Theranos Founder Holmes Begins 11-Year Prison Term for $9bn Pseudostartup.
Today, Elizabeth Holmes, the founder of the pseudo-startup Theranos, who was convicted of fraud for 11 years, will begin serving her sentence in the Bryan prison camp. This is a minimum-security prison, exclusively for women, located approximately 100 miles from Houston. According to The Wall Street Journal, the inmates in the federal camp in Texas are eagerly awaiting the arrival of Elizabeth Holmes. Currently, there are about 655 inmates there, which constitutes approximately 90% of its capacity.
The majority of inmates here have been convicted of white-collar crimes, minor drug-related crimes, and for harboring illegal immigrants, reports WSJ, citing the Federal Bureau of Prisons (BOP) and current and former inmates.
The Theranos founder is expected to report to the prison by 2:00 PM on May 30.
Elizabeth Holmes, the founder of the $9 billion pseudo-startup, was sentenced last year to 11 years in prison with a pregnancy deferral. She is required to compensate investors for losses amounting to $121 million.
Recall, in 2004, Elizabeth Holmes filed a patent for a miniature "cuff": it simultaneously diagnosed the patient's blood and introduced the necessary medication. After that, Holmes gathered the first venture $6 million, using family connections and acquaintances, and founded the startup.
When it turned out that the "cuff" was technologically impossible to realize, Holmes made a "pivot"—a common move for a tech startup, changing the concept of the product: now she planned to release a stationary portable blood analyzer. Even in this form, her product could revolutionize the market. Holmes sincerely believed in her mission "to change the world" - which is why when the new concept faced insurmountable technological obstacles, she managed to effectively lie to investors, employees, and the press.
Over 10 years, on personal charisma and readiness to lie to investors, she built the Theranos company, which was valued at $9 billion.
Her fraud was exposed by The Wall Street Journal reporter John Carreyrou - it turned out that the technology Holmes claimed did not work, Theranos secretly conducted blood tests on other companies' equipment, and their results were distorted.
In 2018, Theranos was liquidated, and in March 2019, the HBO channel released the documentary film about Elizabeth Holmes "The Inventor: Out for Blood in Silicon Valley".
Inmates have already read and are discussing "Bad Blood" based on the Theranos startup story. The Wall Street Journal writes.