23andme, a company that helps consumers understand and decipher their genomes, has raised a partial $11 million out of a $24.26 million B round of funding, according to regulatory filings. 23andme, which was co-founded by Google co-founder Sergey Brin’s wife, Anne Wojcicki, raised $9 million in Series A funding from Google, Genentech, New Enterprise Associates, and Mohr Davidow Ventures in 2007.
Now PEHub is reporting that Mohr Davidow Ventures divested its stake in 23andme after investing in a direct competitor Navigenics. Losing one of your main investors to a competitor is not a good sign. 23andme maps customers’ DNA and helps them find information about their ancestry and their risks of getting certain diseases (Michael tried it last year). Google ended up taking a $3.9 million stake in 23andMe in May 2007, after Brin had personally loaned the company $2.6 million. The debt was repaid after the Google investment. We’re curious as to how much, if any, of this round’s $11 million is Brin’s or Google’s money.
Also, we’d like to know why Mohr Davidow shifted its funds to a 23andme’s rival. Navigenics’ service is similar to 23andme’s with slight differences. For example, 23andme offers one package, priced at $399, to test your saliva. Navigenics offers two packages of testing priced at at $499 and $2,499, with the higher priced test including genetic counseling and testing for more health conditions. Most recently, California’s Department of Public Health issued cease and desist letters to 23andMe, Navigenics and 11 other genetic testing startups, mandating that the labs demonstrate that they have been certified by both the state and federal government, and, perhaps more importantly, that all genetic tests were ordered by a patient’s doctor, which is required by state law.
I do not consider Mohr Davidow to be a quality firm. I have raised money 5 times now over the past 8 years and would never consider taking a dollar from the VC that brought us Revenue Science.
Revenue Science?? What is that?
Your opinion seems to be in agreement with the general opinions and ratings at thefunded.com
I heard that 23andme bought their shares back from MDV because they were not happy that the firm had decided to invest in a competitor without even notifying them.
This seems to have worked out poorly for MDV–Navigenics is doing terribly from what I hear, and has been forced to completely change their business model due to lack of customers.
interesting.
i would invest in the first who offers:
a) an open format for my DNA fingerprint
b) custom news reporting based on my genetic profile
How about Genesense, custom ad serving by Google, based on your genetic profile.
One of the things that is great about the valley is even the billionaires raise venture capital. Bigger risks, external vetting of idea, professional boards. Contrast well with Indian model where the wealthy always debt finance or fund internally. Lots of more me to businesses.
Navigenics is the more serious of the two and has deals with clinics/hospitals to do genetic testing. 23andMe is more consumer focused on mostly ‘entertainment genes.’ Which is the better business model? No one knows for sure at this point, but the B2B route makes more sense.
Two other similar Silicon Valley companies that are even more clinical based than Navigenics (and in my opinion the right strategy) are Counsyl and Gene Security Network.
All I know is, no one is going to drop a grand for that information–or 300 (I heard they lowered the price). I might pay $20.
23andMe just announced they are renaming the company 23DeadpoolandSergey.
Though not everyone will have a spare $2k to find their genetic defects but I presume in near future these services will become an integral part of our preventive measures.
Once a baby is born the report is automatically available to parents to look at it and who knows may be to fix also any genetic anomalies.
Integrate the cost as part of delivering a baby. Instead of charging the normal $10,000 for a baby, they can charge $15,000 to deliver the same baby with a DNA makeup.
Since the mother is already at the hospital for the baby delivery, she has no choice but to pay the price.
I believe that knowing my risk for life threatening health conditions is important. I researched these and other similar companies and ordered the Navigenics service. Their research and process seemed more scientifically sound and they partner with big medical institutions and physicians. I also liked that they gave me a genetic counselor. 23andme did seem more “fun.” But at the end of the day I wanted a group that was more serious then fun.
I suppose there is a market for both, but it makes sense that MDV would pull out and get inline with the company that has physician and medical partnership.
I haven’t participated in either of these services yet. I’ve heard about them though and I’ve been looking at them. I think being able to learn my risk for diseases is an amazing concept. I believe the healthcare industry is moving more toward prevention and it needs to.
Treatments are great, but we need to start looking at how to prevent a disease from even starting. In general, I tend to lean toward the Navigenics services — they seem more serious and focused on the health and medial application, while 23andme is about having fun with your DNA.
The two comments above this one… yeah no.. definitely not baited comments.. not at all.
As long as we are talking about baiting – lets add Scott’s comment about Navigenics doing terribly due to lack of customers to the bunch – come on – how do we know about customers for either of these guys – they are both private.
I can’t imagine that either of these companies is making millions yet.
Both seem like cool ideas to me. Similar but marketing to different groups.
I like the VCs are backing these kind concepts regardless of which it is.
The VCs’ll back any poop as long as you have big names behind it, no matter how bad the idea is.
The fact that a poster above mentioned up to 4 potential companies in the Valley alone that do the same thing (albeit slightly different markets) is crazy. Way too many people sleeping with each other in the valley. Just how many of these companies can survive? My sense is at most one.
Must of been a great pitch that Navigenics put on MDV.