Dear Directors at 23andMe,
My name is Briana Gonzalez, former CEO of NovaBio Solutions, a company that no longer exists except in court documents and my own regrets. Three years ago, our lab equipment was being celebrated in biotechnology conferences across the country. Today, it sits in climate-controlled storage units while bankruptcy administrators decide its fate.
I’m writing because I believe our misfortune could become your innovation.
When our Series C funding collapsed last spring, we were forced to shutter our operations despite having developed several breakthroughs in portable genomic sequencing technology. While our business model failed, our technology did not. And this isn’t just about NovaBio – dozens of biotech startups with valuable intellectual assets are filing for bankruptcy each quarter.
What remains after these failures is a goldmine of potential: cutting-edge equipment, patents pending approval, and technological infrastructure that could revolutionize consumer genetic testing if properly repurposed.
Equipment – The Hidden Value of Bankrupt Biotech Assets
The standard liquidation process treats specialized equipment as merely physical assets, often selling sophisticated biotech machinery for pennies on the dollar to generalist equipment resellers. This approach fails to recognize the true value: the innovative ways these technologies could be integrated into existing platforms like 23andMe.
Our portable sequencing units, for instance, were designed for field research in remote locations. With minimal modification, they could help you decentralize your testing operations, potentially reducing your per-test costs by up to 42% according to our original projections.
Similarly, our patent-pending sample preparation protocol could reduce contamination rates and increase first-pass success rates for consumer samples. The frustration of “insufficient sample” notifications could become a thing of the past for your customers.
I sometimes wonder if we’d still be operational had we focused more on practical applications rather than chasing the perfect technology. That’s a lesson I’ve learned the hard way – perfection can be the enemy of sustainability.
Equipment – Three Practical Applications for 23andMe
1. Distributed Testing Network – Equipment
Your current centralized testing model has proven successful but remains vulnerable to supply chain disruptions and regional processing delays. By acquiring and repurposing compact sequencing technologies from defunct startups, you could establish regional micro-labs that process samples closer to your customers.
The NovaBioSequence-Mini units (currently in storage in Austin) can process up to 96 samples in a footprint smaller than a standard office desk. While they don’t match the throughput of your centralized equipment, they offer redundancy and scalability that could transform your business continuity strategy.
During the pandemic, we watched many labs struggle with backlogs and delays. A distributed network would have provided resilience. I believe this approach could reduce your average processing time by 3-7 days while simultaneously cutting shipping costs and carbon footprint.
2. Enhanced Ancestry Resolution Technology – Equipment
Several bankrupt firms, including our own, developed specialized algorithms for distinguishing between closely related population groups. These technologies were originally designed for academic research but could dramatically enhance your ancestry testing precision.
Admittedly, I was initially skeptical about the commercial applications of these algorithms. They seemed too academic, too specialized. But now I see their potential for your platform.
For example, ChronoDNA (liquidated last year) developed a temporal DNA analysis system that could potentially distinguish migration patterns within the same geographic region across different historical periods. Imagine offering your customers not just where their ancestors came from, but when specific migrations occurred in their family history.
Their patent portfolio is currently held by creditors who have limited understanding of its true value. As a result, acquiring these assets would likely require significantly less investment than developing similar capabilities in-house.
3. Consumer-Operated Testing Devices
The most ambitious application would involve transforming some of the portable testing equipment into consumer-operated devices. While full sequencing would remain in your labs, imagine offering customers a preliminary sampling device that provides immediate basic results and ensures proper sample collection for more detailed analysis.
HomeGen’s bankruptcy last quarter left their consumer-friendly extraction technology in limbo – a system specifically designed to simplify the collection process while improving sample viability. Their preliminary studies showed a 28% improvement in first-pass success rates compared to standard collection methods.
I remember being impressed by their technology at a conference shortly before they ran out of funding. Their engineering team had solved several key challenges that had eluded other companies. It seemed like they were on the verge of something important before financial realities intervened.
Implementation Challenges and Solutions
I won’t pretend this approach comes without challenges. Having navigated (albeit unsuccessfully) the biotech startup landscape, I’m acutely aware of the regulatory, technical, and operational obstacles.
The FDA’s position on repurposed medical technologies remains complex. However, most genetic testing equipment falls under lab developed test (LDT) frameworks rather than medical device regulation. By acquiring these assets as laboratory equipment rather than consumer devices, the regulatory pathway becomes significantly clearer.
Integration of disparate technologies presents another challenge. Various bankrupt startups used different protocols, data formats, and operating systems. However, this is where 23andMe’s established platform becomes an advantage rather than a limitation. Your existing infrastructure could serve as the standardization framework for these diverse technologies.
There’s also the matter of intellectual property rights in bankruptcy proceedings. While complex, this area offers significant opportunities. Many bankrupt firms have patents that are still pending approval, creating a unique window to acquire these assets before their true value is recognized in the marketplace.
Economic Advantages
Beyond the technological benefits, there are compelling economic reasons to consider this approach:
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Acquisition costs: Bankruptcy liquidations typically value specialized equipment at 10-30% of original cost, creating extraordinary value opportunities.
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Time-to-market: Rather than developing new technologies from the ground up, repurposing existing systems could reduce development cycles by 40-60%.
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Talent acquisition: Many former employees of these bankrupt firms remain available and would bring valuable expertise specific to the technologies in question. Their insights would significantly accelerate integration.
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Competitive differentiation: While competitors focus on service improvements using existing technologies, this approach could create fundamental advantages in both cost structure and service capabilities.
I hesitate to make specific financial projections – after all, my own company’s financial models ultimately proved too optimistic. However, the economic fundamentals support this approach. The discount on initial capital expenditure alone would create significant margin opportunities even if only a portion of the technologies prove successful in your ecosystem.
A Personal Perspective
I’ll be candid – watching my company’s innovations gather dust while bankruptcy administrators focus on maximizing liquidation value has been profoundly frustrating. These technologies could be helping people, advancing science, and creating value. Instead, they sit idle, depreciating in both economic and innovative relevance.
There are days I question every decision I made leading NovaBio. Perhaps we expanded too quickly, or maybe we should have focused on strategic partnerships rather than trying to build everything ourselves. The benefit of hindsight makes many mistakes clear, though that clarity offers little comfort now.
But this letter isn’t about salvaging my professional pride. It’s about recognizing that valuable innovations shouldn’t disappear simply because a business model failed. The sequencers, the algorithms, the sample preparation systems – they all work. They just needed a stable business environment and the right application focus.
23andMe has both the infrastructure and market position to breathe new life into these orphaned technologies. You have what we lacked: scale, established customer relationships, and the operational framework to maximize their potential.
First Steps Forward
If you find merit in this approach, I suggest starting with a targeted evaluation of bankruptcy assets currently available in the genetic testing space. Several auction houses specialize in biotech liquidations and can provide comprehensive inventories.
Beyond equipment, I recommend examining the patent portfolios of recently bankrupt firms. Many have pending applications that could provide significant competitive advantages at a fraction of their development cost.
Finally, consider creating a focused team to identify, evaluate, and integrate these technologies. The specialized nature of these assets requires specific expertise to recognize their true potential.
I would be happy to provide more specific information about NovaBio’s assets or make introductions to bankruptcy administrators handling other biotech liquidations. While I no longer have any financial interest in these outcomes, I remain deeply committed to seeing these innovations fulfill their potential.
The future of genetic testing will belong to companies that can provide more personalized, accessible, and comprehensive insights. The technological building blocks for that future already exist – not in R&D labs, but in bankruptcy asset listings.
With respect and optimism,
Briana Gonzalez
Former CEO, NovaBio Solutions
