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Bad Blood Book Summary, Review, Notes

How a $15 billion company with more than 1000 employees was actually a scam with a product that doesn’t work. This is the horrifying story of today’s Enron- Theranos- and its founder, Elizabeth Holmes.


Book Title: Bad Blood: Secrets and Lies in a Silicon Valley Startup
Author: John Carreyrou
Date of Reading: November 2018
Rating: 9/10

Table of Contents

What Is Being Said In Detail:

Bad Blood is the story of rise and fall of Elizabeth Holmes, a wannabe Steve Jobs, and all the schemes that happened at a $10 billion unicorn Theranos. 

John Carreyrou, a journalist from Wall Stre Journal, got tipped off about the major shenanigans happening at Theranos so he started to investigate. 

After the investigation, he published an article at Wall Street Journal about the problems happening at Theranos. And that article became the basis of the book Bad Blood.

Most Important Keywords, Sentences, Quotes:


“Well, there was a reason it always seemed to work, Shaunak said. The image on the computer screen showing the blood flowing through the cartridge and settling into the little wells was real. 

But you never knew whether you were going to get a result or not. So they’d recorded a result from one of the times it worked. It was that recorded result that was displayed at the end of each demo.”

Chapter One – A Purposeful Life

“But it was the accomplishments of Elizabeth’s father’s side of the family that burned brightest and captured the imagination. 

Chris Holmes made sure to school his daughter not just in the outsized success of its older generations but also in the failings of its younger ones. 

Both his father and grandfather had lived large but flawed lives, cycling through marriages and struggling with alcoholism. Chris blamed them for squandering the family fortune.” 

Chapter Two – The Gluebot

“In early August 2007, Ed accompanied Elizabeth to Nashville. Sunny picked them up from the office in his Porsche and drove them to the airport. It was the first time Ed met him in person. 

The extent of their age gap suddenly became apparent. Sunny looked to be in his early forties, nearly twenty years older than Elizabeth. 

There was also a cold, businesslike dynamic to their relationship. When they parted at the airport, Sunny didn’t say “Goodbye” or “Have a nice trip.” Instead, he barked, “Now go make some money!

”We tried everything else and it failed, so let’s call it the Edison,” she said. What some employees had taken to derisively calling the “gluebot” was suddenly the new way forward. 

And it now had a far more respectable name, inspired by the man widely considered to be America’s greatest inventor.”

“Shaunak followed Ed out the door two weeks later, albeit on friendlier terms. 

The Edison was at its core a converted glue robot and that was a pretty big step down from the lofty vision Elizabeth had originally sold him on. 

He was also unsettled by the constant staff turnover and the lawsuit hysteria. After about three and a half years, it felt like time to move on. Shaunak told Elizabeth he was thinking of going back to school and they agreed to part ways. She organized an office party to see him off.”


Chapter Three – Apple Envy

“The first couple of board meetings Avie attended had been relatively uneventful, but, by the third one, he’d begun to notice a pattern. 

Elizabeth would present increasingly rosy revenue projections based on the deals she said Theranos was negotiating with pharmaceutical companies, but the revenues wouldn’t materialize. 

It didn’t help that Henry Mosley, the chief financial officer, had been fired soon after Avie became a director.”

“Shaunak was willing to part with his 1.13 million shares for $565,000. That translated to 50 cents a share, an 82 percent discount to what he and other investors had paid more than a year earlier in Theranos’s last funding round. 

Some discount is warranted because Avie’s shares were preferred shares with higher claims on the company’s assets and earnings while Shaunak’s shares were common ones, but a discount that big was unheard of.” 

But after he filled his friend in on everything that had happened, the friend asked a question that helped him put the situation in perspective: “Given everything you now know about this company, do you really want to own more of it?”

Chapter Four – Goodbye East Paly

In early 2008, Theranos moved to a new building on Hillview Avenue in Palo Alto. It was the Silicon Valley equivalent of moving from the South Bronx to Midtown Manhattan.” 

“Matt regretted helping her with: that of Henry Mosley, the former chief financial officer. After Elizabeth fired Mosley, Matt had stumbled across inappropriate sexual material on his work laptop as he was transferring its files to a central server for safekeeping. 

When Elizabeth found out about it, she used it to claim it was the cause of Mosley’s termination and to deny him stock options. Matt had reported to Mosley until he left and thought he’d done an excellent”

“Aaron printed out the mock ad and took it with him to work the next day. When Justin and Mike spotted it on his desk, they thought it was hilarious. 

Mike decided it deserved a bigger audience and posted it on the wall in the men’s room. Then all hell broke loose. Someone took the ad down and brought it to Elizabeth, who thought it was real. 

She convened an emergency meeting of the senior managers and the lawyers. She was treating it as a full-blown case of industrial espionage and wanted an immediate investigation to find the culprit.”

“After some discussion, the four men reached a consensus: they would remove Elizabeth as CEO. She had proven herself too young and inexperienced for the job. 

Tom Brodeen would step in to lead the company for a temporary period until a more permanent replacement could be found. They called in Elizabeth to confront her with what they had learned and inform her of their decision. 

But then something extraordinary happened. Over the course of the next two hours, Elizabeth convinced them to change their minds. 

She told them she recognized there were issues with her management and promised to change. She would be more transparent and responsive going forward. It wouldn’t happen again.” 

“There was one incident involving Elizabeth herself that also didn’t sit well with Justin. During an email exchange one evening, he asked her for a piece of information he needed to write a section of software. 

She responded that she’d look for it when she was back at work the next morning. The clear implication was that she had gone home. But minutes later, he stumbled on her in Tony Nugent’s office down the hall. Justin got angry and stormed off. 

Elizabeth came by his office a little later to say she understood why he was upset, but she warned him, “Don’t ever walk off on me again.”

John Carreyrou Quote

“In one of their last email exchanges, he recommended two management self-help books to her, The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t and Beyond Bullsh*t: Straight-Talk at Work, and included their links on He quit two days later. His resignation email read in part:” 

“good luck and please do read those books, watch The Office, and believe in the people who disagree with you…Lying is a disgusting habit, and it flows through the conversations here like it’s our own currency. 

The cultural disease here is what we should be curing before we try to tackle obesity…I mean no ill will towards you, since you believe in what I was doing and hoped I would succeed at Theranos. 

I feel like I owe you this bad attempt at an exit interview since we have no HR to officially record it.” 

Chapter Five – The Childhood Neighbor 


Chapter Six – Sunny

“Commerce One acquired the startup for $232 million in cash and stock. It was a breathtaking price for a company that had just three clients testing its software and barely any revenues. 

As the company’s second-highest-ranking executive, Sunny pocketed more than $40 million. His timing was perfect. Five months later, the dot-com bubble popped and the stock market came crashing down. Commerce One eventually filed for bankruptcy.” 

“When Sunny saw the polos, he got angry. He didn’t like that he hadn’t been consulted and he argued that Seth’s gift to his team made the other managers look bad.” 

“Seth had worked at Roche, the big Swiss drugmaker, where he’d been in charge of seventy people and an annual budget of $25 million. 

He decided he wasn’t going to let Sunny lecture him about management. He pushed back and they got into a yelling match.”

Chapter Seven – Dr. J

“Hunter thought the whole thing was bizarre. Walgreens had brought him here to vet Theranos’s technology, but he hadn’t been allowed to do so. 

The only thing they had to show for their visit was an autographed flag. And yet, Dr. J and Miquelon didn’t seem to mind. As far as they were concerned, the visit had gone swimmingly.” 

“Hunter had placed calls to pharmaceutical companies and hadn’t been able to get anyone on the phone to confirm what Theranos was claiming, though that was hardly proof of anything. 

He now asked Van den Hooff to show him the Johns Hopkins review. After some hesitation, Van den Hooff reluctantly handed him a two-page document. 

When Hunter was done reading it, he almost laughed. It was a letter dated April 27, 2010, summarizing a meeting Elizabeth and Sunny had had with Dr. J and five university representatives on the Hopkins campus in Baltimore. 

It stated that they had shown the Hopkins team “proprietary data on test performance” and that Hopkins had deemed the technology “novel and sound.” But it also made clear that the university had conducted no independent verification of its own. 

In fact, the letter included a disclaimer at the bottom of the second page: “The materials provided in no way signify an endorsement by Johns Hopkins Medicine to any product or service.”

“Theranos’s parallel discussions with Walgreens. Elizabeth told him his company would be the exclusive purveyor of Theranos blood tests in supermarkets, while Walgreens would be granted exclusivity in drugstores. 

Neither company was thrilled with the arrangement, but both saw it as better than missing out on a huge new business opportunity.” 

Chapter Eight – The miniLab 

“Elizabeth needed a new device, one that could perform more than just one class of test. In November 2010, she hired a young engineer named Kent Frankovich and put him in charge of designing it. 

Kent had just obtained a master’s degree in mechanical engineering from Stanford. Before that, he’d spent two years working for NASA’s Jet Propulsion Laboratory in Pasadena where he’d helped build Curiosity, the Mars rover.” 

“Like most people, Greg had been taken aback by Elizabeth’s deep voice when he’d first met her. He soon began to suspect it was affected. 

One evening, as they wrapped up a meeting in her office shortly after he joined the company, she lapsed into a more natural sounding young woman’s voice. “I’m really glad you’re here,” she told him as she got up from her chair, her pitch several octaves higher than usual. 

In her excitement, she seemed to have momentarily forgotten to turn on the baritone.”

“The VCs were all male and he couldn’t think of any prominent female startup founder. At some point, she must have decided the deep voice was necessary to get people’s attention and be taken seriously.” 

Sunny was constantly questioning employees’ commitment to the company—the number of hours a person put in at the office, whether he or she was doing productive work or not, was his ultimate gauge of that commitment.”

“The numerous late nights they spent at the office left no time for exercise, so Christian and his friends snuck workouts in during the day. To elude Sunny’s watchful gaze, they ducked out of the building at different times using different exits. 

They were also careful never to return at the same time or together. Ted Pasco, who had left a career on Wall Street to try his luck in Silicon Valley but didn’t have any clear duties during his first few months at Theranos, amused himself by timing their exits and entries.”

John Carreyrou Quote 2

“A month or two after Jobs’s death, some of Greg’s colleagues in the engineering department began to notice that Elizabeth was borrowing behaviors and management techniques described in Walter Isaacson’s biography of the late Apple founder. 

They were all reading the book too and could pinpoint which chapter she was on based on which period of Jobs’s career she was impersonating. 

Elizabeth even gave the miniLab a Jobsinspired code name: the 4S. It was a reference to the iPhone 4S, which Apple had coincidentally unveiled the day before Jobs passed away.” 

”The miniLab is the most important thing humanity has ever built. If you don’t believe this is the case, you should leave now,” she declared, scanning her audience with a dead serious look on her face. “Everyone needs to work as hard as humanly possible to deliver it.”

“Most companies went through three cycles of prototyping before they went to market with a product. But Sunny was already placing orders for components to build one hundred miniLabs, based on a first, untested prototype. 

It was as if Boeing built one plane and, without doing a single flight test, told airline passengers, “Hop aboard.”

“At one point, he pulled Greg and an older engineer named Tom Brumett into the big glass conference room and questioned their passion. 

Greg prided himself on never losing his cool, but this time he did. He leaned menacingly over the conference table. 

His huge, muscular frame towered over Sunny. “God damn it, we are working our asses off,” he growled. Sunny backed off and apologized.”


Chapter Nine – The Wellness Play 

“By this point, some Safeway executives were getting angry. They were being denied their bonuses because the company was missing its financial targets, which had factored in the anticipated extra revenues and profits from the Theranos partnership.”

“After Burd’s departure, the communication channel to Elizabeth was lost. Anyone from Safeway who wanted to talk to Theranos had to go through Sunny or the Frat Pack. 

Sunny acted put-off whenever Safeway executives asked for status updates, as if his time was too precious to waste and they had no idea what it took to produce an innovation of this magnitude. His arrogance was infuriating. 

And yet Safeway was still hesitant to walk away from the partnership. What if the Theranos technology did turn out to be game-changing? It might spend the next decade regretting passing up on it. The fear of missing out was a powerful deterrent.”

Chapter Ten – Who Is LTC Shoemaker?


Chapter Eleven – Lighting a Fuisz 

Chapter Twelve – Ian Gibbons

“Ian fit the stereotype of the nerdy scientist to a T. He wore a beard and glasses and hiked his pants high above his waist. 

He could spend hours on end analyzing data and took copious notes documenting everything he did at work. 

This meticulousness carried over to his leisure time: he was an avid reader and kept a list of every single book he’d read. It included Marcel Proust’s seven-volume opus, Remembrance of Things Past, which he reread more than once.”

”It’s a folie à deux,” he said. Tony didn’t know any French, so he left to go look up the expression in the dictionary. The definition he found struck him as apt: “The presence of the same or similar delusional ideas in two persons closely associated with one another.”

“Ian spent the next eight days hooked up to a ventilator at Stanford Hospital. He had taken enough acetaminophen, the active ingredient in painkillers like Tylenol, to kill a horse. 

Combined with the wine he’d consumed, the drug had destroyed his liver. He was pronounced dead on May 23. As an expert chemist, Ian knew exactly what he was doing. 

Rochelle later found a signed will that he’d had witnessed by Paul Patel and another colleague a few weeks before.” 

“Tony Nugent became upset that nothing was done to honor his late colleague’s memory. He and Ian hadn’t been close. In fact, they had fought like cats and dogs at times during the Edison’s development. 

But he was bothered by the lack of empathy being shown toward someone who had contributed nearly a decade of his life to the company. It was as if working at Theranos was gradually stripping them all of their humanity

Determined to show he was still a human being with compassion for his fellow man, Tony downloaded a list of Ian’s patents from the patent office’s online database and cut and pasted them into an email. 

He embedded a photo of Ian above the list and sent the email around to the two dozen colleagues he could think of who had worked with him, making a point to copy Elizabeth. 

It wasn’t much, but it would at least give people something to remember him by, Tony thought.”

Chapter Thirteen – Chiat\Day 

“Mike Yagi tried out different slogans to go with it, eventually settling on two that Elizabeth really liked: “One tiny drop changes everything” and “The lab test, reinvented.”

“Normally, companies did research to determine the size of the audience they were marketing to and then worked out what percentage of that audience they could realistically hope to convert into customers. But such basic concepts seemed lost on Sunny.”

“Chiat\Day was charging Theranos an annual retainer of $6 million a year.”

“When she inquired about the basis for the claim about Theranos’s superior accuracy, Kate learned that it was extrapolated from a study that had concluded that 93 percent of lab mistakes were due to human error. 

Theranos argued that, since its testing process was fully automated inside its device, that was grounds enough to say that it was more accurate than other labs. 

Kate thought that was a big leap in logic and said so. After all, there were laws against misleading advertising.” 

“Kate and Mike’s main contacts at Theranos were Christian Holmes and his two Duke fraternity brothers, Dan Edlin and Jeff Blickman. Mike called them the “Therabros.”

“They shared their mounting doubts with Stan, whose own interactions with Sunny were becoming increasingly unpleasant. Every quarter, Stan was having to chase Sunny around for money. 

Sunny kept asking him to justify the bills the agency submitted. Stan spent hours going over them with him point by point. Sunny would put him on speaker and pace around his office. 

When Stan asked him to move closer to the phone so he could make out what he was saying, Sunny’s temper would flare.” 

Chapter Fourteen – Going Live 

“There was something about Sunny that he found vaguely creepy, but that impression was more than offset by Elizabeth, who came off as very earnest in her determination to transform health care. 

Like most people who met her for the first time, Alan was taken aback by her deep voice. It was unlike anything he’d heard before.” 

“Elizabeth and Sunny regarded anyone who raised a concern or an objection as a cynic and a naysayer.” 

“With time, some employees grew less afraid of him and devised ways to manage him, as it dawned on them that they were dealing with an erratic man-child of limited intellect and an even more limited attention span.” 

“How to get Sunny off his back: answer his emails with a reply longer than five hundred words.”

“Since the miniLab was in no state to be deployed, Elizabeth and Sunny decided to dust off the Edison and launch with the older device. That, in turn, led to another fateful decision—the decision to cheat.”

Chapter Fifteen – Unicorn

“The Lucas Venture Group, it said, had been “invited” to invest up to $15 million in Theranos. The discounted price Elizabeth was offering the firm valued the company at $6 billion.” 

“TechCrunch on November 2, 2013, a venture capitalist named Aileen Lee wrote about the proliferation of startups valued at $1 billion or more. She called them “unicorns.” 

Despite their moniker, these tech unicorns were no myth: by Lee’s count, there were thirty-nine of them—a number that would soon soar past one hundred.”

“The tight security measures made an impression on James and Grossman. It called to mind the lengths to which the Coca-Cola Company went to guard its secret Coke formula and suggested to them that Theranos had very valuable intellectual property to protect. 

The representations Elizabeth and Sunny made to them cemented that belief.”

“A spreadsheet with financial projections Sunny sent the hedge fund executives supported this notion. It forecast gross profits of $165 million on revenues of $261 million in 2014 and gross profits of $1.08 billion on revenues of $1.68 billion in 2015. 

Little did they know that Sunny had fabricated these numbers from whole cloth. Theranos hadn’t had a real chief financial officer since Elizabeth had fired Henry Mosley in 2006. The closest thing the company had to one was a corporate controller named Danise Yam. 

Six weeks after Sunny sent Partner Fund his projections, Yam sent very different ones to an advisory firm called Aranca for the purpose of pricing stock options for employees. 

Yam forecast a profit of $35 million in 2014 and of $100 million in 2015 ($130 million and $980 million less, respectively, than what Sunny projected to Partner Fund). 

The gap in revenues was even bigger: she predicted revenues of $50 million in 2014 and of $134 million in 2015 ($211 million and $1.55 billion less than the projections given to Partner Fund). As it would turn out, even Yam’s numbers were wildly optimistic.”

“Not to mention the fact that this board had a special adviser named David Boies who attended all of its meetings. With one of the country’s top lawyers keeping watch, what could possibly go wrong? 

On February 4, 2014, Partner Fund purchased 5,655,294 Theranos shares at a price of $17 a share—$2 a share more than the Lucas Venture Group had paid just four months earlier. 

The investment brought in another $96 million to Theranos’s coffers and valued it at a stunning $9 billion. 

This meant that Elizabeth, who owned slightly more than half of the company, now had a net worth of almost $5 billion.”

Chapter Sixteen – The Grandson 

“Tyler and several colleagues tested 247 blood samples on Edisons, 66 of which were known to be positive for the disease. 

During the first run, the devices correctly detected only 65 percent of the positive samples. During the second run, they correctly detected 80 percent of them. 

Yet, in its validation report, Theranos stated that its syphilis test had a sensitivity of 95 percent.” 

“At his grandfather’s urging, Tyler played the song he’d hastily composed. He tried not to cringe as he sang its cheesy lyrics, which borrowed from Theranos’s “one tiny drop changes everything” slogan. 

To his horror, he had to play it again a little while later because Henry Kissinger arrived late and everybody thought that he too should hear it. When Tyler was finished, Kissinger, who like George Shultz was in his early nineties, recited a limerick he’d written for the birthday girl. 

The scene had a surreal quality to it: they were all sitting in a circle in the Shultzes’ living room and Elizabeth was in the middle, reveling in the attention. It was as though she were the queen and they were her court, kissing her ring. 

As awkward as the evening was, it made Tyler feel like he was on friendly enough terms with Elizabeth to speak to her candidly about his concerns. Shortly after the party, he sent her an email asking if they could meet.” 

“I am sorry if this email sounds attacking in any way, I do not intend it to be, I just feel a responsibility to you to tell you what I see so we can work towards solutions. 

I am invested in this company’s long-term vision, and am worried that some of our current practices will prevent us from reaching our bigger goals.” 

“And it was withering. In a point-by point rebuttal that was longer than Tyler’s original email, Sunny belittled everything from his grasp of statistics to his knowledge of laboratory science.”

“Tyler decided it was time to resign. He replied to Sunny with a one-sentence email giving his two weeks’ notice and offering to leave earlier if he wished him to. 

A few hours later, Mona, the head of HR, summoned him to her office and informed him that the company had decided he should leave that day.”

“They agreed to meet again for dinner that evening at his grandfather’s house. As they parted, George told Tyler, “They’re trying to convince me that you’re stupid. 

They can’t convince me that you’re stupid. They can, however, convince me that you’re wrong and in this case I do believe that you’re wrong.”

“George, on the other hand, was unmoved. Tyler had noticed how much he doted on Elizabeth. His relationship with her seemed closer than their own. 

Tyler also knew that his grandfather was passionate about science. Scientific progress would make the world a better place and save it from such perils as pandemics and climate change, he often told his grandson. 

This passion seemed to make him unable to let go of the promise of Theranos.” 

“A top surgeon in New York had told him the company was going to revolutionize the field of surgery and this was someone his good friend Henry Kissinger considered to be the smartest man alive.”

Chapter Seventeen – Fame

It was like writing about Apple or Google in their early days before they became Silicon Valley icons and entered the collective consciousness. 

“Roger, this is the greatest company you’ve never heard of,” she said. “Think of it as an old-school Fortune cover.”

“After getting over his initial shock at her deep voice, he found her smart and engaging. 

When they broached topics other than blood testing, she was unassuming, almost naïve. But when their conversations shifted to Theranos, she became steely and intense.” 

“Theranos had raised more than $400 million from investors at a valuation of $9 billion, making it one of the most valuable startups in Silicon Valley.” 

“He talked to Shultz, Perry, Kissinger, Nunn, Mattis, and to two new directors: Richard Kovacevich, the former CEO of the giant bank Wells Fargo, and former Senate majority leader Bill Frist. 

Before going into politics, Frist had been a heart and lung transplant surgeon. All of them vouched for Elizabeth emphatically. Shultz and Mattis were particularly effusive.” 

“Especially when that cover featured an attractive young woman wearing a black turtleneck, dark mascara around her piercing blue eyes, and bright red lipstick next to the catchy headline “THIS CEO IS OUT FOR BLOOD.”

“More fawning stories followed in USA Today, Inc., Fast Company, and Glamour, along with segments on NPR, Fox Business, CNBC, CNN, and CBS News. With the explosion of media coverage came invitations to numerous conferences and a cascade of accolades. 

Elizabeth became the youngest person to win the Horatio Alger Award. Time magazine named her one of the one hundred most influential people in the world. 

President Obama appointed her a U.S. ambassador for global entrepreneurship, and Harvard Medical School invited her to join its prestigious board of fellows.” 

“The image of the reclusive, ascetic young woman Parloff had been sold on had overnight given way to that of the ubiquitous celebrity.”

“He had helped her prepare for the conference and before that had worked with Fortune’s photographer on the magazine’s cover shoot. To Patrick, making Elizabeth the face of Theranos made perfect sense. 

She was the company’s most powerful marketing tool. Her story was intoxicating. Everyone wanted to believe in it, including the numerous young girls who were sending her letters and emails. 

It wasn’t a cynical calculus on his part: Patrick was one of her biggest believers. He had no knowledge of the shenanigans in the lab and didn’t pretend to understand the science of blood testing. 

As far as he was concerned, the fairy tale was real.”

Chapter Eighteen – The Hippocratic Oath

“He’d gone a step further two days earlier and called a law firm in Washington, D.C., that specialized in representing corporate whistleblowers, but the person who answered the phone was a “client services specialist.”

“Before Alan had time to finish reading, he heard Sunny say in an icy tone, “We know you sent yourself a bunch of work emails. 

You have to let Mona access your Gmail account so that she can go through them and delete them.” Alan refused. He told Sunny the company had no right to invade his privacy and he wouldn’t sign any more documents.”

“That evening, Alan glumly sat down at his computer in his apartment in Santa Clara and logged into his Gmail account. One by one, he erased the emails. By the time he was done, he’d counted 175 of them.” 

Chapter Nineteen – The Tip 

“It was the second Monday in February and I was sitting at my messy desk in the Wall Street Journal’s Midtown Manhattan newsroom casting about for a new story to sink my teeth into.” 

“There was a firewall between the Journal’s editorial and newsroom staffs. If it turned out that I found some skeletons in Holmes’s closet, it wouldn’t be the first time the two sides of the paper had contradicted each other.”

“Beginning to make sense: Holmes and her company had overpromised and then cut corners when they couldn’t deliver.

“One former high-ranking lab employee did agree to talk to me but only off the record. 

This was an important journalistic distinction: Alan and the other two former employees had agreed to speak to me on deep background, which meant I could use what they told me while keeping their identities confidential. 

Off the record meant I couldn’t make any use of the information. The conversation was nonetheless helpful because this source confirmed a lot of what Alan had told me, giving me the confidence to forge on. 

He summed up what was going on at the company with an analogy: “The way Theranos is operating is like trying to build a bus while you’re driving the bus. Someone is going to get killed.”

“I wasn’t entirely surprised. Alan Beam had explained to me that, of the more than 240 tests Theranos offered on its menu, only about 80 were performed on small finger-stick samples (a dozen on the Edison and another 60 or 70 on the hacked Siemens machines).”

“I got back to New York. At the Journal, we had a cardinal rule called “No surprises.” 

We never went to press with a story without informing the story subject of every single piece of information we had gathered in our reporting and giving them ample time and opportunity to address and rebut everything.” 

“As I scanned my results, I noticed a number of discrepancies.”

“Theranos had flagged three of my values as abnormally high and one as abnormally low. 

Yet on LabCorp’s report, all four of those values showed up as normal. Meanwhile, LabCorp had flagged both my total cholesterol and LDL cholesterol (otherwise known as bad cholesterol) as high, while the Theranos report described the first as “desirable” and the second as “near optimal.”

“Tyler and Erika were both very young and had been junior employees at Theranos, but I found them credible as sources because so much of what they told me corroborated what Alan Beam had said. 

I was also impressed by their sense of ethics. They felt strongly that what they had witnessed was wrong and were willing to take the risk of speaking to me to right that wrong.”

Chapter Twenty – The Ambush

”Have you been speaking to an investigative journalist about Theranos?” his father asked accusingly. “Yes,” Tyler responded. “Are you kidding me? How stupid could you be? Well, they know.”

“It had been three weeks since we had met at the beer garden in Mountain View. Back in New York, Matthew Traub had continued putting off my requests for an interview with Holmes and had asked me to send him questions instead. 

I had sent him an email outlining seven main areas I wanted to discuss with Theranos, ranging from Ian Gibbons to proficiency testing.”

“Tyler felt blindsided and betrayed. He had specifically asked that they meet without lawyers. But if he tried to duck out now, it would reinforce everyone’s suspicion that he had something to hide, so he heard himself say, “Sure.” 

While George went upstairs, Charlotte told Tyler she was beginning to wonder whether the Theranos “box” was real. “Henry is too,” she said, referring to Henry Kissinger, “and he’s been saying he wants out.”

”Tyler isn’t a snitch. Finding out who spoke to the Wall Street Journal is Theranos’s problem, not his,” George said. 

Brille ignored the former secretary of state and continued pressing Tyler to sign the document and to name the newspaper’s sources. 

Look at things from his perspective, he pleaded: in order to do his job, he needed to get that information from him. But Tyler wouldn’t budge.” 

“George grabbed a pencil and scrawled a line on the affidavit to the effect that Theranos pledged not to sue Tyler Shultz for two years. Tyler wondered for a split second if his grandfather thought he was an idiot. 

“That doesn’t work for me,” he said. “It needs to say they won’t ever sue me.” “I’m just trying to come up with something Theranos will agree to,” George protested.”

“Tyler tried to be conciliatory in an effort to reach an agreement, acknowledging in the new versions of the document that he had talked to the Journal. 

Theranos gave him the option of saying that he was young and naïve and that the reporter had deceived him, but he declined.

“Tyler also received a tip that he was being surveilled by private investigators. His lawyer tried to make light of it. “It’s not a huge deal,” he said. 

“Just don’t go anywhere you’re not supposed to be and remember to smile and wave to the man in the bushes outside your house when you leave for work.”

“This led to an incident that rattled both Tyler and his parents. Hours after his parents’ new lawyer met with them for the first time, her car was broken into and a briefcase containing her notes from the meeting was stolen. 

Although it could have been a random act of theft, Tyler couldn’t shake his suspicion that Theranos had something to do with it.” 

“I called him back and told him the Theranos representative—and the phalanx of attorneys I suspected would accompany him—needed to come to me. A meeting was scheduled for 1:00 p.m. on Tuesday, June 23, at 1211 Avenue of the Americas, home to the Wall Street Journal.”

Chapter Twenty One – Trade Secrets

”We do not consent to waiving our journalistic privileges,” I snapped back.” 

“We turned to my questions about the Edison. How many blood tests did Theranos perform on the device? 

That too was a trade secret, they said. I felt like I was watching a live performance of the Theater of the Absurd. Did Theranos really have any new technology? I asked provocatively”

“One of his answers struck me as odd. When I brought up the Hematology Reports study Holmes had coauthored, Young immediately dismissed it as outdated. 

It had been conducted with older Theranos technology and its data were ancient, dating back to 2008, he said. Why then had Holmes cited it to The New Yorker? I wondered. 

It seemed Theranos was now distancing itself from it, probably because it was conscious of its flimsiness.” 

Chapter Twenty Two – La Mattanza 

“Politically connected as Theranos. At first, I thought he was referring to its board of directors, but that was the least of his concerns. He pointed out how chummy Holmes had gotten with the Obama administration. 

He had seen her at the launch of the president’s precision medicine initiative earlier in the year, one of several White House appearances she’d made in recent months. 

The latest had been a state dinner in honor of Japan’s prime minister, where she was photographed in a body-hugging black gown on the arm of her brother.” 

“Balwani had tasked a Theranos software engineer named Michael Craig to write an application for the miniLab’s software that masked test malfunctions. 

When something went wrong inside the machine, the app kicked in and prevented an error message from appearing on the digital display. Instead, the screen showed the test’s progress slowing to a crawl.”

“Holmes had invited Vice President Joe Biden to come visit Theranos’s Newark facility, which was now home to both Theranos’s clinical laboratory and its miniLab manufacturing operations.” 

“Balwani had terrorized its members after a scathing critique of Theranos appeared on Glassdoor, the website where current and former employees reviewed companies anonymously. 

Titled “A pile of PR lies,” it read in part: Super high turnover rate means you’re never bored at work. Also good if you’re an introvert because each shift is short-staffed. 

Especially if you’re swing or graveyard. You essentially don’t exist to the company. Why be bothered with lab coats and safety goggles? You don’t need to use PPE at all. Who cares if you catch something like HIV or Syphilis? 

This company sure doesn’t! Brown nosing, or having a brown nose, will get you far. How to make money at Theranos: 1.Lie to venture capitalists 2.Lie to doctors, patients, FDA, CDC, government. While also committing highly unethical and immoral (and possibly illegal) acts.”

“During the roundtable discussion, Biden called what he had just seen “the laboratory of the future.” He also praised Holmes for proactively cooperating with the FDA. 

“I know the FDA recently completed favorable reviews of your innovative device,” he said. “The fact that you’re voluntarily submitting all of your tests to the FDA demonstrates your confidence in what you’re doing.”

Chapter Twenty Three – Damage Control 

“Unbeknownst to me, the lead investor was Rupert Murdoch, the Australian-born media mogul who controlled the Journal’s parent company, News Corporation. 

Of the more than $430 million Theranos had raised in this last round, $125 million had come from Murdoch. That made him the company’s biggest investor.” 

“The investment packet she sent forecast $330 million in profits on revenues of $1 billion in 2015 and $505 million in profits on revenues of $2 billion in 2016. Those numbers made what was now a $10 billion valuation seem cheap.” 

“Chairman, Jim Kennedy, he was friendly with, and the Waltons of Walmart fame. Other big-name investors he didn’t know about ranged from Bob Kraft, owner of the New England Patriots, to Mexican billionaire Carlos Slim and John Elkann, the Italian industrialist who controlled Fiat Chrysler Automobiles.”

“Still, other on-the-record sources such as Dr. Gary Betz, the nurse Carmen Washington, and Maureen Glunz, the patient who had spent hours in the emergency room on the eve of Thanksgiving, remained impervious to the company’s intimidation tactics. 

And Alan Beam and Erika Cheung continued to cooperate with the story as confidential sources, as did several other former employees.”

“Many of our tests require only a few drops of blood” had been deleted. When I asked why, King inadvertently blurted out that she assumed it was for “marketing accuracy.” (Later, she would insist she never pronounced those words.)”

“Weeks but that he was willing to push back publication by a few more days to give Holmes one last opportunity to talk to me. He gave her until early the following week to pick up the phone and call me. She never did.” 

“On the Journal’s front page on Thursday, October 15, 2015. THE STORY WAS PUBLISHED”

“Silicon Valley innovator who was being smeared by entrenched interests trying to thwart progress. “This is what happens when you work to change things,” she said. “First they think you’re crazy, then they fight you, and then all of a sudden you change the world.”

“I now knew why: toward the end of her interview with Cramer, Holmes dropped mention of the nanotainer withdrawal and spun it as a voluntary decision. 

She was trying to get ahead of my scoop. We quickly published my follow-up piece online. Setting the record straight, it revealed that the FDA had forced the company to stop testing blood drawn from patients’ fingers and declared its nanotainer an “unapproved medical device.” 

The story made the front page of the paper’s print edition the next morning, providing more fuel to what was now a full-blown scandal.”


“Theranos had issued a second press release that morning that amounted to what we in the news business call a “non denial denial.” 

“We are disappointed to see that The Wall Street Journal still can’t get its facts straight,” it began, before going on to admit that the company had “temporarily” withdrawn its little blood tubes in what it portrayed as a proactive move to seek FDA clearance for their use.”

“When she opened the floor to questions, Patrick O’Neill, the former advertising industry executive who had helped craft her trailblazing image, was one of the first to raise his hand. 

“Do we really want to take on the Wall Street Journal?” he asked, incredulous. “Not the Journal, the journalist,” Holmes replied.”

“What we hadn’t fully anticipated was her willingness to tell bald-face lies in a public forum. Not just once, but again and again during the half-hour interview. 

In addition to continuing to insist that the nanotainer withdrawal had been voluntary, she said the Edison devices referred to in my stories were an old technology that Theranos hadn’t used in years.”

“One of them was a well-known former Apple executive named JeanLouis Gassée. 

A few days earlier, Gassée had published an item on his blog describing sharply discordant blood-test results he had received from Theranos and Stanford Hospital over the summer. 

Gassée had written Holmes to inquire about the discrepancies but had never received a response.”

“Soon after the interview ended, Theranos posted a long document on its website that purported to rebut my reporting point by point. 

Mike and I went over it with the standards editors and the lawyers and concluded that it contained nothing that undermined what we had published. It was another smokescreen. 

The paper put out a statement to say that it stood by my stories.” 

“George Shultz, Henry Kissinger, Sam Nunn, and the other aging ex-statesmen all left to join a new ceremonial body called a board of counselors. In their place, Theranos made a new director appointment that signaled an escalation of hostilities: David Boies.”

“But if Theranos thought this saber-rattling would make us stand down, it was mistaken. Over the next three weeks, we published four more articles. 

They revealed that Walgreens had halted a planned nationwide expansion of Theranos wellness centers, that Theranos had tried to sell more shares at a higher valuation days before my first story was published, that its lab was operating without a real director, and that Safeway had walked away from their previously undisclosed partnership over concerns about its testing. 

With each new story came a new retraction demand from Heather King.”

”Until what happened in the last four weeks, I didn’t understand what it means to be a woman in this space,” she told the magazine. “Every article starting with, ‘A young woman.’ Right? 

Someone came up to me the other day, and they were like, ‘I have never read an article about Mark Zuckerberg that starts with ‘A young man.’”

Chapter Twenty Four – The Empress Has No Clothes 

“The email was from Erika Cheung and it contained a series of allegations, ranging from scientific misconduct to sloppy lab practices. 

It also said that Theranos’s proprietary devices were unreliable, that the company cheated on proficiency testing, and that it had misled the state inspector who surveyed its lab in late 2013. 

Erika closed the email by saying that she’d resigned from the company because she couldn’t live with herself knowing that she could “potentially devastate someones life by giving them a false and deceiving result.”

“As the tug-of-war with Heather King over the inspection report dragged on, news surfaced that Holmes would be hosting a fund-raiser for Hillary Clinton’s presidential campaign at Theranos’s headquarters in Palo Alto. 

She had long cultivated a relationship with the Clintons, appearing at several Clinton Foundation events and forging a friendship with their daughter. 

The fund-raiser was later relocated to the home of a tech entrepreneur in San Francisco, but a photo from the event showed Holmes holding a microphone and speaking to the assembled guests with Chelsea Clinton at her side.”

“More important, the inspection report showed, citing the lab’s own data, that the Edisons produced wildly erratic results. During one month, they had failed quality-control checks nearly a third of the time. 

One of the blood tests run on the Edisons, a test to measure a hormone that affects testosterone levels, had failed quality control an astounding 87 percent of the time. 

Another test, to help detect prostate cancer, had failed 22 percent of its quality-control checks. In comparison runs using the same blood samples, the Edisons had produced results that differed from those of conventional machines by as much as 146 percent. 

And just as Tyler Shultzhad contended, the devices couldn’t reproduce their own results. An Edison test to measure vitamin B12 had a coefficient of variation that ranged from 34 to 48 percent, far exceeding the 2 or 3 percent common for the test at most labs” 

“The coup de grâce came a few days later when we obtained a new letter CMS had sent to Theranos. 

It said the company had failed to correct forty-three of the forty-five deficiencies the inspectors had cited it for and threatened to ban Holmes from the blood testing business for two years. 

As with the inspection report, Theranos was desperately trying to keep the letter from becoming public, but a new source had contacted me out of the blue and leaked it to me” 

“She had to come out and say something, so she gave an interview to Maria Shriver on NBC’s Today show in which she professed to be “devastated.” 

But not enough, it seemed, to apologize to the patients she had put in harm’s way. Watching her, I got the distinct impression that her display of contrition was an act. I still didn’t sense any real remorse or empathy.”

“If not for his courage and the more than $400,000 his parents had spent on his attorneys, I might never have been able to get my first article published, I realized. I felt pangs of guilt for having put him through such an ordeal.” 

“Not long afterward, Theranos contacted Tyler’s lawyers and told them it knew about our meeting. Since neither of us had told a soul about it, we deduced that Holmes was having one or both of us followed. 

Fortunately, Tyler didn’t seem too worried about it. “Next time maybe I’ll take a selfie with you and send it her way to save her the trouble of hiring PIs,” he quipped in an email” 

“Maria Shriver on the Today show that she took responsibility for the HOLMES HAD TOLD Newark lab’s failings, but it was Balwani who suffered the consequences. 

Rather than take the fall herself, she sacrificed her boyfriend. She broke up with him and fired him. In a press release, Theranos dressed up his departure as a voluntary retirement.” 

“In Chicago, executives at Walgreens were astonished to learn of the scale of the test voidings. 

The pharmacy chain had been trying to get answers from Theranos about the impact on its customers for months. On June 12, 2016, it terminated the companies’ partnership and shut down all the wellness centers located in its stores.” 

“The odds that Holmes could pull off this latest Houdini act while under criminal investigation were very long, but watching her confidently walk the audience through her sleek slide show helped crystallize for me how she’d gotten this far: she was an amazing saleswoman.

 She never once stumbled or lost her train of thought. She wielded both engineering and laboratory lingo effortlessly and she showed seemingly heartfelt emotion when she spoke of sparing babies in the NICU from blood transfusions. 

Like her idol Steve Jobs, she emitted a reality distortion field that forced people to momentarily suspend disbelief.”

“Partner Fund, the San Francisco hedge fund that had invested close to $100 million in the company in early 2014, sued Holmes, Balwani, and the company in Delaware’s Court of Chancery, alleging that they had deceived it with “a series of lies, material misstatements, and omissions.” 

Another set of investors led by the retired banker Robert Colman filed a separate lawsuit in federal court in San Francisco. It also alleged securities fraud and sought class-action status” 

“Most of the other investors opted against litigation, settling instead for a grant of extra shares in exchange for a promise not to sue. One notable exception was Rupert Murdoch. 

The media mogul sold his stock back to Theranos for one dollar so he could claim a big tax write-off on his other earnings. With a fortune estimated at $12 billion, Murdoch could afford to lose more than $100 million on a bad investment”

“Walgreens, which had sunk a total of $140 million into Theranos, filed its own lawsuit against the company, accusing it of failing to meet the “most basic quality standards and legal requirements” of the companies’ contract. 

“The fundamental premise of the parties’ contract—like any endeavor involving human health—was to help people, and not to harm them,” the drugstore chain wrote in its complaint.”

“The number of test results Theranos voided or corrected in California and Arizona eventually reached nearly 1 million. The harm done to patients from all those faulty tests is hard to determine. 

Ten patients have filed lawsuits alleging consumer fraud and medical battery. One of them alleges that Theranos’s blood tests failed to detect his heart disease, leading him to suffer a preventable heart attack. 

The suits have been consolidated into a putative class action in federal court in Arizona. Whether the plaintiffs are able to prove injury in court remains to be seen” 


”Data is a powerful thing because it speaks for itself,” she said on October 26, 2015, at a conference hosted by the Cleveland Clinic. 

Two years and three months later, she finally delivered on that pledge: in January 2018, Theranos published a paper about the miniLab in the peer-reviewed scientific journal Bioengineering and Translational Medicine.” 

“A close read revealed other significant shortcomings. For one thing, the paper included data for only a few blood tests. 

And results for two of those tests, HDL cholesterol and LDL cholesterol, diverged from the FDA-approved machines by a margin that Theranos itself acknowledged “exceeds recommended limits.” 

The company also conceded that it had run the assays one at a time, belying Holmes’s previous claim that her technology could do dozens of tests simultaneously on one tiny blood sample. 

Last but not least, the tests performed had required different configurations of the miniLab because Theranos hadn’t yet figured out how to fit all the components into one box. 

All of this was a far cry from the revolutionary breakthrough Holmes had touted when Theranos launched its tests in Walgreens stores in the fall of 2013.” 

“Seven weeks later, Theranos settled the case for $43 million on the eve of Balwani’s own deposition. (Soon after, it settled the Walgreens lawsuit for more than $25 million.)” 

“By late 2017, Theranos was running on fumes, having burned through most of the $900 million it raised from investors, much of it on legal expenses. 

Several rounds of layoffs had reduced the size of its workforce to fewer than 130 employees from a high of 800 in 2015. To save on rent, the company had moved all its remaining staff to the Newark facility across San Francisco Bay. 

The specter of a bankruptcy filing loomed. But a few days before Christmas, Holmes announced that she had secured a $100 million loan from a private-equity firm. 

The financial lifeline came with strict conditions: the loan was collateralized by Theranos’s patent portfolio and the company would have to meet certain product and operational milestones to get the money.”

“On March 14, 2018, the Securities and Exchange Commission charged Theranos, Holmes, and Balwani with conducting “an elaborate, years-long fraud.”

“Relinquish her voting control over the company, give back a big chunk of her stock, and pay a $500,000 penalty. She also agreed to be barred from being an officer or director in a public company for ten years.” 

“As of this writing, criminal indictments of both Holmes and Balwani on charges of lying to investors and federal officials seem a distinct possibility.” 

“They were the kind with dark blue dome covers that kept you guessing about which way the lens was directed. 

All of this was ostensible to protect trade secrets, but it’s now clear that it was also a way for Holmes to cover up her lies about the state of Theranos’s technology.” 

“If anything, it was Holmes who was the manipulator. One after another, she wrapped people around her finger and persuaded them to do her bidding. 

The first to fall under her spell was Channing Robertson, the Stanford engineering professor whose reputation helped give her credibility when she was just a teenager. 

Then there was Donald L. Lucas, the aging venture capitalist whose backing and connections enabled her to keep raising money. 

Dr. J and Wade Miquelon at Walgreens and Safeway CEO Steve Burd were next, followed by James Mattis, George Shultz, and Henry Kissinger (Mattis’s entanglement with Theranos proved no obstacle to his being confirmed as President Donald Trump’s secretary of defense). 

David Boies and Rupert Murdoch complete the list, though I’ve left out many others who were bewitched by Holmes’s mixture of charm, intelligence, and charisma.”

Book Review (Personal Opinion):

This is a phenomenal book about one of the biggest lies in Silicion Valley. 

It’s mind-blowing to see just how many high-profile people were involved into this without realizing that the product was non-existant. 

This book is great for anyone who dreams of changing the world (including me)– sometimes, we need to stop and think about what we’re doing in the process. I highly recommend this book.

Rating: 9/10

This Book Is For (Recommend):

  • A dreamer with an audacious goal who is willing to do everything to succeed
  • A young professional not considering the consequences of cutting corners
  • Anyone struggling to keep their emotions in check after comparing themselves to other people

If You Want To Learn More

Here’s John Carreyrou explaining his investigative process for the book.
Politics and Prose

How I’ve Implemented The Ideas From The Book

Having the belief that something will work is good. But using that to make delusions about reality is really bad. After reading this book, I’ve made an analysis to see if my passion for a project, goal, dream, or direction in life is healthy or not. And that led me to many surprises…

One Small Actionable Step You Can Do

Write down a list of things you’re passionate about and that you’re doing at this moment. Ask a close friend to give you feedback on your actions to see if you’re on the right path or if you’ve gone overboard into dangerous territory when it comes to your passion (project).

Bad Blood by John Carreyrou Book Summary Infographic