Theranos: The $10 Billion Disaster

• Why did Theranos attract so much attention?
• How Did Theranos Operate and What Made It Unique?
• Why Did Theranos Ultimately Fail?
• What happened to Theranos' management?
• Theranos Timeline: Major Milestones
• What Are the Main Lessons from the Theranos Failure?

Theranos — was a medical technology company founded in 2003 promised hundreds of blood tests from a single drop, raised over $ 700 million in funding, and hit a $ 10 billion valuation in 2013−2014.
The company collapsed in 2018 because the technology did not deliver the promised results and many claims were exaggerated or false.
The biggest lesson: in high-technology businesses, real proof and transparency matter far more than secrecy and bold promises.
In 2026, the Theranos story is still one of the most discussed examples of what can go wrong in technology.

• The idea seemed like a real breakthrough in healthcare.
• Major investors and well-known partners believed in it.
• The company received huge investments and very high praise.
• The founder was very young at the time of launch—Elizabeth Holmes was only 19 when she founded the company.

The combination of all these factors has created a real buzz in the world of technology.
But hype is no substitute for a clear business model and a well-calculated project economy. For more information on launching a technology-based entertainment business, see our guide to launching a VR business.

Theranos positioned itself as a revolutionary technology company.
It developed blood tests that required only a tiny amount of blood.
The core technology was "nanocontainers" — small capsules for storing and analyzing microscopic volumes of blood.
In technological projects, it is the equipment that must confirm the stated capabilities — we discussed this issue separately in the article on LBE-VR equipment requirements.

• Extreme secrecy: employees were isolated from each other, everyone signed strict non-disclosure agreements, and almost no one saw the main device in action.
• Strategic partnerships with large pharmacy chains Walgreens and Safeway, which gave the impression of real commercial success.

These choices helped build hype, but also concealed serious problems.

Theranos failed because the technology did not perform as promised.
The devices could not reliably run the claimed tests, and many demonstrations were not based on actual results.

• The machines were not accurate enough for real medical use.
• Important data and independent tests were never made public.
• Internal problems were not addressed openly.
• Warnings from experts and employees were ignored.

Such mistakes begin with an incorrect assessment of the technical base — we wrote more about this in our article on "Mistakes in choosing VR headsets for LBE"

In 2018, the US Securities and Exchange Commission (SEC) charged Theranos, Elizabeth Holmes, and former president Sunny Balwani with fraud, wire fraud, and conspiracy to commit fraud.
In 2022, Holmes was found guilty on four counts and sentenced in November of that year to 11 years and 3 months in prison, while Balwani was convicted on all twelve counts in December 2022 and sentenced to 12 years and 11 months in prison and 3 years of probation.

• 2003 — company founded (initially named Real-Time Cures, later renamed Theranos).
• 2013−2014 — peak valuation of $ 10 billion; major funding rounds.
• 2015 — medical experts and journalists start questioning the technology.
• 2016 — authorities ban certain devices; the company withdraws test results.
• 2018 — company accused of misleading investors and shuts down completely.
• 2022 — Holmes and Balwani are convicted on multiple counts of fraud and conspiracy.

On November 18, 2022, a federal court in California sentenced company founder Elizabeth Holmes to 11 years in prison and banned her from leading any company for 10 years.
This timeline clearly shows how fast high expectations can collapse without solid evidence.

Theranos teaches one central truth: big promises in advanced technology must be backed by real proof, openness, and strict standards.

1. Always run independent tests and publish real results publicly.
2. Be transparent about what works and what still needs work — secrecy often hides major flaws.
3. Follow all industry rules and safety standards right from the start.
4. Build a culture where people can speak honestly about problems.
5. Earn trust through facts and data — not just exciting narratives.

This is where any large-scale project begins, whether it’s medical technology or the opening of a VR entertainment park, as we discussed earlier.
Unlike cases like Theranos, many successful companies today prioritize proven technology, clear communication, and reliable partner support — and they grow steadily.
In conclusion: the Theranos story reminds everyone in technology that real results and transparency always beat hype in the long run.
We at Anvio live by these principles every single day.
Business sustainability is formed not only at the launch stage, and additionally, through a well-structured system of load management—we discussed this aspect in detail in our article on seasonal promotions for VR clubs.
Ready to build a profitable business in the field of VR entertainment?

Write to us at sales@anvio.com or leave a request on the website—We will calculate your model, help you choose a location, and help you open your VR arena in two months.