Genetics Company 23andMe Plans to Go Public in Q2 2021 Thanks to SPAC Merger With Virgin Group

By James White Friday, February 5, 2021

23andMe is among a growing number of companies involved in the direct-to-consumer genetic testing business. The company has received over $868 million in funding from investors including Sequoia Capital and NewView Capital since the founding of the business in 2006 by entrepreneurs Anne Wojcicki, Linda Avey, and Paul Cusenza. Now, the personal genetics business seeks to go public in the near future via a special purpose acquisition company, or SPAC merger, with a branch of conglomerate investment company Virgin Group.

“As a fellow industry disruptor as well as an early investor in 23andMe, we are thrilled to partner with Sir Richard Branson and VG Acquisition Corp. as we approach the next phase of our business, which will create new opportunities to revolutionize personalized healthcare and medicine,” Wojcicki, CEO of 23andMe, said in a press release.

23andMe headquarters.

DNA Testing Direct to Your Door

The consumer genetics company offers three different packages for customers to choose from. Selecting one of the options will have a saliva sample collection kit sent to the user’s home.

The first testing kit option runs for about $100 and provides information about the ancestry and genetic traits of the user, including the DNA composition of various nationalities, the origin of maternal and paternal haplogroups, as well as traits that may have been passed down to the user. The next package costs about $200 and offers all the previous features plus information about the user’s health, including family health history, genetic predispositions, and carrier status for a number of genetic conditions. The final package includes all previous features as well as a subscription service (for another $29 a year) that provides personalized reports based on research by companies utilizing the genetic data provided by the business.

Genetic Testing Businesses Emerge as DNA Sequencing Costs Decline

In the past, where sequencing a single human genome would cost $100 million, direct-to-consumer testing businesses were simply not feasible. However, the National Human Genome Research Institute reports that the cost per human genome in 2020 hovers somewhere in the neighborhood of $1,000, thanks to technological advances in the industry and increases in computing power.

Today, 23andMe is among several businesses taking advantage of the affordable process. Competitors such as Ancestry and MyHeritage have raised $33.2 million and $49 million in funding from investors, respectively. Ancestry was acquired last year by investment management company Blackstone for $4.7 billion.

Under the terms of the SPAC merger, the combined VG Acquisition Corp. and 23andMe entity holds an enterprise value of $3.5 billion. The genetics company will also see $759 million in proceeds from the agreement.

About the Author

Headshot for author James White

James White is a Michigan State University graduate with a B.S. in Environmental Biology. He is interested in reporting emerging trends in technology, especially with regard to alternative energy and environmental conservation.

Related Articles