AILSA CHANG, HOST:
A new HBO documentary chronicles the rise and collapse of the entrepreneur Elizabeth Holmes and her biotech company Theranos. "The Inventor: Out For Blood In Silicon Valley" debuts tonight. NPR TV critic Eric Deggans says it's a compelling and critical look at startup culture in Silicon Valley.
ERIC DEGGANS, BYLINE: "The Inventor" is a story about the power of stories. At age 19, Elizabeth Holmes dropped out of Stanford University to found a company which became Theranos, a Silicon Valley-based enterprise aiming to reinvent health care.
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ELIZABETH HOLMES: The question was, as a 19-year-old, how do you go about the process of convincing people that you know what you're doing and that you can pull it off? I think the first piece is realizing that it's not necessarily about age.
DEGGANS: Ten years later, she was the youngest self-made female billionaire in the world. Theranos was valued at $9 billion. And then it all fell apart. She claimed to have invented a portable machine which performed more than 200 tests from a small blood sample gathered by a finger prick. This machine was called the Edison.
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UNIDENTIFIED NARRATOR: Using just her story as the blueprint for success, Holmes would convince private investors to put up hundreds of millions of dollars without ever looking at audited financial statements.
DEGGANS: Behavioral economist Dan Ariely says stories like Holmes' provide the emotion and passion that draw in early investors.
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DAN ARIELY: If you think about the people who invested in her with very little amount of data, it's about having an emotional appeal, about having trust and believing the story and being moved by this and being able to tell themselves a story.
DEGGANS: Director and writer Alex Gibney, an Emmy winner for HBO's "Going Clear: Scientology And The Prison Of Belief," doesn't have an original interview with Holmes. Instead, he uses loads of footage from interviews filmed during her rise to show how she was marketed, right along with Theranos. The camera lingers on her carefully crafted visual image - blond hair, often pulled back, black turtlenecks like those worn by her idol, Apple founder Steve Jobs, and large blue eyes that rarely blink, communicating the intensity of her vision or her delusion.
Gibney eases up to the idea of how Holmes may have used her beauty to cultivate supporters. Theranos' board of directors was filled with big names like former secretaries of state Henry Kissinger and George Shultz.
Phyllis Gardner, a professor of medicine at Stanford who was skeptical of Holmes' early ideas, explained that strategy.
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PHYLLIS GARDNER: She aligned herself with very powerful older men who seemed to succumb to a certain charm. And those powerful men could influence people in the government.
DEGGANS: But the Edison largely didn't work. Silicon Valley's fake-it-till-you-make-it ethos, where companies tout technology breakthroughs to potential investors before they actually achieve them, didn't help when Theranos began testing blood for Walgreens drug stores. Tyler Shultz, grandson of George Shultz, was working at the company. He explained the problem with a 65 percent success rate on one blood test.
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TYLER SHULTZ: If a hundred people who had syphilis came and got tested on the Theranos devices, we would only tell 65 of them that they had syphilis, and we would tell the other 35, you're healthy - no need for medical intervention. If people are testing themselves for syphilis using Theranos, there's going to be a lot more syphilis in this world.
DEGGANS: By the time the film shows how an investigative report in The Wall Street Journal uncovered Theranos' massive problems, Gibney's already built an impressive narrative. He shows how Holmes and her supporters pushed the limits of Silicon Valley's culture of risk-taking and overpromising until they created a house of cards that collapsed under close scrutiny. I'm Eric Deggans.
(SOUNDBITE OF FRANZ FERDINAND SONG, "SHOPPING FOR BLOOD") Transcript provided by NPR, Copyright NPR.
