DNA testing company 23andMe filed for Chapter 11 bankruptcy protection on Sunday, marking a dramatic fall for a firm once valued at nearly $6 billion. The company, which pioneered consumer genetic testing, will now seek to sell itself through a court-supervised auction process while continuing operations.
In a simultaneous announcement that signals the depth of the company’s troubles, co-founder Anne Wojcicki has resigned as chief executive officer, effective immediately. Joseph Selsavage, the company’s chief financial and accounting officer, will serve as interim CEO, though Wojcicki will remain on the board of directors.
“We have had many successes but I equally take accountability for the challenges we have today,” Wojcicki wrote in a post on X early Monday. “There is no doubt that the challenges faced by 23andMe through an evolving business model have been real, but my belief in the company and its future is unwavering.”
The bankruptcy filing comes after a series of setbacks for the once-pioneering firm. Despite attracting celebrity endorsements and helping popularize ancestry tracing through genetic testing, 23andMe has struggled to maintain growth. Customers typically purchased testing kits once with little incentive to return, and efforts to launch subscription services fell short of expectations.
A major data breach in 2023 that exposed personal information of nearly 7 million customers dealt a significant blow to the company’s reputation. Last November, 23andMe cut 40% of its workforce as part of a restructuring plan that also saw the resignation of its entire board except for Wojcicki.
The company’s financial decline has been steep. After reaching a market valuation peak of nearly $6 billion in 2021, 23andMe’s value has plummeted to approximately $50 million today. Wojcicki’s recent offer to take the company private at 41 cents per share valued the business at just $11 million, a proposal rejected by the board.
The bankruptcy process will allow 23andMe to solicit bids over a 45-day period with a potential auction to follow. Interestingly, Wojcicki herself may emerge as a bidder. “I have resigned as CEO of the company so I can be in the best position to pursue the company as an independent bidder,” she stated on social media.
For the company’s approximately 15 million customers, questions about the security of their genetic data loom large. 23andMe has assured users that the bankruptcy filing “does not change how we store, manage, or protect customer data” and that any buyer would be required to comply with applicable privacy laws.
California Attorney General Rob Bonta has issued a consumer alert reminding Californians they have the right to direct the company to delete their genetic data, destroy test samples, and revoke permissions previously granted.
Despite securing $35 million in financing to maintain operations during the sale process, 23andMe’s future remains uncertain as it attempts to navigate bankruptcy while preserving what remains of a business that once promised to revolutionize personal genetics.
