Post: #151

(05-25-2016 08:42 PM)Cattle Rustler Wrote:  

(05-25-2016 04:30 PM)Days of Broken Arrows Wrote:  I just saw this headline today at MarketWatch and wanted to share it: "Walgreens made $50 million Theranos deal without testing its technology."

The bad news: Someone at Walgreens fucked up royally and it will probably affect prices in their stores for everyone.

The good news: No matter how bad you or I fucked up our investments and no matter how many mistakes we make at work, and least we aren't the guy who made the decision to spend $50 million on this scam.

Imagine having that on your resume.

I don't know how people give money to these dorks. They could give it to me and I would give them a bigger ROI, probably by buying coke in Colombia and slinging it in Asia.

Insert obligatory comment about how most fund managers can't keep up with the S&P in terms of ROI, let alone exceed it.

Always remember: absent very high-end technology, all this stuff around us that we call life was made up by people who are no smarter than you.

God save us from people who mean well. -storm

Post: #152

It's a shame Basil Ransom doesn't post anymore, I've enjoyed reading his old stuff.

Post: #153

^^ what happened to basil? I remember he was one of the OGs.

Post: #154

If you look at his last post and the response you can see why he may have stopped.

Post: #155

And now the lawsuits starts to roll in. Bring out more popcorn.

http://money.cnn.com/2016/05/25/technolo...s-lawsuit/

Theranos is sued for inaccurate blood tests and false marketing

Quote:On Wednesday, a lawsuit was filed in Northern California, accusing Theranos of falsely marketing its proprietary finger-prick blood test. According to the suit, Theranos promoted itself as being compliant with regulations even as it was being sanctioned by authorities.

The suit, filed on behalf of an Arizona man referred to as "M.P.B.," comes one week after Theranos said that it had issued corrections for thousands of its blood tests. It also said it voided two years' worth of results from its "Edison" device. At that time, the company said that no patients suffered harm due to inaccurate results.

But there is at least one unhappy customer who is taking legal action against Theranos. According to the suit, M.P.B. purchased a Theranos test at a Theranos Wellness Center in a Walgreens in Tempe, Arizona, around December 2015. The suit claims that the test didn't work and didn't produce accurate results.

"As a result, tens of thousands of patients may have been given incorrect blood-test results, been subject to unnecessary or potentially harmful treatments, and/or been denied the opportunity to seek treatment for a treatable condition," reads the suit, filed by attorneys from McCuneWright LLP.

Post: #156

(05-25-2016 06:46 PM)alphaspiraton Wrote:  

(05-25-2016 05:16 PM)porscheguy Wrote:  

(05-25-2016 04:44 PM)Soma Wrote:  My understanding is that all recent funding for Theranos came from private equity (dumber money) rather than venture capital. For example, CrunchBase shows that 80% of all Theranos funding was from PE. The rumor mill says that Silicon Valley VC's smelled something was off with Holmes and Theranos and haven't touched the company since 2010.

What's the difference between PE and VC? Am I to assume that PE is when you gamble with other people's money, and VC is when you gamble with your own?

Technically speaking, VC is a form of PE. The other being BO. However, PE and BO are used synonymously.

VC would be investing at the seed (idea) or start up stage (early operations) of a company, whereas BO would be investing in more mature companies. VCs look for 1 hit wonders, and most of their investments are failures with very few but very successful winners. On the other hand, BOs look for established companies with a track record and steady cashflows. Due diligence is significantly more important for BOs (investing millions/billions more than VC on each venture) which is why this Theranos scandal reflects very badly on the profession; these dimwits were trying to make a quick buck on the back of a female exec (the next steve jobs) that no one really bothered to do their due diligence.

And although it's all private money, some larger pension funds and foundations/endowments do occasionally invest in PE funds so I wouldn't be surprised if this scandal impacts more people than we think (indirectly).

Private equity usually involves buying up a company that's in trouble, fixing it up (read: fire all the current senior management and replace with better managers) then selling it a few years later at a profit. PE does not typically get involved in startups, strictly speaking. Cerberus, Carlyle, KKR, etc. are examples of PE firms.

Venture capital is just like it sounds - a firm with money seeking ventures that they will fund if they think they can make money from it. That said, VC firms often go into a string of deals expecting a few to fail - maybe three out of ten. Tim Draper is a well known VC guy in Silicon Valley who got behind Theranos at the very beginning before all of the DC hacks piled on. As mentioned, the lack of due diligence is appalling even in the current irrationally exuberant Silicon Valley climate.

The two are related but not always from the same people.

As for those lawsuits, I sure hope they are able to find a few people who suffered actual harm they can prove versus "it could have happened" speculation. The latter just isn't enough to be successful in a civil case. I do think it's very telling how Holmes played hide the ball for so long - refusing any and all opportunities to demonstrate transparency.

She is starting to look a lot less like the innocent dorm room kid who got in over her head and more like a complicit actor in a grand scam. I seriously hope that sooner or later she will answer for this malfeasance somehow, pussy pass notwithstanding.

Post: #157

(05-26-2016 10:40 AM)SlickyBoy Wrote:  

(05-25-2016 06:46 PM)alphaspiraton Wrote:  

(05-25-2016 05:16 PM)porscheguy Wrote:  

(05-25-2016 04:44 PM)Soma Wrote:  My understanding is that all recent funding for Theranos came from private equity (dumber money) rather than venture capital. For example, CrunchBase shows that 80% of all Theranos funding was from PE. The rumor mill says that Silicon Valley VC's smelled something was off with Holmes and Theranos and haven't touched the company since 2010.

What's the difference between PE and VC? Am I to assume that PE is when you gamble with other people's money, and VC is when you gamble with your own?

Technically speaking, VC is a form of PE. The other being BO. However, PE and BO are used synonymously.

VC would be investing at the seed (idea) or start up stage (early operations) of a company, whereas BO would be investing in more mature companies. VCs look for 1 hit wonders, and most of their investments are failures with very few but very successful winners. On the other hand, BOs look for established companies with a track record and steady cashflows. Due diligence is significantly more important for BOs (investing millions/billions more than VC on each venture) which is why this Theranos scandal reflects very badly on the profession; these dimwits were trying to make a quick buck on the back of a female exec (the next steve jobs) that no one really bothered to do their due diligence.

And although it's all private money, some larger pension funds and foundations/endowments do occasionally invest in PE funds so I wouldn't be surprised if this scandal impacts more people than we think (indirectly).

Private equity usually involves buying up a company that's in trouble, fixing it up (read: fire all the current senior management and replace with better managers) then selling it a few years later at a profit. PE does not typically get involved in startups, strictly speaking. Cerberus, Carlyle, KKR, etc. are examples of PE firms.

Venture capital is just like it sounds - a firm with money seeking ventures that they will fund if they think they can make money from it. That said, VC firms often go into a string of deals expecting a few to fail - maybe three out of ten. Tim Draper is a well known VC guy in Silicon Valley who got behind Theranos at the very beginning before all of the DC hacks piled on. As mentioned, the lack of due diligence is appalling even in the current irrationally exuberant Silicon Valley climate.

The two are related but not always from the same people.

There are many many forms of private equity investing and your first paragraph refers to distressed investing, which utilizes extreme amounts of leverage to buy troubled public companies and take them private, reshuffle the operations and take them public again or sell them to strategic buyers for a profit. Middle-market buyout funds could also just purchase private companies and divisions of public companies. Obviously, in this case, Theranos was not in a distressed situation (prior to funding), but rather everyone wanted a piece of the pie so this is a different form of PE.

We are essentially saying the same thing and what I was trying to point out is that VC is just a subset of private equity. The 2 most common forms of PE are Venture Capital and Buyout Funds. Private equity is a broad term but yes it does mean what it sounds like, private capital. So at the end of the day to say there are many pissed off rich investors as a result of the Theranos scandal would be an understatement. Makes you think though, that the ones that were "in" surely must have been in on it to keep the little Theranos bubble going but that's pure speculation.

Post: #158

(05-26-2016 07:56 AM)Buakaw Wrote:  And now the lawsuits starts to roll in. Bring out more popcorn.

http://money.cnn.com/2016/05/25/technolo...s-lawsuit/

Theranos is sued for [b]inaccurate blood tests and false marketing[/b]

Quote:On Wednesday, a lawsuit was filed in Northern California, accusing Theranos of falsely marketing its proprietary finger-prick blood test. According to the suit, Theranos promoted itself as being compliant with regulations even as it was being sanctioned by authorities.

The suit, filed on behalf of an Arizona man referred to as "M.P.B.," comes one week after Theranos said that it had issued corrections for thousands of its blood tests. It also said it voided two years' worth of results from its "Edison" device. At that time, the company said that no patients suffered harm due to inaccurate results.

But there is at least one unhappy customer who is taking legal action against Theranos. According to the suit, M.P.B. purchased a Theranos test at a Theranos Wellness Center in a Walgreens in Tempe, Arizona, around December 2015. The suit claims that the test didn't work and didn't produce accurate results.

"As a result, tens of thousands of patients may have been given incorrect blood-test results, been subject to unnecessary or potentially harmful treatments, and/or been denied the opportunity to seek treatment for a treatable condition," reads the suit, filed by attorneys from McCuneWright LLP.

Inaccurate blood tests? Imagine that?

May 1: "We're sorry to tell you that you have cancer. You have three months to live. Goodbye and good luck."

May 2: "Terminal cancer" patient quits his job, blows his entire life savings doing everything he always wanted to do, and just goes wild.

June 1: "Hi, this is Mandy from Theranos. We were wrong -- you don't have cancer at all. You had the common cold. The blood test was 'inaccurate.' Oops! Sorry! Our bad!"

June 2: Jobless, broke man who ruined his rep going wild jumps off bridge to his death. But hey, at least he was cancer-free!

Post: #159

(05-26-2016 02:37 PM)alphaspiraton Wrote:  We are essentially saying the same thing and what I was trying to point out is that VC is just a subset of private equity. The 2 most common forms of PE are Venture Capital and Buyout Funds. Private equity is a broad term but yes it does mean what it sounds like, private capital. So at the end of the day to say there are many pissed off rich investors as a result of the Theranos scandal would be an understatement. Makes you think though, that the ones that were "in" surely must have been in on it to keep the little Theranos bubble going but that's pure speculation.

The last I read, there was about $400 million in actual cash raised, with the rest being nonsensical valuation. Draper put in one million, with the rest coming from others who were probably just that blasé about it after getting the blessing from a big shot Silicon Valley type like Draper. A basic level of checking should have revealed the utter lack of fundamentals. That said, one of the backers was Tako Ventures, a firm that specializes in biotech companies - they should have known better. Others like Continental Properties (a DC based real estate developer) were just piling on. High stature DC insiders probably wouldn't want to be involved with something potentially litigious. I think they just got careless, greedy and drank their own grrrl powered kool aid.

Had Theranos managed to release an IPO that would have been the short of the century for anyone paying attention. I suspect it was the pre-IPO investigation by others in the financial world which revealed the man behind the curtain and finally put the brakes on it.

Post: #160

Good research. I would also suspect that when the SEC got involved publicly a lot of things started unravelling quite fast. Reminds me of Valeant's (TSE: VRX) own demise earlier this year. Anytime the SEC made an announcement of further investigation in their accretive accounting practices or their involvement with Philidor (?) the stock would tank $10-50/sh. With Theranos, only 1 person knew from the start that it was a bust and I don't see her ass in jail yet.

Post: #161

http://www.forbes.com/sites/matthewherpe...217fa82f29

Quote:
Last year, Elizabeth Holmes topped the FORBES list of America’s Richest Self-Made Women with a net worth of $4.5 billion. Today, FORBES is lowering our estimate of her net worth to nothing. Theranos had no comment.


Our estimate of Holmes’ wealth is based entirely on her 50% stake in Theranos, the blood-testing company she founded in 2003 with plans of revolutionizing the diagnostic test market. Theranos shares are not traded on any stock market; private investors purchased stakes in 2014 at a price that implied a $9 billion valuation for the company.

Since then, Theranos has been hit with allegations that its tests are inaccurate and is being investigated by an alphabet soup of federal agencies. That, plus new information indicating Theranos’ annual revenues are less than $100 million, has led FORBES to come up with a new, lower estimate of Theranos’ value.

FORBES spoke to a dozen venture capitalists, analysts and industry experts and concluded that a more realistic value for Theranos is $800 million, rather than $9 billion. That gives the company credit for its intellectual property and the $724 million that it has raised, according to VC Experts, a venture capital research firm. It also represents a generous multiple of the company’s sales, which FORBES learned about from a person familiar with Theranos’ finances.

At such a low valuation, Holmes’ stake is essentially worth nothing. Theranos investors own preferred shares, which means they get paid back before Holmes, who owns common stock. According to VC Experts, investors in Theranos own a particular kind of preferred equity, called participating preferred shares, which take precedence to common stock in the event of a liquidation. FORBES is not aware of any plans to liquidate. If that were to happen, participating preferred investors would get their money back and more before Holmes gets a cent.

It is possible that at some point, Holmes may be able to raise money at a higher valuation than $800 million from her existing investors, but we are not betting on it.

Here are three reasons FORBES lowered our estimated value of the blood testing company:

Too much is unknown. Everything but the $9 billion valuation is secret. Theranos said it would replace traditional blood tests, in which a needle is used to extract blood into a vial, with machines that could do dozens of tests on a drop of blood taken from a finger. But it has presented no data proving its systems work.

Theranos has not delivered. Holmes has been promising to publish data for six months, but hadn’t submitted a single paper as of April. She initially presented the Food and Drug Administration’s approval of a single test for herpes virus as proof that her technology worked, and that a startling 120 more approvals would follow. Instead, the FDA introduced restrictions that led Theranos to stop using its finger-stick tests, and no approvals have followed. Theranos has voided thousands of the finger stick tests, according to a May report from The Wall Street Journal.

Theranos’ target market may not exist. Outside experts are skeptical of the idea that Theranos could be worth nearly as much as incumbents like Laboratory Corp. of America (market capitalization: $13 billion) and Quest Diagnostics DGX -0.05% (market capitalization: $15 billion). Theranos, which charges less per test, would need to dramatically improve margins on its tests (which it has said it can do), as well as get many more people to take its blood tests.

“Trying to displace low-cost lab tests is just such a tough area,” says Robert Nelsen of ARCH Ventures, the top-ranked healthcare venture capitalist on the Forbes Midas List. Margins are low, and it is difficult for new technologies to become established. Robert Kocher, a healthcare-focused partner at venture capital firm Venrock, says if Theranos’ technology works, it will find more value selling its machines than trying to recreate LabCorp LH -0.05% and Quest’s infrastructure from scratch.

Holmes will be making a presentation on Theranos’ data at the annual meeting of the AACC, formerly the American Academy for Clinical Chemistry, in August. Perhaps that will shed some light on what data Theranos has to support the use of its technology. In the meantime, given the difficulties at Theranos, Holmes falls off the list of America’s Richest Self-Made Women and off all of FORBES’ other wealth lists.

Post: #162

Kind of a Johnny come lately in the due diligence department, but better late than never I guess.

One of the commenters in the article astutely pointed out that she's also famous for speaking out against backup plans. Bet she wishes she had one now......

Post: #163

Amazing what you can do if your only thinking whatever the rest of the group thinks.

Post: #164

Forbes revised the estimate of her wealth from $4.5b to ZERO.

http://money.cnn.com/2016/06/01/technolo...os-forbes/

Surprised she hasn't tried becoming an hero yet.

Post: #165

(06-01-2016 01:14 PM)Mr. Accuride Wrote:  Forbes revised the estimate of her wealth from $4.5b to ZERO.

http://money.cnn.com/2016/06/01/technolo...os-forbes/

Surprised she hasn't tried becoming an hero yet.

When comes the part where her net worth falls into the negative numbers because she gets sued for defrauding investors and has to pay insane lawyer fees?

This isn't all that different from those nutjob women who claim they have cancer and raise money under false pretenses. Come to think of it, this seems like an upper-class version of that.

Post: #166

2015 Woman of the Year Awards for being a fantastic con artist?

You should read some of the comments on the Daily Mail article on her net worth's nonexistence, they're along the lines of "If she had stayed home and baked bread and taken care of her man's house, none of this would have happened." Savage, to say the least.

Post: #167

Although she was a nobody several years ago, seems she was involved / conned into being apart of something sinister.
Note the hand gesture. 666 :

Post: #168

(06-01-2016 04:57 PM)Days of Broken Arrows Wrote:  

(06-01-2016 01:14 PM)Mr. Accuride Wrote:  Forbes revised the estimate of her wealth from $4.5b to ZERO.

http://money.cnn.com/2016/06/01/technolo...os-forbes/

Surprised she hasn't tried becoming an hero yet.

When comes the part where her net worth falls into the negative numbers because she gets sued for defrauding investors and has to pay insane lawyer fees?

This isn't all that different from those nutjob women who claim they have cancer and raise money under false pretenses. Come to think of it, this seems like an upper-class version of that.

She'll just BK.

Post: #169

I wonder if she's already started boinking some rich guy hoping that he'll bail her out.

Post: #170

I wonder how much of her VC came from thirsty dudes who wanted to hop on the grrl power band wagon?

Post: #171

I just heard her talking for the first time. Sweet Jesus, she has a deeper voice than James Earl Jones!

Post: #172

I was always wondered is how somebody who was not doing anything and did not have a background in the field of the product they are suddenly was billions invested into a company, the board member of her company are all top politicians, I wonder if this a big laundering operation.

Post: #173

The whole story sounds like the background for an Illuminati thriller. Even the name, Theranos, sounds sinister.

Post: #174

(06-02-2016 11:57 PM)RawGod Wrote:  The whole story sounds like the background for an Illuminati thriller. Even the name, Theranos, sounds sinister.

Theranos sounds like the name of some pagan god or demon.

Post: #175

Reminds me of Thanos