actually been thought of after all.

Then again, I didn’t progress to an environment in which naive childhood ambitions were encouraged and extended into adulthood, where the mere idea was considered enough and the actual talent for achieving the goal was something that wasn’t necessarily top priority. In a way, this ‘believe the hype’ philosophy isn’t that different from the route pop music has taken over the past 20-25 years, whereby genuine talent and having something to say have been downgraded to secondary factors; as long as you can convince the public you’re a major talent, the talent itself will somehow magically materialise once success has occurred through sheer self-promotion. It’s a contemporary curse that cuts across many creative fields this century, but Silicon Valley in particular seems to prioritise it; and Elizabeth Holmes was first a beneficiary and then a casualty of this mindset.

Holmes founded her company in 2003, despite being told on several occasions by those more medically qualified than her that her idea of reaping ‘vast amounts of data from a few droplets of blood derived from the tip of a finger’ was impossible. Undeterred and driven by an unshakable faith in her destiny to be recognised as one of the 21st century’s visionaries, Holmes had managed to raise an impressive $6 million in funding within a year of founding Theranos. Her ability to communicate her self-confidence to potential investors was evident early on, and the lure of dollar signs enabled Holmes to recruit prominent US politicians to the Theranos board of directors – making both her and the company one of corporate America’s rising stars. By 2014, after barely a decade in existence, Theranos was valued at $9 billion. The hype, it seemed, could be believed.

However, in 2015 Wall Street Journal reporter John Carreyrou began digging into this too-good-to-be-true success story. He received testimonies from whistleblowers and acquired company documents that supported the suspicions surrounding the inaccuracies of the blood-testing device promoted by Theranos. The world’s ‘youngest self-made female billionaire’ (according to Forbes magazine) was not impressed when she discovered the investigation and even went so far as to approach Wall Street Journal owner (and Theranos investor) Rupert Murdoch to prevent the story’s publication. She didn’t succeed and the veritable bombshell of a story hit the newsstands in 2015. It was unsurprisingly publicly denounced by Holmes, but in the months that followed several prominent agencies Theranos was dependent upon in order to carry on trading began to circle the company. A series of lawsuits culminated in the US Securities and Exchange Commission charging Holmes and the company’s former president Ramesh Balwani with fraud; although this suit was settled out of court, it wasn’t the end of the story.

Following a two-year investigation into Theranos by the US Attorney’s Office for the Northern District of California, in June 2018 Holmes and Balwani were indicted by a federal grand jury on nine counts of wire fraud and two counts of conspiracy to commit wire fraud. The trial ended this week with Holmes found guilty on four charges; she was acquitted on three, but of the four she was found guilty of, three were of wire fraud against investors and one was of conspiracy to defraud investors. The defence’s gamble of putting Holmes on the stand, perhaps hoping her proven skill for convincing investors to part with their dollars could work similar wonders on a jury, appeared to have backfired if the verdict is anything to go by; and although sentencing has yet to take place, that verdict suggest a prison sentence is what the world’s youngest self-made female billionaire has to look forward to next. And the charges carry a sentence of 20 years.

The Silicon Valley business model has always been built upon the ability of a company’s founder to sell an idea in a manner reminiscent of Augustus Melmotte, the memorably dodgy financier who expertly cons aristocrats with more money than sense in Anthony Trollope’s 1875 novel, ‘The Way We Live Now’. The swift rise and dramatic fall of Elizabeth Holmes has been the first notable dint in a business model that has flourished unchecked for at least two decades; the New York Times has referred to the case as coming to ‘symbolise the pitfalls of Silicon Valley’s culture of hustle, hype and greed’. If an idea such as the one Elizabeth Holmes promoted succeeds, a fraudster is reborn as a visionary; but her story has shown the reverse applies if a little scratching below the surface reveals little in the way of substance. At the same time, it shouldn’t come as a surprise to find such a sprawling beast of an institution is as prone to corruption as all the rest; it’s just worrying that this particular institution continues to have such an immense sway over all our lives.

© The Editor

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