Theranos founder faces up to 15 years in prison

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The lawsuit against fallen Silicon Valley star Elisabeh Holmes continues. The founder of Theranos, the startup that was to revolutionize medical testing, had already been convicted of fraud in January – but the trial continues, and we are now approaching a sentence.

The defense is offering a year and a half in prison – but last Friday the Department of Justice (DOJ) instead requested a 15-year prison sentence accompanied by restitution of $800 million. The judge will announce his final decision in a hearing by the end of the week.

Elisabeth Holmes suspended from a heavy prison sentence

The DOJ indeed justifies its decision as follows: “taking into account the extent of the fraud committed by Elisabeth Holmes […] a prison sentence of 180 days would reflect the seriousness of the offenses, would be a just retribution for the offenses, while acting as a deterrent to Elisabeth Holmes and others”.

The prosecution alleges, among other things, that the defendant lied to her investors between 2010 and 2015 by promising that the technology developed by her startup could carry out numerous analyzes with a simple droplet of blood taken with a lancet.

Elisabeth Holmes founded Theranos in 2003. The firm promised to democratize, among other things, access to biological analyses, particularly in developing countries. Theranos claimed to have developed a relatively compact system, which can perform numerous tests without requiring a qualified operator to operate.

Investors then flocked to an idea that promised, at least on paper, significant returns. But behind the scenes, Theranos never managed to develop the technology in question. The complexity of carrying out so many analyzes from so little blood proved impossible to overcome.

This did not prevent the entrepreneur from continuing to sell the dream and inflate the valuation of Theranos by attracting investments with wind… until everything came to light. A lightning fall which does not fail to illustrate for some the ambivalent side of success in Silicon Valley, in particular the aphorism “fake it till you make it” (pretend until you get there).

A way of saying that in a context of strong competition, young entrepreneurs can be encouraged to imitate a certain self-confidence, skills that they do not have and adopt a resolutely optimistic discourse to achieve their objectives. Without it necessarily succeeding every time…

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