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Disney’s new series, “The Dropout”, has every tech entrepreneur and investor glued to the tv with their hands in their hair.

How did this Stanford Dropout manage to get her tech start-up, “Theranos”, to become a ‘ten billion dollar’ company? How did she achieve the status of “the next Steve Jobs” with just a promise and a bunch of sweet talk?

With the rise of tech investments and the popularity of SaaS based companies, this is the worst nightmare for investors all around the world.

Elizabeth Holmes managed to get up to a valuation of nearly ten billion dollars for her tech start- up in blood-testing technology. From influential investors to pharmacy giants such as Walgreens, she managed to sweet talk her way to covers of magazines and tv appearances. Did everyone just trust her and her product without performing the proper due diligence?

The answer is both yes and no. Since the company’s demise in 2018, it has become public knowledge that many companies and investors did not feel comfortable investing in Theranos due to the lack of transparency about the results and accuracy of the technology.

Simply put, the “Dropout” greatly benefited from the rise in tech innovation and its market interest in 2014 and the lack of technical due diligence performed by those who were interested. 

These investors could’ve saved millions of dollars by simply investing in relatively cheap technical due diligence.

Now this particular case might be an odd one out, but you would be surprised by how often investors and entrepreneurs lose tons of money just because they do not analyze weaknesses within their technology; data breaches, privacy disputes, cyber-threats - the list goes on. 

Introducing an expert third party allows you to get that extra level of cybersecurity. It allows you to review code, store it in a safe space, and make sure your payments are only executed if the work is up to par.

In conclusion, Technical Due Diligence should be a standard in every investor’s checklist before investing. It might even be a smart move to put it amongst the first items on that checklist. It will save you so much time and money in cases where there is something wrong, and it will make sure you act swiftly when you have the confirmation it’s all clear.

If only those who fell victim to Holmes’ schemes would’ve taken a moment to investigate properly, it could’ve saved them millions of dollars… and a lot of gray hair as well. 

Learn more about how tech verification performed by Codekeeper.co can help you in your new tech investment.