THREE years ago, Walgreens (b. 1901) arrived in Silicon Valley for the same reason many old economy companies do: to hurry and join the digital vanguard before it was left behind. Walgreens quickly made a deal with Theranos (b. 2004), the medical diagnostics company and media darling that promised a revolutionary approach to blood tests.

That hopeful beginning seems so long ago. Last fall, a series of investigative articles in The Wall Street Journal cast suspicion on Theranos’s methods, a devastating federal report found serious deficiencies in the company’s quality control, and Theranos is now under investigation by federal prosecutors and by the Securities and Exchange Commission.

It is tempting to see Theranos as another example of Silicon Valley hype — a company based on a wisp of an unproven idea becomes a multibillion-dollar phenomenon with the backing of pump-and-dump venture capitalists.

In fact, however, Silicon Valley’s most experienced investors in start-ups saw red flags at Theranos before anyone else. The Theranos saga shows just how well Silicon Valley does its homework, especially when considering medical technology, in which the risks of doing real harm to people are higher than those posed by the next photo-sharing app.