Wednesday, December 24, 2014

Elizabeth Holmes at Fortune/NextGen 2014

A Conversation with Elizabeth Holmes at MPW Next Gen
(Uploaded December 8, 2014)
Fortune's Pattie Sellers and Elizabeth Holmes.




Summary only - not verbatim.



It's one of the most essential tools - the blood test.  But unpleasant, inconvenient, costly, and old.  Not changed since 1960s.  Ready for disruption, as our guest is doing with the revolutionary Theranos.  Founded with her Stanford tuition money when she dropped out at 18.

We're excited to learn more today.

PS:
This is incredibly exciting for several regions.  I hadn't heard of Elizabeth Holmes til our June 2014 FORTUNE cover story.  We didn't discover her, but we put her on the cover.  Before we talk about her and Theranos, an announcement.  She is getting an honor tomorrow, the Horatio Alger Award.  She is the youngest person to ever get this award since its beginning in 1947.  Big deal!

EH:
I appreciate that.  It's a big deal to connect with young people in classrooms across the US.  Little girls hear people tell them...but may not here from Young Women who have pursued science, engineering, and business.  What's possible and what we can do.  It's something they can excel in, and share my experience as a little girl growing up, what we have the privilege to do in this country.

PS:
Tell us about what you do.   This is your second live interview?  First in October at the Most Powerful Women's Summit.
  
EH:
It's a challenge!  If you look, the word Diagnose in a dictionary, it says, "to determine the onset of disease from signs and symptoms." So you figure out why someone is sick, due to symptoms they are sick, figuring out cancer because they have a tumor.  It's too late to do enough about it.  

Theranos is to detect onset of disease in time for therapy to be effective.  See the onset in time to do something.  How can we create a world in which people "don't have to say goodbye too soon."  We got into lab testing, because lab data drives 80% of clinical decision making.  For a physician to take care of a person.  If you can make lab data accessible, and really early in disease progression, before you're already really really sick, you make it possible to intervene in time to do something.

Our work is to make lab data accessible. Do any lab test, from a tiny drop of blood, from the finger, not tubes and tubes from your arm.  Make it possible for every lab test to be affordable for every person.  And accessible in convenient locations.  We've built service centers in Walgreens, and now in Arizona [in addition to N. Calif.], and people can go after work, and be engaged in information about their bodies to change their life.

PS:
We called it, 1/100 to 1/1000 the normal amount of blood, quicker, cheaper, pain free, and all sorts of test.  So Elizabeth dropped out of Stanford after one year, and Theranos started in 2003.  Initially as a wearable patch to transmit the information to doctors.  Was there a big fork in the road?

EH:
There are a billion forks.  You have a vision, a mission, to find what I'm passionate about in life, then go down a 1000 paths to get to the endpoint.  So our patch was the first embodiment of the idea.  How you could do this type of testing.  To realize the same dream - to intervene in time for therapy to be effective.  The course of building this business has been to figure out at every fork how to make that vision work, to avoid things that are too long, and try something else.

PS:
As you say this, you did not start with an idea like "we will make a wearable patch" or "draw blood better" but rather, with a mission to change diagnosis and therapy.  

EH:
People start about starting companies, "I want to start a business" and the question is, Why, The Mission, so you'll keep doing it because you love it.  What I want to spend my life doing is to change our world, so people don't have go through what they go through when - you have to say goodbye too soon.  A business is a vehicle to make that change in the world, operationalize, tune, and change it toward the end game.  There are a lot of moments to leverage.

PS:
You've raised $400M.  The valuation is $9B.  You own >50%.  Congratulations on that.  (Laughter).

You had 500 employees in June (EH: and 700 now.)  In the next year?

EH:
We're pursuing the model, wellness centers, we call it crawl walk run.  We started in the crawl phase.  We want to fine tune it so it is replicable and scaleable.  Role it out within 5 miles of "everyone's home."  We are starting in AZ now.   We will replicate and expand throughout the country.  And make sure the experience is "wonderful."  It's not something now describe as something they love.  But we think it should be, the most valuable first step for your life and health.

We're most proud when someone comes out of a Wellness Center and says "That was fun!"

We want to engage and connect with more and more people, helping them understand there is all this information that should be accessible TO them and BY them.

PS:
You are in 40 Walgreens, mostly AZ, and a Palo Alto one.   Go in there and do the finger prick.  The results come back very quickly.  What will we see in 5 years?

EH:
Sure.  So there are 8200 Walgreens nationally, and that's in 5 miles of almost everyone.  

PS:
IS that the plan?  Each Walgreens?

EH:
To be within 5 miles, certainly.

Q:
K., Google.
Are you hiring?
Are you running to regulatory pushback?  Or traditional medicine pushback, as did 23andMe.

EH:
This is important: Access to actionable information when it matters.  It's only actionable if it's the highest level of quality lab information.  We've done a huge number of studies over 11 years to get to this point, where the data is of that quality.  We've been proactively submitting every test to FDA.  That's an important quality stamp.  My mom gets a test, I want to know it is flawless data.  So we embrace regulation, it is mission critical.  

Q:
N., Qualcomm.
You are passionate.  What keeps you up at night?

EH:
I don't sleep much - 4 hours.  I feel like the luckiest person every day because of what I can do.  Building this company is about building people and from within the company.  I spend as much time as humanly possible, getting and building the right people.  That's how we do the dream.  

Q:
K., IHEART Media.
Stanford's not bad, you were there one year, and you left, something was so great?

EH:
The moment?  You find what you feel you are born to do.  I WAS doing this all the time, and spending money on classes I didn't go to.   I got what I needed, I was in the engineering school.  I was clear this is what I wanted to do.

PS:
Many people, at established companies, are of the mentality, even if the company has been around 11 years, they feel like a startup, and we also have "real" new entrepreneurs in the audience.  How did you deal with the struggle to change?

EH:
We jumped in feet first, if you know why you are doing something, it is a question of being open to failure and change.  The patch product was code named Edison, we will fail 1000 times and work on the 1001st!

That mind set has always guided us.  A determination to make it work no matter what, but many attempts can fail, embrace it.

Q:
R., John Deere.
All the Walgreen's in 5 years.  Are you looking at having customers doing this from home?

EH:
Great question!  It's a different world than retail pharma today.   I think there's definitely applications for that.  We've done testing from people's homes in our pharma trials.  

PS:
You have senators and cabinet secretaries on your board - fascinating.   No women? (Laughter).  EH: I count myself.

Henry Kissinger said, "There's no sign that financial gain is of interest to her, she's like a monk."  Do you care about the billions?

EH:
Money is a tool.  To make a difference.  We reinvest what we make back into the company.  It's to create better and better products, to realize the vision.  We never would have built the company this way if it's about making money.  Money is a by product of value, and, the money is a tool to reinvest.

PS:
Let's end on those wonderful words. 


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