In a dramatic turn of events, all seven members of the 23andMe board resigned on Tuesday amidst ongoing tensions over CEO Anne Wojcicki’s plans to take the company private. This mass resignation marks a critical blow for the company, which is best known for its mail-order DNA-testing kits.
Since merging with a special purpose acquisition company (SPAC) in 2021, 23andMe has struggled to achieve profitability. The company’s shares, initially priced at $10 during its IPO, have plummeted, closing at $0.30 on Tuesday following the board’s exits. As of Wednesday afternoon, the stock showed a slight increase to $0.36.
The board included prominent figures such as Roelof Botha of Sequoia Capital and Neal Mohan, the CEO of YouTube. In a letter addressed to Wojcicki, they expressed their disappointment in not receiving a “fully financed, fully diligenced, actionable proposal” that would benefit non-affiliated shareholders. They acknowledged their support for the company’s mission but noted significant differences regarding its strategic direction, leading to their decision to resign. Wojcicki, holding 49% of the voting power, remains the sole board member.
In a memo to staff following the resignation, Wojcicki expressed her surprise and disappointment but remained optimistic about the company’s future. She reiterated her commitment to taking 23andMe private, stating it is the best path forward and announced an immediate search for new independent directors who align with her vision.
The company’s struggles have intensified this year, including a recent shift to prescribing GLP-1 weight-loss medications through its telehealth subsidiary, Lemonaid Health, as part of a cash-raising effort. Sales of DNA tests have declined, a research partnership with GlaxoSmithKline has ended, and a major data breach affecting nearly 7 million customers sparked lawsuits and a significant settlement of $30 million. Once valued at $3.5 billion, the company’s market capitalization has fallen to under $200 million.
Despite these challenges, Wojcicki has conveyed confidence that the company’s focus on drug development and genetic sequencing will eventually yield positive results, acknowledging that the journey may be tumultuous. However, the recent board departures indicate a growing rift over the company’s strategic future.