23andMe Tumbles Into Bankruptcy, CEO Steps Down

"23andMe, the buzzy consumer technology startup that convinced millions of people to spit into test tubes to determine their ancestry, filed for bankruptcy late Sunday night and announced the resignation of its chief executive.

Shares dropped 59% Monday after the late Sunday bankruptcy filing. It marks a stunning fall for a health-technology company that more than 15 million consumers have used to gain new insight into their lineage and health risks.

CEO Anne Wojcicki, who is stepping down from her position but remaining on the board, has so far tried unsuccessfully to rescue the business by buying it back.

Wojcicki wrote in a late Sunday post on X that she still aims to buy the company's assets. "I remain committed to our long-term vision of being a global leader in genetics and establishing genetics as a fundamental part of healthcare ecosystems worldwide," she wrote.

23andMe traded at $0.73 per share late Monday, the second time its stock has fallen below $1. The company did a reverse 20:1 share split in October to boost its price above the threshold needed to comply with listing requirements for Nasdaq.

The company said its chapter 11 filing in the U.S. Bankruptcy Court for the Eastern District of Missouri is "the best path forward to maximize the value of the business."

23andMe's global database has grown into a virtually unprecedented repository of human genetic information that could be sold in bankruptcy proceedings.

On Friday, California Attorney General Rob Bonta issued an alert to consumers in his state, reminding them of their right to delete their information, a step some might scramble to take due to concerns over who may ultimately own their personal genetic data.

The company said "any buyer will be required to comply with applicable law with respect to the treatment of customer data." For now, 23andMe plans to continue operations, and consumers can continue to order test kits which the company will process.

The company's website appeared inundated Monday as some customers tried to delete their data. Many received error messages, and those trying to resolve the issue reported long customer service wait times. A company spokesman didn't respond to requests for comment.

Six years ago, 23andMe was one of the hottest startups in the world. Its tests had won the support of the Food and Drug Administration, and, with an affordable price tag, became popular Christmas stocking stuffers.

Accounts of test-takers discovering life-altering details about their lineage -- siblings they never knew or finding unknown parents -- led to news stories and namechecks on Saturday Night Live and in a chart-topping song. Its tagline "welcome to you" sold users on the promise of learning more about themselves.

But 23andMe never solved its central business problem: Customers only need to take its DNA test once.

It tried alternative business strategies, including selling subscriptions, but those never caught on. It also sought to license its data to outside pharmaceutical companies to help with their drug-development efforts. But there, too, it struggled to find significant recurring revenue.

Meantime, Wojcicki's effort to have the company develop its own drugs was complicated by rising interest rates. That has made 23andMe, along with a swath of the biotech industry, less appealing for investors, since getting new drugs to market is expensive and can take years.

Wojcicki resigned as CEO effective immediately by mutual agreement between her and the special committee of the company's board of directors. 23andMe's chief financial and accounting officer, Joe Selsavage, was appointed interim CEO.

The company has endured multiple rounds of layoffs, including one that cut 40% of staff last November, as it dialed back Wojcicki's ambitions to use genetic data to develop drugs and provide personalized medical care.

Wojcicki joined the company after being introduced to one of its co-founders through her then-boyfriend, Google co-founder Sergey Brin. She helped it gain momentum, hosting glitzy spit parties where celebrities would spit into the company's test tubes.

Wojcicki first indicated she wanted to take the company private last April, buying back the shares she didn't already own. But she was unable to win the support of two separate boards of directors.

She held supervoting shares that gave her control of 49% of company votes. That enabled her to block anyone else from buying the company.

The company's prior board resigned en masse last fall, saying that they had not received an "actionable" buyout proposal from her and that they differed with her over the strategic direction of the company. The company's current board rejected another offer earlier this month.

With the company entering the bankruptcy process, Wojcicki's stake is effectively wiped out and she becomes an independent bidder.

Last year, The Wall Street Journal reported on 23andMe's struggle to find a profitable business model as its ambitious bet to develop drugs using its stockpile of DNA faced expensive, lengthy delays.

Wojcicki pressed ahead, launching a subscription business offering personalized health reports, lifestyle advice and unspecified "new reports and features as discoveries are made" for an initial $229. She also bought a struggling telehealth company.

23andMe was valued at more than $6 billion after it went public in 2021. Today its shares are nearly worthless.

In her post on X late Sunday, Wojcicki said she takes accountability for the company's challenges but still believes in its future." [1]

1.  23andMe Tumbles Into Bankruptcy, CEO Steps Down. Winkler, Rolfe; Kao, Kimberley.  Wall Street Journal, Eastern edition; New York, N.Y.. 25 Mar 2025: A1.