Silicon Valley companies received a strong message this week: Your innovative attitudes and inspirational slogans don't exclude you from federal regulations.
The Securities and Exchange Commission charged Elizabeth Holmes, the purported "next Steve Jobs," with fraud Wednesday morning after an investigation into her blood-testing company Theranos. In 2015, The Wall Street Journal found the company -- then valued at $9 billion -- had not, in fact, developed the quick-testing technology it was advertising to investors and pharmacies.
"The Theranos story is an important lesson for Silicon Valley," said Jina Choi, director of the SEC's San Francisco Regional Office, according to Bloomberg. "Innovators who seek to revolutionize and disrupt an industry must tell investors the truth about what their technology can do today, not just what they hope it might do someday."
The SEC statement is a warning to companies working on autonomous vehicles. Like biotechnology, self-driving technology has the power to save or harm lives, and both industries promise billions to companies that can crack costly inefficiencies.
Add media infatuation with "disrupters" to the mix and you have an environment rife for companies to cut corners for a short-term payout. And, as a report from The Information this week shows, self-driving companies may already be overhyping the capability of their technology.
The Theranos story is a cautionary tale to everyone in Silicon Valley, from startups to investors to media. Let's hope the self-driving car industry heeds the warning.
— Katie Burke