"Can I et the CFO directly?"
At my request, Sharma's expression hardened instantly.
His sharp gaze swept over as if piercing through.
Sharma was notorious for being authoritarian and overbearing.
They say the ‘monarch and subject’ mindset typical of middle-aged Indian businessn was ingrained in him to the bone.
Under normal circumstances, he would have already snapped, "How dare soone like you make such a request?"
But now, I wasn’t just a ‘potential investor.’
I was the representative of an investor who had already promised to invest.
Perhaps that’s why he managed to force a strained smile and replied.
"Just a mont. I have an urgent matter to attend to."
Leaving us in place, Sharma began exchanging ssages with soone on his smartphone.
He’s probably contacting Hols.
‘Is he stupid, or just rude?’
A normal person would have excused themselves to step outside and handle the matter.
But this guy lacked even that basic common sense.
His stupidity and rudeness had been topics of discussion many tis before, but witnessing it firsthand left speechless.
After five minutes, he finally looked up again.
"Why do you want to et the CFO?"
Contrary to the smile on his lips, his jaw was stiff.
I smiled faintly and replied.
"I have inquiries regarding revenue projections."
"I can answer that for you."
"No, it’s about financial risk, so I need the CFO."
The CFO handles financial risks.
Since that’s a different area from Sharma, who is the Vice President and COO (Chief Operating Officer), I clearly emphasized the need for the CFO.
At this, Sharma’s eyebrows twitched.
After a brief silence, he forced another smile and answered.
"The CFO position at Theranos is currently vacant."
Of course, it is.
Because you fired them.
"Why is that?"
"Startups don’t necessarily require a CFO. Financial managent is relatively simple. We plan to hire one when the business scales up."
Well, technically, that’s not wrong.
However…
"Then, has the position been vacant since the company’s founding?"
Sharma paused for a mont.
Avoiding my gaze, he answered.
"There was one before, but the position is currently vacant."
"That’s strange. You said you’d hire a CFO as the company grows, yet you had one in the early stages but left it vacant later?"
"… …"
When I pointed out his contradiction, Sharma’s breathing grew rough.
As expected, there’s satisfaction in poking at the sore spots.
He clearly seed angry, but still forced a smile and replied.
"You said you had questions. Ask away. I handle risks as well."
"In that case, since the revenue projections are quite optimistic, how do you account for the risk of contracts falling through, which were used in these calculations?"
"There's no such risk."
Sharma answered firmly, but I was just as firm in my request.
"Then I’d like to review the contract with the Departnt of Defense directly."
After a mont’s hesitation, Sharma instructed an employee to bring the docunts.
However, what the employee brought was not a contract.
"These are just eting agendas and mos. Where’s the contract?"
Sharma’s expression stiffened.
"The contract is about to be signed."
"So, you’re saying it doesn’t exist yet."
Theranos projected $261 million in revenue and $165 million in gross profit for 2014.
They also claid they’d achieve $1.68 billion in revenue and $1.08 billion in gross profit in 2015.
However, the Departnt of Defense contract, which was central to these projections, hadn’t even been signed yet.
In response to my point, Sharma replied stiffly.
"It’s on the verge of being finalized. It’ll be done within a few weeks."
I turned my gaze sideways.
To the financial expert I had brought along.
As if waiting for this mont, he refuted Sharma’s claim.
"Contracts with the Departnt of Defense typically take several months due to bureaucratic procedures like the Federal Acquisition Regulation, Defense Federal Acquisition Regulation, security clearances, and compliance checks. If it hasn’t been signed by July, it’s unlikely that any revenue from this contract will be realized within this year."
"……."
Sharma bit his lip.
Normally, he would’ve stubbornly insisted it would be finalized.
But when an expert presents such specific facts, it’s hard to argue back.
"Without a CFO, these verifications can’t be properly handled."
At my words, Sharma’s eyebrow twitched again.
Internally, I humd a little tune while ntally summarizing my findings here.
‘First, I’ve proven that mistakes occurred due to the CFO position being vacant.’
I’m gathering evidence right now.
As I’ve ntioned before, the final battleground of this fight is the courtroom.
Every single piece of circumstantial evidence I collect now can be used as a weapon there.
Of course, I’m not obsessed with evidence related to ‘proprietary technology.’
That area is like an impregnable fortress.
However, Theranos had nurous other critical weaknesses scattered around.
Gathering those is my goal.
I must secure any evidence that works in my favor without leaving anything out.
But it’s crucial that they don’t realize I plan to use these materials in court.
To do that, the thod is simple.
"Then, shall we wrap up the sales discussion and proceed with a partial facility tour?"
At my suggestion, Sharma’s expression stiffened again.
Unable to hide his discomfort, he made excuses.
"As I ntioned earlier, it’s not possible today due to equipnt calibration issues."
"That was about equipnt demonstrations. We can postpone the demo to the last day, but can’t we still visit the lab?"
I had just pressed the sales team hard, demanding all sorts of contracts.
If they respond similarly regarding the lab?
Will they still be able to brush it off as smoothly as they have been?
Of course, just touring the lab won’t reveal the golden goose.
However, even if Sharma knows that, he wouldn’t be thrilled about poking around like a detective.
"Haa…"
Sharma sighed deeply and then spoke.
"The lab is difficult to access today. Let’s move on to the IT inspection instead."
It’s quite interesting to see him trying to maintain politeness despite his evident frustration.
I could push harder for the lab visit here, but…
"Understood."
I decided to accept Sharma's proposal.
After all, I had no real business with the lab.
It was just a decoy to distract them.
The real evidence had to be found elsewhere.
Thus, we arrived at the IT departnt.
I continued my sharp questioning with them.
"Why is the information from all departnts separated? It seems highly inefficient in terms of information exchange."
The IT head darted his eyes, glancing nervously at Sharma.
Sharma’s face showed clear signs of irritation again, but he gestured for the IT head to answer.
The IT head stamred in response.
"To prevent confidential information leaks."
"In that case, I’d like to know specifically what software you use and what asures you’ve implented to prevent information leaks."
There was plenty to uncover here as well.
Theranos strictly controlled employees’ use of USBs and printers, and even banned ssenger communication.
I’d already overheard these details at a café, but I needed to docunt them officially through this inspection.
"Wouldn’t such asures hinder smooth communication? If interdepartntal collaboration is compromised, overall efficiency drops as well. Isn’t this excessive?"
At my point, Sharma’s eyes widened.
I could see the anger flickering in his gaze, but he managed to suppress it and responded.
"Extre situations call for extre asures. Currently, the diagnostic service market is effectively monopolized by two companies. Theranos is a strong disruptor in the industry, so they’ll try to steal our technology by any ans necessary."
Before my regression, I’d heard that those two companies didn’t even know Theranos existed.
In short, this was a product of delusion and paranoia.
Still, I made sure to officially docunt this statent as well.
"Then, how many information leak incidents have been detected so far?"
"Why do you need to know that…?"
"Oh, am I digging too deep again? In that case, shall we head to the lab?"
If they didn’t answer, I’d insist on going to the lab without hesitation.
This strategy hit the mark.
The mont I ntioned the word ‘lab,’ they answered my questions willingly.
After thoroughly inspecting the IT and finance departnts, it was already 6 p.m.
"Let’s wrap up for today. We still have tomorrow."
At my words, a hint of relief flashed across Sharma’s face.
But this was just the beginning.
On the second day of the inspection, I ramped up the intensity.
The first target was the legal team.
"Are there any ongoing lawsuits?"
"……"
"This is essential information for assessing the company’s potential risks."
"… …"
"If not, we can head to the lab—"
"There are so, but we don’t have redacted docunts prepared."
Lawsuit docunts must be disclosed if an investor requests them.
While they’re not obligated to provide nas or detailed personal information, they must at least outline the cases.
"Then please prepare them now. I’ll wait."
"……"
"Or we could go to the lab—"
That’s how I obtained the lawsuit docunts.
There were lawsuits involving employees, and unexpectedly, even a patent-related case.
After securing the legal docunts, I headed to the HR departnt.
"I’d like to request workforce data, including employee tenure and retention rates."
At the ntion of tenure and retention rates, Sharma’s expression stiffened.
Of course.
Theranos was notorious for indiscriminately firing employees.
Sharma took a deep breath, forcing a distorted smile as he replied.
"Do you really need such trivial information? No inspection team has ever requested that before."
I figured as much.
They probably relied on investors conducting only superficial inspections.
But I’m different.
"In startups, dependency on human resources is quite high. Preventing turnover is key to growth. And just because others haven’t asked doesn’t an we’re not entitled to request it."
Sharma shot a sharp look at the HR head—an unspoken command to reject my request sohow.
The HR head responded nervously.
"We can’t provide that right now as we don’t have anonymized data prepared. It’s a matter of employee privacy."
"Aggregate data will suffice."
"We don’t have such aggregated data separately. All records include employee nas, so it’s difficult to provide them imdiately…"
Of course, I had soone with precisely for situations like this.
I turned my head, and Liliana imdiately stepped in.
"What HR information system do you use? Workday? SAP? Oracle HCM? UKG? It should only take a few clicks to extract the data."
As Liliana listed common HR software, the HR head stamred in confusion.
"N-no, none of those. We’re using a relatively obscure program…"
"What’s it called?"
"You probably wouldn’t know it even if I told you."
The HR head’s face turned pale.
That’s probably another lie.
Now I had additional evidence that Theranos provided false information about its HR software during the inspection.
Accumulating such lies would help prove a pattern of providing false information to investors.
‘Should I press further?’
I could have ordered them to turn on a computer right then, but that would’ve given them room to make excuses.
It was better to let this slide for now and later claim we were deceived.
But maybe I should scratch the surface a bit more.
"Software plays a crucial role in enhancing efficiency. I’d like to suggest adopting an industry-standard system."
At the subtle mockery in my tone, Sharma’s eyes grew sharper.
While he clenched his fists to suppress his anger, the HR head hastily replied.
"Yes, we’ll keep that in mind. We’ll prepare the requested data by tomorrow."
By then, they’d likely fabricate docunts to falsify employee tenure data.
And that would beco evidence of ‘intentionally submitting false docunts to the inspection team.’
"Then, next, I’d like to request the company’s organizational chart."
I skimd through it quickly and found another point to nitpick.
"I don’t see a Chief Risk Officer (CRO) on the chart?"
"There isn’t one."
"Not even a CMO (Chief dical Officer), CCO (Chief Compliance Officer), CQO (Chief Quality Officer), or a Head of Clinical Operations?"
"… …"
Judging by Sharma’s reaction, he didn’t even seem to know what the titles I listed ant.
I sighed deeply and shook my head.
"Typically, dical device companies appoint executives dedicated to regulatory affairs. Since dical devices are directly related to human lives, the regulations are stringent. Are you saying you really don’t have a single person in such a role?"
"Our lab director handles that."
"I see. Then, would it be possible to have an interview with them?"
Sharma couldn’t answer.
Because I was now asking to et the head of research—the keeper of the golden goose, so to speak.
‘Let’s see how he responds.’
I watched with so anticipation, and sure enough, he acted exactly as expected.
"Why are you so insistent on eting directly? Are you suspecting our company of sothing?"
At this point, he was starting to shed his patience and act like his usual self.
I responded with a calm, professional deanor.
"Suspecting? Not at all. This is a standard part of the due diligence process. We simply want to assess the awareness regarding risks and regulatory compliance."
"Ha…"
Sharma let out a long sigh.
Then, in an arrogant tone, he continued.
"You need to see the big picture. If you get bogged down with trivial details like these, how can you accomplish anything significant?"
He had just referred to ‘complying with legal regulations’ as trivial.
This was another useful statent I could present in court.
However, it seed he still had plenty more to say.
It was obvious from the way he was fuming, practically frothing at the mouth.
All my efforts to scrape away at his patience had paid off.
Now, let’s see just how many useful statents he’s about to spill.
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