In 2015, Time Magazine named her one of the “100 Most Influential People” in the world, just two months after her 31st birthday. President Obama appointed her to be a U.S. ambassador for global entrepreneurship and Harvard Medical School invited her to its board of fellows.
She was publicly admired by the likes of Henry Kissinger, George Schultz, and current secretary of defense, Jim Mattis, who once stated with elation:
She has probably one of the most mature and well-honed sense of ethics—personal ethics, managerial ethics, business ethics, medical ethics that I’ve ever heard articulated.
Despite all this praise, Elizabeth Holmes, the founder and CEO of the blood-testing company Theranos, was eventually charged with fraud by the SEC after lying about her company’s capabilities. Her falsehoods cost her investors more than $600 million.
How did Holmes fool so many for so long? How was she able to convince some of the highest members in society to believe in her despite her lack of experience in the medical industry? How did she do it?
Confidence.
In his book Bad Blood: Secrets and Lies in a Silicon Valley Startup, John Carreyrou tells how Holmes used her confident attitude time and time again to convince regulators, investors, and fellow employees to believe in her and her mission.
In one such incident in the early years of Theranos, the board of directors had decided on firing Holmes, but she miraculously persuaded them that she should stay on as CEO.
Holmes seemed to suffer from a condition best described in a Ted Talk by Tim Hartford—the God complex. Hartford described the God complex as:
No matter how complicated the problem, you have an absolutely overwhelming belief that you are infallibly right in your solution.
Holmes believed in her ability to revolutionize the medical industry at the expense of everyone around her. The God complex isn’t exclusive to Holmes though.
Just consider the case of Long Term Capital Management or the market forecaster who consistently predicts the next downturn, and you will see that being confident can get you a lot of supporters, even when you are wrong. This works because confidence inspires belief.
When people express beliefs to one another, their level of confidence usually reflects how certain they are. It tells us how much information they have. When we are listening to others, we are more likely to be persuaded by people who seem really confident.
This is exactly why the God complex is so irresistible. The overwhelming confidence reels people in. However, there is something much more primal, something deep within human nature, that makes confidence so compelling. People have a need to believe in something.
As Joseph Campbell said in his spellbinding documentary series The Power of Myth:
Buried deep in our DNA, no matter who we are, is the need to worship, to believe, and the capacity for reverence. Religion with its symbols and rituals and stories, is the way we mortals try to connect to that unseen world.
You might think that I am talking about monotheism or polytheism, but I’m not. I am talking about the new Gods. The Elizabeth Holmeses, the LTCMs, the market pundits, the influencers. The ones who seem to divine the future, to do the impossible.
Yes, these are the Gods of our times. How should I eat? How should I invest? How should I live?
Find yourself a little God that tells you. It’s okay. It’s in your nature to crave this advice.
As Jeff Gundlach stated in a recent interview:
People want to be told what to think.
And he is right. Just consider what happened when a fake Warren Buffett account (famously known as “WarrenBuffet99”) started spouting life advice on Twitter. A lot of people thought it was the real Buffett, despite there being an actual Buffett account and the fake account being misspelled with only 1 “t.”
I watched the fake account gather 30,000 Twitter followers in a week, then explode to over 200,000 followers in one night. Why? People loved the life advice it provided in list form. Here is one such @WarrenBuffet99 tweet:
Kanye West, Mark Cuban, and hundreds of thousands of others retweeted the advice espoused by the fake Buffett account. Why was it so contagious?
Because people just want simple answers. They want there to be a “10-step guide” to getting rich or “5 daily habits” to become successful. Though the truth is far messier, they will follow whoever gives them the easy path.
I am not immune from this either. I have read lots of these lists because, maybe, just maybe, one of them will have an insight I hadn’t thought of before.
You are probably not all that different. Yes, you don’t want to be told what to think in every aspect of your life, but in many areas you will take the easy out.
Did you spend years studying medicine and nutrition? Or did you outsource that thinking to someone else?
Why else would you be reading blogs, books, and whatever other content you consume? We are all looking for answers. Whether we can admit it is another story.
What Do You Worship?
In This is Water, David Foster Wallace addresses the idea of worship with utter brilliance:
Because here’s something else that’s weird but true: in the day-to-day trenches of adult life, there is actually no such thing as atheism. There is no such thing as not worshipping. Everybody worships. The only choice we get is what to worship.
So what do you worship? Money? Fame? Power? Jesus? Muhammad? Buddha? Something else? No matter what it is, we all worship something. And we always will. You can burn the blessed texts, destroy the holy temples, and forget the sacred rituals, but you can’t change human nature. Because man may not always have religion, but man will always have Gods…
If you are interested in digging deeper on this issue, I highly recommend Bad Blood (a non-fiction book that reads like a thriller) and The Power of Myth. Thank you for reading!
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This is post 98. Any code I have related to this post can be found here with the same numbering: https://github.com/nmaggiulli/of-dollars-and-data
