Elizabeth Holmes remained confident she could turn things around until the last moment. Photo / Getty Images
Elizabeth Holmes remained confident she could turn things around until the last moment. Photo / Getty Images
Elizabeth Holmes was celebrated as the youngest and wealthiest self-made female billionaire in America in 2015.
Her revolutionary blood testing technology company, Theranos, had been valued at nearly US$10 billion ($14.5b), and the young entrepreneur had a personal net worth of US$4.5b ($6.5b).
But just a year later, everything started to fall apart.
That multibillion-dollar estimated fortune was slashed to $0 by Forbes as Holmes was faced with mounting allegations of potential fraud.
And by September 2018, Theranos was shut down for good — a spectacular fall from grace for a woman and a company that once had the backing of high-profile investors including Rupert Murdoch, the executive chairman of News Corp, and US Education Secretary Betsy DeVos.
But it appears Holmes didn't give up without a fight.
In a new article published in Vanity Fair, reporter Nick Bilton, who has extensively followed Theranos' downfall over the years, revealed fresh details of Holmes' increasingly bizarre behaviour as her company marched towards collapse, as well as her desperate attempts to keep it afloat.
Holmes was long known for her love of luxury, opting to fly via a private jet, and hiring "her own personal security detail, drivers, personal assistants, and a personal publicist who was on retainer for US$25,000 ($36,400) a month", a former Theranos exec told Bilton.
The company also had an indemnity agreement with Holmes and her former partner and Theranos chief operating officer Sunny Balwani, with multimillion-dollar legal bills allegedly racked up each month.
Holmes splashed out on luxe accessories such as Birkin handbags and was known to charge personal expenses, such as car mileage, to her company.
DESPERATE MOVE
Despite all that conspicuous spending, Holmes did attempt to cut back as Theranos' woes deepened.
According to Bilton, the company had been operating out of a lavish address which reportedly cost US$1 million a month to rent, with one conference table alone costing US$100,000.
Elizabeth Holmes could spend 20 years behind bars. Photo / Getty Images
But in late 2017, the decision was made to downgrade into a "crummy" lab in Newark, California for a fraction of the price.
BALTO
As Theranos unravelled, Holmes' erratic behaviour seemed to intensify, especially regarding her newly-adopted puppy, named Balto.
According to Vanity Fair, Balto "wasn't potty-trained" and "frequently urinated and defecated" in the office, with an assistant forced to clean up after him.
The husky dog had traces of wolf DNA — and after discovering that fact, Holmes insisted to everyone she met that he wasn't a dog, but a wolf instead.
He was named after a famous husky that had led an expedition carrying medicine to fight an outbreak of diphtheria in 1925. As Bilton reports, "The metaphorical connection was obvious. In Holmes's telling, Balto's perseverance mirrored her own. His voyage with the life-changing drug was not so different from her ambition."
LOW MORALE
Unnamed executives told Bilton that as the crisis deepened, employee morale sunk, with more and more workers either quitting or being let go as the US Securities and Exchange Commission investigated the case.
But oddly, Holmes remained fiercely optimistic.
Elizabeth Holmes was known for her lavish spending. Photo / Getty Images
"The company is falling apart, there are countless indictments piling up, employees are leaving in droves, and Elizabeth is just weirdly chipper," a former senior executive explained, according to the Vanity Fair piece.
Another said she would be "chirpy" in meetings, acting as if everything was "great".
LAST-MINUTE BAILOUT
In December 2017, Holmes announced to staff that leading private investment firm Fortress Investment Group had promised a US$100m loan to save the company.
But while Holmes was visibly excited by the deal, the revelation was met by deafening silence from her remaining disillusioned employees.
And it wasn't enough to save Theranos — just months later, Holmes was slapped with 11 criminal charges including wire fraud and conspiracy.
Holmes is now facing a possible 20-year prison sentence, and it's possible she and Balwani could be hit with even more charges.
But according to the anonymous former executive who spoke with Bilton, Holmes has not owned up to her mistakes, instead blaming her former lawyers for giving her "bad advice", and Wall Street Journal investigative reporter John Carreyrou, who first broke the Theranos scandal in 2015.
"Elizabeth sees herself as the victim," the ex-employee said.
