The five-month trial of Elizabeth Holmes, founder of failed startup Theranos came to an end after she was found guilty on four counts including wire fraud on January 3, 2022. A lot of information about the company’s financial transactions have come to light. Holmes’ personal expenses, company’s losses throughout the years and more have been revealed.
The Silicon Valley based startup has wiped out $945 million that was invested by wealthy individuals. Records reveal that Elizabeth Holmes stayed in an expensive apartment as the company kept losing money. The apartment, with a fantastic view which overlooked the Golden Gate Bridge in San Francisco, cost $5,395 a month.
In the course of the trial, the startup lost the following amounts:
In 2010 the losses were $16.2 million.
In 2011, the losses were $27.7 million.
In 2012, the loss was $57 million.
However, in 2013, the company was losing about $2 million per week. The final loss in the year amounted to $92 million. In 2014, the company recorded a deficit of $376 million while its revenue was reported as $14,000. Theranos shut down operations in 2015. However, in 2015, Holmes had projected that Theranos would earn $122 million, in order to attract large investors.
Many startups see losses in early years but they slowly make it up because of the viability of the service offered. However, Theranos did not own any technology that was ground breaking. It used traditional machines already made by market leaders for the initial tests.
According to Danise Yam, the former financial controller, the company invested a lot of money into the research and development of blood testing machines but was not able to develop these machines as the breakthrough health technology that the company projected that they would provide.
Elizabeth Holmes remained a paper billionaire as the largest shareholder and was feted by many till Theranos was exposed by John Carreyou, who was an investigative journalist at the Wall Street Journal.