how Theranos could fool so many investors for so long?

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Someone with a PhD in microbiology explained to me (a layman) why what Theranos was claiming to do was impossible. She said you cannot test only a single drop of blood for certain things because what you are looking for literally may not be there. You need a full vial of blood to have a reliable chance of finding many things.

1. Is this simple but clear explanation basically correct?

2. If so, how could Theranos hoodwink investors for so long when possibly *millions* of well-educated people around the world knew that what they were claiming to do made no sense?

In: Biology

22 Answers

Anonymous 0 Comments

> possibly *millions* of well-educated people around the world knew that what they were claiming to do made no sense?

There were millions of uneducated people around the world who didn’t want to listen. That, and the fact that some people thought *What if it’s real and I’m missing out on a golden opportunity?* was enough to make a decent amount of people invest.

Anonymous 0 Comments

4 things occurred. This is mostly from the book on Theranos, *Bad Blood*

1) Investors had fomo (fear of missing out). If Theranos system actually worked. It would be completely revolutionary. And it would have been. Absolutely wild. Something that should be impossible. If it did work, you wanted in now while it was cheap because that investment would be worth so much fucking money later nothing else would matter. Or ya lose some
Money if it doesn’t. It was decent amount of money bet for a bonkers payoff.

2) Elizabeth Holmes herself was quite enthralling in meetings. Many people say they weren’t interested and thought the company was full of shit, but she would get into these meetings and they would come out of there convinced they could actually do it.

3) Theranos took huge amounts of effort to hide and manipulate what was actually happening there with nothing working as described. Including massive legal actions against some employees and others disparaging them. I have to stress how serious Theranos threatened employees and others with legal action. It was a huge deal and people were scared as hell.

4) due to #1, (and a bit of 3). Experts laughing at Theranos that it could never be done that it was totally impossible were just ignored by investors… because if it did work…

Anonymous 0 Comments

Why do people gamble? Because hope springs eternal.

History is full of instances where experts said “That’s impossible” only for it to be done later. There’s an infamous quote about heavier-than-air flight taking thousands of years to work out being published like a year before the Wright Bros. did it. 

But those kinds of things are pretty well known and published because they did something thought impossible and were worth writing about. Whats not worth writing about is when experts say something is impossible, someone tries it, and well, turns out its probably impossible. Which is the far, far, far, more common situation. But nobody writes about it, because why would you?

So some people decide to bet on the weird guys claiming they can do something experts say can’t be done. Because history shows it happens all the time, right? Maybe it pays out, more likely it doesn’t. Or maybe they just never heard the experts statement on the matter and thought the thing sounded cool.

Anonymous 0 Comments

As Upton Sinclair said he found out the hard way, it’s hard to persuade someone if their ability to draw a paycheck depends on them not believing you. People were asked the question “can she do what she claims?” but the question they *heard,* and answered truthfully, was “do you want to get rich?”

Anonymous 0 Comments

Lots of answers about your second question. As to your first question, the many reasons a single drop wont work include:

* Some tests require a higher volume of blood to get a larger sample size of blood cells for an accurate test. If you take a teeny tiny spot that just so happens to have a higher concentration of white cells than the rest of your blood, the result will be artificially inflated

* Some tests require you to dilute the blood to perform the test adequately. But if you try to dilute a single drop of blood enough to run the test you end up with… pink water

* Some tests use up the blood, leaving not enough blood for other tests

* Small amounts of blood congeal much faster, making their shelf life much shorter/

Anonymous 0 Comments

Fraud, in simple terms.

Not only was there not enough of a sample to test to a high enough certainty, but many of the instruments used to test blood cannot be miniaturised into the footprint they were promising due to instrument incompatibilities. The way they kept investors on for so long was by using existing instruments to do testing under the name of their new machine.

Anonymous 0 Comments

People want to invest in those who make the impossible possible. Who would have thought that the people who kept screwing up trying to get a small rocket in space would eventually be launching a hundred orbital rockets in the span of a year? That blows away the launch rate of any country in history, impossible. And they’ve successfully landed hundreds of boosters in a row? Impossible.

Anyway, they falsified everything, simple as that. Tests they showed were done with other equipment, while they swore it was coming from theirs. People wanted to believe it was true because they stood to make a massive amount of money when it worked, so they weren’t too keen on digging deeper. Theranos kept a tight lid on leaks to make sure the ruse was able to continue.

Anonymous 0 Comments

Part of #1: Theranos conned some big names, which drew in other investors. “Holy shit, George Schultz is all in, it must be a good investment!”

Probably a corollary to #3, but didn’t Theranos also present the results of conventional tests as their own?

Anonymous 0 Comments

I’m going to take a different direction than the rest of the commenters and disagree with your friend.

At the time, without knowing how Theranos was accomplishing what they were suggesting (obviously with hindsight, it’s because they were lying), nothing of what they were suggesting was hypothetically impossible. What if they had discovered a new version of luciferase with 100x sensitivity? Wouldn’t that mean they could run the test with 100x less blood? Or what if they used a combination of modern high-precision liquid handling and modern optics for better resolution?

To your friend’s point, there could be the issue of volume, but there are ways around that as well. You could test for secondary effects of the disease, or you could simply not guarantee the results of that particular test. Imagine you’re sitting at your doctor’s office: they listen to your heart, look in your ears, take a prick of blood to send to general screening, and, oh… one of your enzymes is slightly off. Here, go get the actual blood test later today so we can know more. It’s a great idea. The problem was people gave them a reasonable benefit of the doubt, but I’d argue the fault of dishonesty lies with the liar, not the listener. People just weren’t expecting conspiracy levels of lying, deceit, and secrecy.

Anonymous 0 Comments

The average non-medical person’s experience with lab testing is limited to the original input (like a blood sample) and the output (a report), with no understanding (or need for it) of what happens between those 2 events. In fact, many medical professionals tend to think like this as well, which I can personally attest to as a pathologist. Even as an anatomic pathologist some more complex labs seem like a black box to me.

Furthermore, many of the tests her instrument claimed to do can theoretically be performed on samples as small as a few drops of blood, but generally require a single, much larger instrument to perform them, and then just for a few specific tests. So theoretically many of her claims seemed possible, just requiring figuring out some long standing and likely impossible breakthroughs. To put it another way, the claims make sense with a little suspension of disbelief, though they break down when you realize the immensity of the problems that would need to be solved to accomplish everything she claimed.

If you don’t understand the impossibility of these hurdles she would have had to figure out, a very convincing person wouldn’t have that hard of a time selling this, especially when you factor in that this would like finding the holy grail of lab testing and whatever that would be worth. I probably would have invested in this given the opportunity before knowing of the fraud, purely because if it was true it would be so valuable.

She showed people results that seemingly matched the results from the current tests…because they were actually performed on existing current testing systems. If you have no idea how either system works, all you’ve seen is the input and output, and for most people, when it comes to lab testing, that’s all that matters.