It's not always easy to speak up when you see someone doing the wrong thing.
It's even harder when that someone is close friends with your grandfather and attending your family's Christmas dinners.
Tyler Shultz was put in that unique, between-a-rock-and-a-hard-place position after he started working for Theranos. He spoke about his experiences in an hour-plus-long discussion at Louisville Startup Week.
Shultz was first introduced to the now-infamous startup by his grandfather, George Shultz, a former U.S. Secretary of State, while he was a junior at Stanford.
"He basically said he was having a brilliant woman come over to his house and that I would learn a lot if I came over and listened in on their discussion," Shultz reflected. "So I biked over to his house, and that's where I met Elizabeth [Holmes] for the first time.
"She was wearing her all-black outfit and Steve Jobs turtleneck. I heard her very deep voice, and the way she spoke really pulled you in — everything she did was so deliberate. And that was really the first time that I heard her lay out his vision."
Spoiler alert: That vision, in which any laboratory test could be done with a single finger prick, didn't work out.
Theranos dissolved in 2018, and its founder, Elizabeth Holmes, was convicted of criminal charges in January when a jury found her guilty of misleading investors and customers about her company's blood tests. She's currently seeking a retrial, the Silicon Valley Business Journal reports.
A jury also found Ramesh "Sunny" Balwani, the company's president and Holmes' ex-boyfriend, guilty of 12 counts of fraud earlier this summer. Holmes is citing arguments made by prosecutors about their personal relationship in that trial in her request for a retrial.
Shultz said he started with Theranos after graduating college, which happened to coincide with the company's launch with Walgreens.
"It was a very exciting time to be there," he said. "But it was also very disorienting because while they were doing the ribbon cutting ceremony and celebrating, I also learned that even though we launched the products that we actually had no tests that were validated on the platform."
That was just the first red flag. Later, while working in Theranos' assay validation lab, Shultz said it felt like he was living in alternative realities — the reality of the inconsistent results in the lab versus the reality presented to him by Holmes.
"I would speak to her and I would feel like I was changing the world like I was a part of the Apple of health care," Shultz said. "Then I would go to my job, thinking, 'What the heck is this? How did she convince me that this was something incredible? It's clearly not.'"
Shultz claims in some cases, results were off by more than 300%. It was an "open secret" that the technology didn't work, he said, adding that management knew about it.
It was the company's syphilis tests that spurred the beginning of the end of Shultz's time at Theranos. Testing samples, he said only some of the results were correct when compared to lab-validated tests. About 20% of people at Theranos tested positive for the bacterial infection according to the company's results, which were wrong, Shultz continued.
But instead of rejecting the data by saying test failed validation, he said the company's statistics team approved it, meaning it could be offered to patients at Walgreens.
"I remember feeling like I had been punched in the stomach because I knew that if we tested real patients with this test, people were going to get hurt beyond any doubt, so that's when I felt like I really had to start speaking up," he said.
After attempting to confront Holmes about the invalidated claims the company was making, Shultz quit. Later, he confidentially spoke to a Wall Street Journal reporter.
There's a lot more to the story — an unsigned affidavit, $500,000 in legal fees and family drama — but Shultz eventually went public with his version of events in 2016 after recognizing that his relationship with his grandfather, who still sided with Holmes, wasn't mendable.
The relief of going on the record was the "best feeling ever" Shultz said.
"A huge fear that I had was that once I went on the record, the threat from the internet was basically I would never be able to work again. That's basically what they told me like, 'If you go on the record with this, no one's ever going to hire you ever again,'" he said, noting he thought. "That's fine. I'm fine never working again. I love playing guitar. I will go play guitar on the sidewalk and make enough money to buy my meals and I'll be fine."
Shultz, who told his story to the Wall Street Journal and later in the documentary "The Inventor: Out for Blood in Silicon Valley," said the outpouring of support has been incredible.
In spite of those past threats, he is working again as the co-founder and CEO of Flux Biosciences, his own startup founded in 2017. He also recently got married, he told the audience, noting that he would be leaving for his honeymoon from Louisville.
"Now I love turning this negative experience into a positive one," Shultz said. "I'm super happy to be here at Startup Week in Louisville and I've just felt so welcomed here."
Louisville Startup Week continues through Thursday, wrapping up with the Render Competition at Lynn Family Stadium.
