Independent directors of 23andMe resign from board

Original Article ↗ Hacker News Discussion ↗

Board Resignations and Governance

  • Entire slate of independent directors resigned after the CEO pursued a low-priced take-private offer; they cited her concentrated voting power and misalignment with other shareholders.
  • CEO controls ~20% of shares and ~49% of voting power, leaving the board effectively powerless in direct conflicts.
  • Some see the resignations as a protest signal; others note it may actually ease a plan to further entrench control or worsen future offers.

Take-Private Bid, Valuation, and Bankruptcy Risk

  • CEO’s proposed $0.40/share buyout was rejected by a special committee as not in minority shareholders’ interests.
  • Debate over whether $0.40 is a “lowball”: it’s a typical premium over the current sub-$0.40 trading price but far below the original de-SPAC price and perceived strategic value.
  • Company is burning cash quickly, risks delisting, and faces a $30M breach-related payout; some argue letting it hit bankruptcy could wipe out current control and reset governance.
  • Others note intentional value destruction would violate fiduciary duties and invite legal action.

Business Model: Kits vs. Drug Development

  • Original consumer ancestry/health kit business has plateaued; many feel 23andMe “gave up” on ancestry relative to Ancestry.com’s subscription-driven genealogy focus.
  • Company bet heavily on pharma collaborations and drug discovery using its genomic database (e.g., GSK deal), with some recent positive phase 2 cancer drug data.
  • Commenters highlight that phase 2 success is far from commercialization; aggregate probabilities suggest only a coin-flip chance of any candidate reaching market.

Data Breach, Lawsuits, and Privacy Concerns

  • A major credential-stuffing incident exposed genetic data for specific ethnic subsets and led to a ~$30M class-action settlement.
  • Dispute over blame: some fault weak security (lack of enforced MFA), others blame users’ password reuse.
  • 23andMe also drew criticism for retroactively changing terms of service after the breach to limit legal exposure.

DNA Data Use, Ethics, and Personal Risk

  • Strong reluctance from many to ever submit DNA, citing risks of:
    • Future discrimination (insurance, employment, life insurance).
    • State misuse (law enforcement dragnet, potential future persecution).
    • Sale or repurposing of data if the company is acquired or goes bankrupt.
  • Others argue the benefits (health insights, genealogy, pharmacogenomics) outweigh largely speculative risks, especially given existing newborn screening and other government collection.

Employee and Technical Perspectives

  • Former employees describe a culturally and operationally flawed but not fraudulent company.
  • Some had access to customer data under heavy auditing; deletion processes for GDPR were reportedly taken seriously but acknowledged as technically imperfect.
  • Platform sequences only selected SNPs, not whole genomes; commenters discuss alternatives (full-genome services, DIY nanopore sequencing) but note cost, fidelity, and privacy trade-offs.