One of the most concerning aspects of the Theranos investment has been the total lack of due diligence in this process.
Putting aside the technology for a moment (it could be considered difficult to evaluate for most investors), due diligence failed on multiple counts. For example, Holmes told potential investors they had over $100 million in revenue when, in reality, they had close to $100,000 in revenue. That's a bit like trying to tell someone a SMB SaaS business with ~100 customers has the same traction as, say, Algolia. Hard to understand how this passed through the filters.
There is a far simpler way to look at this, and that is to say that this is why we have peer review in science. If a scientist won't release data or methods, there is a 99% chance they are bullshitting their claims. Theranos's product happened to be adjacent to my research space, so I was already highly skeptical when I heard the initial product claims. When I heard they weren't releasing data however, I strongly suspected they were bullshit. Many years later, sure enough..
Putting aside the technology for a moment (it could be considered difficult to evaluate for most investors), due diligence failed on multiple counts. For example, Holmes told potential investors they had over $100 million in revenue when, in reality, they had close to $100,000 in revenue. That's a bit like trying to tell someone a SMB SaaS business with ~100 customers has the same traction as, say, Algolia. Hard to understand how this passed through the filters.