Beth Esponnette, founder of Unspun, a bespoke jeans company, said investors have often encouraged her to be more aggressive and take action that could border on dishonesty. On one occasion, an investor recommended that you increase your profit prospect by multiples of 10, a highly unrealistic level.
Last month Esponnette published an essay titled “I Get It, Elizabeth Holmes” describing this tug of war. Many of Holmes’ actions are inexcusable, wrote the 33-year-old Esponnette. “But I think she was convinced she was doing the right thing and just followed Silicon Valley’s universal recommendation: ‘do so until you succeed.’
Several women who work in tech startups have written to thank her for writing about the feelings many of them share, Esponnette said.
Lola Priego, 30, founder of Base, a company that offers home blood and saliva tests that are then processed in traditional laboratories, says she hears a Theranos comparison at least once a week. The recommendations come directly or indirectly from potential partners, consultants, investors, clients and reporters, he said.
Priego says he understands the need to be skeptical because healthcare startups need to be scrutinized to avoid negligence. Comparisons often stop when people learn that Base is working with Quest Diagnostics, a multinational company, to do their test analysis.
“But the additional bias and skepticism are difficult to overcome,” said Priego.
The biggest blow came from a scientific advisor Priego planned to hire in 2019. The consultant attended the meeting to tell him that the introduction of technology into healthcare is just as damaging to the industry as it is to Theranos. That made Priego wonder if he could hire the kind of consultants he needed.
“It was pretty demoralizing,” he said. Since then he has hired six consultants.
In July, Verge Genomics formed an alliance with pharmaceutical giant Eli Lilly that will allow him to work on drugs to treat amyotrophic lateral sclerosis, or ALS, for three years, Zhang said. In addition, the company published an article about its methods in a scientific journal last year and this year hired a director for science.
It is a relief to be able to show something to doubters, said Zhang.
“The most fragile time of any company is the initial phase, when it comes to attracting people, convincing them of your vision and the merits of the idea,” he said. Commenting on Holmes and Theranos, he added, “At this stage, these types of partnerships can be most damaging and undermine your potential.”
Erin Griffith writes about tech startups and venture capital from her San Francisco office. Before joining the Times, she was a senior writer at Wired and Fortune. @eringriffith