If you need to to convince Elizabeth Holmes to be a person with feelings and not a bad one for blood, just look at her text messages. “You’re a desert breeze for me,” sent Ramesh Balwani, her business partner and boyfriend, in 2015. “My water. And ocean.” Even when Wall Street Journal Journalist John Carreyrou was investigating his medical testing company, Theranos, Holmes still had love in mind. “I was thinking of you this morning,” he texted Balwani that June. Balwani reminded him that he had concentrated: Theranos was under attack.
Six pages of text messages are some of the first documents to come out of Holmes’ trial, which began this week, more than three years after she was accused of defrauding investors, as well as doctors and patients, of fraud. Theranos capabilities. She has pleaded guilty. The task of the defense over the next few months is to humanize Holmes, showing the jury a young, ambitious businessman who made some mistakes in his quest for success. The government will try to convince the jurors that it became a billionaire at the expense of the health of its customers and that it endangered its investors.
And Silicon Valley will be watching. The flagship case examines a company, a founder, but in doing so will shed some light on some of the rules of home culture, including the expectation that founders will pursue their ideas with reckless determination. Elizabeth Holmes had become, as Chief Prosecutor Robert Leach said in her opening statement, “one of the most celebrated CEOs in Silicon Valley and the world. But under the façade of Theranos ’success, there were significant preparation issues. “The question for the jury, then, is to decide when the initial braggart turns into fraud.
“I’m glad the Silicon Valley mantra‘ Fake it till you make it ’is in question,” says Eric Bahn, co-founder of Hustle Fund, an early-stage VC company. “Over the last decade, it almost seemed like a cry of concentration for founders and investors.”
At the same time, Bahn says, he worries that attention to Holmes could become more controlling for the founders, who, according to studies, already have more difficulty raising money in Silicon Valley. “I’ve already heard an anecdote about the question of a founding woman of health care about her thoughts on Holmes and how this founder felt they were already comparing her.” A recent story in The New York Times found that many other founding women face comparisons with Holmes.
Holmes ’history has already left an indelible mark, not only on Silicon Valley, but also on American culture. He was a seductive figure for both investors and the media – the blonde baritone with black turtle necks – and his fall attracted as much attention as his rise: hundreds of magazine articles, a best-selling book, a podcast series, several documentaries, an upcoming television series starring Amanda Seyfried. As a result, the first judicial week was devoted primarily to the difficult task of selecting a jury that had not been impregnated with coverage and could present an impartial opinion.
Jurors were also asked if they had been exposed to domestic abuse, as the defense plans to argue that Holmes was subjected to “a decades-long campaign of psychological abuse” by Balwani. (Balwani has denied any allegations of abuse. He has also been charged with fraud and has also pleaded guilty. His trial will begin in January.) About half of the jury group raised their hands, according to The New York Times.