The maker of 2017’s hottest holiday gift is in dire straits.
What happened: DNA-testing company 23andMe has filed for bankruptcy as it looks for a buyer to take it private. Co-founder Anne Wojcicki also stepped down as CEO and will continue trying to buy back the company (despite being rebuffed by the board several times).
Catch-up: The company was valued at US$6 billion just four years ago, but fortunes quickly turned as sales slumped and it realized it was selling single-use products all these years. This was all made worse by a massive data leak in 2023 that decimated consumer trust.
- 23andMe already settled a $30 million suit relating to the breach, and a top reason for selling is that it doesn’t believe it will be able to cover costs for over 50 other suits.
Why it matters: As the company looks to sell, the fate of the data of some 15 million users is up in the air. While 23andMe said it’s looking for a partner who “shares in its commitment to customer data privacy,” there’s no guarantee of what a new owner will do with that info.
- For all its faults, the company has stood firm in its commitment not to sell data to law enforcement or insurance companies. Whoever winds up owning its data, however, may not share that commitment.
In Canada: Genetic data is protected under the Genetic Non-Discrimination Act, which prohibits the use and disclosure of genetic test results without written consent. So, if you’re a 23andMe user, be very wary before accepting any future terms of service updates.—QH