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In early 2014, recent Stanford University graduate Tyler Shultz was in a quandary. He had been working at Theranos, a blood-diagnostic company founded by Elizabeth Holmes, a Stanford-dropout wunderkind, for almost a year. Shultz had learned enough about the company to realize that its practices and the efficacy of its much-touted finger-prick blood-testing technology were questionable and that the company was going to great lengths to hide this fact from the public and from regulators.

Theranos and Holmes were Silicon Valley darlings, enjoying positive press and lavish attention from potential investors and technology titans alike. Just as companies like PayPal had revolutionized the stagnant payments industry and Uber had upended the for-hire transportation sector, Theranos had been positioned as the latest technology firm to substantially disrupt yet another mature sector: the medical laboratory business. By the start of 2014, the company had raised more than $400 million in funding, and had an estimated market valuation of $9 billion.

Shultz's situation was exacerbated by the fact that his grandfather, the highly respected former US Secretary of State George Shultz, was on the Theranos board and was one of Elizabeth Holmes's biggest supporters.

But Tyler Shultz worried about the customers he was convinced were receiving highly unreliable and often inaccurate blood-test results. With so much at stake, Shultz wondered how he should proceed. Should he raise his concerns with the firm's investors? Blow the whistle externally? Report to industry regulators? Go away quietly?

This case and its subsequent four brief follow-up cases are based largely on interviews with Tyler Shultz, and outline the dilemma he faced and the various steps he would take both to extricate himself from his unsavory position and let the public know the full extent of the deception at Theranos.

Five optional handouts are available to instructors to further discussion after the case has been debriefed. The handouts serve as additional decision points for the students if your class time permits.

After completion of the case study, students will learn to use Lean Canvas to identify business opportunity. They will also learn the balancing of exploitation of profit-producing activities and exploring new opportunities according to the environmental dynamism.

WONK, a tutor discovery and booking app was launched by MyEdge in 2016 to search and book verified tutors in locations served by the company. Based on their requirements, parents and students could sort and book verified tutors in their area. Through the app, users could search for academic and hobby classes in the form of individual tuitions. The ease of use and the service offering made it a popular app with students enrolling every 6 min. Within a span of six years, WONK had provided services to thousands of students in 20+ countries and had 200,000+ tutors registered on their app from 15,000+ pin codes. Despite a plethora of Edtech companies in India, a different business model and services offered gave them an edge over other Edtech companies. To keep up with the customer needs, they were constantly making the upgrades to their technology and expanding their services. Vidhu Goyal, the founder of the company, was enjoying the progress when another development in the technology hit the world. With the launch of applications based on artificial intelligence, will it disrupt the business or not?

The case study is recommended to be taught in a 90-min class to Master of Business Administration students. The case study may be used in courses related to strategy, information systems management and entrepreneurship.

Teaching notes are available for educators only.

CSS 11: Strategy.