The two Theranos executives also allegedly told investors that the company would generate revenue of more than $100 million in 2014, according to the SEC. In fact, Theranos had barely $100,000 of revenue that year, securities regulators alleged.
Everyone loves a good story, especially when fiction feels like reality.
Venture investors — pioneers on Sand Hill Road financing big bets on our collective future — are especially susceptible. The Theranos’ story was written for the history books.
Until it wasn’t.
Like Theranos, Voodoo Innovation is the common practice of abundant ideas, future work to be done, secrets that must not be shared, and scarce execution. It is the cult for make-believe entrepreneurs.
But fear not, my dear innovators.
There’s an easy test to tell the difference between a company-builder and voodooist: the company-builder talks about what she did yesterday, what she did today, and what, precisely, she will do tomorrow; a voodooist talks about what he will do at some point, never named, in the future.
It sounds silly, but this is the quickest way to immediately sanity check someone’s legitimacy.
Since the company-builder knows real value is in execution, she doesn’t spend much time talking about what-may-happen-in-the-future. She lives the day-in, day-out company building grind.
The voodooist is different. He describes his incredible idea — he has a vision, it is significant, and requires you to sign an NDA! — but remains stubbornly light on critical details.
By practicing Voodoo Innovation, his vision stays safe — as an idea. It will never be tested, challenged, and strengthened. It will never go through the nasty, productive company-building process.
This perverse dynamic now has a name: Voodoo Innovation.