A variety of factors contributed to Theranos’s prolonged public deception, though they’re often summed up by “tech hype.” The company’s founder, Elizabeth Holmes, was a Stanford dropout who dreamed of “ making a difference in the world.” Her company was valued at nearly $10 billion. She was hailed as the “next Steve Jobs.”
Blogger and media entrepreneur Anil Dash explains that Theranos successfully drummed up buzz about its faulty products “because the company, its founder and its investors all shielded themselves under the cultural cover of being a glamorous member of the ‘tech industry’ rather than a prosaic medical supplier.”
It’s absurd to refer to companies that specialize in vastly disparate goods and services all under the umbrella of “tech,” Dash argues in a Medium post titled, “There is no ‘technology industry.’” If Theranos had been treated as a blood-testing company rather than a tech company, his argument follows, it would have been under far more scrutiny from day one.
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It’s not simply an imprecise description, Dash notes. He emphasizes that this overarching label obscures the reality that there is no such thing as the tech industry, in terms of a common set of regulations for the companies that supposedly exist within it.
“Mature industries develop their own regulatory frameworks, their own systems for self-regulation, and their own standards for monitoring transgressions within the industry,” Dash writes. “Today, tech as an industry is almost completely lacking in all of these areas.”
In other words, a “tech company” in pursuit of “disruption” is not exempt from the law. See: Uber and its disregard for background checks based on its self-designation as a technology company rather than a taxi service.
Obviously Dash is not the first to make the argument that the tech industry is a misnomer for a nonexistent collective. In a May 2012 Slate piece, “It's Official: There's No Such Thing as a Tech Company,” journalist Matt Yglesias wrote of Apple and Amazon, “they're in different lines of business, so there's no ex ante reason to expect them to [be] valued in a similar way.”
In March 2013, reporter David Yanofsky wrote in Quartz, “To stay competitive in today’s marketplaces, every company, by the current standard, could be called a tech company, which of course, is another way of saying that none of them should be.”
Yet in the third quarter of 2016, the phrase “tech industry” persists, as companies continue to incorporate technology, in the broadest most literal sense of the word, into their business operations and consumer products. Now that technology is omnipresent, it’s time to start conceiving of tech companies based on their sub-industries -- transportation, information, food and beverage -- and impose restrictions on them based on the specific services they provide.
Every company occupies the “business” space, but society does not treat all of these companies as though they exist on the same plane. The same should be true of “tech.” Embrace the reality that your company is more than a “tech company” and establish what differentiates you from all of the tech startup bandwagoners out there.