I’m an unabashed nerd blogger. I don’t often comment on current events but sometimes things are so egregiously wrong that I feel compelled to put bytes to screen and this is one of those times.
The topic in question is the Wall Street Journal article regarding Tyler Shultz, Theranos and George P Shultz, his grandfather and a Theranos Director. Yes the article is, alas, behind a paywall. Here’s the tldr since you’re not going to read it anyway:
- Tyler Shultz is the grandson of American statesman George P Shultz.
- Tyler was an intern at besieged blood testing company Theranos.
- Tyler tried to report the technical flaws endemic to the Theranos technology internally but was rebuffed and ridiculed.
- Tyler was then largely but not solely responsible for being a whistleblower on the efficacy problems in Theranos’ blood testing technology.
- George Shultz was a Director of Theranos and essentially took the company’s side against his own grandson to the point of ambushing him with Theranos lawyers – in the grandfather’s own house.
And here’s the TLDR on Theranos in case you don’t follow the business press:
- Theranos is a Silicon Valley blood testing company started by a female Stanford drop out with an issue in terms of needles and blood draw.
- Theranos raised 400 million in venture funding
- The market cap of Theranos until recently was 9 billion. It is now 800 million (June 2016).
- The issue at hand is that the core technology doesn’t actually work. This is now proven. Their partnership with Walgreen’s is in the process of dissolving and lawsuits are pending.
- Apparently the 400 million that was raised was largely done by force of personality / oddity (the founder is an attractive blond woman with Steve Jobs like mannerisms).
- The venture capital raised apparently did relatively poor due diligence (that’s my personal theory more than anything I’ve seen stated).
When I say the technology doesn’t work, here’s what I mean – people were told that they had cancer when they didn’t. Apparently their STD testing was similarly flawed. Can you imagine being told that you have cancer or an STD and then finding out it was an error? People make legitimate life changing decisions based on news like that.
Now, back to George Shultz. I will admit that I’m at least a moderately smart buy but when I see the list of accomplishments that George Shultz has on his wikipedia page, I feel a bit like a drooling buffoon:
- Secretary of State
- Secretary of Labor
- Secretary of Treasury
- Director of the Office of Management and Budget
- President of Bechtel
- Dean of University of Chicago Graduate School of Business
- Professor of Economics at MIT
- Professor of Economics at University of Chicago
You can always argue about someone’s politics and you can sometimes point fingers and say that they got a particular role due to who they knew not their skills but when you see a literal lifetime of accomplishment, you have to think “Hm… I think is a really smart guy”. So I write this with a degree of mild embarrassment – to stand at the edges and throw stones at people more accomplished than yourself generally isn’t in the best form. Nevertheless …
Cui Bono is one of the only two bits of latin I know and its the only one that I come back to time and again – I even taught it to my 9 year old son. Cui Bono means “for whose benefit?” and it is generally used in legal terms for “who benefits from a crime”. I’ve taught both my sons to always ask who benefits when trying to sort something out.
I have to think that a man as accomplished as George Shultz would know Cui Bono and would have applied it when his own grandson told him what was going on at Theranos. Even before the news broke about Theranos he should have thought:
“Is it more rational that my grandson would make something up (when it benefits him nothing), or is it more likely that the company would try and cover something up (when it benefits them completely)”.
He is clearly a wise, accomplished man; he knows better. Sigh. We all make mistakes.