Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou
Alright, so there’s a lot to talk about with this one. I’ve so far started three different versions of this post, each based on a different lesson. That’s a good thing! There’s plenty in Carreyrou’s book, and more broadly the Theranos story, that provides great fodder for any leader’s learning and reflection. But, if you’ve read my work in the past or found my thoughts on vision, you know I’m likely to grab hold of that lesson above the others–so today, we’re talking about vision and how it does not give you license to simply ignore everything else. Maybe this sounds simple, straightforward. But as someone who’s fallen into this trap, I can tell you the lesson’s harder to learn than it seems.
In my first five years as a missile operator, I was lucky to work with a few great leaders and supervisors and take on several opportunities to explore the job and develop my own technical skills. Yet many of us were convinced the way we trained and developed our people–or rather, how little we cared to–left too much potential on the table. At the expense of building leaders who could think for themselves, we judged our Airmen on inflated test scores and how well they hid mistakes. Nearly everyone in the community knew it. We had a problem.
In Bad Blood, John Carreyrou chronicles the meteoric rise and precipitous fall of Elizabeth Holmes and her startup, Theranos. Holmes entered Stanford’s undergrad chemical engineering program in 2002, only to leave after two years inspired by a laboratory internship and the pull of tech entrepreneurship. After filing her first patent, she founded Theranos on a vision of providing advanced, efficient diagnostics using a piece of hardware about the size of a toaster oven and a miniscule blood sample.
For a host of reasons, including her own family’s own medical experiences, Holmes’ drive was admirable. Nursing a serious fear of needles, she was adamant that blood samples be taken without the large needs and vials most are accustomed to with laboratory samples. But the contemporary technology available didn’t allow for too many diagnostics on a single drop of blood, there would simply not be enough left after the first few tests to ensure an accurate read. Holmes’ vision was to revolutionize blood testing, but reality hadn’t caught up with her.
As Theranos gains momentum, and investors, Holmes courts large corporations and even the military as buyers. Imagine the applications of such a compact device, capable of detecting hundreds of conditions, in the middle of a warzone. She was signing contracts and committing millions in resources and research, all while her top scientists were struggling to fit expensive electronics and complicated machinery into such a small space. Dozens of tests resulted in failure, yet aggressive timelines only ramped up. Turnover was extreme as employees burned themselves out working seven days per week, from dawn to dusk and beyond, all pushed to the brink by Holmes and her animated right-hand, and boyfriend, Ramesh “Sunny” Balwani. For me, the lesson comes to a head when as the mechanics of Holmes’ approach become clear. To mask series of failed product tests, she enlists her senior team to replace true video and samples with a version of the diagnostic machine that produces a false result and simulated screen images; everything ‘looks’ good as observers can only see the superficial indications and are never permitted a look ‘under the hood.’ And so we see the beginning of the end, for both Theranos and Holmes.
Like I said, the vision was admirable. Design and field a new diagnostic platform that could detect hundreds of ailments, all with little more than a drop of blood. Such a device would revolutionize how we diagnose, increase the time available for treatment, and theoretically prolong millions of lives otherwise caught on unsustainable paths for lack of early detection. But there were too many obstacles that became apparent early, and Holmes’ devotion to the cause proved to rigid for even her own expert hires to break through. She recruited the best of Silicon Valley and beyond, looking for researchers already at the cutting edge of engineering, chemistry, biology, and bioinformatics, and brought them under Theranos’ roof to build something heretofore unheard of. Those recruits all knew how long research and development usually takes. For something like this device, going from concept to implementation would likely take years … if not a decade or more. Consider how long the healthcare community has been working on cancer, cardiovascular diseases, and HIV to name a few. Long-term investments of energy and money are a prerequisite to solving the world’s toughest medical challenges. Building this machine would have been no different. Yet Holmes wouldn’t accept any of the warnings as she pushed her staff beyond the realm of the normal to fabricate hardware, results, and hide whole parts of the company’s building and lab space when entertaining visitors from state regulatory agencies. It sounds ridiculous, and I had the same thoughts as I read Carreyrou’s telling. But he brings a journalist’s discipline to the documentation of the story, and manages to share a book that reads more like a thriller than business exposé.
We had a problem in missile operations. That much was clear, at least to those of us at the bottom of the hierarchy. As 2013 gave way to 2014, life moved along normally and I prepared to attend a truncated version of the Air Force’s Weapons School course to learn how to lead instructors and teach the ins and outs of the missile system. Then all hell broke loose. Almost overnight, the inertia powering the missile operations career field came to a halt; our senior leaders could no longer ignore the “world’s worst culture” after more than 100 people saw their careers derailed or terminated after a cheating scandal that uncovered how abusive (not to mention counterproductive) our testing regime had become. When I reported to my new assignment later that summer, I was tasked explicitly: build a new training team, and a training program, that advances knowledge and keeps us ready to fight 24/7. I decided on the initial cadre, received nearly 100% authority on how to structure the program, and most critically–had to paint a clear vision of what success for my team and our unit would look like. This was our golden opportunity to prove how great a community missile operations could be. This is the chance I’d always wanted … right?
To be continued …
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