23andMe Board Resigns En Masse Amid CEO Buyout Controversy and Data Privacy Concerns

23andMe Board Resigns En Masse Amid CEO Buyout Dispute

In a surprising turn of events, all independent directors of 23andMe, the prominent genetic testing company, have resigned from its board this week. The mass exodus follows prolonged negotiations with CEO and co-founder Anne Wojcicki over the company’s future direction.

The departing directors cited the absence of a “fully financed, fully diligenced, actionable proposal” from Wojcicki as the primary reason for their resignation. While expressing belief in 23andMe’s mission, the board members found themselves at odds with the CEO regarding the company’s path forward.

Wojcicki, who holds 49% of the voting power at 23andMe, responded to the resignations in a memo to employees, expressing both surprise and disappointment. She maintained her stance that taking the company private would be beneficial in the long term and announced plans to identify new independent directors for the board.

The genetic testing giant has faced significant financial challenges since going public in 2021. With a reported net loss of $667 million for the last fiscal year, 23andMe has struggled to establish a profitable business model. The company’s stock has plummeted, closing at 33 cents, marking a staggering 97% decline since its public debut.

In April, Wojcicki announced her intention to take 23andMe private, proposing to acquire all outstanding shares she doesn’t currently own. However, her late July proposal was deemed insufficient by the board’s evaluating committee, further straining relations between the CEO and the now-resigned directors.

Adding to the company’s woes, 23andMe recently agreed to a $30 million settlement for a class-action lawsuit stemming from a 2023 data breach. While $25 million of the settlement is expected to be covered by insurance, the incident has raised concerns about privacy and data security among customers.

As 23andMe navigates these turbulent waters, the company faces the dual challenge of rebuilding its board and addressing its financial struggles. The coming months will be crucial in determining whether Wojcicki’s vision for privatization can salvage the once-promising genetic testing venture.