“Now, I wouldn’t perpetuate the funding if it turned out they weren’t able to do what they said they would,” he adds. Here’s why I’ve been able to find it and other people haven’t.’ I’d back them in a heartbeat,” Sahlman says. “If someone came in tomorrow, including a 19-year-old Stanford student, and said: ‘Look, I’ve developed this way to detect colon cancer 15 years before it shows up… Here’s the protein marker. Fraud, for instance, would cross that line. At the same time, there’s a line founders shouldn’t cross. It’s important that investors are willing to take gambles and risks early on, as ideas can change and teams can morph, according to Sahlman. “In all of my experience, I’ve not seen anyone do what they did,” he says. The Theranos case was an extreme one, according to Bill Sahlman, a professor at Harvard Business School, who has studied entrepreneurship for 40 years and been involved in around 200 different companies. Indeed those that were brave enough to invest in the health sector in the aftermath of Theranos’ demise have been rewarded handsomely.” “And in many ways the venture capital community has already moved on from this. “It’s important to remember that there are fraudsters in every industry,” says Mark Tluszcz, CEO at Mangrove Capital Partners. Some venture capitalists are worried that society might throw the baby out with the bathwater. While most appear to agree that Holmes did engage in the fraud she was accused of, Draper gets to a specific point: Without trial and error, there is no innovation. ![]() Some investors even sued the company when things went south, including hedge fund Partner Fund Management and Robert Colman, a former investment banker who brought the class-action suit against Theranos that revealed the extent of losses faced by the Walton family, Betsy DeVos family, Rupert Murdoch, and others. This is the nature of investing in progress.”ĭraper declined to comment on questions specifically regarding whether any evidence presented in trial had shifted any of his opinions or regarding his thoughts on the near- one million test results Theranos had to void or correct.ĭraper, a former neighbor of the Holmes family in California, is one of the last to continue standing by Elizabeth Holmes, or at least publicly. ![]() I still believe in what she was trying to do, and if this scrutiny happened to every entrepreneur as they tried to make this world a better place, we would have no automobile, no smartphone, no antibiotics, and no automation, and our world would be less for it.Ī willingness to bet on these entrepreneurs and their visions has made Silicon Valley the innovation engine of the world. Entrepreneurs invent and keep iterating until their product works. What has made America and Silicon Valley great is its ability to recognize what is possible. “This verdict makes me concerned that the spirit of entrepreneurship in America is in jeopardy. In a response to a series of questions, Draper sent me the following statement via email: Tim Draper, a venture capitalist who wrote Holmes a $1 million check when she dropped out of Stanford at 19 to start Theranos, says he still believes in what Holmes was trying to do.
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