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Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

arstechnica.com

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Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#201

Post by supperburg »

junon wrote: post #196
supperburg wrote: post #164

Earlier quoted context omitted.

The idea that Uber is not profitable is a myth isn’t it? I remember they posted some financial documents a while back that showed them in the red. But when I looked at the papers there were literal billions in advertising and expansion. Uber runs the app. People call an Uber and they pay money. Some of that money goes to the driver and some goes to Uber. You’re really saying that Uber can’t collect enough money to ru…

> The idea that Uber is not profitable is a myth isn’t it? I worked on the long-term forecasting team while I was there. At least 5-6 years ago, Uber was very, very far from profitable. I can't imagine much has changed enough for it to make them profitable. Maybe with the new CEO things changed but I'm doubtful. That company had a slew of issues.

Right, but would they be profitable if you took out the advertising and expansion costs? From the document I saw, yes. Can you please explain where are these enormous costs that are necessary to run the business? Is it SV salaries? Are their servers costing too much money? It doesn’t make sense. It’s like saying that the concept of dispatching taxis with a computer is not capable of being profitable. It simply isn’t true. It’s like people who said Amazon and Tesla were vapor ware because they were unprofitable. Everyone in the media and most people on HN couldn’t fathom the concept of subtracting R&D.

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#202

Post by dontblink »

photochemsyn wrote: post #29

The crazy thing about Theranos is that so many people with experience in microfluidics (developed mainly for DNA sequencing although there are other uses) knew that their claims were impossible, technologically speaking. Working with such small volumes to obtain quantitive estimates of blood chemistry is so implausible, as you are introducing uncontrollable variability - micro-evaporation, even tissue localization is…

I wouldn't say all train professionals knew this. I talked to doctors about Theranos and they were impressed by them and were bullish. It may be they didn't look too much into it.

Context: I was approached by a recruiter and I couldn't understand how Theranos distinguished itself from other labs or get any data when I tried to do diligence on their claims.

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#203

Post by hef19898 »

supperburg wrote: post #201
junon wrote: post #196

Earlier quoted context omitted.

> The idea that Uber is not profitable is a myth isn’t it? I worked on the long-term forecasting team while I was there. At least 5-6 years ago, Uber was very, very far from profitable. I can't imagine much has changed enough for it to make them profitable. Maybe with the new CEO things changed but I'm doubtful. That company had a slew of issues.

Right, but would they be profitable if you took out the advertising and expansion costs? From the document I saw, yes. Can you please explain where are these enormous costs that are necessary to run the business? Is it SV salaries? Are their servers costing too much money? It doesn’t make sense. It’s like saying that the concept of dispatching taxis with a computer is not capable of being profitable. It simply isn’t…

Excluding an integral part of the costs to say they are profitable is like saying you are cash flow positive, after including external funding. There is a reason why companies are running their books the way they are. Very good and valid ones!

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#204

Post by mardifoufs »

edot wrote: post #93
avalys wrote: post #83

Earlier quoted context omitted.

Can you provide any examples of a high-profile company, ultimately shown to be dishonest, where the early investors were able to “cash out” before this dishonesty became known?

WeWork and Nikola come to mind. Robinhood depending on if you consider purporting yourself to be “stealing from the rich, giving to the poor - Robinhood”, but you actually take orders from Citadel to be fraud. I think a lot of recent IPOs will turn out to be fraud-lite, in which it is shown over the next decade that these companies were pump and dumps that never actually do anything. They look just good enough to gar…

Which investor actually made money from WeWork? If anything it's an example proving the opposite. The founder may have made some money but the investors were left holding the bags. The whole scandal was centered around the size of the investment loss that the main investor, Softbank, had to eat...

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#205

Post by mardifoufs »

stagger87 wrote: post #177
avalys wrote: post #83

Earlier quoted context omitted.

Can you provide any examples of a high-profile company, ultimately shown to be dishonest, where the early investors were able to “cash out” before this dishonesty became known?

MoviePass

Movie pass was literally a loss for the vast majority of its investors. If anything it was a wealth transfer from the public/private market to the app users who got extremely subsidized movie tickets. Moviepass was a total loss for it's investors, so how does that not prove the opposite of what's being argued here

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#206

Post by junon »

supperburg wrote: post #201
junon wrote: post #196

Earlier quoted context omitted.

> The idea that Uber is not profitable is a myth isn’t it? I worked on the long-term forecasting team while I was there. At least 5-6 years ago, Uber was very, very far from profitable. I can't imagine much has changed enough for it to make them profitable. Maybe with the new CEO things changed but I'm doubtful. That company had a slew of issues.

Right, but would they be profitable if you took out the advertising and expansion costs? From the document I saw, yes. Can you please explain where are these enormous costs that are necessary to run the business? Is it SV salaries? Are their servers costing too much money? It doesn’t make sense. It’s like saying that the concept of dispatching taxis with a computer is not capable of being profitable. It simply isn’t…

It's not an easy question to answer, but the majority of the cost were salaries and marketing. We didn't consider the one-off costs of e.g. legal, from what I remember.

It was in the order of thousands (I think either $2k or $22k, sorry for the rounding error) per user signup that Uber paid in terms of marketing and advertising - and that was regardless of if they generated any money. It was way more for driver signups since the driving bonuses were pretty sizeable.

The amount of staff Uber has is way too much, in my opinion. Uber's internals are the definition of "over-engineered", to the point things were just too complicated for any single person to really work with, let alone understand to any degree. We had teams internally that were making the same thing but had no idea each other existed - and this happened pretty frequently.

There was a lot of turn and restructuring in upper management, not to mention pulling out of China and then having months in a row with almost daily sexual harassment/discrimination/bad CEO news stories breaking out. So the rest of the company was just kind of left to fend for itself for a long time, just burning even more money despite nothing getting released.

I knew one other engineer that... to this day, I'm not sure he even wrote a single line of code. He was always hanging around other people, wanting to chat. When you'd casually ask "so what are you working on these days?" he'd just shrug and smile. Never got a straight answer out of him. He was higher up in the ranks than I was, younger, assumedly paid more. Couldn't answer basic questions about writing code, but loved to brag about his new designer shoes and stuff. Just an anecdote.

It was insanity. Everyone I personally interacted with hated working there, and it was clear it was way too crowded. That, along with the marketing/ad spend, made me convinced Uber would never be profitable.

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#207

Post by kube-system »

MrGando wrote: post #189
malcolmgreaves wrote: post #70

Earlier quoted context omitted.

The fake it part is calling something full self driving when it does anything but that.

They stopped calling it fully self driving a little while ago in part due to a lot of pretty bad press and some good journalistic research.

> "Full Self-Driving Capability $10,000"

... is listed today as an option when configuring any vehicle on tesla.com

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#208

Post by supperburg »

hef19898 wrote: post #203
supperburg wrote: post #201

Earlier quoted context omitted.

Right, but would they be profitable if you took out the advertising and expansion costs? From the document I saw, yes. Can you please explain where are these enormous costs that are necessary to run the business? Is it SV salaries? Are their servers costing too much money? It doesn’t make sense. It’s like saying that the concept of dispatching taxis with a computer is not capable of being profitable. It simply isn’t…

Excluding an integral part of the costs to say they are profitable is like saying you are cash flow positive, after including external funding. There is a reason why companies are running their books the way they are. Very good and valid ones!

I don’t know if that’s a technical accounting term but “integral” is the key word there. Massive expansion is not integral to the normal operations of a business. R&D and literal billion dollar ad campaigns are tools to expand and grow into whatever space is open from lack of competition. Amazon filled their space, Tesla theirs and one of the computerized taxi companies will fill that space. Until they do, they will spend money on expansion. So that’s the key. It’s a temporary state. “Integral” is a completely incorrect term for the cost of that growth. The viability of a business is based on how much it costs them to actually carry out their core business.

And maybe Uber has already gotten as big as they will get. It doesn’t change the fact that they don’t need one billion dollars in advertising. And also, what you are asserting is that it’s impossible for a computerized taxi company to exist. So do you think it would be cheaper to have a human dispatcher? Obviously you can run a profitable taxi company. It’s been a thing for a long time and the computers aren’t making it any worse or more expensive I can assure you.

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#209

Post by stickfigure »

avalys wrote: post #83
munificent wrote: post #74

Earlier quoted context omitted.

> What just amazed me is how gullible all the investors were, and how they didn't do due diligence, hire outside experts, or anything. Weird. The thing is, the primary goal of an investor is not to invest in companies that are honest and actually do what they claim. The goal is to invest in a company that reaches a valuation high enough to let them recoup their investment at a profit. If that valuation happens throug…

Can you provide any examples of a high-profile company, ultimately shown to be dishonest, where the early investors were able to “cash out” before this dishonesty became known?

The hard part here is "ultimately shown to be dishonest" - who is privy to what is said in boardrooms and sale negotiations? How about just examples where the investors managed to get out just before the bubble popped?

The canonical example would be Broadcast.com, which made Mark Cuban a billionaire.

https://en.wikipedia.org/wiki/Broadcast.com

1998 IPO at $1B valuation

1999 bought by Yahoo! for $5.7B

2002 shut down

Re: Elizabeth Holmes urged employees to hide Theranos’ lab equipment from inspectors

#210

Post by paxys »

fullshark wrote: post #116
tushar-r wrote: post #62

I recommend the "Bad Blood: The Final Chapter" podcast by John Carreyrou. He's the journalist who broke the story and the podcast goes into some detail about the history and also talks about what is going on now.

Or read his book! It's fabulous.

Do both! I loved the book and am following the podcast. There's a lot of new commentary about the trial and the material that came out during discovery (which wasn't available to the author when he wrote the book).
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