Two years after Theranos was exposed as a scam by Wall Street Journal reporter John Carreyrou, who uncovered CEO Elizabeth Holmes and Theranos’ former president Ramesh Balwani’s elaborate scheme of lies and deception, the SEC finally took off their blinders last month, and charged the pair with “massive fraud” for raising $700M+ “through an elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business, and financial performance.”
Theranos, a Silicon Valley healthcare startup known for its false claims about its revolutionary blood tests, will cease to exist in the coming months unless it can raise significant swaths of money, according to Theranos’ letter to shareholders on April 10.
At one point, the Silicon Valley unicorn was valued at $9 billion and backed by some of the most significant names like the venture capitalist Tim Draper, but like any unicorn — the hype will eventually fade.
Early last week, Theranos cut much of its remaining workforce from 125 employees to about several dozen. This was a last-ditch effort to preserve cash and avert bankruptcy until the end of summer. Before Carreyrou exposed the company as a fraud, Theranos had about 800 employees in 2015.
During the company’s latest round of layoffs, Carreyrou released a screenshot of what was an alleged “Space Invaders”-style video game in which Theranos employees took turns blasting Carreyrou heads with a space gun. As it appears, some employees believe Carreyrou is to blame for the company’s fall from grace, rather than the technology or its management.
Just learned of a priceless anecdote (so too late to include it in the book): At a company party, Theranos employees played a video game modeled after Atari's Space Invaders: The gun was the miniLab, the bullets the nanotainers and the invader being shot at: Yours Truly!— John Carreyrou (@JohnCarreyrou) April 12, 2018
Carreyrou provides a screenshot of the game, titled “Haters Gonna Hate v1.5.”
Space Invaders, Theranos Edition! pic.twitter.com/gOeUNqASBU— John Carreyrou (@JohnCarreyrou) April 13, 2018
Carreyrou says he will get to play it eventually:
He’s going to send me a copy of the game and I’m going to play it! I loved Space Invaders growing up. https://t.co/PtaYMIu49l— John Carreyrou (@JohnCarreyrou) April 13, 2018
Here is the leaked video provided by Business Insider, who said, “someone sent us a video of employees playing it.” The person who sent the video to Business Insider said the video was taken some time ago at Theranos’ manufacturing facility. The video confirms Carreyrou’s series of tweets last week about the existence of the game.
Bussiness Insider said,
“The company enlisted David Boies, a legendary lawyer who tried to intimate and threaten The Journal with legal action, according to a Vanity Fair report. Employees even chanted “F— you, Carreyrou!” at an all-hands meeting. ”
“There are many more eye-opening anecdotes and revelations in my book, ‘Bad Blood,’ which comes out next month,” Carreyrou said to Business Insider.