This had to hurt more than a pinprick.
Elizabeth Holmes — the 32-year-old founder of embattled blood-testing startup Theranos — has seen her net worth crash to “nothing” from $4.5 billion last year, according to Forbes.
Holmes, whom the money magazine earlier dubbed “America’s richest self-made woman,” has seen her wealth go to zero as Theranos has been slammed by reports that its tests are inaccurate, spurring a slew of federal probes.
The regulatory storm has slashed the $9 billion valuation previously assigned to Theranos by investors down to a “more realistic value” of $800 million, Forbes said Wednesday.
“At such a low valuation, Holmes’ stake is essentially worth nothing,” according to Forbes writer Matthew Herper, citing interviews with a dozen venture capitalists, analysts and industry experts.
That’s because some Theranos investors own preferred shares, which will get paid back in the event of a liquidation before Holmes, who owns common stock, Herper said.
He added that he isn’t aware of any plans to liquidate.
The markdown is a sharp blow for Holmes, her backers and her board of directors, which has included luminaries like Henry Kissinger and Bill Frist.
“As a privately held company, we declined to share confidential information with Forbes,” a Theranos spokeswoman said. “As a result, the article was based exclusively on speculation and press reports.”
Forbes said its $800 million figure gives credit to Theranos for its intellectual property and the $724 million in cash it has raised.