The IT Nerd

You might recall the recent troubles of DNA testing service 23andMe. The company got pwned in epic fashion. That led to them quietly trying to alter their terms of service to avoid getting sued. But when that didn’t work, they blamed their users for getting pwned. Ultimately, they are now trying to to pay their way out of trouble. Now they have some new trouble:

On Tuesday, the independent directors of the Board of 23andMe Holding Co. (NASDAQ:ME) sent a letter to Anne Wojcicki, Chief Executive Officer, Co-Founder, and Chair of the Board of Directors of 23andMe, providing their resignation, effective immediately.

The board said, “After months of work, we have yet to receive from you a fully financed, fully diligenced, actionable proposal that is in the best interests of the non-affiliated shareholders. We believe the Special Committee and the Board have provided ample time for you to submit such a proposal. That we have not seen any notable progress over the last 5 months leads us to believe no such proposal is forthcoming. The Special Committee is therefore unwilling to consider further extensions…”

That’s bad, but it gets worse:

On Wednesday, 23andMe Holding Co., a company specializing in biotechnology and personal genomics, disclosed a notification of non-compliance from Nasdaq’s Listing Qualifications Department. The notice, dated September 18, 2024, indicated that 23andMe does not currently meet Nasdaq’s corporate governance requirements due to a shortfall in the number of independent directors on its board and the composition of its key committees.

And:

23andMe must now submit a plan by October 3, 2024, to regain compliance. If Nasdaq accepts this plan, the company may be granted up to 180 days to demonstrate full compliance. However, if the plan is rejected, 23andMe will have the option to appeal before a Nasdaq Hearings Panel.

Seeing as this company has been trying to sort itself out for months, I don’t see a scenario where they get themselves sorted in weeks. Thus I am pretty sure that they are going to get delisted from NASDAQ, and then they are likely going to cease to exist. This shows what happens when you have one catastrophic event, in this case getting pwned, and you can’t recover. Other businesses should see this as a cautionary tale.

This entry was posted on September 23, 2024 at 8:01 am and is filed under Commentary with tags 23andMe. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.