Silicon Valley loves unicorns, the privately held startups that surge to $1 billion valuations and beyond. By that measure, Theranos was a very special breed of unicorn—not only was the company worth several billion dollars, but it also raised around $1 billion from investors alone. Finding that kind of money can be challenging, but thanks to one well-connected matchmaker, Theranos made it look almost easy.
In the criminal trial of Theranos founder Elizabeth Holmes, the jury heard that the matchmaker was Daniel Mosley, the estate attorney for former secretary of state and Theranos board member Henry Kissinger. In less than two years, Mosley connected several wealthy families and individuals with Theranos, ultimately bringing it over $400 million in investments, a significant portion of the estimated $900 million to $1.3 billion that the startup raised over its lifetime.
The list of Mosley-introduced investors, most of them his clients, reads like a who’s who list of the rich and powerful. The DeVos family, which made its money from founding Amway, put in $100 million, as did the Cox family, which controls Cox Enterprises, a media, telecom, and automotive conglomerate. The Walton family of Walmart fame invested $150 million, while Andreas Dracopoulos, a Greek shipping heir, put up $25 million. Kissinger himself was good for $3 million, and Mosley for $6 million. Kissinger’s friends who were not Mosley’s clients, including the Oppenheimer family (which formerly controlled the diamond miner DeBeers), invested another $24 million.
All told, Mosley helped connect Theranos to $403 million, more than half of the startup’s $730 million funding round that began in June 2014. That round valued the company at $9 billion.
Other people’s due diligence
Mosley testified on Tuesday that he hadn’t pushed his clients to invest, but he was clearly smitten with the company and its founder, according to emails shown to the court. “I can’t tell you how enamored I am in what you’re doing,” he wrote in September 2014. “I could not be more impressed with what you have accomplished and what lies ahead for Theranos,” he said.
Around that time, Mosley penned a memo for Kissinger, in which he said, “There is substantial data and other information attesting to the quality, performance, and reliability of the Theranos technology and equipment.” Under cross-examination, Mosley told the court that he had no real way to investigate the company’s claims and that he relied on the work of others to vet the company. The Walgreens’ deal was one source—Mosley assumed that the drugstore did due diligence in advance of its deal with Theranos.
Then there was the “Pfizer” report. “The most extensive evidence supplied regarding the reliability of the Theranos technology and its application is a Study Report prepared by Pfizer based on a clinical cancer treatment trial,” Mosley wrote to Kissinger. That report, despite sporting the company’s logos, had in fact been prepared by Theranos and included claims that weren’t supported by Pfizer’s scientists. Holmes’ defense attorney Lance Wade asked Mosley whether he confirmed the report with Pfizer itself, and Mosley admitted that he had not.
Wade pressed Mosley further on his vetting process, showing him various webpages from Walgreens and Theranos that contained footnotes disclaiming that venous draws may be used instead of finger pricks. Mosley said, “I don’t believe I knew this at the time.”