23andMe Bankruptcy: A Wake-Up Call for Data Ethics and Brand Trust as Consumer DNA data goes up for sale

The news that 23andMe filed Chapter 11 bankruptcy sent shockwaves around the consumer genomics space. Co-founder, Ann Wojcicki stepped down as CEO and hopes to bid to buy the company which is set to be auctioned off in the bankruptcy process. Once valued at $6B, the company is now worth under $50M. The implications are huge—not just for customers and shareholders, but for the entire data-driven marketing and AI ecosystem.

Customer DNA privacy is now in limbo

Per 23andMe’s terms, your genetic data may be transferred if assets are sold. That means your most personal information—your DNA—could change hands.

While there are clear data ethics and stockholder concerns, a new owner could potentially infuse additional cash into the company while removing stockholder pressures. It has happened before. Major 23andMe competitors have shifted consumer DNA data ownership.

• AncestryDNA (over 25 million users) is now owned by private equity firm Blackstone

• MyHeritage (9.6 million users) was acquired by Francisco Partners in 2021 

• FamilyTreeDNA and its parent company, Gene by Gene was acquired by myDNA™ in 2021  

Each has varying levels of data transparency and ownership models, making it critical for consumers to stay informed. From an industry perspective, these private equity acquisitions provided financial stability while giving them the independence to pursue profitable personalized wellness and pharmacogenomics fields. Perhaps 23andMe could enjoy the same fate? The media is crushing the value of 23andMe’s DNA data by scaring existing customers into deleting their data. New owners may end up with a smaller database.

Shareholders are left holding the bag 

Investors have seen massive value erosion. Any recovery depends on what—if anything—emerges from an impending sale. Shares of ME could be delisted from the stock market, or the new owners could cancel current shares and issue new shares.

From a marketing and AI lens, here’s what this teaches us:

Transparency = Brand Currency 

Companies handling sensitive data must over-communicate and build trust by design—not as a reaction to crisis.

Ethical data practices must evolve with tech 

With AI enabling more predictive modeling, the bar for consent, security, and use-case clarity keeps rising.

Your tech stack is only as strong as your values 

Trust is not a KPI—but it is a competitive advantage, especially in industries like genomics, finance, and health.

Advice for customers & investors:

For 23andMe users: 

• Review your privacy settings and consent forms. The website is still operational as it waits for its new owner.

• Media cries for customers to delete their data weakens the value of the company’s biggest asset.

• If you are concerned about data privacy and choose to delete your data, download your raw data FIRST. You can upload your raw data into some other consumer DNA websites like MyHeritage and FamilytreeDNA.

• Stay updated on bankruptcy news and the terms of any future sale of the company.

For shareholders: 

• Track bankruptcy proceedings and sale prospects.

• Seek professional investment advice about next steps.

As someone bridging traditional marketing with AI and data ethics, I will be tracking this closely.

Disclosure: I am a 23andMe customer.

Would love to hear your take. Do you trust private companies with your DNA data? What can we learn as marketers about transparency and trust in the AI age?

#AI #Marketing #BrandStrategy #DataPrivacy #23andMe #Genomics #AncestryDNA #MyHeritage #FamilyTreeDNA #EthicalAI #TechEthics #DataGovernance #CX #MarTech

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