The most popular movie in North America last weekend is about a founder convicted of fraud. You Can See Everything, Nathan Fielder's documentary about Theranos founder Elizabeth Holmes, took in $10.6 million from Friday to Sunday. It edged out Clayface, which took $10.4 million. People are paying to watch a con get taken apart.
The Journal's box-office table on Monday, Nov. 2 shows the film at No. 1 with $63.9 million in total sales, by Comscore's count. This wasn't an opening. Sales fell 43% from the weekend before, which means it had been playing for a while and people kept coming. Street Fighter has $53 million in total but dropped 63% in a week. The fraud film held up better than the video-game movie.
What a fraud movie teaches
Journal columnist Andy Kessler, reviewing it on the same day's opinion page, enjoyed the film and worries that renewed Theranos talk will pull trust in startups down again. Here's the thing about Theranos. It promised a machine that could run many blood tests from a few drops. By most accounts the machine couldn't do it, and Holmes was convicted of defrauding investors. Well-known, wealthy backers put money in without, as far as the record shows, seeing it work as promised. The checklist that might have caught it is short. Ask for audited numbers. Ask to see the product do the thing. Ask who else has checked, and whether they were paid to say yes. Treat urgency, secrecy and a story too good to question as warning signs.
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This is a Consumer Protection story (M11), and a Behavioral one. Nobody buys a ticket to a fraud movie thinking they'd have fallen for it. Yet many of the people who fell for Theranos were smart and rich. A con works on confidence. The fix is a habit. Before money moves, somebody who doesn't benefit from the deal checks the claim. That's the whole checklist. It's as useful for a private placement or an annuity pitch as it would have been for a blood test.
Here's the connection to your own money. If anyone has pitched you something this fall, a private deal, a crypto yield, an annuity with a bonus, pull out the paperwork this week. Find the audited financials or the prospectus. Then look the salesperson up on FINRA's BrokerCheck or the SEC's adviser search. Both are free. You don't test the smoke alarm during the fire. If you'd like a second set of eyes on the paperwork, that's what a review is for.