Why we shouldn’t let the Theranos scandal deter us from trusting and funding pioneering startups in this field.
We all want it: I can assure you I sure do. Some magic blood test that will diagnose every health problem we have and tell us precisely how to fix it. In 2003, this is exactly what clever, young Elizabeth Homes and her business Theranos promised to do. From one single drop of blood, Theranos claimed to have the diagnosis technological capacity to be able to prevent and cure hundreds of aliments. This year, she was convicted of fraud, resulting a spiral of doubt and scepticism surrounding blood testing biotech emerged. This has limited essential growth in this pioneering area. However, there are many legitimate blood-analysis companies out there, from Livo to Thriva. The question is, how do we tell the expert from the con artist? How do we not let one bad grape spoil the bunch and take advantage of innovative and potentially lucrative healthcare and investment opportunities?
Theranos was big. It was an industry “disrupter” and thus, as customers love new things and investors love to ride and surf the money-making wave of new trends, was sugary honey to investors. It was a maverick, claiming to shake-up biotech and Elizabeth was the talented, pretty, sweet-nectar genius who was going to change lives and make investors loads of money. It was no surprise that Theranos quickly raised over $700 billion investment, with a market valuation in 2014 of $9 billion. So, when the bees in the beehive were found to be wasps and Theranos a fraud, disappointed and angry customers and investors were left hungry. In 2022 Elizabeth was found guilty of four cases of fraud, in a case so unforgettable that they made a HBO documentary on it.
Yet, the blood testing start-up world is not all clones of the ugly mess that was Theranos. There are many clinically excellent, evidence-based companies out there. As we resurface from the Coronavirus pandemic, there is also much interest in health startups. After facing lockdowns and mass scale medical emergencies, the consumer is more aware than ever of their health and lifespan. In the last ten years, the market for private personalized health tech has soared, and so has the funding in scientific research, producing new healthcare startups which provide paradigm shifts in current therapies.
From Thriva, founded in 2015 (currently at £15m Series A), to 1Drop Diagnostics, founded in 2018 ($4.3m Series A) and Everlywell, founded in 2015 ($325M Series A) to hundreds more, blood testing biotech are part of these startup solutions. Livo, which uses artificial intelligence technology to analyze blood and detect viral and bacterial infections, allergies, cancers and more, is a prime example of this. Founded in 2018 and currently at $200K seed funding stage, its expert founders Dr. Junaid Shaik, Faisal Sheikh and Prof. Prasanth Kumar have developed pathology equipment to produce more accurate results and affordable healthcare for the patient.
Like many other biotech startups, Livo is millions of miles from the world of Theranos, with the science behind it based on peer-reviewed, multiple citated, expert research. Unlike Theranos, it is built on a foundation of evidence-based medical advances, which enable it to provide maximum clinical customer benefit. There is a strong demand for this, and thus it is a lucrative potential investment.
As someone who works with investors, startups and funds, I would recommend that all do their due diligence before purchasing or investing in blood analysis startups. It is essential to check the citated research and investigate the marketing claims made by a business, in the same way as you would before purchasing or investing anything. But please, do not be put off by Theranos or intimidated by the science, as it is a hugely interesting space and most definitely, not one to be missed out on. See the good grapes in the carton and ride that healthcare opportunity wave.
Here are some other dynamic and exciting blood testing startups to follow: