Elizabeth Holmes private text messages leak during Theranos fraud trial
Former Theranos CEO Elizabeth Holmes believed in herself so much that she wrote in a text message to Ramesh “Sunny” Balwani proclaiming that she had “total confidence in myself best business person of the year.”
The messages to Balwani and her ex-boyfriend were among thousands of text and Skype messages that CNBC obtained. These texts show Holmes believed in herself, Theranos and the company she started. The messages also show that Holmes spoke to Balwani in regards to her pursuit of high-profile investors, who ultimately gave Theranos millions.
“My new life as of this night and forever more: – total confidence in myself best business person of the year – focus – details excellence – don’t give what anyone thinks – engage employees in meetings by stories and making it about them (ie prepare well),” Holmes texted Balwani in November 2014 while discussing the full moon that evening.
Holmes again texted Balwani ten minutes later with the following: “No Response?” Balwani said, “Awesome. U r listening and paying attention…”
That same month, Holmes texted Balwani: “Just finished calls. Alice Walton is in for 50. Confirmed 100 Greg.” She is apparently referring to Alice Walton of Walmart fame. Greg’s identity remains a mystery. The Walton Family invested an estimated $150 million in Theranos by 2014.
Balwani replied, “Awesome. Balwani replied, “Awesome. They’re not investing in us, they’re investing in our future.” It was an unsettling prediction, considering Theranos’ 2018 closure. Theranos and Balwani were now charged with orchestrating a scheme that cost millions to fool investors and patients.
Holmes and Balwani are each facing 10 wire fraud charges and 2 conspiracy to commit wirefraud. Both have pleaded guilty. Holmes’ trial began last month. Balwani will be facing a different trial in the coming year.
Holmes messaged Balwani in the same text channel a few minutes later: “Rupert more than 100,” in reference to Rupert Murdoch (media mogul) who was one of Theranos’ most high-profile investors. Murdoch invested $125M in the company.
Balwani responded by texting, “Can’t wait to hear more about Rupert’s conversation,” Holmes responded, saying “Very nice :).” Holmes added that Holmes would love to have met Holmes longer.
CNBC reached Walton, Murdoch. CNBC did not get a response. The trial is expected to include some testimony by Theranos investors.
These nearly 600-pages of private messages span almost 600 pages from June 2011 through July 2016. The texts also show specifics about the high-flying lifestyle Holmes and Balwani led while Theranos was bleeding hundreds of millions of dollars, according to financial reports.
Holmes wrote Balwani in March 2015 “Mary Meeker trying my best to convince me to remain private, raise enormous $$$$, and to think bigger.”
Bond Capital’s partner, Meeker is an established venture capitalist. She is famous in the tech industry for her annual Internet Trends report, a presentation of dozens of slides covering the hottest trends for investors. CNBC did not reach out to Meeker regarding a request for comment.
Christian Holmes’ brother sent Balwani and Holmes a group message in April 2015. He asked them about their upcoming trip to Las Vegas.
A source at Theranos said that the group planned a weekend trip. This time frame was described by an employee as a very difficult one for the company, which saw high-profile exits such as the sudden resignation of Adam Rosendorff, lab director. Theranos may have paid for this trip.
The ex-employee of Theranos said that “people would simply disappear” and were going without employment. This made it clear that Theranos was in serious trouble. This is a big red flag.
Balwani, in a series text messages from April 2015 also acknowledges the mistaken timing of his trip. Holmes received a text from Balwani saying: “The Vegas Trip is such a distraction. Poor timing. However, the men bought all non refundable. We will accomplish it. Once we have won, I will not allow distractions.”
Holmes said, “Let’s then focus in our rooms, make dinner, and return early.” “I don’t like distractions ever.”
Holmes sent Balwani another text about high-end reservations. “Dinner could try the three Michelin French stars in mgm. We can only try the top national rated ones and see what happens,” she wrote.
In another exchange, Balwani said “Got table at XS dance [floor].” Balwani said to Holmes “Getting Private Security for U” just a couple of minutes later. Holmes replied, “Private security?” Holmes was adamant. “One security guard with us throughout the night. Balwani stated.
John Carreyrou, then a Wall Street Journal reporter, first reported the problems within Theranos in October 2015. CNBC has obtained texts indicating that there were discussions between Holmes and Balwani regarding Carreyrou.
Carreyrou wanted to interview Holmes and Balwani, but they refused. Balwani said that he didn’t need to speak with anyone who was attacking him.
Jeffrey Coopersmith, Balwani’s attorney declined to respond. CNBC reached out to Holmes attorneys for clarification.