then. The company was about to announce the launch of its innovative
finger-stick tests in one of the country’s largest retail chains. And that
wasn’t all, he said. The Theranos devices were also being used by the
U.S. military.
“Did you know they’re in the back of Humvees in Iraq?” he asked
Mike.
Mike wasn’t sure he’d heard right. “What?” he blurted out.
“Yeah, I saw them stacked up at Theranos’s headquarters after they
came back.”
If all this was true, these were impressive developments, Mike
thought.
Don had launched a new firm in 2009 called the Lucas Venture
Group. In recognition of her longstanding relationship with his aging
father, who was addled by the onset of Alzheimer’s disease, Elizabeth
was giving him the chance to invest in the company at a discount to
the price other investors were going to be offered in a big forthcoming
fund-raising round. Intent on seizing what he saw as a great
opportunity, the Lucas Venture Group was raising money for two new
funds, Don told Mike. One of them was a traditional venture fund that
would invest in several companies, including Theranos. The second
would be exclusively devoted to Theranos. Did Mike want in? If so,
time was short. The transaction had to close by the end of September.
A few weeks later, on the afternoon of September 9, 2013, Mike
received an email from Don with the subject line “Theranos-time
sensitive” that contained more details. The email, which went out to
people who like Mike had previously invested in Don’s funds, provided
links to the Wall Street Journal article and to the Theranos press
release from that morning. The Lucas Venture Group, it said, had been
“invited” to invest up to $15 million in Theranos. The discounted price
Elizabeth was offering the firm valued the company at $6 billion.
Mike took a deep breath. That was a huge valuation. He couldn’t
help but be annoyed with Don. When his friend had brushed aside his
suggestion that they invest seven years before, Theranos had been
valued around $40 million, he remembered ruefully.