I just taught the Theranos case in my course on “Innovation and Industry Development,” co-taught with Prof. Elizabeth Lyons. The first half is about positioning a startup: powerful new technology, established incumbents, how should we enter to disrupt the industry and make the world a better place? Any moderate set of numbers makes Theranos’ reputed  $9,000,000,000 valuation look reasonable.

The “case” presently consists of four articles. I put together a set of overhead slides to generate and lead the discussion. The first half ends with some general lessons about disruptive innovation and whether to follow an open or closed IP strategy. The second half starts in December 2015 and discusses the crash. I also compare Theranos with the Google contact lens (another technically impossible pseudo-invention).

“That’s a type of Silicon Valley arrogance,” he said. “That isn’t how science works.” (re Google, not Theranos)

To my surprise, students were not familiar with Theranos’ and thought it was a great technology. This allowed a discussion that took everything at face value. I even did some glucose testing on myself, to show how self-testing can work very well. The second half, of course, led to lots of questions and surprise.

I’m posting my slides if anyone wants to teach a case about Theranos. If there is enough interest, I may turn this into a real HBS-style case. Theranos case slide deck Bohn 2017 Here is a thorough chronology by a medical site. I had not realized how brief their ride was: press coverage started in September 2013, and by the end of 2015 the writing was on the wall for anyone with expertise. In fact, it turns out that many VCs refused to invest in them due to the lack of information.

There is a huge amount of other information on the WWW, of course, so a case can emphasize many different aspects. In a few years perhaps some lawsuits will become public, and we will be able to better understand why so many employees at Theranos went along with what turned out to be, by 2012, fraudulent.