Let us delve into the details of one of the world's youngest self-made woman billionaire and the founder of Theranos, Elizabeth Holmes.
The story of Theranos founder, Elizabeth Holmes is quite dramatic, considering a rapid rise and fall. The diva got the tag of the 'youngest and wealthiest self-made female billionaire in America' in 2015 by Forbes. However, the 36-year-old failed to sustain such a peak, and within a year, the same source revised her worth to zero. Shocking isn't it? Not just that, Fortune named her as one of the 'World's Most Disappointing Leaders' as well.
The story of Elizabeth Holmes isn't the ordinary, so it caught the attention of several production units resulting in an ABC documentary 'The Dropout' on her financial collapse. The rapid rise did incur a doubt among the regulatory bodies, which led an investigation on Holmes' firm's technology claims and investors. Ultimately, she received several charges on massive fraud that led her to fall. So, without wasting much time, let's know more about her net worth and the drastic fall.
Elizabeth Holmes Was the Youngest Billionaire by Net Worth
Just like most of the famous dropouts we know, such as Steve Jobs and Bill Gates, it seemed like Elizabeth Holmes was on the same route initially. The Stanford-University dropout founded Theranos in 2003 when she was just 19. It was a unique concept in the health sector as it used to perform blood tests using small amounts of blood. Despite the fact that many pulled her leg while she pitched her idea, labeling it as impossible, she went on to burn the midnight oil and eventually achieved success.
Elizabeth Holmes' company Theranos received a massive valuation of $9 million in 2020. Photo Source: Biography
In 2015, Holmes broke all sorts of records when Forbes described as the youngest and wealthiest self-made billionaire in America. Specifically, the claims were made based on the staggering net worth of $9 billion from her company's valuation. Reaching so high, so fast wasn't easy as she went through a lot of struggles in funding and expanding Theranos in the early years. By 2004, Holmes managed to raise $6 million to fund the venture. Similarly, the numbers soared quickly with operational accomplishments, resulting in more than $92 million in venture capital. Consequently, she managed to enter the Forbes 400 in 2014, with more than $400 million in venture capital.
Once a hero, Elizabeth Holmes managed to make a significant sum of wealth for herself from all those fruitful years. Even though the firm is undergoing insolvency, the 35-year-old accumulates a staggering net worth of $4.5 billion as of April 2020. The numbers are quite vast and would be more than enough for Holmes to live the rest of the lives in a lavish style.
Elizabeth Holmes' Fall From Fraudulent Activities
Following the massive valuation of Theranos, Elizabeth Holmes couldn't be happier. However, that point of time could be labeled as the beginning of the end since John Carreyrou from The Wall Street Journal started a secret investigation with the help of ex-employees to publish a brutal article on how the firm produced inaccurate results and how it was using commercially available machines made by other manufacturers for most of its testing. Eventually, regulatory bodies and concerned parties got the much-needed attention and inspected their own.
The 35-year-old Elizabeth Holmes is a drop out from Stanford University. Photo Source: Wikipedia
The Centers for Medicare and Medicaid Services found enough evidence on Theranos's uncovered irregularities with staff proficiency, procedures, and equipment to send a warning later. Later in July 2016, they officially banned Elizabeth Holmes for two years, which caused severe damage to the firm's reputation. Similarly, all its major stakeholders pulled out, including Walgreens, as the FDA also ordered them to stop using its Capillary Tube Nanotainer device, one of its important inventions. Similarly, the State of Arizona filed a suit against Theranos in 2017 on the claims of how it sold 1.5 million blood tests by misrepresenting essential facts. While they settled the lawsuit by paying $225,000 in fines and a total of $4.65 million, the damages were already done.
Following numerous lawsuits and fraudulent allegations, 99% of Theranos shareholders reached on the agreement to dismiss all the litigation for the preferred stock. Holmes also released her portion of the equity to offset the dilution of stock value to non participating shareholders. With every inspection, new allegations propped up, such as the time when the firm lied when t claimed to have $100 million in revenue instead of the actual $100 thousand in 2014. Gradually, the firm laid off most of its employees and started the dissolving process, with the remaining assets to be distributed among the creditors. A further trial is scheduled in August 2020.
Elizabeth Holmes Moved out of the San Francisco Apartment
Elizabeth Holmes listed her San Francisco on rent for $5,395 per month. Photo Source: Rentsfnow
The billionaire earning diva, Elizabeth Holmes, looked to start fresh in 2019 as she tied the knot with husband, Billy Evans. The former Theranos CEO moved out of her luxury apartment in Lombard Street, San Francisco.
The lavish house comprises of all the modern-day amenities such as a modest hallway, with delightful white decors. The two-bedroom apartment includes expensive interiors, hardwood floors, and a scene of the beautiful Golden Gate Bridge from the window. Following the move-out, Holmes preferred not to sell her property but rent it instead. In fact, the house is currently on rent for $5,395 per month.
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