What Elizabeth Holmes’s trial means for Silicon Valley.

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V Elizabeth Holmes fraud trial, who founded the failed blood testing startup Theranos, has multiple ramifications for Silicon Valley.

Its ups and downs were considered the ultimate test of Silicon Valley culture “fake until you get it.” In some hot startups, it is not uncommon for founders to inflate their profits or advertise their company’s products to raise money and close deals, even if their products may not be exactly what they advertise, said Margaret O’Mara, a University of Washington professor who wrote a book on Silicon Valley history.

Ms. Holmes has also enveloped herself in the mythology of the tech industry. Dropout from Stanford University styled itself after late Apple co-founder Steve Jobs., her company is headquartered in Palo Alto, California, and has received accolades in the media.

Lawyers and others said that the outcome of Ms. Holmes’ trial could result in a referendum on this behavior. If Ms Holmes is found guilty, aspiring entrepreneurs may be more careful with the claims they make to investors and partners, knowing they could face fraud charges, said Neama Rahmani, president of West Coast litigation attorneys and a former federal lawyer. prosecutor.

But “the acquittal will confirm a Silicon Valley culture that celebrates aggressive innovation at the expense of complete truth,” said Jeffrey M. Cohen, an assistant professor at Boston College Law School.

However, some in Silicon Valley reject the idea that Miss Holmes and Theranos are a typical startup. That’s because Ms Holmes got most of her money from investment firms that represented wealthy families, rather than traditional venture capital firms that typically invest in high-growth tech startups. Ms. Holmes has also focused on medical devices, not software like many other startups.

For this reason, Ms O’Mara said, some Silicon Valley insiders may not consider the importance of the outcome.

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