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What does Elizabeth Holmes’ trial mean for Silicon Valley?

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What does Elizabeth Holmes’ trial mean for Silicon Valley?

The fraud trial of Elizabeth Holmes, who founded the failed blood testing start-up Theranos, has a lot of implications for Silicon Valley.

Its rise and fall has been hailed as the ultimate test of Silicon Valley’s fake-until-you-make culture. In some hot start-ups, it is not uncommon for founders to increase their revenue or promote their company’s products to raise funds and secure deals even if their products may not perform as advertised, Margaret O’ Mara, a university said. Washington professor who has written a book on the history of Silicon Valley.

Ms. Holmes also wrapped herself in the mythology of the tech industry. The Stanford University dropout styled himself after the late co-founder of Apple, Steve Jobs, which was headquartered in Palo Alto, Calif., and benefited from a lauded media following.

Ms. Holmes’ trial could result in a referendum on that behavior, lawyers and others said. If Ms. Holmes is found guilty, start-up entrepreneurs could be more careful with claims made to investors and partners, knowing they could be charged with fraud, said West Coast Trial Lawyers Chair. And said Neema Rahmani, a former federalist. Prosecutor.

But “a nonjudgmental decision would justify the Silicon Valley culture of celebrating aggressive innovation at the expense of absolute and absolute truth,” said Jeffrey M., an associate professor at Boston College Law School. Cohen said.

Still, some in Silicon Valley have opposed the idea that Ms. Holmes and Theranos represented typical start-ups. That’s because Ms. Holmes raised the bulk of her wealth from investment firms that represented wealthy families, rather than the traditional venture capital firms that typically invest in booming tech start-ups. Ms. Holmes was also manufacturing medical devices, not software, like many other start-ups.

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For this reason, Ms O’Mara said, few Silicon Valley insiders may dismiss the significance of the result.

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