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A reminder to all that nothing lasts forever. Whatever happens to 23andMe as a result of this - and hopefully it's something positive - you should never assume that your ability to continue genetic genealogy with the status quo will continue indefinitely.

The most valuable thing in genetic genealogy is your data, and the ability to compare it to others'. I would strongly recommend that you download your raw data from any company at which you've tested, or at which you have had relatives test. If you feel comfortable doing so, I'd also recommend you upload your data to a third-party storage facility as backup, in case a company has to close its servers. This then protects you from losing your original copy, and allows you to continue comparing that data to others (and us to you). For autosomal DNA tests like 23andMe, the most appropriate would be . For Y-DNA tests, we have the .

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Here's an open letter from 23andMe to their customers:

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23andMe have stated on Twitter/X:

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"We believe in the strength of what we’ve built and believe today's announcement will enable 23andMe to emerge a more financially stable organization. We remain open for business, and there are no changes to the way we store, manage or protect customer data."

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Here are some FAQs from 23and Me about the Chapter 11 bankruptcy filing

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A database of 15 million people is a valuable asset and I think it's highly likely that a buyer will be found.

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As Iain says, the survival of any company is not guaranteed. We've already seen a number of companies disappear from the market (BritainsDNA, DNA Heritage, Oxford Ancestors, Genetree, etc). In some cases the genetic data was completely lost.

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As a precautionary measure it's always a good idea to download your data as an insurance policy.

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If you've tested at 23andMe I would recommend in the first instance uploading to MyHeritage and FamilyTreeDNA. With both companies you get free access to your matches but you will need to pay a small fee to unlock the additional features. At FTDNA you will also get a Y-DNA haplogroup (males only):

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If you upload to GEDmatch you need to be aware that it is now a forensic DNA database and all new uploads are automatically opted in to law enforcement matching for unidentified human remains cases.

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Best wishes

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Debbie Kennett

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Here's an open letter from 23andMe to their customers:

?

?

23andMe have stated on Twitter/X:

?

"We believe in the strength of what we’ve built and believe today's announcement will enable 23andMe to emerge a more financially stable organization. We remain open for business, and there are no changes to the way we store, manage or protect customer data."

?

?

Here are some FAQs from 23and Me about the Chapter 11 bankruptcy filing

?

?

A database of 15 million people is a valuable asset and I think it's highly likely that a buyer will be found.

?

As Iain says, the survival of any company is not guaranteed. We've already seen a number of companies disappear from the market (BritainsDNA, DNA Heritage, Oxford Ancestors, Genetree, etc). In some cases the genetic data was completely lost.

?

As a precautionary measure it's always a good idea to download your data as an insurance policy.

?

If you've tested at 23andMe I would recommend in the first instance uploading to MyHeritage and FamilyTreeDNA. With both companies you get free access to your matches but you will need to pay a small fee to unlock the additional features. At FTDNA you will also get a Y-DNA haplogroup (males only):

?

?

If you upload to GEDmatch you need to be aware that it is now a forensic DNA database and all new uploads are automatically opted in to law enforcement matching for unidentified human remains cases.

?

Best wishes

?

Debbie Kennett

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Appreciate the Overview here Debbie of 23andMe’s status.

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I would have thought the one item that could impact 23andMe’s sale value to other companies is the number and scope of Class Action lawsuits pending or financial liabilities unpaid against the company following their data breach in late 2023.? Do you have any feeling for the potential liabilities there in March 2025 [?].

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This article relates to September 2024 – and I would doubt if 23andMe would have paid out the full $30 million dollars by now.

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Other articles claim it has all been settled for sums in the $2 million to $3 million range in America.

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For genetic genealogists, it is probably a good thing that FTDNA is a CLIA approved laboratory and has other income streams arising from genetic health tests, which can be a repeat screening business and used to offset its genetic genealogy business.

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When I was at a TOPRA Conference in September 2024 at Rotterdam covering the EU, a lot of play was made of involving patient advocacy groups in the design of clinical trials.? I’m sure this aspect of 23andMe’s business model appealed to many customers, especially in America. But reputational damage in this field can take a long time to recover from.

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I’m unsure whether inheriting this database of potential clinical trial customers would appeal in 2025 – and any buyer would want to see a breakdown of the countries in which 23andMe has sold its Kits and healthcare opt-ins by region.

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Brian

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Brian

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Sorry I don't have any idea of 23andMe's liabilities in terms of outstanding lawsuits.

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A restructuring website has been set up which has a lot of information about the various debtors. I haven't had time to study the content but you may well find the answer to your question there.

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It was noticeable at RootsTech this year that 23andMe were very much focused on the ancestry market. I wonder if that may be where their future lies rather than in drug development and clinical trials.

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When I visited the 23andMe offices a few years ago now I noticed a kit sales tracker which divided the market up into the US and the rest of the world. The US appeared to account for about 90% of the company's sales. I suspect the UK is probably their second largest market.

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Best wishes

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Debbie

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Appreciate the Overview here Debbie of 23andMe’s status.

?

I would have thought the one item that could impact 23andMe’s sale value to other companies is the number and scope of Class Action lawsuits pending or financial liabilities unpaid against the company following their data breach in late 2023.? Do you have any feeling for the potential liabilities there in March 2025 [?].

?

This article relates to September 2024 – and I would doubt if 23andMe would have paid out the full $30 million dollars by now.

?

?

Other articles claim it has all been settled for sums in the $2 million to $3 million range in America.

?

For genetic genealogists, it is probably a good thing that FTDNA is a CLIA approved laboratory and has other income streams arising from genetic health tests, which can be a repeat screening business and used to offset its genetic genealogy business.

?

When I was at a TOPRA Conference in September 2024 at Rotterdam covering the EU, a lot of play was made of involving patient advocacy groups in the design of clinical trials.? I’m sure this aspect of 23andMe’s business model appealed to many customers, especially in America. But reputational damage in this field can take a long time to recover from.

?

I’m unsure whether inheriting this database of potential clinical trial customers would appeal in 2025 – and any buyer would want to see a breakdown of the countries in which 23andMe has sold its Kits and healthcare opt-ins by region.

?

Brian

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Hi Debbie, All

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The most useful of the links below to us on this list, seems to be the Advice to Vendors.

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There is a paragraph in there which says:

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Does the Company have sufficient liquidity to fulfil obligations to current vendors and to continue operating in the ordinary course?

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? Yes, 23andMe expects to pay for all goods and services received after the petition date.

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? The Company received a DIP financing commitment of up to $35 million. Upon Court approval, the additional liquidity from the DIP financing, combined with cash generated from the Company’s ongoing operations, is expected to support the business during these proceedings.

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Not knowing immediately what the acronym DIP stood for – it is ‘Debtor in Possession’ financing.

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What Is Debtor-in-Possession (DIP) Financing?

Debtor-in-possession (DIP) financing allows companies that have filed for bankruptcy protection under??to borrow capital to restructure and continue trading. DIP loans usually have priority over existing debt, equity, and other claims and are facilitated in the hope that the distressed company, with a new cash injection, can save itself, begin making money again, and pay off all its debts.

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Key Takeaways

• Debtor-in-possession (DIP) financing is financing for firms in Chapter 11 bankruptcy that allows them to continue operating.
• Lenders of DIP financing take a senior position on liens of the firm’s assets, ahead of previous lenders.
• Lenders permit DIP financing, as it allows a firm to continue operations, reorganize, and eventually pay off debts.
• Term loans are the most common type of financing provided, whereas historically it used to be revolving loans.
• Interest costs on this type of financing tend to be high.

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I take the paragraph “Lenders of DIP financing take a senior position on liens of the firm’s assets, ahead of previous lenders” to be the key item here.? They now have the first claim on the firm’s assets.

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So, somewhere down the line, and probably sooner rather than later, they want their $35 million dollars back, coupled to the last paragraph, “Interest costs on this type of financing tend to be high”.

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I suggest 23andMe has bought itself some time – but given the fact it has never made a profit all the time it has existed, to use a current phrase, “It holds very few cards, it has a very weak hand to play”.

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Any potential buyer has to decide what to do about the $35 million dollars loan and commit to pay that back over an agreed time if it wants 23andMe to survive.

?

Or simply wait for the company to go under and buy its assets(and hopefully some of its undoubtedly very good people) at whatever price they might be auctioned off by the DIP financiers to recover some of their losses - and thus to get rid of a market competitor.

?

You might regard this as either a variation of asset stripping, or adjusting the autosomal DNA Chip marketplace to the financial realities in 2025, compared to the Stock Market hype of a $4.5 billion dollar valuation in the past – before cheap WGS came along to change the marketplace for ever.

?

Brian

?

?

Hi Debbie, All

?

The most useful of the links below to us on this list, seems to be the Advice to Vendors.

?

There is a paragraph in there which says:

?

Does the Company have sufficient liquidity to fulfil obligations to current vendors and to continue operating in the ordinary course?

?

? Yes, 23andMe expects to pay for all goods and services received after the petition date.

?

? The Company received a DIP financing commitment of up to $35 million. Upon Court approval, the additional liquidity from the DIP financing, combined with cash generated from the Company’s ongoing operations, is expected to support the business during these proceedings.

?

---------------

?

Not knowing immediately what the acronym DIP stood for – it is ‘Debtor in Possession’ financing.

?

?

What Is Debtor-in-Possession (DIP) Financing?

Debtor-in-possession (DIP) financing allows companies that have filed for bankruptcy protection under??to borrow capital to restructure and continue trading. DIP loans usually have priority over existing debt, equity, and other claims and are facilitated in the hope that the distressed company, with a new cash injection, can save itself, begin making money again, and pay off all its debts.

?

Key Takeaways

• Debtor-in-possession (DIP) financing is financing for firms in Chapter 11 bankruptcy that allows them to continue operating.
• Lenders of DIP financing take a senior position on liens of the firm’s assets, ahead of previous lenders.
• Lenders permit DIP financing, as it allows a firm to continue operations, reorganize, and eventually pay off debts.
• Term loans are the most common type of financing provided, whereas historically it used to be revolving loans.
• Interest costs on this type of financing tend to be high.

?

I take the paragraph “Lenders of DIP financing take a senior position on liens of the firm’s assets, ahead of previous lenders” to be the key item here.? They now have the first claim on the firm’s assets.

?

So, somewhere down the line, and probably sooner rather than later, they want their $35 million dollars back, coupled to the last paragraph, “Interest costs on this type of financing tend to be high”.

?

I suggest 23andMe has bought itself some time – but given the fact it has never made a profit all the time it has existed, to use a current phrase, “It holds very few cards, it has a very weak hand to play”.

?

Any potential buyer has to decide what to do about the $35 million dollars loan and commit to pay that back over an agreed time if it wants 23andMe to survive.

?

Or simply wait for the company to go under and buy its assets(and hopefully some of its undoubtedly very good people) at whatever price they might be auctioned off by the DIP financiers to recover some of their losses - and thus to get rid of a market competitor.

?

You might regard this as either a variation of asset stripping, or adjusting the autosomal DNA Chip marketplace to the financial realities in 2025, compared to the Stock Market hype of a $4.5 billion dollar valuation in the past – before cheap WGS came along to change the marketplace for ever.

?

Brian

?

?

[Edited Message Follows]