Elizabeth Holmes facts for kids
Quick facts for kids
Elizabeth Holmes
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Holmes in 2014
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Elizabeth Anne Holmes
February 3, 1984 Washington, D.C., U.S.
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| Education | Stanford University (dropped out) |
| Years active | 2003–2018 |
| Known for |
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| Criminal status | Incarcerated |
| Children | 2 |
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| Conviction(s) |
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| Criminal penalty | 11⁄1 years in prison |
| Imprisoned at | Federal Prison Camp, Bryan |
Elizabeth Anne Holmes (born February 3, 1984) is an American businesswoman. She started a company called Theranos. This company claimed to have a new way to do blood tests using only a tiny amount of blood, like from a fingerprick.
For a while, Theranos was valued at billions of dollars. In 2015, Forbes magazine even called Holmes the youngest and richest self-made female billionaire in the U.S. But soon, people found out that the company's claims were not true.
In 2016, Forbes changed its estimate of Holmes's wealth to zero. Fortune magazine called her one of "The World's 19 Most Disappointing Leaders."
The problems for Theranos began in 2015. News reporters and government groups started looking into the company. They found out that Theranos's claims might be false. They also wondered if Holmes had tricked investors and the government.
In 2018, a U.S. government group called the U.S. Securities and Exchange Commission (SEC) accused Theranos, Holmes, and her business partner, Ramesh "Sunny" Balwani, of fraud. Fraud means tricking people to get money. They were accused of raising $700 million from investors by making false claims about their blood-testing technology.
Holmes agreed to a settlement. She paid a $500,000 fine and gave back some company shares. She also agreed not to lead a public company for ten years.
Later in 2018, a federal grand jury charged Holmes and Balwani with fraud. Her trial started in 2021 and ended in January 2022. Holmes was found guilty of tricking investors. She was found not guilty of tricking patients.
She was sentenced to 11⁄1 years in prison. She began her prison sentence on May 30, 2023, at Federal Prison Camp, Bryan. Holmes and Balwani were ordered to pay $452 million to the people they tricked. Many important people, like Henry Kissinger and George Shultz, supported Theranos. This helped the company seem trustworthy for a while.
Holmes and Balwani ran the company together. Employees said the company had a "secretive and fearful" culture. Staff who spoke up with concerns were often fired. After Theranos closed, Holmes got married and had two children.
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Early Life
Elizabeth Holmes was born on February 3, 1984, in Washington, D.C.. Her father, Christian Rasmus Holmes IV, worked for an energy company called Enron. This company later went bankrupt because of a big accounting fraud scandal. Her mother, Noel Anne, worked for a government committee.
Her father later held important jobs in government groups like USAID. Elizabeth's family was proud of their history. Her great-great-great-grandfather, Charles Louis Fleischmann, started the Fleischmann's Yeast company.
Holmes went to St. John's School in Houston. In high school, she was interested in computer programming. She said she started her first business selling C++ compilers to universities in China. She also learned Mandarin Chinese.
In 2002, Holmes went to Stanford University. She studied chemical engineering. She also worked as a student helper in a lab.
After her first year, Holmes worked at a lab in Singapore. She tested for a virus called SARS-CoV-1 using blood samples. In 2003, she applied for her first patent for a wearable device that could deliver medicine. In March 2004, she left Stanford. She used her tuition money to start her own company.
The Story of Theranos
How Theranos Started
In 2003, Holmes started a company called Real-Time Cures in Palo Alto, California. She wanted to make healthcare easier for everyone. Holmes said she was afraid of needles. So, she wanted to do blood tests with only a few drops of blood from a finger.
She told her medicine professor, Phyllis Gardner, about her idea. Professor Gardner told her it would not work. Several other experts told Holmes the same thing. But Holmes did not give up.
She convinced her advisor at Stanford, Channing Robertson, to support her idea. In 2003, Holmes changed the company's name to Theranos. This name combines "therapy" and "diagnosis." Robertson became the first board member and helped her find investors.
Growing the Company
By December 2004, Holmes had raised $6 million for her company. By 2010, Theranos had over $92 million from investors. In 2011, Holmes met George Shultz, a former U.S. Secretary of State. He joined the Theranos board of directors.
Over the next three years, Holmes built a very impressive board. It included many famous and powerful people.
Theranos operated in "stealth mode" for a long time. This means they worked secretly without telling the public much. In September 2013, the company announced a partnership with Walgreens. They planned to open blood sample collection centers in Walgreens stores.
Media attention grew in 2014. Holmes appeared on the covers of magazines like Fortune and Forbes. Forbes called her the world's youngest self-made female billionaire. Theranos was valued at $9 billion.
By the end of 2014, Holmes had 18 U.S. patents and 66 foreign patents. In 2015, Theranos made deals with other healthcare groups to use its technology.
What Went Wrong?
John Carreyrou from The Wall Street Journal started investigating Theranos in 2015. He got a tip from a medical expert who thought Theranos's blood testing device seemed suspicious. Carreyrou talked to former employees who shared their concerns.
When Holmes found out about the investigation, she tried to stop Carreyrou from publishing his articles. Her lawyer threatened the Journal and the former employees.
Carreyrou kept reporting problems with the company and Holmes. In 2018, he wrote a book called Bad Blood: Secrets and Lies in a Silicon Valley Startup. It explained his investigation into Theranos.
Holmes denied all the claims. She called the Journal a "tabloid" newspaper. She promised that Theranos would show data proving its tests were accurate. She said, "This is what happens when you work to change things, first they think you're crazy, then they fight you, and then all of a sudden you change the world."
In January 2016, a government agency called the Centers for Medicare and Medicaid Services (CMS) sent a warning to Theranos. They found problems at the company's lab in California. CMS regulators suggested banning Holmes from running a lab for two years. This was because the company had not fixed the problems.
In July 2016, CMS officially banned Holmes for two years. Soon after, Walgreens ended its partnership with Theranos. They closed all their blood collection centers. The U.S. Food and Drug Administration (FDA) also told Theranos to stop using one of its main devices.
In 2017, the state of Arizona sued Theranos. They said the company sold 1.5 million blood tests to people in Arizona while hiding important facts. Theranos settled the lawsuit. They agreed to refund money to customers and pay fines.
In March 2018, the SEC charged Holmes and Balwani with fraud. They said the company lied about its technology being used by the U.S. Department of Defense. They also lied about making $100 million in 2014, when they only made $100,000. Holmes settled this lawsuit. She gave up control of Theranos and paid a fine.
At its busiest in 2015, Theranos had over 800 employees. But as problems grew, the company laid off many people. In September 2018, Theranos announced it was closing down. Its remaining money and assets would go to its creditors (people it owed money to).
The Trial and After
On June 15, 2018, a federal grand jury charged Holmes and Balwani with several counts of wire fraud and conspiracy to commit wire fraud. They both said they were not guilty. The government said Holmes and Balwani tricked investors, doctors, and patients. After these charges, Holmes stepped down as CEO of Theranos.
Holmes's trial began on August 31, 2021. It was delayed because of the COVID-19 pandemic and Holmes's pregnancy. Holmes testified for seven days. She claimed that her staff misled her about the technology. She also said Balwani had a lot of influence over her. However, she also said Balwani did not force her to make false statements.
On January 3, 2022, the jury found Holmes guilty on four counts of fraud against investors. She was found not guilty on four counts of fraud against patients. The judge declared a mistrial on three other counts, which the government later dropped.
On November 18, 2022, the judge sentenced Holmes to 11⁄1 years in federal prison. He also ordered her and Balwani to pay $452 million to the victims of the fraud. She started her prison sentence on May 30, 2023.
Holmes has appealed her conviction and sentence. Her lawyers argue that the judge made mistakes during the trial. The appeals court heard arguments in her case in June 2024.
Connections
Theranos had many powerful people on its board and as investors. Holmes's first big investor was Tim Draper, a well-known investor. Other major investors included Rupert Murdoch and the Walton family (who founded Walmart). These investors lost millions of dollars when Theranos failed.
One of Holmes's first board members was George Shultz, a former Secretary of State. The 12-member Theranos board eventually included:
- Henry Kissinger, another former Secretary of State
- William Perry, a former Secretary of Defense
- James Mattis, a future Secretary of Defense
- Bill Frist, a former U.S. senator
- Sam Nunn, another former U.S. senator
- Former CEOs of large companies
Personal Life
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Holmes had a relationship with Ramesh "Sunny" Balwani, who was also a technology entrepreneur. She met him in 2002. Holmes was 18, and Balwani was 19 years older.
Balwani officially joined Theranos in 2009 as chief operating officer. But he had been advising Holmes since the company started. Balwani left Theranos in 2016 after the investigations began.
Before the March 2018 settlement, Holmes owned half of Theranos's stock. In 2015, Forbes listed her as one of the richest self-made women in the U.S. with $4.5 billion. But in 2016, Forbes said her shares were worth nothing. This was because other investors would be paid before her if the company closed.
Holmes met William "Billy" Evans in 2017. They got engaged in 2019 and reportedly married later that year. Holmes and Evans have two children, born in 2021 and 2023. Before going to prison, she lived in Woodside, California with her family.
In the Media
The story of Elizabeth Holmes has been very popular in the media. Some people say her case has made it harder for other women entrepreneurs, especially in science and health. They are sometimes compared to her.
Holmes's story has been featured in many media works:
- A book called Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou was released in 2018. It tells the story of Holmes and Theranos.
- In 2019, ABC News released a podcast and documentary called The Dropout. It included interviews with key people in the story.
- In March 2019, HBO showed a documentary called The Inventor: Out for Blood in Silicon Valley. It showed how Theranos fell apart because of many false claims.
- In March 2022, Hulu released a TV miniseries called The Dropout. It was based on the podcast. Amanda Seyfried played Elizabeth Holmes in the series and won awards for her role.
- In May 2023, Holmes gave her first interview in seven years to The New York Times. This interview was published as she was getting ready to go to prison.
Images for kids
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Holmes in 2014
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Holmes at Stanford University, 2013
See also
In Spanish: Elizabeth Holmes para niños
