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It's easy to get a complex about not being a billionaire when there are so many of them now, and so young. For example, last year Elizabeth Holmes was on top of the world, worth billions of dollars due to the valuation of her company Theranos. There's also Parker Conrad of Zenefits.
Today both companies are worth substantially less than last year, face criminal accusations, and the founders appear to have deceived people they met on their meteoric rise to the top. What's the takeaway for you in the story of these booming startups that seem to be stalling out?
Elizabeth Holmes dropped out of Stanford University at age 23 to start Theranos, and she was very successful at first. Last year Forbes named her the wealthiest self-made woman in the US, which is impressive indeed. She came up with a way to test blood using only a pinprick of liquid instead of vials drawn by a lab technician. It was revolutionary and investors were excited about Theranos.
But Forbes is rescinding the honor bestowed on Holmes last year -- her personal wealth valued at $4.5 billion before is now only $100 million (still a lot of money but also a big drop in net worth). The fall from grace is based on a substantial devaluation of Theranos, which Holmes half owns and is no longer worth nine billion dollars.
Theranos is accused of deceiving investors and could face criminal consequences, according to Money. Its revolutionary blood-testing system is also considered questionable, raising issues about the long-term viability of the company.
Meditating on Zenefits
Conrad Parker of Zenefits had an even more dramatic rise and fall. Touted a genius of tech and human resources last year for his free application that made money selling insurance services, he has since been ousted from his company.
It turned out that Zenefits was taking some illegal shortcuts on the licensing of its insurance sales representatives, apart from having a questionable company culture. Conrad Parker went from the inspiring billionaire in a t-shirt giving talks on being awesome to persona non grata pretty fast.
The takeaway from these two tales is that some successes that seem too good to be true are just that. Taking shortcuts around the law is never a good idea. Deceptions can catch up to you and have serious consequences, destroying not only your company but your credibility in the business community.
There may be no reward without risk, but there is also no point risking everything for a quick buck. Some geniuses take longer to bloom. Maybe your billions are just around the corner. Keep working.
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