I watched the HBO documentary about Elizabeth Holmes and the Theranos debacle. The Inventor: Out for Blood in Silicon Valley was inspired by John Carreyrou’s Bad Blood expose in The Wall Street Journal. This was a powerful blood story with an important lesson for marketers.
Founded in 2003 by 19-year-old Elizabeth Holmes, the company raised 700 million dollars from VC and private investors. At one point the company was worth 9 billion dollars, and she owned half making her the youngest self-made billionaire in the world.
She hyped a revolutionary breakthrough to challenge the $90 billion-dollar blood-testing market where her blood test required just a finger prick or 1/1000 of the necessary blood. I was captivated by the story, but one line kept jumping out at me.
“Elizabeth’s story had emotion. She never relied on conveying data.”
Storytelling for Good or Evil.
It is evident from the documentary that Elizabeth Holmes perpetuated fraud and the SEC charged her. Investors and particularly older statesmen, bought into her story and vision because they wanted to believe it was true. From Henry Kissinger, Warren Buffet, George Schultz, William Perry, Sam Nunn, and James Mattis. They never relied on data to make multi-million dollar investments.
Untruthful Storytelling
Marketing, as a practice, can be used for good or evil. It can be a force that disguises and hides the truth by creating an aura, image, and vision. Holmes painted a picture of a reality that she believed could be true – but the science never supported. And those who invested in her false story drank the Theranos KoolAid without the type of due diligence you would expect from investors.
Her stories and vision had emotional hooks. She repeated the powerful story of her love for her uncle who died of cancer at a young age.
Why investors didn’t carefully explore the science and data before investing, bewilders me. Even Walgreens, who agreed to the market test in Arizona appears to have been mesmerized by the picture Elizabeth dreamed. Everyone believed the story and no one invested the hard work to study the data. Holmes claimed trade secrets as the reason why no one could see what was inside her Edison device that was her miniature blood laboratory that could be in every pharmacy.
Marketing can be a force for good or evil. It can be used to communicate propaganda or can be part of a vision for true disruption and marketplace innovation. In the documentary, Holmes quotes Martin Luther King, Jr. as she paints a picture of her vision.
“Take the first step in faith. You don’t have to see the whole staircase; just take the first step.”
Many entrepreneurs take a leap of faith. They strive for something heroic and more significant than themselves. But when that vision is an anchor in deception, the truth eventually shines through the crevices of deceitfulness.
Elizabeth Holmes was never an honest broker. And unlike her hero, Steve Jobs, she wanted to change the world but felt that she needed to cheat to accomplish her goal.
There was never a staircase.
You can set up a time to chat with me about your marketing challenges using my calendar. Email me jeffslater@themarketingsage.com Call me. 919 720 0995. The conversation is free, and we can explore if working together makes sense. Try my new chat feature on my site if you have a quick question.
Photo by Fernando @cferdo on Unsplash
