I think this is a super-interesting question. Because it helps show you how she was thinking about the company.
It appears she did not cash out any shares (or take a dividend) from Theranos. If she had, I can only assume the SEC would have forced her to pay more than a $500,000 penalty, etc.
Given the huge amounts invested in the company and how hot it was for a while, she could have easily sold $10m-$20m in the later stage rounds without much of an issue. Perhaps a lot more. This is very common in late stage “unicorn” rounds. See, e.g.:
But if she sold nothing, as it appears — that’s truly the sign of a believer.
In fact, it may be that she owes Theranos $25m for exercising shares early: Elizabeth Holmes Reportedly Owes Theranos $25 Million … which is a very bullish move on the company:
“Holmes, whose stake was once valued at about $5 billion and is now practically worthless, reportedly didn’t get any Theranos money from the arrangement, and has never sold any of her shares, including the shares related to the debt. People close to the 33-year-old founder told the Journal she lives an “austere” lifestyle.”
And that’s suggests whatever fraud there was on her part, was not fraud from a cynic. But from a believer. That perhaps just believed too much removed from reality.
It suggests a CEO that always, truly believed in the technology and mission, to an extreme, no matter what lines were crossed.
I don’t have any inside information, but Theranos feels like a story of a young first-time/first-job founder that truly believed in a technology that didn’t quite work out, that surrounded herself with the wrong sort of advisors. That pushed her the wrong way, to cross too many lines.
We all cut corners as CEOs. All of us. The question is how many, and where do we stop. I wonder with better advisors, mentors and management team, if the Theranos story might have been different.