Despite the board’s abrupt exit, Wojcicki remains resolutely dedicated to her vision. Founded by Wojcicki in 2006, 23andMe transitioned to public markets in 2021 via a special purpose acquisition company, initially at a share price of $10. However, the company has since witnessed a dramatic plunge in its stock value, falling below $1 per share since December.
In March, a special committee was formed by the board to explore alternative paths for the company. Wojcicki’s proposal in July to privatize 23andMe was ultimately dismissed by this committee. The departing directors articulated their dissatisfaction in a resignation letter, stating, “After months of diligent work, we have yet to receive from you a thoroughly financed, fully vetted, actionable proposal that serves the interests of non-affiliated shareholders. We believe the Special Committee and the Board have provided ample time for such a proposal.”
Among those resigning were prominent venture capitalists Roelof Botha of Sequoia Capital and Patrick Chung of xFund. They cited a lack of progress over the past five months and a divergence in strategic visions for the company as reasons for their immediate departure.
The South San Francisco-based company reported a financial loss of $69.4 million for the quarter ending June 30, with revenues amounting to $40.4 million. Following the resignations, Wojcicki stands as the sole remaining board member. Nonetheless, in an internal memo obtained by CNBC, Wojcicki reiterated her belief that privatization is the optimal route for long-term success and announced that the search for new independent directors will commence this week.
Last week, 23andMe reached a $30 million settlement, which includes three years of security monitoring, to resolve a lawsuit related to a data breach impacting 6.9 million customers. This breach, which predominantly affected customers of Chinese and Ashkenazi Jewish descent, led to the illicit sale of their data on the dark web. The company characterized the settlement as fair and reasonable and requested a judicial pause on arbitrations for numerous class members pending settlement approval or opt-out.
According to 23andMe, approximately $25 million of the settlement cost is anticipated to be covered by cyber insurance. Wojcicki’s perseverance is noteworthy, especially following the recent personal tragedies: the passing of her sister, former YouTube CEO Susan Wojcicki, last month after a two-year battle with cancer, and the death of Susan’s 19-year-old son, Marco Troper, earlier this year due to an accidental overdose.
In her memo to the team, Wojcicki conveyed the following:
“Team 23,
We wish to inform you that the 23andMe Board issued a press release today announcing the immediate resignation of all independent directors. I am both surprised and disappointed by this decision.
For the past 18 years, I have been steadfastly committed to 23andMe’s mission and firmly believe in the transformative potential of genetic information in healthcare and therapeutic discovery. I remain dedicated to our customers, employees, and stockholders in achieving our objectives. I continue to believe that moving 23andMe to private ownership will provide the best opportunity for sustained success.
We will promptly initiate the process of identifying new independent directors. I extend my gratitude to the departing directors for their service to the company and its shareholders.
I do not have further details to share at this moment but will provide updates as we approach Thursday’s Feisty.”