Rishi Shah, a 31-year-old college dropout, who co-founded a healthcare media company, became the richest Indian in America with a personal worth of $3.6 billion, for all of a few weeks. His fortune evaporated almost overnight amidst allegations that his company had fudged data and misled advertisers.
Shah’s Chicago-based Outcome Health delivers pharmaceutical advertising to patients on tablets and screens placed in physician’s offices. He became the 206th richest American in the Forbes 400 list after his company raised $500 million based on a valuation of $5 billion in May from Goldman Sachs, Google’s parent Alphabet and the Pritzker Group Venture Capital.
Shah, the son of a physician, founded ContextMedia in 2006 with a fellow student at Northwestern University, which later morphed into Outcome Health.
The Wall Street Journal alleged that the company exaggerated the number of screens installed in physician offices, inflated data on ad performance and manipulated third-party analyses showing the effectiveness of its ads.
Shah and Outcome Health are now being sued by investors, several premium advertisers have fled, the company has laid off a third of its workforce and abandoned its lease of a premium downtown Chicago building for its new headquarters. However, John Eddy, an Outcome Health spokesperson, claimed that: “Most of the company’s advertisers (including the largest) remain active.”
The Chicago Sun Times reported in November, “When a private detective tried to hand Chicago’s newest billionaire CEO Rishi Shah a summons to face a lawsuit filed in New York alleging he misled investors — Shah ran away and jumped in a waiting Cadillac Escalade and shut the door.” Davidson Goldin, a spokesman for Shah, disputed that characterization, blaming it on a misunderstanding: “Rishi was not aware the person banging on the door was trying to serve papers.”