Elizabeth Holmes, whose descent from tech visionary to felon rocked Silicon Valley, reported to a prison camp in Texas on Tuesday to begin a more than 11-year sentence on charges tied to her defunct blood-testing start-up.
For months, the Theranos founder sought to remain out of prison as she appealed her wire fraud conviction, arguing that she had been on good behavior throughout her trial and would have no reason to flee, citing “strong ties” to her family, including her two young children. But U.S. District Judge Edward J. Davila, who oversaw the federal case, rejected that request in April. The 9th Circuit Court of Appeals also rejected the request, and Holmes was ordered to report to prison by 2 p.m. Tuesday.
Holmes’s downfall has been used as an allegory of the apparent “growth at all costs” mind-set within the tech community, even as some of its members have sought to cast Holmes and Theranos as outliers. Holmes’s fall from grace has been chronicled in an HBO documentary, a Hulu drama series, a best-selling book and multiple podcasts.
Holmes founded Theranos in 2003 while a student at Stanford University. She later dropped out of school, pouring her energy into the blood-testing start-up and adopting a persona that included black turtlenecks reminiscent of the wardrobe of Apple founder Steve Jobs. At its height, Theranos was valued at $9 billion and attracted prominent investors including Larry Ellison and Rupert Murdoch. Political figures such as Henry Kissinger and Jim Mattis sat on the company’s board. Holmes was celebrated as an example of a successful female entrepreneur, her image graced magazine covers and her net worth peaked at an estimated $4.5 billion in 2015.
That year, however, her reputation began to unravel when a Wall Street Journal investigation revealed a dysfunctional workplace and cast serious doubt on the company’s claims that it could run a multitude of tests from just a couple of drops of blood. In 2018, Theranos shuttered amid multiple regulatory and media investigations, and Holmes faced criminal charges.
Holmes was convicted in January 2022 on four counts of wire fraud and conspiracy to commit wire fraud against investors. In a separate but similar trial, Holmes’s former business and romantic partner, Ramesh “Sunny” Balwani, was found guilty of 12 counts of conspiracy to commit wire fraud and wire fraud. He began serving a 13-year sentence April 20 at a federal correctional institute in San Pedro, Calif.
At the Bryan prison camp, inmates are generally required to wake up at 6 a.m., according to the facility’s handbook. Each is required to keep her space clean, and inmates typically wear clothing colored pastel green, gray or white.
In addition to their prison sentences, Holmes and Balwani have been jointly ordered to pay more than $452 million in restitution to a list of victims that includes venture-capital firms and wealthy individuals, including Murdoch and Richard Kovacevich, a former chief executive of Wells Fargo. It’s unlikely they’ll see much of their money, since Holmes probably will not earn enough to pay them in full, legal experts told the BBC.
In an interview published in the New York Times in early May, Holmes said she would “have to work for the rest of my life” to pay her legal expenses, which have been estimated at around $30 million. Holmes, who the article said now goes by “Liz” and had been volunteering at a rape crisis hotline, expressed remorse in the interview.
“I made so many mistakes and there was so much I didn’t know and understand, and I feel like when you do it wrong, it’s like you really internalize it in a deep way,” she told the Times.
