From celebrity ‘spit parties’ to a drop in the bucket: The once-hot DNA-testing company is struggling to profit
Five years ago, 23andMe ME -3.72%decrease; red down pointing triangle
was one of the hottest startups in the world. Millions of people were spitting into its test tubes to learn about their ancestry. Oprah had named its kit one of her favorite things; Lizzo dressed up as one for Halloween; Eddie Murphy name-checked the company on “Saturday Night Live.” 23andMe went public in 2021 and its valuation briefly topped $6 billion. Forbes anointed Anne Wojcicki, 23andMe’s chief executive and a Silicon Valley celebrity, as the “newest self-made billionaire.”
Now Wojcicki’s self-made billions have vanished. 23andMe’s valuation has crashed 98% from its peak and Nasdaq has threatened to delist its sub-$1 stock. Wojcicki reduced staff by a quarter last year through three rounds of layoffs and a subsidiary sale. The company has never made a profit and is burning cash so quickly it could run out by 2025.
Silicon Valley’s fortunes were built on the lofty ambitions of entrepreneurs swinging for the fences—even if most of them strike out. Wojcicki, for her part, isn’t giving up. She’s sticking to her goal to transform 23andMe from a supplier of basic ancestry and health data into a comprehensive healthcare company that develops drugs, offers medical care and sells subscription health reports.
She still has to prove the business can sustain itself. She’s raised about $1.4 billion for 23andMe, and spent roughly 80% of it.
Read More (...)