23andMe May Disappear as Public Stock

By Douglas A. McIntyre Published Apr 18, 6:35AM EDT

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23andMe May Disappear as Public Stock — © Altayb / Getty Images

Battered 23andMe Holding Co. (NASDAQ: ME), its shares driven down to penny stock levels, may disappear from the public markets completely. That is if its CEO can take the company private. If not, 23andMe may run out of money.

CEO Anne Wojcicki has told a special committee of the 23andMe board that she will begin to look for funding to buy out public investors. According to an SEC filing, “Ms. Wojcicki also indicated that she wishes to maintain control of the Issuer and, therefore, will not be willing to support any alternative transaction.” In other words, if she cannot get her way, she will ensure 23andMe is not taken over.

23andMe shares trade at $0.36 apiece, and its market cap is down to $172 million. The stock traded at $3.50 a share in May 2022. (Check out three stocks under $5 that Wall Street thinks will grow 35% or more.)

23andMe is in the personal DNA business, which has lost much popularity. The company decided to use its database of DNA to help with drug trials. Since these trials can often take years, the goal of that business may only be hit near the end of this decade, if at all. 23andMe bought a company to help make this work. However, that has yet to work.

In the most recently reported quarter, 23andMe posted revenue of $44.7 million, down from $66.9 million in the same quarter the year before. The company lost $278 million, compared to $99.3 million a year ago.

At the current burn rate, 23andMe will run out of cash in a year. Given its stock price, it seems to be in an unattractive business. So why would investors take it private? Without a transaction, it is hard to see how 23andMe can survive.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.