Disruptive technology is defined as an innovation that creates a new market and value network, eventually disrupting an existing market and value network and displacing existing technology. It is what everyone is on the search for, that business idea that would change how things are currently done. The previous post covered synthetic biology, which I believe will become a disruptive technology though it may take several years.
In current times however, one company that has been on the news for being a disruptive innovator is Theranos started by Elizabeth Holmes at the age of 19. The company is a service provider, providing an array of blood tests at affordable prices using a minute blood sample (25-50 microliters to be exact) obtained by a finger prick. Starting out with the money her parents had saved for her education, Ms Holmes dropped out of Stanford to start the company, initially called Real-time Cures, in Palo Alto. Operating discretely, she has managed to raise over $400 million in funding over 10 years, at times even turning away investors because they were too interested in quick returns. Starting out from the basement of a college house, Theranos now valued at $9 billion, employs about 500 people and has labs at 21 Walgreen departmental stores, making it extremely accessible to the general public. What’s more the cost of her blood tests are often half to a quarter the amount that hospitals and private clinics charge. The right to know the status of your health, is a point Elizabeth consistently drives across in her talks and interviews, relating how deeply affected she was by an uncle’s death from cancer which may have been prevented if only diagnosis tests came earlier and were more affordable.
A co-inventor of 82 US patents and 189 foreign patent applications, 84 of which have been granted so far, Elizabeth is obviously an extraordinarily gifted individual. Though she has received flak for not publishing data from the blood tests in peer-reviewed journals, she has successfully obtained FDA approval for her test system and tests for Herpes Simplex Virus 1. Being recognized by the FDA, the most stringent regulatory board, gives Theranos a boost in terms of establishing itself in the laboratory diagnosis industry. Theranos technology however is based on existing methods, so the basic technology is not disruptive per se. It is more of how it is being implemented which is changing the state of healthcare. Using smaller samples, less material, a smaller carbon footprint, and minimal labspace compared to current standards, allows Theranos to charge less. The results are even sent out using an app, and available much quicker than other test centers such as Quest and Laboratory Corp. of America. This is due to their tests being automated and running through nights and weekends. Furthermore, Theranos is now linking up with insurance providers, which will probably increase their customer uptake.
It is not often that someone so young can drive something to fruition in such a short time. Elizabeth has even garnered support from very famous individuals including former U.S. Secretary of State, Treasury, and Labor George Shultz; former Secretary of Defense Bill Perry; former Secretary of State and National Security Adviser Henry Kissinger; and former U.S. Senators Sam Nunn and Bill Frist, among others. People seem impressed by her conviction, leadership and drive. Perhaps it also helps that she’s blond and beautiful? You can read more about her here and here, and here’s the Ted Talk she gave last year.