Days Before Christmas, Theranos Secures $100 Million in New Funding (fortune.com) 96
An anonymous reader quotes Fortune:
Call it a Christmas miracle -- albeit of a rather perverse sort. Theranos, the digraced medical-technology startup that infamously inflated the capabilities of its devices, has secured $100 million in new funding in the form of a loan. The loan, reported by the Wall Street Journal, will come from Fortress Investment Group. Fortress, whose other underdog bets include a private passenger rail line under construction in Florida, is set to be acquired by Japan's SoftBank. Theranos was reportedly on the verge of bankrutpcy...
By the end of 2016, the company reportedly still had $200 million in cash on hand, but had sharply limited prospects for attracting more capital. It has since settled a major lawsuit with Walgreens, a former client, for an undisclosed but likely substantial sum. According to the Journal, the Fortress loan is expected to keep Theranos solvent through 2018. That will give the company more time for its ongoing effort to reboot as a medical device manufacturer, rather than a testing service.
The loan is conditional on "achieving certain product and operational milestones," notes Fortune, adding "It's unclear whether those might include positive outcomes for the multiple investigations and lawsuits still facing the company."
By the end of 2016, the company reportedly still had $200 million in cash on hand, but had sharply limited prospects for attracting more capital. It has since settled a major lawsuit with Walgreens, a former client, for an undisclosed but likely substantial sum. According to the Journal, the Fortress loan is expected to keep Theranos solvent through 2018. That will give the company more time for its ongoing effort to reboot as a medical device manufacturer, rather than a testing service.
The loan is conditional on "achieving certain product and operational milestones," notes Fortune, adding "It's unclear whether those might include positive outcomes for the multiple investigations and lawsuits still facing the company."
What is todayâ(TM)s date? (Score:2)
Re: (Score:3, Insightful)
Re: (Score:2)
See, the thing is, there was nothing wrong with your comment until you claimed she is only still CEO because she is a woman. There are many, many heads of companies that have wasted vastly more money and fucked over many more people including crashing entire economies, and they never lose their jobs. Or if they do, they get giant golden parachute packages. And yet I doubt you ever said it was 'because "penis"'.
So if you really want to keep gender out of the conversation, then do so. But you didn't. You've b
Re: What is today's date? (Score:5, Informative)
No, that's not what I said. It is about committing FRAUD, not just being inept. And yes, the two ARE different.Here's 10 CEOs who also committed fraud [cbsnews.com] and all are in jail. Another CEO of a startup committed fraud [csoonline.com] and is going to jail. And here's another [lawsitesblog.com] startup CEO going to jail because of fraud. Curiously, all those CEOs who committed fraud are going to jail. Why not Holmes? I'll tell you why: vagina. She is STILL the CEO because she is a woman, and kicking her out would be seen as sexist.
Why else would a CEO of a company, who committed fraud, NOT go to jail or be charged? Can you tell me?
Re: What is today's date? (Score:5, Interesting)
Ignoring for a minute the difference between incompetence and fraud, it's worth pointing out that a big selling point for this venture was the gender and youthfulness of the CEO. Nearly every article and interview I saw when the "technology" was first being revealed spent as much time fawning over how wonderful it was to have a young woman "researcher and CEO" as they did actually discussing her supposed invention.
Had she been an old white dude, Theranos would never have gotten the publicity it did. It's fair to point out that her gender played a role in the continuing success of her scam.
Re: (Score:2)
Their basic idea/vision wasn't wrong - low budget labs-on-chips for blood tests. The only problem is that existing medical blood sampling systems have required decades of research and development, validation, medical board approval and other requirements.
They should have moved into other things like smart wound dressings that could measure bacterial activity and release iodine or hydrogel in order to maintain optimum healing conditions.
Re: What is today's date? (Score:2)
No, their basic idea was flawed. While you can do many tests with a very small quality of blood, there are also many which you cannot. Additionally, the number of tests they wanted to run from a tiny sample was impossible even if they were just running the tests which individually didn't require large samples.
There was a reason why experts were skeptical from the get-go. Most of them suggested that even a major improvement in current technology wouldn't be enough to make these problems go away.
Of course,
Re: (Score:2)
I've had medical tests done on myself. They need a full syringe full of blood, and even then that is only valid for a few hours between it being extracted and sent to the lab. Some tests are so time sensitive they need the sample to be taken at the lab and processed immediately. Since every medication you take can change your blood chemistry, even the results of a blood test are only valid up until you have a new prescription.
Re: What is today's date? (Score:2)
I hear ya man. Back in the 70's my company invented warp drive, but after I returned from my trip to Alpha Cantauri the goddamn lawyers shitcanned the whole thing. Said it would draw too many lawsuits from all the NASA contractors we were about to put out of work.
Re: (Score:2)
Ignoring for a minute the difference between incompetence and fraud, it's worth pointing out that a big selling point for this venture was the gender and youthfulness of the CEO. Nearly every article and interview I saw when the "technology" was first being revealed spent as much time fawning over how wonderful it was to have a young woman "researcher and CEO" as they did actually discussing her supposed invention.
Had she been an old white dude, Theranos would never have gotten the publicity it did. It's fair to point out that her gender played a role in the continuing success of her scam.
An where I worked, it was a requirement to favor purchase decisions specifically on the gender of the Owner/CEO. https://www.ellevatenetwork.co... [ellevatenetwork.com]
Re: What is today's date? (Score:2)
If only there were less articles on who she was and how she looked and more on what she actually did. Perhaps then she could be evaluated on an equal footing scientifically and the fraud would have been apparent much, much earlier.
It was evaluated "on an equal footing" by actual engineers and scientists, and most of them were either extremely skeptical or outright called it bullshit. Today's media don't much care about that, though; they care about whether a story is sexy and likely to generate clicks far more than they care about whether it's actually true.
It is disgusting that success (and investor probability) for women is often graded by appearance. Welcome to the downsides of gender discrimination.
Gender discrimination in general is disgusting, but cases like this are the inevitable result of third-wave-feminism inspired policies. When there's a disparity in representatio
Re: (Score:2)
You've become an SJW.
Yer not doin' too bad at that yourself, sailor!
Re: (Score:2)
Re: (Score:2)
Why do they need funding? I've always found Thermos bottles to be of goo quality!
Bubble (Score:2)
Deep learning and block chain (Score:5, Funny)
Re: (Score:2)
Re: (Score:2)
schadenfreude (Score:4, Interesting)
The reason so many people find the downfall and disgrace of this company so satisfying is that it symbolizes the just retribution of the market / facts against a company that:
- was based on hype and deception
- punished its employees for speaking the truth
- had access to capital and investment that others with more legitimate products didn't, only on account of its founder's connections
- was so tied to the idea of an idealistic successful woman CEO that they were willing to take shortcuts and sell that more as the product instead
And here is another investor throwing $100m after the bad, hoping to pick something from the scraps. If there's a quicker way to lose $100m, I would be surprised.
Re: (Score:1)
No one would ever say that Juicero failed this year because they had a male CEO. Or that Equifax shat all over consumers because they had a male CEO.
Theranos' failure, as you say, was based on hype and deception. It was not because the CEO lacked a penis.
Re:schadenfreude (Score:5, Insightful)
The fact that the CEO was female was part of their hype. They did this.
The fact that they failed was because they had a fundamentally flawed product that they were never able to fix and they engaged in widespread fraud and deception to avoid facing up to their problems. This has no relation to the sex of their CEO. It's common in industry.
Re: (Score:2)
The fact that the CEO was female was part of their hype. They did this. The fact that they failed was because they had a fundamentally flawed product that they were never able to fix and they engaged in widespread fraud and deception to avoid facing up to their problems. This has no relation to the sex of their CEO. It's common in industry.
That's where these companies get into trouble. It is obvious that gender isn't specifically related to success or failure. Happens all the time to male or female CEOs.
But the selfsame people who shout from the rooftops that the company is wisely being run by a woman, and make certain everyone knows that this woman is a symbol of casting off the shackles of the Patriarchy and shattering the glass ceiling ( Fiorina first deinied there was one, then backpedaled) - and now the place for a woman is on top....
"Loan conditional on achieving milestones" (Score:3)
Is it technically possible? (Score:2)
Putting the bullsh*t-artist CEO issue aside, is what they were trying to accomplish technically possible? Is existing medical testing simply bogged down by non-technical reasons e.g. insane bureaucracy, paperwork tsunamis, etc? I know for a fact that hospitals have a 4-to-1 ratio of non-medical staff to actual doctor/nurse medical staff which is a significant factor in the exponential rise in costs. So how bad is it in the testing realm?
Re: Is it technically possible? (Score:5, Interesting)
There is a fundamental problem with their basic technology in that finger tip blood is not the same as venous blood in many different ways and you can't compensate for that.
Re: (Score:3)
It doesn't appear so. Quest Diagnostics, for example, seems to have a pretty well-automated, paper-free environment, and definitely more clinical workers than bureaucrats.
The scam continues (Score:1)
Did Holmes offer to sleep with everyone at Fortress to get this money? Because that's the only way I can see this fraudster convincing them to pour money down the black hole of her scam.
How many times must it be said, this is a scam. A fraud. A fake (to use the current parlance). This process had no chance of succeeding because there was no process. To this day she still has not let anyone review her supposed methods, nor has she submitted any paperwork to the FDA.
Let it die the in the throes of a thousa
Re:The scam continues (Score:4, Insightful)
How many times must it be said, this is a scam.
To misquote Marie Antoinette:
"Let them eat scam!"
Smoking certainly isn't healthy for you . . . but lots of folks do it anyway . . . because they like it. Casino gambling doesn't offer you good odds, but folks get addicted to that, as well.
Folks buy into scams . . . for kinda sorta the same reason. They like the thrill of maybe buying into the next Facebook . . . even if all sane evidence says that it is a scam.
So just let these folks toss their money away . . . as long as they don't harm anyone other than themselves.
Re: (Score:2)
No need to resort to misogynistic statements.
This is "usual" corporate fraud and deception abetted by a "good old boys" network of clueless investors who weren't smart enough (or trusted their "bros" too much) to ask basic questions.
Re: (Score:2)
Bullshitters might be attracted to bullshitters - they might be betting on Elizabeth Holmes. She was able to fleece so many people once before, making a lot of people a lot of money, they might be betting on her abilities again. I mean look back at the year 2000 stock bubble and the 2008 housing bubble. There were many pundits screaming buy! buy! buy! (Jim Cramer [fool.com], Abby Joseph Cohen [reuters.com], and others [dividend.com]) and they suffered no significant negative consequence.
Of course, it's not hard to create an updraft in a stock ("
Lisbeth belongs in prison (Score:1)
Sheâ(TM)s far more likely to see a cell than Hillary. But she is a complete fraud.
I'm sorry - why? (Score:2)
Why would you invest in these bozos? If you wanted the tech, why wouldn't you just wait for the bankruptcy and buy it there (hiring the relevant tech people as they get laid off)? I mean, NO ONE is going to trust that company's name, especially the FDA. You'd have a lot easier time getting all relevant approvals if none of the old principles are attached to the enterprise.
What am I missing? Does Fortress need a big tax write-off or something?
Re: (Score:1)
Re: (Score:1)
Buy the patents. Who cares if the tech is real when you can patent troll for years beyond? It’s the gift that keeps on giving.
Re: (Score:2)
If Fortress is about to be acquired, there may be eliminating of redundant positions. Someone may be trying to reduce the value of the their investment portfolio where they escape under the notice of the seats everyone is fighting for.
In other words, sometimes what's best for an executive is not best for the company. This is esp. true when mergers are happening.
Re: (Score:2)
Theranos has managed to stay alive despite being clearly criminal fraudsters on a large scale. There is a type of investor that is impressed by this, because they essentially operate the same way.
Well.. (Score:2)
Excessive hate? (Score:1)
It's common for young companies to be overambicious and flaky only to mature later. Remember all the wild claims made by young Apple about its products? Of course, Apple was not in healthcare back then, but Theranos is also not doing open heart surgeries. Theranos technology could be valuable despite not being as accurate as existing bulky/expensive labs by reaching patients that could not or would not be served by mainstream medicine. Maybe they have learned their lessons and will do allright.
Re: (Score:1)
despite not being as accurate
Interesting euphemism for test results that were often flat-out wrong and could have lead to numerous patients being given incorrect, unnecessary and potentially harmful treatments.
Re: (Score:2)
Theranos has had plenty of time to show up their 'tech'. While their idea is a good one (multiple medical tests on very small sample volumes) they have been unable to produce pretty much anything in close to a decade of research. There may be some IP worth pursuing in this mess, but that certainly isn't a given - at least from the publicly available information.
If it's not completely hot air, it's pretty damn close. Remember, we have plenty of medical tests that can be run with a small sample volume - 10
PT Barnum (Score:1)
Re: (Score:2)
Not by PT Barnum. It's probably no more his than "A sucker is born every minute."
There ain't no justice (Score:1)
Re: (Score:2)
Re: (Score:2)
Obviously, fraud pays (Score:2)
At least if you do in on a large enough scale. Small-time criminals doing much less damage would face a lengthy time behind bars. Of course, this speaks volumes of those that provided the money as well. Morality not required and actually a hindrance. That they (Theranos _and_ the investors) seem to get away with it is a pretty bad sign for the state of society as a while.
She's somebody's niece (Score:2)
digraced? (Score:2)
Like, it has two graces?
Russia? (Score:2)