What Has Befallen Theranos CEO, Elizabeth Holmes? From Her Net Worth to Her Current Situation
Elizabeth Holmes, the pioneering founder of Theranos – an industry that has been making headlines for over 10 years – has been making waves in the blood testing business.
Though she had once been seen as a promising young businesswoman, the Wall Street Journal exposed in 2015 that her blood testing technology failed to generate accurate results, leading thousands of people to receive inaccurate reports.
Holmes left her role as Theranos CEO in 2018 and was found guilty of four fraud-related charges at the start of January 2022.
Hulu adapted Sherlock Holmes’ story in March 2022 for their streaming show “The Dropout”, featuring Amanda Seyfried who earned an Emmy nomination for her performance as Holmes.
What Is Elizabeth Holmes’ Sentence?
On November 18th, Elizabeth Holmes was sentenced to 11.25 years in prison and then three years on supervised release after more than three hours of deliberations, according to live coverage by NBC Bay Area on Friday afternoon. She will have to surrender at a future date as seen entering the courtroom looking pregnant in a video obtained from The Wall Street Journal.
At a later date, CNN’s Scott Budman will tweet from the courtroom regarding how much Holmes must repay investors.
At the sentencing hearing, Holmes addressed the court and expressed her regret with every atom in her body.
Who Is Elizabeth Holmes?
Elizabeth Holmes’ journey began at Stanford University in 2002 when she intended to pursue a degree in medicine. But her fear of blood and needles led her to develop an implantable medical device that would monitor patient blood flow and administer medication when necessary, according to Business Insider.
Within two years, Holmes left Stanford and founded her own company, Theranos, from her basement office.
Holmes boasted to investors that her technology could detect illnesses like cancer with just a drop of blood. Furthermore, she led investors to believe Theranos provided hundreds of diagnostic tests even though the company later used third-party equipment, as reported by the BBC.
She made these claims and was able to secure over $700 million of investments from renowned names, including Oracle founder Larry Ellison. To emphasize the significance of keeping secrets, she collected investors’ money without disclosing any details regarding how her technology worked.
Holmes and Sunny Sunny Balwani were later revealed to have secretly had a relationship while working together. For years they ran the business under the false impression that their technology, known as Edison, was working when in fact it wasn’t.
They continued to accumulate millions of dollars in funding, which included agreements with major healthcare brands like Walgreens (who they had planned to open Theranos Wellness Centers across America according to CNN), as well as a deal worth $350 million with Safeway.
Through it all, Holmes earned herself the title of “Girl Boss” and even graced the cover of Forbes and Fortune magazines.
But Theranos’ chief scientist Ian Gibbons cautioned Holmes about potential errors in the technology and noted that it wasn’t yet ready for general consumption.
In August 2015, the FDA launched an investigation into Theranos after discovering “major discrepancies” in its testing. Two months later, The Wall Street Journal revealed that Theranos was testing blood samples using traditional tests after receiving incorrect results from its own Edison machine.
In 2016, Theranos Lab was under investigation by the FDA, SEC, and Centers for Medicare & Medicaid Services (CMS). According to CNN’s reporting, CMS found that Theranos lab failed to meet compliance standards and its “deficient practices pose immediate jeopardy to patient health and safety,” per a letter sent by them from the agency.
As a result, Theranos voided two years’ worth of blood tests and corrected thousands of reported errors as reported by CNN. Furthermore, the agency barred Holmes from running a laboratory for testing blood during that period, while Walgreens shut down forty Theranos Wellness Centers.
What Happened to Theranos?
Following Theranos Lab’s closure, Holmes was able to launch her new product “MiniLab,” which would enable her to circumvent CMS restrictions by selling it instead of operating within its own labs as reported by CNN.
As Theranos focused on building its MiniLab and defending against numerous lawsuits from investors, the company cut 155 of its employees.
In March 2018, the SEC charged Holmes and Balwani, who quit the company in 2016 but left before 2016, with “massive fraud,” according to Business Insider. They were charged in June with nine counts of wire fraud and two counts of conspiracy to commit wire fraud.
As Theranos was a privately-owned company, Holmes was allowed to stay as CEO but must surrender control of voting and financial aspects of the business. She also had to pay a fine of $500,000 and return $18.9 million worth of Theranos stock. Shortly after her arrest, Theranos announced she would step down as CEO.
In September 2018, the company announced its impending closure after 15 years in operation.
Where Is Elizabeth Holmes Now?
Holmes had legal problems, yet her trial was adjourned until July 2021 when she is expected to give birth to her first child.
At her trial, Holmes accused Sunny Balwani of sexual abuse which he denied according to The Guardian.
CNN reported that a jury found her guilty on four of 11 charges filed by the federal government in January 2022. These included one count of conspiracy to defraud investors and three counts of wire fraud.
Holmes is currently out on bail with a bond of $500,000 and out of jail, but she could face up to twenty years in jail and a fine of $250,000. Additionally, each count against her carries with it an element of restitution.
Prosecutors have requested a sentence of 15 years and payment of $800 million, as reported by The Guardian because it will “denote the seriousness of these offenses, ensure just punishment for them, and deter Holmes and others.”
At this stage, Holmes’ lawyers requested an 18-month stay in her home and no jail time.
On November 18th, 2011 a judge sentenced her to 11 years in prison.
Before her sentencing hearing in April, it appears that she has welcomed a second child. According to court filings referring to both children, it appears they have been living together.
“Ms. Holmes has strong ties to her community: She is the mother of two very young children; she enjoys close relationships with family and friends, many of whom wrote letters at sentencing attesting to her good character; additionally, she volunteers at a rape crisis and counseling organization,” according to CBS news.
Sunny Balwani was found guilty in July 2022 of ten charges of federal wire fraud and two counts of conspiracy to be a wire fraud ringleader.
What Is Elizabeth Holmes’ Net Worth?
At 30 years old, Forbes named Holmes the world’s youngest billionaire woman with an estimated net worth of around $4.5 billion. However, in 2016, after multiple allegations against Holmes were revealed, Forbes revised their estimation to around $4 billion.
At one point, experts estimated her net worth to be $880 million; however, due to only owning half of Theranos shares and having many investors who had to repay the company, Theranos’ outlet calculated her net worth as zero.
In 2019, Holmes married William “Billy” Evans, the heir to the Evans Hotel Group founded by his grandparents in 1953 and owns three properties located in San Diego. According to Business Insider, Evans Hotel Group owns three properties from its portfolio.
Although the exact value of Evans and his relatives remain unknown, CNBC discovered during her trial that they resided in a 74-acre property located in Woodside, California that was appraised at $135 million.
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