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At Theranos, Elizabeth Holmes Didn’t Work Alone

May 19, 2018, 6:22 PM UTC

Theranos, the disgraced, collapsing, and allegedly fraud-rife blood-testing startup, is most often associated with its founder and CEO, Elizabeth Holmes. But a new profile by indefatigable Theranos watchdog John Carreyrou sheds light on another major figure, suggesting some of Theranos’ worst sins weren’t Holmes’ doing at all.

Ramesh “Sunny” Balwani was 37 years old and already a multimillionaire when he met Holmes, then 18, at a Stanford University language-learning program in China in 2002. According to reporting in the Wall Street Journal by Carreyrou, who has spearheaded efforts to uncover deceptive practices at Theranos, Balwani helped defend Holmes from bullies during that sojourn, and soon became her mentor. Within three years, Balwani had divorced his wife and was living with Holmes.

Though Holmes founded Theranos in 2004, Balwani was not directly involved until 2009. That’s when Balwani guaranteed a $12 million loan to keep the capital-intensive company going, and became president and COO. Former employees told Carreyrou that Balwani was both a flashy and overbearing presence, driving exotic cars and frequently berating employees. Balwani also reportedly fired Theranos employees so often that they were referred to as being “disappeared,” a phrase normally associated with despotic political regimes like those of Augusto Pinochet and the Nazi Gestapo.

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In particular, Balwani and Holmes fired or marginalized employees who raised concerns about the company’s working conditions, test results, or product claims. Balwani reportedly leaned on labworkers to reveal which of them had written a negative note about the company on the jobs site Glassdoor, while also ordering the company’s HR staff to write fake positive reviews on the site.

Though Holmes played a direct role in many of the most notorious episodes in the Theranos story – including displaying a fake laboratory to Vice President Joe Biden – it was Balwani who left the company after the depth of its problems became clear. Though the departure was framed as voluntary at the time, a source close to Holmes told Carreyrou that the CEO actually fired Balwani.

Balwani has denied charges from the SEC alleging fraud, including wild exaggerations of its revenue. He and Holmes are, unsurprisingly, no longer a couple.