DFJ's Draper: There's Nothing Wrong with Theranos [video]

http://www.bloomberg.com/news/videos/2016-06-23/dfj-s-draper-there-s-nothing-wrong-with-theranos

by uptown • 10 years ago

44 44 10 years ago

bloomberg.com

exolymph• 10 years ago

Can you put [video] in the title?

projectramo5• 10 years ago

And you know what: we can't dismiss him.

The interesting thing here is that we can't just say that's not true.

I am not making a larger point about solipsism or our inability to know reality. I mean the much narrower point of not being able to tell -- from the press -- whether a company actually has a technology that works.

Think about the implications that has for investing in public stocks.

Let's ignore the cases of fraud like Enron etc., and focus on an ordinary company that honestly reports what it is doing.

EDIT: I have followed the Theranos story, so I know about the legal actions etc.

What I can't tell is if there is poor science at the heart of it, or it is a case of poor scaling and application of good science.

Animats• 10 years ago

Well, after the FDA shut down many of the company's operations, and Walgreens pulled out of their contract to use Theranos services, one might suspect that their technology does not actually work.

If it did work, it would be straightforward for them to demonstrate that it did.

projectramo5• 10 years ago

Didn't it have to demonstrate to both Walgreens and the FDA that it was working before?

I can't tell if it never worked, or if something prevented it from scaling.

dimdimdim8• 10 years ago

>I mean the much narrower point of not being able to tell -- from the press -- whether a company actually has a technology that works.

http://www.wsj.com/article_email/theranos-voids-two-years-of... ??

minimaxir3• 10 years ago

I mean the much narrower point of not being able to tell -- from the press -- whether a company actually has a technology that works.

There have been empirical actions which resulted based on Theranos's errors, including FDA/SEC investigations and Walgreens revoking their partnership. Those aren't media spins.

projectramo5• 10 years ago

But didn't Walgreens have to test the technology to agree to the partnership in the first place?

There is a difference between the tech that doesn't work and tech that cannot work.

The former will work eventually, but the latter can never work.

Can you tell which it is?

Zigurd2• 10 years ago

I don't know what point you are trying to make, but Theranos is not some reality-bending exceptional case. You might say it's possible he is correct, but, yes, one can dismiss "There's nothing wrong with Theranos." There have been documented wrongs that nobody has tried to refute.

projectramo5• 10 years ago

In your opinion, has it been documented that the technology doesn't work or that they couldn't apply the technology properly in the field?

In other words:

1. Is it fraud and poor science? 2. Is it good science but still immature?

That is the key distinction.

conistonwater• 10 years ago

I mean the much narrower point of not being able to tell -- from the press -- whether a company actually has a technology that works.

There has always been a simple solution to this: it is the company's own job to clearly demonstrate that it has a working technology.

If you view it that way, then the press's inability to prove it one way or the other doesn't matter because the responsibility lies with the company. In fact, Theranos was quite unusual among lab companies from the beginning in that it didn't follow the path other companies followed in showing they had a working technology. Anything less than a clear proof by the company, and the subsequent confusion is the company's own fault.

projectramo5• 10 years ago

To demonstrate it to whom?

yueq• 10 years ago

stockholm syndrome?

joezydeco3• 10 years ago

sunk-cost fallacy.

dimdimdim8• 10 years ago

Unbelievable - even if he said Theranos is trying to get their shit together and there have been some mistakes, it would make sense. To say its just a smear campaign is ridiculous - what about the thousands of results they withdrew as they admitted it was wrong?

http://www.wsj.com/article_email/theranos-voids-two-years-of...

It's even more ridiculous to call her one of the greatest female entrepreneurs!

I had a lot of respect for Draper but this is so disappointing. Just to make sure their investment does not hit a big ZERO value, they seem to be siding with an entrepreneur who has wronged everyone! What a shame!

entee• 10 years ago

I'm not sure if he's completely blind or self-deluded. I hope to believe that he's not saying these things just to line his own pockets. Being delusional isn't malicious.

That said, it makes me wonder how it is possible for someone to live so far outside a reasonable view of the world. We should critically examine the press, but these days conspiracy theories are running rampant and we can't seem to agree on a common set of facts to examine anymore.

The facts here are clear, Theranos has sold a product that doesn't work irresponsibly, and done so without proper science.

minimaxir3• 10 years ago

Back when the first anti-Theranos article was published, VC Dave Morin argued that it was the duty of Millennials to dig deeper and investigate the press for the possibility of a smear campaign: https://twitter.com/williamalden/status/658705178523258880

After Theranos admitted fault, he retracted those comments.

xiaoma• 10 years ago

"I had a lot of respect for Draper but this is so disappointing."

Didn't you ever read Founders at Work and what DFJ did to the Hotmail guys?

dimdimdim8• 10 years ago

No, but can you give a gist?

grandalf6• 10 years ago

Theranos technology is more like typical startup tech. How many bugs did Facebook's feed algorithm suffer before it finally got stable? How many pages of sub-optimal search results has Google returned? How many major security bugs have been found in Windows, Chrome, Linux, etc?

Healthcare is one area where many people (particularly Americans) have the absurd idea that everything has to work perfectly.

Think of the level of indignation people feel when a surgeon who spent 15 years beyond college doing advanced training (for little pay) makes a small mistake that costs someone's life. Or an OB misjudges something and ends up in a major lawsuit.

But for other jobs, mistakes are a part of life. In software we are proud to decrease our bugs through testing and improved techniques and processes, but nobody expects perfection. Even mass market products like TurboTax ship with tons of bugs. Lawyers routinely let innocent people wind up in jail out of pure incompetence.

We need to get over it. Theranos is doing something very smart and while it needs some additional refinement, it is pretty clear that doing large scale blood testing/monitoring is the future of diagnostic medicine.

The irrationality we have about healthcare being perfect is a) false (mistakes get swept under the rug all the time) and b) counterproductive because it gives us a sense of mastery over our destiny that we simply do not (yet) have.

Let's also not forget that medicine is plagued by a very irrational risk aversion, which is why many useful treatments are available around the world but not in the US.

minimaxir3• 10 years ago

Healthcare is one area where many people (particularly Americans) have the absurd idea that everything has to work perfectly.

There's a line between not working perfectly and not working at all.

dimdimdim8• 10 years ago

Not when your bug can kill a person or damage his organs due to wrong medication give because of a wrong test result.

http://www.wsj.com/article_email/theranos-voids-two-years-of...

There is a reason Healthcare is regulated and required multiple degrees of testing before it can be released to the general public -- imagine every new "health startup" pushing new drugs and then saying they'll "fix a bug" when a couple of folks die. The comparison is immature.

grandalf6• 10 years ago

The comparison is immature

Quite the opposite. Health regulations suffer from a number of perverse incentives that economists have studied extensively:

Drugs are needlessly delayed in getting to market. Doctors and patients are perfectly capable of assessing the risk/reward of an unproven treatment by looking at scientific studies. The FDA adds a layer of false-security... in spite of its sluggish process, the FDA is often quite wrong and drugs that were approved get taken off the market. For other drugs, they are delayed for several years and much harm is caused. Economists have studied this and found that regulators cause much needless suffering and death by being excessively risk-averse.

Consider too illegal drugs. Our regulators criminalize many substances, resulting in black market behavior and significant crime and other negative effects. Here too, backward regulations cause much unnecessary suffering, death (and crime too).

For people who do not understand healthcare, the world appears quite black and white. In reality no treatment works all of the time, and no test is without its share of inaccurate results. Doctors are equipped with enough Bayesian reasoning ability to use the available information wisely.

Also, a physician should not base any decisions on a single blood test result. That is not the proper way to use such tests. If it were, doctors and medical training would not be necessary. Most tests have a significant probability of false positive and false negative results, so docs are trained to consider the results only in the context of other diagnostic clues.

jeffmould• 10 years ago

Healthcare is one area where many people (particularly Americans) have the absurd idea that everything has to work perfectly.

Yes, healthcare tech should at work at near perfect. There is an enormous difference between getting poor search results or not seeing photos of your drunk friend from the weekend and determining if you have a life-threatening illness. Healthcare is not an area where you want to be "bug testing" and the outcome can be life or death.

I agree that the tech should be explored and probably could be refined over time, but healthcare is an industry where you can't "fake it till you make it."

grandalf6• 10 years ago

Well, all tests have some probability of returning a false negative or a false positive. The key is for the physician to know the probability of each and to reason appropriately using the diagnostic methods at his/her disposal.

dimdimdim8• 10 years ago

On a more humorous note - I'd like to see you volunteer as a Beta Tester for Theranos' next release :) :)

grandalf6• 10 years ago

I would happily do so. I do not have any health conditions that require testing, however, so I would not be exposing myself to risk by doing so.

DanBC• 10 years ago

People know that clinicians making their very best efforts will sometimes kill patients. Hopefully there's some process in place for that organisation to learn from the error.

Compare that to Theranos, where non-clinicians were deceiving customers with a tech that could not work in order to make money.

That kind of behaviour is rightly criticised.

grandalf6• 10 years ago

That kind of behaviour is rightly criticised.

Indeed it is. I think there is a big difference between a promising company whose technology has a few bugs and whose salespeople are overzealous and unethical, and a company that is an outright fraud.

joezydeco3• 10 years ago

Their top spokeswoman just resigned today:

http://www.sfchronicle.com/business/article/Theranos-spokesw...

w1ntermute2• 10 years ago

Full text: https://notehub.org/iugbf

stanfordkid• 10 years ago

Tim Draper is, quite frankly, the Trump of Venture Capital. He's a great, nurturing guy though in terms of personality and affect.

dimdimdim8• 10 years ago

I love his song though: https://www.youtube.com/watch?v=XTrz6lMQGAs :)

w1ntermute2• 10 years ago

The rights to the Theranos movie (Adam McKay, JLaw) have been picked up by Legendary Pictures[0]. Looks like the tentative title is Bad Blood. Too bad they didn't go with the HN-recommended title, Unicorn Blood[1].

0: http://www.vanityfair.com/hollywood/2016/06/jennifer-lawrenc...

1: https://news.ycombinator.com/item?id=11876937

wavefunction• 10 years ago

They'd have to pay someone if they took any suggestions. Or even acknowledged being exposed to suggestions.

dmix• 10 years ago

From the Vanity Fair link:

“They basically tell the story of how Elizabeth Holmes created these fraudulent blood-testing machines, raised $9 billion through venture capitalists in Silicon Valley, and refuses to admit they don’t work even when it is obvious the testing is inaccurate,” says a studio source familiar with how the project was pitched.

This old hat: they were valued at $9 billion by VCs while raising $400 million in 2014.

dimdimdim8• 10 years ago

Something seems awfully wrong with HNs rating system - somehow this story is plummeting way soon down the list :)

Seems like a Google - Hilary thing :)

DFJ's Draper: There's Nothing Wrong with Theranos [video]

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