By Rolfe Winkler

Anne Wojcicki isn't ready to let go.

The company she co-founded, 23andMe, has burned through more than $1 billion and laid off more than half its staff. A board of directors Wojcicki stocked with her friends resigned en masse in September because they couldn't get on board with her strategy for the maker of at-home DNA tests.

On Sunday night, the company filed for bankruptcy protection, its survival uncertain. Wojcicki immediately vowed to buy it back.

Can-do optimism helped Wojcicki bring the DNA test to millions. It also led her to pursue expensive, and ultimately failed strategies to use 23andMe's trove of medical data to develop drugs and provide healthcare.

The odds are no longer tilted in her favor. In bankruptcy court, her supervoting shares, which previously enabled her to block other bidders, have been wiped out. And her earlier bids for the company, which she once joked would be bigger than Google, were rejected by two boards of directors.

Wojcicki said in a statement that it is difficult to innovate in healthcare. "23andMe pioneered something radically different, to put the individual in direct control of important information about themselves, empowering them to think about their genetic identity and personalized preventative care in a whole new way."

Spit Parties

Wojcicki grew up at the center of Silicon Valley, the daughter of the onetime chair of Stanford University's Physics Department. She played ice hockey at Yale and worked at finance firms after college, analyzing healthcare companies.

Her sister Susan rented her Palo Alto garage to a pair of engineers starting a company called Google. Wojcicki met Google co-founder Sergey Brin, who introduced her to Linda Avey, the founder of a yet-to-be-named genetics startup.

Wojcicki became a co-founder of what became 23andMe.

23andMe initially struggled to excite people about genetic testing, which cost $399 in 2008. To generate buzz, they staged spit parties at New York Fashion Week and the World Economic Forum in Davos, where celebrities spit into 23andMe tubes to provide their DNA sample.

The price came down, but in 2013 the Food and Drug Administration told 23andMe to stop marketing its health test after it said the company failed to provide data and get clearance for it.

Wojcicki, by now running the company solo, pressed on. Her friend and former FDA commissioner David Kessler recalled in an interview telling her to take the agency's warning seriously, and she did, ultimately securing clearance for a consumer genetic test.

With FDA support, and now a $99 price tag, the tests had mass-market appeal. As stories filtered out about people discovering lost siblings or parents, 23andMe went viral.

Taking the stairs

From the beginning, the company faced a challenge that never went away: People only need to take, and pay for, one DNA test.

So Wojcicki looked for new ways to profit from its repository of genetic data.

She raised more cash and plowed it into a new drug discovery business, aiming to use 23andMe's data to make new medicines. It can take years and hundreds of millions of dollars to get a new drug to market, which made that plan risky.

She walked the Met Gala red carpet with then-boyfriend and baseball star Alex Rodriguez carrying a clutch decorated with DNA test chips, and regularly attended Vanity Fair's Oscars party with her sister Susan.

Wojcicki leased a new Sunnyvale office building with enough space to double staff. There was a gym, and free lunch. A staffer posted Richard Simmons placards in the stairwells when Wojcicki, a health nut who rode her bike to work many days, said she wanted a fun way to discourage elevator riding.

The company went public in 2021 and was briefly valued just above $6 billion. It had secured even more capital, but was still struggling to generate recurring revenue.

Wojcicki bought struggling telehealth company Lemonaid Health for $400 million, hoping it could use genetic reports to provide better patient care. The plan didn't work and Lemonaid's revenue halved.

In 2020 Wojcicki launched 23andMe+, joining the stampede of companies offering subscription content offerings. 23andMe had told investors millions of customers would sign up. Only a few hundred thousand did.

Failed Bids

With cash dwindling, the company staged multiple rounds of layoffs in 2023. And by April 2024, its stock languishing below a dollar, Wojcicki said she would take the company private. With 49% voting control, she said she would block any other bidder.

In August, 23andMe directors rejected her first bid for the company, writing her a letter saying they were "disappointed." Wojcicki was tending to her sister Susan at the time, who was in the hospital with terminal cancer, and who had lost her son, Anne's nephew, six months earlier. Susan died a week later.

The board waited a month and then resigned as a group saying they disagreed with Wojcicki over the company's strategic direction.

After the resignation of the first board, Wojcicki appointed a new one in October, paying three new directors $800,000 up front, two weeks before 23andMe laid off 40% of its staff.

Five months later they rejected her bid of $0.41 per share. Shares fell 60% to $0.73 on Monday, the day after the bankruptcy filing. The Sunnyvale office Wojcicki designed sits mostly empty. Its lease is likely to be discharged in bankruptcy.

Write to Rolfe Winkler at Rolfe.Winkler@wsj.com

(END) Dow Jones Newswires

The garage Susan Wojcicki rented to the Google founders as their first office was in Menlo Park, Calif. "23andMe Went From a $6 Billion Giant to Bankruptcy. Its Former CEO Won't Walk Away. ," at 9:52 p.m. ET March 25, incorrectly said it was located in Palo Alto, Calif.

(END) Dow Jones Newswires

March 26, 2025 10:28 ET (14:28 GMT)

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