Is ‘The Dropout’ a true story?

Yesterday, viewers were treated to the first three episodes of Hulu’s latest psychological miniseries, The Dropout, which stars Amanda Seyfried as the real-life entrepreneur and disgraced businesswoman, Elizabeth Holmes.

The series focuses on Holmes, who created the medical diagnostic company, Theranos, and the rise and eventual downfall of the fraudulent company. The trailer, which has garnered 10 million views, depicts the turbulent spiral of Holmes through the rise and fall of the company she built.

The show is particularly gripping because it is based on a true story. Once upon a time, Holmes’ Theranos was valued at nine billion dollars, and Forbes hailed her as the youngest self-made female billionaire. Now, the former biotech wonder girl faces up to 20 years in prison. So how exactly did things get so bad?

Who is Elizabeth Holmes?

In 2003, Holmes dropped out of Stanford University at just 19-years-old, using her education trust to found the company, Theranos, which claimed that it could carry out rapid tests with just one drop of blood. Serving as the chairwoman and CEO, she introduced “the Edison,” a patented blood testing machine that would carry out these tests. In public, she adopted a low speaking voice and opted for all-black outfits, similar to Steve Jobs, whom she admired. 

According to The Wall Street Journal, while traditional healthcare venture capitalists passed, she received funding from a family friend, who gave her a million-dollar check, and influential names like Rupert Murdoch. The only problem was that the Edison did not work, even though Holmes lied that it did. She had also managed to snag Avie Tevanian, a longtime friend of Jobs, on board before he and numerous other staff members eventually quit. 

Holmes and her then-boyfriend and COO of Theranos, Ramesh “Sunny” Balwani, kept up the lie in numerous ways, often staging tours to prove the machine worked, faking demonstrations, and presenting potential investors with false numbers. They would often select data that worked in their favor while refusing to disclose any anomalies. 

The downfall of Theranos

While the company had begun to face enormous pressure internally, it wasn’t until The Wall Street Journal’s John Carreyrou published a front-page story in 2015 that Holmes faced a real threat. After receiving a tip about Theranos’ suspicious practices from a medical expert, Carreyrou began a secret investigation into the company, speaking with ex-employees and obtaining company documents. By October, his story had revealed that the company was using other machines to run its tests. While he continued reporting on Holmes, he published a book titled Bad Blood: Secrets and Lies in a Silicon Valley Startup in 2018. 

In January, Holmes was found guilty of four counts of defrauding investors, including three counts of wire fraud and one count of conspiracy to commit wire fraud. She is currently out on bail while awaiting trial, slated for Sept. 26.

The Dropout series is based on the Rebecca Jarvis-hosted podcast of the same name. The season will feature eight episodes and will run through till April 7. Seyfried has received critical acclaim for her portrayal of Holmes. The story of HBO’s documentary feature film, The Inventor: Out for Blood in Silicon Valley, previously told Holmes’ story