23andMe paid $400 million for a repeat business. It sold for $10 million.
23andMe bought telehealth firm Lemonaid Health for a stated $400 million to add recurring revenue. By the 2025 bankruptcy, Lemonaid was sold for about $10 million, and the stock had lost roughly 99.6% of its peak.
Transcript
23andMe bought Lemonaid Health for a stated $400 million. In bankruptcy, Lemonaid was sold for about $10 million.
The problem was the model. A genetic test is sold once. In 2021, 23andMe needed recurring revenue to justify its valuation.
It chose telehealth, the annuity the spit kit lacked. It paid 25% in cash and 75% in its own stock.
On March 23, 2025, 23andMe and 11 affiliated debtors filed for Chapter 11. The stock had lost roughly 99.6% of its peak.
Buying a repeat business does not make your core business repeat. Test whether your own customers come back before you pay for the proof.
The records behind this video
Every figure in the video comes from this Decision Record, each with its sources.
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