23andMe Exits Stealth Mode

One downside of taking venture capital from a public company is that the deal can wind up in an 8-K filing. At that point, startups have two basic choices: Ignore the filing and hope nobody notices, or grudgingly emerge from stealth mode. 

But there's a big caveat: If your company was funded by Google, forget about nobody noticing. And put that caveat on steroids if your co-founder happens to be married to Google's Sergey Brin.

This latter scenario describes 23andMe, a genetics startup that is part personalized medicine and part online informatics. The company was outed in a Google 8-K at market close today, which also notes that 23andMe's Anne Wojcicki recently walked down the aisle with Brin.

Google was joined in the Series A round by Genetech, New Enterprise Associates and Mohr, Davidow Ventures. No one is disclosing the entire round amount, although Google pegged its contribution at $3.9 million. 

23andMe's mission is to connect people with their genetic information, in order to help them identify and/or exclude specific health risks. The initial rollout will be more focused on education than prediction, so that people better understand the more detailed information that will come in later versions. Nonetheless, you will be able to enter certain family medical histories to get a better understanding of your own risks.

If you're wondering why Google would invest in such a company, think for a minute about how the Google search algorithm works. In the most simplistic sense, it tracks how popular certain search results are among users, and then re-ranks the most-clicked items as the top search results. Expect a similar sort of backend strategy for 23andMe, with genetic characteristics linked to most prevalent diagnoses. 

What still remains unclear is exactly how 23andMe will make money, or how users will be able to obtain more detailed genetic information on themselves.

One speculative possibility could be that 23andMe adopts an SOAS model, whereby medical practitioners swab patients, and then enter their lab results into the 23andMe system. And yes, that could raise all sorts of HIPPA hackles