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  • Lloyd Price

Genetic Testing sites are the new Social Networks, so will Facebook acquire 23andMe?

Genetic Testing sites like 23andMe are rapidly emerging as the new Social Networks. Over the last 10 years, millions of people across the world have submitted their DNA for testing and eagerly waited the results, including me back in May 2016.

How are genetic testing sites becoming the new Social Networks?

People are completing their DNA testing, receiving their results and then opting in to receive contacts from others with a similar genetic profile to them. This process of being contacted by people based on their DNA profile instead of location and shared interests is a fuelling a new wave of social network activity.

The big benefit appears to be discovering relatives or distant family members based on a highly relevant profile and scientific match. This new activity could unlock a new use case for Facebook, particularly for older users in the 65+ bracket, not only could people keep in touch with their children and grandchildren by using the world's largest social network, they could also "search" for older or newly discovered family members of the same age.

Instagram and WhatsApp are highly appealing to younger users and real assets for Facebook, could 23andMe be the jewel in the Facebook crown for the older user base?

Why now, what is so unique and interesting about genetic testing?

Genetic testing appears to have hit an inflection point, growth in the last 2 years has increased 300% from around 4M to 12M. In addition to the growth in this core service, a number of peripheral companies and consumer services have emerged, particularly focused on the data produced and analysis to create personalised insights.

"Genealogy services use DNA to tell people what continents their ancestors are from and to locate family members, including distant cousins.The type of readout used, called a genotype, consists of around a million measurements of a person’s genome, performed using an inexpensive DNA chip."

"Both and 23andMe allow customers to download the data files.The sheer number of people who have the data could spur growth in websites that offer to reanalyze it. Companies including Habit and Promethease take the files and provide a breakdown of people’s diet or health risks, frequently with little oversight from regulators."

"Consumer gene-testing companies have struggled for years to convince buyers that DNA tests have much value. Genealogy testing is, so far, the one killer app that has emerged to capture wide interest."

Size of the global direct-to-consumer (DTC) genetic testing market from 2014 to 2022

If Facebook did acquire 23andMe, what would be the benefits of the deal beyond the data?

DNA based Advertising – imagine targeting people based not only on their likes, interests, age, location etc.. but also their genetic profile? Their DNA, pre-determined and pre programmed would unlock a new advertising format. Very appealing to advertisers looking to go beyond hyper-local, hyper-targeted, programmatic and retargeted solutions.

Advantage over Google – with a new layer of targeting by genetic profile, Facebook’s advertising platform would gain a competitive advantage over Google. Instead of trying to compete on reach, scale and quantity, Facebook could compete with a first mover advantage combined with technology, design and mobile products.

Silicon Valley Talent – the 23andMe workforce of about 450 employees is roughly a 50/50 split between men and women and over 50% of its leadership roles (heads of research, regulatory, privacy, comms, ops, and more) are filled by women. This is rare in many companies, but even more so in its home base of Silicon Valley.

Sales and Distribution – 23andMe kits are already available to order on Amazon, one of the world’s largest sales and distribution channels, now imagine them also being available to order on Facebook? How quickly could the order numbers scale from 10 million to 20 to 50 million?

Following Spotify and MusicalDNA – Facebook would be following in the slipstream created by Spotify a few months ago, “ and Spotify have joined forces in a campaign that marries science, technology and creativity to deliver personalized experiences and new findings for consumers. Specifically, people can now create personalized playlists based on their DNA."

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